Category: Federal Health Insurance

Many retirement plans fail because of seemingly minor details that have a significant impact. This article summarizes ten such minor details listed below, then follows up with in-depth articles on each.

1. Just Show Up

The days of “putting in my time” and having a successful financial life and retirement are long gone. This is especially true of the problematic concept of the Minimum Retirement Age (MRA). You’ll need an excellent strategy to make the most of your benefits.

2. Pay Your Bills First, Then Save if You Can

No! That should be reversed. It would be best if you had a barrier to separate your way of life from your income. Throughout my career, those who came out on top created and maintained that wedge. They never lived above their means; they were always slightly below. In this manner, raises and bonuses propelled them forward.

3. Borrow for Tomorrow

Loans from your tax-deferred savings account (TSP) should be your last option. However, experts believe this practice stems from a faulty cash flow plan. Note this right now: debt is not your ally. It’s a tool, but it’s not a solution. Managing and eventually eliminating installment debt is a trait I see in financially successful people regularly.

4. Silo Save

TSP is fantastic, but it is not a strategy. The most successful retirees I’ve seen have assets in traditional plans like TSP. However, they also have money in non-retirement assets. No, I don’t mean a few thousand dollars in a savings account. Once you’ve maxed out your TSP, start putting money into a regular investment account.

5. TSP Underfunding

Please don’t roll your eyes at me. Daily, I encounter individuals who agree with me that those who maximize their contributions are in the minority. A sizeable TSP balance is required if you want to retire before age 65.

6. Lose Your Equilibrium

That one was too simple and does not refer to market fluctuations, but to your TSP allocation. You can’t just set it and forget, even if you’ve established an appropriate asset mix across your TSP’s five core funds. Now, I’m not talking about trying to steer excessively. If you’ve determined that you should have 40% of your portfolio in a C fund based on your age and risk tolerance, don’t forget to review it once a year.

7. Ineffective TSP Strategy

I can hear you sigh. Twenty percent in each core fund or a small amount in all funds (yes, including all lifecycle funds) is not a winning strategy. Neither is it entirely in C (because it’s been doing so well.). Your asset allocation should accurately reflect your ability to tolerate risk in good and bad times. It is disastrous to try to time the market or, even worse, to change your investment strategy based on “what’s happening.”

8. Don’t Forget Your Umbrella

That was a no-brainer. This doesn’t mean getting wet; it means not having enough liability insurance. Nothing can derail your retirement plans more quickly than an accident followed by an adverse judgment. Check your auto and homeowners’ insurance limits today and request a quote for an excess liability umbrella.

9. Ignore the Risk of Long-Term Care

Okay,  it’s a dull subject, and the premiums keep rising (even the Fed plan). However, it remains a problem. You must assess your resources and obligations and plan a working strategy ahead of time. Will you look for in-home care? Do you think you’ll need a facility? Right now is the time to ask the tough questions! TSP balance is not a panacea.

10. Neglect the Federal Employee Group Life Insurance Plan (FEGLI)

The FEGLI is one of the best employer plans available. However, this does not imply perfection. For example, an employer plan must charge all employees the same rates for optional coverage based on age (the unsubsidized part). That means that smokers and nonsmokers, people in good health, and those in poor health all pay the same. Consequently, these plans become significantly more expensive as we age. It’s not a joke. Shopping around and comparing private sector options can save you tens of thousands of dollars over your career. You can contribute every penny you save to your retirement.

Contact Information:
Email: [email protected]
Phone: 2129517376

Bio:
M. Dutton and Associates is a full-service financial firm. We have been in business for over 30 years serving our community. Through comprehensive objective driven planning, we provide you with the research, analysis, and available options needed to guide you in implementing a sound plan for your retirement. We are committed to helping you achieve your goals. Visit us at MarvinDutton.com . Tel. 212-951-7376: email: [email protected].

Once you’ve decided to retire and submitted your application, remember that what comes next might be a lengthy and involved procedure. Be patient.

Once your personnel office receives your retirement application, it’ll verify that you’re eligible to retire on the date you specify and that you’ll be able to keep your Federal Employees’ Health Benefits (FEHB) and/or Federal Employees’ Group Life Insurance (FEGLI) coverage in retirement.

Assuming no problems arise, your personnel office will create a Certified Summary of Federal Service detailing your federal civilian and military service, if any. When you get the copy from them, double-check for accuracy and make any necessary adjustments.

When the day you choose to retire approaches, your personnel office will:

• certify your FEGLI coverage to OPM if you’re qualified to keep it; 

• forward any existing beneficiary designations in your OPF;

• file an SF 50 (Notification of Personnel Action) to be separated from the service;

• complete and certify the personnel office component of your retirement application; and 

• send your retirement application and supporting documentation to your agency’s payroll office.

The payroll department will:

• approve your final salary payment upon your retirement separation. It’ll also authorize any lump-sum payment for unused yearly leave that you owe. If you’ve been offered a “buyout,” it’ll also authorize that payment. 

• certify and close out the official record of your current service, your Individual Retirement Record (IRR), unused sick leave credit for retirement considerations, pay rates and so on. The IRR cannot be closed out until your final paycheck has been delivered as it includes a list of your retirement deductions for the last work term.

• certify your yearly basic pay for life insurance reasons, if you have any, and
• forward your retirement package to OPM.

Your agency payroll office will notify you when your file has been delivered to OPM. That notice will include the registration number, transmittal and mailing dates, and payroll office number. That information is helpful if you need to check on the progress of your case after it has been submitted to OPM. If it doesn’t, you’ll have to contact them again.

The length of this procedure is determined by various factors, including the workload in your agency’s personnel and payroll departments. It may take longer, perhaps much longer, if they are understaffed and/or buried behind a mountain of retirement applications.

The processing of OPM is also affected by workload. It can become overburdened during peak seasons, such as the end of the year and early in the new year. Fortunately, they will try to give you a portion of your annuity if possible. That interim compensation will remain until your application is approved. Then you’ll get your exact monthly annuity payment, plus any catch-up payments you missed while you were on interim pay.

Contact Information:
Email: [email protected]
Phone: 2129517376

Bio:
M. Dutton and Associates is a full-service financial firm. We have been in business for over 30 years serving our community. Through comprehensive objective driven planning, we provide you with the research, analysis, and available options needed to guide you in implementing a sound plan for your retirement. We are committed to helping you achieve your goals. Visit us at MarvinDutton.com . Tel. 212-951-7376: email: [email protected].

The possibility of obtaining retirement benefits premised on your civil service is one perk of working for the federal government. As a general rule, military service in the United States Armed Forces is considered creditable for the purpose of federal retirement provided it was active service rendered before separation from civilian employment for retirement, ended under honorable conditions, and performed.

However, federal employees must typically forego military retiree pay to have their military service counted toward their federal annuity and qualify for the retirement annuity.

Military retirement benefits are determined by the branch of service, not your employer or Office of Personnel Management. They are based on a service-connected impairment sustained in the line of duty during a time of war or sustained during a battle with an American enemy.

Military retired pay obtained follows 10 U.S.C. 12731-12739 (Chapter 1223) provisions, which provides retirement pay to personnel of reserve components of the military services based on age and service (active personnel).

Military service is not taken into account when determining military retirement pay.

Get a retirement estimate with and without credits for your retired army service to see whether merging your retired military service alongside your civilian employment is advantageous. Next, ascertain the size of the military deposit. Once you know this, you can decide whether the deposit benefits you. Usually, a hiring company will carry out this calculation.

Fill out Form RI 20-97 (Expected Earnings Throughout Military Service), enclose a copy of your DD 214 or D.D. 214s indicating your army duty, and mail the completed form to the relevant military finance center indicated on the form. A completed RI 20-97 or a letter outlining your anticipated military pay will be returned by the center.

Request a Military Deposit Worksheet and a Military Deposit Application from your organization (OPM 1514). Fill out the employee section of the application, and submit it to the payroll office with your DD 214(s), the OPM 1514, the document or letter outlining your expected military wages, and the OPM 1514. When the amount of the deposit is determined, that office will get in touch with you to arrange for payment.

As soon as you’re prepared to retire, you should file a waiver of your military retired wage to the relevant military finance center 60 to 90 days before the start of your civilian retirement. If you choose not to forego your military retirement income, the OPM will return your deposit with interest if you are a FERS employee and without if you are a CSRS employee. You’ll then submit the proper refund application form with your retirement package.

If the deposit is paid early, less interest is charged. If you want to pay a deposit, you must finish it before retiring. Your military service won’t count toward civilian retirement if you don’t pay the deposit or elect not to renounce military retired pay.

Contact Information:
Email: [email protected]
Phone: 2129517376

Bio:
M. Dutton and Associates is a full-service financial firm. We have been in business for over 30 years serving our community. Through comprehensive objective driven planning, we provide you with the research, analysis, and available options needed to guide you in implementing a sound plan for your retirement. We are committed to helping you achieve your goals. Visit us at MarvinDutton.com . Tel. 212-951-7376: email: [email protected].

A FERS disability retirement application must undergo a protracted, arduous, and challenging bureaucratic process. So, naturally, one would like to get accepted at the process’s first (initial) stage. The second step (the “reconsideration stage”), however, is an important and significant event in the process since the U.S. Office of Personnel Management (OPM) is not easily disposed to approve a case at the first stage.

There are two significant elements provided at the reconsideration stage: First and foremost, you have the chance to address any claimed shortcomings that OPM flags. Secondly, and perhaps even more crucially, you can start to position yourself so that a U.S. Merit Systems Protection Board (MSPB) Judge can assess the merits and consistency of your case.

Since you will need to appeal OPM’s denial of your FERS Disability Retirement application to the MSPB in the third stage of the procedure if OPM rejects it a second time, the best way to approach this is to think of it as a dual-purpose reaction, as is the case with most opportunities: first as a rebuttal to OPM’s denial and secondly as a legal defense before the prospective MSPB Judge.

Additionally, OPM never informs applicants that if their application is denied a second time and an appeal is submitted to the MSPB, they would be given another “reconsideration” or “re-reconsideration.” This is because the OPM Legal Specialist representing OPM at the MSPB will automatically evaluate the whole case and re-consider it afresh from an entirely different viewpoint—than from a legally sufficient perspective—in the same manner that the MSPB Judge would see it.

The “second” point in responding to an OPM denial at the reconsideration stage is to not only correct any alleged deficiencies pointed out by OPM but also to make compelling legal arguments that point to the legally sufficient cogency of your application. Again, this is because the Merit Systems Protection Board is a legal forum rather than a bureaucratic forum.

Therefore, the Reconsideration Response should always contain a responsive legal memorandum addressing the relevant case law to prepare for the MSPB adequately. This not only makes it easier for you to defend your case in front of the MSPB Administrative Judge on its merits, but it also serves as a warning to the OPM that your case will be unbeatable in court if and when it is brought before the MSPB. Finally, prepare your case for the “real reconsideration”—the re-review before the MSPB—by speaking with a counselor who focuses on federal disability retirement legislation.

Contact Information:
Email: [email protected]
Phone: 2129517376

Bio:
M. Dutton and Associates is a full-service financial firm. We have been in business for over 30 years serving our community. Through comprehensive objective driven planning, we provide you with the research, analysis, and available options needed to guide you in implementing a sound plan for your retirement. We are committed to helping you achieve your goals. Visit us at MarvinDutton.com . Tel. 212-951-7376: email: [email protected].

Social Security can be confusing, but understanding how the program works will help you maximize your monthly payouts. While you don’t have to know everything about the program, there’s one crucial factor that almost half of Americans overlook — and it might result in a lower-than-expected benefit.

What effect will your age have on your benefits?

The age at which you file for Social Security substantially impacts the amount you receive. To get the full amount based on your work record, you must wait until you reach your full retirement age (FRA), which is either 66, 67, or anywhere in between, depending on the year you were born. You can file for benefits as early as age 62, but you’ll get lower monthly amounts.

However, many Americans fall into the trap of not realizing that this benefit cut is permanent. According to a 2021 Nationwide Retirement Institute poll, over 45% of respondents wrongly assume that if they file early, their benefits will increase after they reach their FRA.

In reality, if you file for Social Security early, your lower payments are usually fixed for life. In other words, you’ll keep receiving reduced monthly payments even after you hit FRA.

So, should you claim early or wait?

As a result, making an informed decision about when to claim benefits is vital.

Claiming Social Security early may be the best option for some people, but remember that the benefit cut is permanent. If you file with the expectation that your payments will be increased later, it could jeopardize your retirement.

When it comes to when to claim, there’s no right or wrong answer. Generally, though, deferring Social Security may be the best option if your funds are running low and you want to earn as much money as possible each month. Waiting until 70 to file may result in hundreds of extra dollars every month, which can go a long way in retirement.

On the other hand, claiming Social Security earlier may be a wise choice if you have a solid nest egg and are ready to forego some monthly income for the opportunity to retire early. Similarly, if you have reason to suspect you won’t live a longer-than-average life, filing your claim early may allow you more time to make the most of your benefits.

Maximizing your Social Security payments

Before you decide when to file your claim, run the figures to determine how much you would gain or lose each month.

You may check your statements online by creating a mySocialSecurity account. That’ll provide you with an estimate of your benefit amount based on your actual earnings and the amount you’ll get if you claim at your FRA.

If you claim at 62, your benefit amount will be lowered by up to 30% if you have an FRA of 67. If you wait until 70, you may be able to get your full benefit amount plus up to 24% more each month (again, assuming your FRA is 67).

It’s easy to decide when to file after understanding how your age affects your benefit amount. And the more deliberate your decision, the better off you’ll be in retirement.

Contact Information:
Email: [email protected]
Phone: 2129517376

Bio:
M. Dutton and Associates is a full-service financial firm. We have been in business for over 30 years serving our community. Through comprehensive objective driven planning, we provide you with the research, analysis, and available options needed to guide you in implementing a sound plan for your retirement. We are committed to helping you achieve your goals. Visit us at MarvinDutton.com . Tel. 212-951-7376: email: [email protected]