Federal News Network Senior Correspondent Mike Causey discusses everything of interest to federal employees, from pay, benefits and retirement, to buyouts, COLAs and pay freezes.
Avoiding retirements seven deadly sins
People under the Civil Service Retirement System (CSRS) program will get larger annuities and full cost of living adjustments (COLAs) to keep pace with inflation. But the majority who will this year and in the future are under the Federal Employees Retirement System (FERS). They will have to live with smaller monthly annuities, diet COLAs, and depend on their Social Security and TSP investments for their retirement income. Long range planning isn’t just important, it is absolutely essential. Federal benefits expert Tammy Flanagan thinks this upcoming December-January may produce the tidal wave of retirements experts have incorrectly predicted for decades. But maybe this time it will happen. But whether you are going out this year, next summer or departure day is years away, plan ahead. Starting yesterday. But beginning now is better than nothing. A lot better.
Tammy will be my guest today on our Your Turn. She is going to cover the waterfront and focus on the 7 things you should NOT do when mapping out your retirement. Her list is a long one, but trust me your retirement will seem a lot longer and leaner if you skip it.
2021 COLA mixed bag for retirees
News that they will be getting a 1.3% cost of living adjustment in January 2021 is getting a mixed reception from federal, military and Social Security retirees. The inflation catch-up will to go roughly one in six Americans. And its more than some analysts had predicted based on the low inflation rate over the past 12 months And its 100% more than most retirees — who depend on pensions promised by their private sector employers — will be getting.
We talked with many, many feds and picked up more questions and suggestions on the way. So today’s guests on Your Turn will have the answers. They are Jessica Klement, NARFE’s staff vice president for policy and programs, and legislative specialist John Hatton.
Listen. Could save you lots of time, money and grief.
6% raise, followed by a 12% cut
Retired Gen. Mike Meese is president of American Armed Forces Mutual Aid Association (AAFMAA) and an expert on the tax deferral plan and its impact on federal and military paychecks. He talks about how you can avoid going in a financial hole by setting aside your 2020 take-home pay raise to augment or create an emergency fund for 2021 or the future.
The art of leaving a legible financial footprint
Most people know they are worth more dead than alive. But many — including those who survive them — don’t know how much more. Or where the treasure (if any) is buried. And how you want it to be handled.
Many federal workers and retirees, especially if they own property or have TSP accounts and life insurance, are easily worth a million dollars or more. Deciding who gets it (Uncle Sam, the state, your children) isn’t easy but it isn’t rocket science either. And you doing it now can save lots of grief, ill will and money down the road. Might help keep an otherwise tight-knit family from falling apart.
So we asked estate and tax attorney Tom O’Rourke what he tells his clients. Most of them are current or former feds.
Shouting ‘fire’ — or WEP or GPO — in a crowded theater
Many, if not most people, are familiar with the phrase “shouting fire in a crowded theater” — even if they might have trouble recalling who first said it (Justice Oliver Wendell Holms in a 1919 case before the Supreme Court) — and why.
The modern day equivalent of the panic-starter is to bring up the subject of the Government Pension Offset or Windfall Elimination Provision in any venue — theater, retirement community, house of worship — with a large number of retired federal or state government employees, or their spouses.
The initials may not mean much, if anything, to you, but ask your federal parents or grandparents, then watch their blood pressure go off the charts.
So what’s the big deal?
Tammy Flanagan will be my guest today on Your Turn. Meantime, for background, each has agreed to share answers and observations from someone seeking help and clarification from Social Security about WEP and GOP issues.
Trump vs. Biden and the impact on your TSP
Some savvy investors say the President has a major impact on the economy and the stock market. Others say events — not whoever is elected POTUS in November — will determine whether your Thrift Savings Plan languishes or takes off like a rocket over the next four years.
Bottom line: What do you think?
Is it all important that your candidate win? Or does it really matter when it comes to building and growing a nest egg that, depending on the breaks, may supply anywhere from one third to one half of all the spending money you have in your golden years. Will they be 24 carat, or something less?
We asked D.C. area financial planner Arthur Stein for his thoughts on the importance of the November election on the economy in general — and your TSP in particular. Stein has a wide background in economics. He’s also a long-time financial advisor whose clients include several TSP millionaires.
Customer ReviewsSee All
Great practical podcast but...
I enjoy all of Mike Causey’s podcasts and listen to each one. I’d give it a five (5) star however, there’s really not much mention of the single, no dependents demographic that planning to retire. It would be helpful if Mike and his guests could work touch on it in the podcasts as we need guidance and the practical steps, too.
Episode 10/14/20 displays how “out of touch” host is with current (younger) federal workforce
Mike, you are a generous and dedicated host.... however, your discussion points on FMLA and the new paid parental leave policy were CRINGEWORTHY, and frankly, scary. “Many employees used to think the 12 weeks of unpaid leave was generous”..... what????! Thank you to your guests, who provided educated corrections and pointed remarks. I appreciate the education and relevant discussions, but could use less of the “federal employees have it so great” propaganda Mike tends to lean into HARD. (Also, thanks for laying off on the “I read the obits everyday” stories as well). ;)
Sincerely, federal employee in their 30s
Enjoy the Fruitful Discussions
Enjoy the podcasts. Good conversations on issues impacting federal employees. Keep up the good work.
However, I do agree with “jkoe1”. I’d like to learn about more topics of interest pertaining to the “single, no dependents demographic”.