Federal Retirement Advice by Alexis Hongamen, CRPC

Here are a series of financial tips/information for designed for quick reading, written in the style of Twitter. ·          Good returns for the stock funds for September 2019 in the TSP, but a poor return in the bond fund: .14% for the G fund, -.54% for the F fund, 1.87% for the C Fund, 1.06% for the S fund and 2.87% for the I Fund. ·          Your credit score ( FICO ) is composed of your payment history (~35%), credit utilization (~30%), length of credit history (~15%), new credit (~10%), and credit mix (~10%). Closing a credit card can adversely impact your credit score. ·          The Office of Personnel Management (OPM) has made available the 2020 rates for Federal Employees Health Benefits (FEHB) plans. Federal employees and retirees will pay on average 5.6% more on their premiums next year. ·          Once you reach the year in which you turn age 70 ½ you are no longer eligible to make a Traditional Individual Retirement A ccount (IRA) con

Financial Tips for Federal Employees - September 2019 Here are a series of financial tips/information for designed for quick reading, written in the style of Twitter. ·          Generally poor returns for the stock funds for August 2019 in the TSP, but a good return in the bond fund: .18% for the G fund, 2.6% for the F fund, -1.59% for the C Fund, -4.19% for the S fund and -1.77% for the I Fund. ·          The White House is recommending a 2.6% pay raise for 2020. ·          FEHB open season will be 11/11 through 12/9 for 2019. If you do nothing, your FEHB and FEDVIP will continue as is. FSAFEDS is also open to set aside $ for a Flexible Spending Account . If you do nothing, your election WILL NOT automatically renew. ·          Please remember that as a FERS or CSRS retiree , you receive your payment monthly. Not the every-two-week payment you received while you were working. ·          If you obtain stock or real estate through an inhe

Here are a series of financial tips/information for designed for quick reading, written in the style of Twitter. Positive returns across the board for  June 2019 in the TSP : .19% for the G fund, 1.26% for the F fund, 7.04% for the C Fund, 6.80% for the S fund and 5.94% for the I Fund. Please remember that beneficiary designations on accounts (like on the TSP) supersede any declarations on a will. If benefits are not cut by 23% or taxes are raised, the  social security  trust fund will run out of money between 2032 and 2034. A battle is setting up for pay raises for Feds in 2020. House has submitted a  3.1% increase  and The White House is  proposing a pay freeze . You don’t have to take a Required Minimum Distribution (RMD) from your  TSP  if you are still working, regardless of age. If you are retired, they begin being due April 1 of the year AFTER you turn 70.5. Please remember that FICA and  Medicare  are two wage taxes you won’t have to pay in retirement.

Federal employees have some unique benefits they can utilize to improve their financial security. Let’s take a look at these while at the same time discussing some good practices that can be followed by anyone, regardless of their employer. Live on Less Than You Make I’d like to begin with some advice your grandfather probably gave you…don’t spend more than you make! Short, sweet and simple. Bad things tend to happen if you make a habit of spending more money than you bring in every month. Of course, there are times when you have a big ticket item you need to buy that will skew your budget for the month. That, however, should be an odd occurrence and shouldn’t be the norm. Ideally, you should have some money set aside or budget for these large expenses. I tell clients that one of the things you can control that has a huge impact on your finances is how much you spend. I’ve consulted postal service employees that have modest incomes that are financially fit to retire b

The Five Biggest Retirement Decisions Feds Have To Make As a late career Fed, you are pondering retirement. For some, this is a chance to discover new hobbies and pursue things you didn’t have time for when you worked. For others, it’s an opportunity to pursue a different career with the safety net of a retirement income. And yet for others, it will be an opportunity to do a lot of relaxing after a career in the federal government. Regardless of your circumstances, you have some big decisions to make during your retirement years. Some of these decisions have to be made right away, while others are several years down the road. Let’s take a look at what I believe are the five biggest decisions a federal employee will have to make for their retirement. ·          WHEN TO RETIRE – The first decision to make is when will the employee be ready to retire. This is a multi-faceted question.   The first hurdle is eligibility. There is a sliding scale based on the year you were born

Four Reasons Not To Take A TSP Loan For most federal employees under the Federal Employee Retirement System (FERS), the Thrift Savings Plan (TSP) is their largest investment asset outside their home.   The Plan offers loan programs which allows federal employees to borrow money from their accounts. This feature is very enticing for someone that has a need for cash to place a down payment on a home purchase or just general expenses they want to take care of.   They can tap the dollar value they have built up in their TSP after contributing for years through payroll deductions. There are two loan programs available through the TSP: the residential loan and the general purpose loan. The residential loan program is available to assist in putting together the funds required for a down payment or to help pay for closing costs on a home purchase. These loans can be paid back for up to a fifteen-year period and require documentation on the property.   The general purpose loan can