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Return to Article: Retiring Women

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  Regarding health insurance in retirement, now that Medicare Part B premiums will be higher for those with somewhat higher retirement incomes, it seems more economical to take Part A, but not Part B and keep FEHBP (with premiums not related to income) as primary health insurance (for all except what Part A covers) instead of using FEHBP just to cover prescriptions and as a Medicare Supplement. Could someone do that?

  SJC Posted December 19, 2007 5:44 PM
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  I'd like to know, if a man & a women are on social security can they marry each other and still collect their own social security checks?

  Faith Gilman Posted August 19, 2007 6:27 PM
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  For a man who THINKS he sees clearly, Michelle opened my eyes yet again. "Walk a Mile in MY Shoes." While I've made considerably less in the past than I do today, I am still far from rich; but it was my plans and efforts that made my family and I comfortable. I know the troubles of the single head-of household female intimately, even if only from the child's perspective; and perhaps that is what motivates me to encourage TSP participation so much.

  I will not debate budgets. As the saying goes, "It's hard to remember your objective is to drain the swamp when you're neck deep in alligators." But I specifically mentioned $30k as a level that is about half the average GS income ($59,896 in 2004, as per the Federal Civilian Workforce Statistics, The Fact Book, 2005 Edition). This equates to a GS-5, mid career. And I remind anyone interested that the $35 dollars per pay period required to meet the aprx 3% matching, results in only $30 less in net pay.

  I wish to belittle none, but if you are a government employee making less than $30,000 and facing retirement after a full career; any advice I may presume to give you would be too late. If you are just starting your career and make that amount or less, then you have a long career and many decisions ahead. Housing, food, clothing, self-education, and personal retirement are all your choices and your responsibility. My only goal herein is to let folks know that some money saved is TSP is better than none, even that little bit most folks think insignificant.

  Unbelievably, I've run out of words; other than to say good luck to you single parents and lower GS out there. We all know it ain't easy.

  Tip off Posted June 20, 2007 4:21 PM
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  Tip is right. If you put money into savings that you never see and can't get at, it will grow expedentiously. BUT... most women (and this article was aimed at women) did not (and still do not) make a starting salary of $30,000+ on average.

  Remember, many women in the workforce are single parents. This one fact alone precludes the ability to save additional money toward retirement. I'm sure they would love the luxury of puting 3% of their gross salary into long-term savings. When I was in my 20s & 30s (and a single parent), I would have given my eye teeth to have some kind of untouchable retirement fund. As it was, everytime I would get ahead in my savings, something would happen that needed that money right then.

  Even though starting salaries are far beyond what they were 30-40 years ago so are prices. In fact, if I take my starting salary from back then and "correct for inflation" to today's rates, I actually make LESS money than I did then. How can you save for retirement on a path like that?

  Michelle Posted June 20, 2007 11:02 AM
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  Does SSDI apply to federal workers?

  ann hu Posted June 18, 2007 11:42 PM
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  I've heard many say they just don't make enough to save. Some of my co-workers sound this call every day. Well, if I may be so bold... I tell them they don't make enough to NOT save in the TSP.

  We've all been there, newly hired praying anxiously for that first pay check to come in; worried that we'll not bridge the gap between income and out go. Yet, somehow we manage. We almost always do.

  So, I am the new kid. Let's say I make $30,100 and am single; I'm in the 14% (aprx of .1378) tax bracket and trying to start a career and a family. Putting 3% of my income in savings will "earn" me $903 more than my buddy due to matching funds, who still thinks he can't afford to save. And it will only reduce my income (net) by $778. BUT, ONCE MORE, I'VE SAVED $1,806. And all this for only $35 a pay period. ($30,100 .03 = $903, $903 / 26 = $34.73)

  So by spending the amount of a new desk top computer or a decent stereo, I made almost 103% profit/return from jump street. And perhaps lowered my tax threshold in the mean time, saving me more money on the rest of my income.

  And time IS money. Since the TSP went to a per-share-basis, when you buy now you just know those shares are going to rise in price over the next 30 years. The earlier money is contributed in your career, the more it grows; more than the money you contribute at the end. And the entire concept is buy low, sell high.

  If you still think you can't afford to save this kind of mone; then just throw in a fifty, per pay period that is. Wait just one or two pay periods to ensure you will survive, and throw in another $50 per pay period ($100). Every time you think you can afford just a little more, throw in another $50 ($150). And each year, throw in another $50 or $100 ($200 or $250); until you reach at least the matching funds maximum.

  Remember, since TSP contributions are before tax money, you are saving more than you lose from your take home pay. And if you're still working the matching funds, that's instant profit.

  This is the stuff new employees should hear. Perhaps there are better ways to say this, but there is no better time to just do it.

  Tip off Posted June 18, 2007 4:31 PM
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  tip is right, even thoughthe article is targeted to our women team mates that the info is pertinant to a ll members of the work force. What is onteresting to me is the same pont that Michelle is making, that the pundits all say that saving should begion as soon as you enter the work force (one keeps hearong about 6 months salary in savings on top of retirement savings) but the reality is that with the lowere earning power of our younger people and the hugh debt (not always frivolous, in our office the dominant sources are education and mortgages) that you're lucky to be able to put food on your table and make the electric bill (sorry I can't pay you this month, I saved the money instead. yah, right.) let alone save well over 1/4 of your salary (add it up - 15% to TSP, 8% to SSC plus recommended emergency savings). The pundits need to get a grip on reality.

  bill t Posted June 18, 2007 11:02 AM
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  Please forgive me for snoopy when I was not the target population but, other than the obvious tilt, I found most of the information pertained to anyone, regardless of age or gender.

  Age: If you hadn't done it already, the article was a spur to motivate action. Gender: Didn't matter who you are, these things need to be done and the time-table fits.

  Still, thank you for keeping me on track and, trust me, my female relatives, friends, and co-workers have received their copies; and we all appreciated it.

  Tip off Posted June 18, 2007 8:30 AM
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  I have been a single female federal employee in CSRS since 1979. Before that, I worked in the private sector and have my 40 quarters in. I thought for sure I'd lose a lot of my social security benefits when I retired. However, I found out from a co-worker and then my local Social Security Office that once I reached my full retirement age (in my case, 65 years and 8 months), I could collect my full Social Security benefit and continue to work full time. You can do this because (as Social Security explained it to me) once you reach your full retirement age, there is no cap on your earnings.

  Of course thanks to Congress, once you start collecting your government pension, you lose a big percentage of the Social Security benefits. And, of course, that's just the time you need it most!

  Since I really don't need the cash right now, I am putting part of it in my IRA up to the max per year. The rest goes into my savings account and I'm going to use it to buy a new vehicle and a new computer just before I retire. I also plan to use part of it as a deposit for some nondeduction service I had early in my career as a seasonal. I'd advise anyone in similar circumstances to look into this.

  Louise Power Posted June 15, 2007 2:55 PM
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  Theresa -

  You only need go to the Department of Labor's Women's Bureau to find the answers you seek. In fact, women in government do a bit better than their counterparts in the private sector, but not by much. And, unfortunately, we still do lag behind. And, according to the latest Supreme Court ruling, even when we find out we have been earning less money for the same work for 20 years (!), we can't be compensated for longer than the six months before we found out.

  Labor Attorney Posted June 15, 2007 1:36 PM
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  This is an excellent article that covers a lot of ground in a small space! It is a good reminder that managers need to be encouraging their female employees to remember that their retirement planning needs to take into consideration different things than their mothers had to even if their mothers worked outside the home.

  Rosemary Posted June 15, 2007 11:10 AM
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  All very well and good, if, while you're in your 20s, you actually have the time, energy, and money to start your retirement funds. Following through while in your 30s, 40s, and 50s sounds good, too, but that's when most people have to spend most of their money on [college-bound] children, home repairs, and the beginning of personal medical problems. By the time you're in your 60s and ready to start looking at retirement (because you always had your CSRS or FERS/Social Security and TSP) it's a little late to get articles on what you should have done when you were in your 20s.

  Michelle Posted June 15, 2007 10:55 AM
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  I always find it interesting when people start advising how women should prepare for retirement. While the advise is prudent, there always seems to be a part that is missing. As a group, women still earn comparatively less than men and that translates into less money available for retirement. Since the late 60s, we've heard a lot about the pay parity issue but no one has ever successfully taken that subject on seriously.

  In the 80s, the Illinois Department on Aging did a video on aging women living in poverty. They found that those women who had never married and needed to rely on their own social security, the majority of them lived in poverty as compared to those who were widows and relied on their husband's pension and social security.

  Despite the pursuit of education as a potential equalizer for women to help themselves advance in comparison with their male counterparts, this has not seemed to provide the boost to women's earning potential comparatively speaking. I would be interested to see a study done to compare and contrast the number of women and men in the various levels of government along with their educational attainment.

  Theresa M. Brandon Posted June 15, 2007 9:44 AM
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  This was a wonderful article. Thank you so very much.

  barbara Posted June 15, 2007 8:55 AM