Retirement Planning Retirement PlanningRetirement Planning
Advice on how to prepare for life after government.

Providing For Each Other

In last week’s column, we looked at the critically important question of whether to take a reduced retirement benefit to provide a survivor annuity.  This week, I’d like to explore a more specific scenario based on an e-mail I recently received about a situation involving two married federal employees.

Kat and Charlie are both high-level federal managers, and are planning to retire at the end of this year under the Civil Service Retirement System. They’re looking forward to retirement benefits computed at $112,000 per year for him and $90,000 per year for her. (But their level of benefit in this scenario wouldn’t really affect their decision.) If Charlie were to provide a full spousal survivor annuity to Kat, the reduction to his benefit would be $10,930 a year, or $910.83 a month. If Kat were to do the same, the reduction to her annuity would be $8,730 per year, or $727.50 per month.

Instead of providing survivor annuities for each other, Charlie and Kat decided to buy life insurance:

  • Charlie bought a 20-year term life insurance policy worth $400,000 with a premium of $1,541 a year. The term ...

The Most Important Retirement Decision

It’s the time of year again, when federal employees who are planning an end-of-year retirement begin to ask themselves a series of questions: What exact date should I choose? Should I downsize my living space? Should I move to a warmer climate? Should I enroll in Medicare Part B?

These are all significant considerations in preparing for retirement, but there’s another issue that is more important than any of them: whether or not to take reduced retirement benefit to provide a survivor annuity.

There are five options for federal employees. Let’s look at each of them as they apply to both the Civil Service Retirement System and the Federal Employees Retirement System.

1. Maximum survivor annuity for spouse


  • 55 percent of unreduced annuity benefit to surviving spouse, adjusted by cost-of-living adjustments before and after the death of the annuitant.
  • Almost 10 percent reduction to the annuity benefit (2.5 percent of the first $3,600 and 10 percent of the annuity over that amount).
  • Paid for the life of the surviving spouse.
  • Annuity can be restored if the spouse dies before the annuitant.


  • 50 percent of unreduced annuity benefit to the surviving spouse, adjusted by ...

Making the Most of Your Money After You Retire

We all know what it means to accumulate assets for retirement. That’s what you are (hopefully) doing in the Thrift Savings Plan and other savings plans while you continue to work. But have you given much thought to what you will do with this money after you move from employment to retirement?

It’s important to think about how you’ll manage your savings after you stop working, and how you’ll create income from them that you may need to supplement your federal retirement benefit and Social Security.

The website of the National Endowment for Financial Education offers the following advice on a website called My Retirement Paycheck:

You do not know whether your retirement will last 10 years or more than 40 years. To be prepared for reaching advanced age, continue saving and making wise investments even during your retirement. At retirement, most retirees still need to invest in diversified assets that may need to last decades or help weather investment market turmoil.

In simple terms, here’s how this applies to the TSP: Don’t move everything to the G Fund just because you’re retiring. Consider the allocation of the L Income fund, which was ...

Become a TSP Wizard

Did you know that the Thrift Savings Plan has wizards? If you haven’t borrowed from the TSP or applied for a withdrawal of funds, you might not know about these tools, which can help you navigate complex loan application and withdrawal request forms.

There are four different wizards to choose from. Two are for active participants:

  • Financial hardship loan application
  • Age-based in-service withdrawal

Two others are for separated participants:

  • Partial withdrawal request
  • Full withdrawal request

The wizards guide you through the process of filling out the required forms. After you’ve completed a form, you may be able to submit it electronically. (Sometimes you will be instructed to print the completed form to mail or fax your request to the TSP due to spousal consent requirements.) Either way, it makes sense to you the wizard to maximize your chances that your request will not be rejected. It is kind of like doing your taxes using an electronic program that makes sure that you get all of the deductions you are entitled to and you are aware of any recent changes to the tax code.

Many of the forms submitted to the TSP rely on optical scanner technology. Using one ...

5 Things You Can Change After You Retire

There are many things about retiring from federal service that are considered irrevocable, permanent and “one-time only.” This kind of language can make people nervous about the transition from employee to annuitant.

But there are several things you can -- and often need to -- change after you retire. Here’s a list of the top five:

1. Your Address

Retirees need to remember to notify the Thrift Savings Plan, the Office of Personnel Management and the Social Security Administration of any change in address. It’s important to make sure you’re notified of any change in your benefits as well as any upcoming deadlines, such as required minimum distributions from your TSP.

2. Your Insurance

Health: Retirees are eligible to participate in the annual Federal Employees Health Benefits Program open season, just like active employees. The difference is that retirees make changes to their insurance directly with OPM. Retirees also can make other changes outside of the open enrollment period. For example, when you turn 65, you have a personal open season allowing you to change your health plan to something that might work better with Medicare. Here’s more information about FEHBP and Medicare. You can find a list ...