TSP Retirement Center Chat Room

[Spaf]

TSPTalk Retirement Center Chat Room


Opened February 13, 2007


Notice


1378

[Spaf]

I retired when my retirement income matched my work income, basically. There was also some medical and physical factors that became an influence.
However, it's amazing how much money can be saved by not working!
Downtown parking was terrible!
Eating out was pricy!
Gasoline was expensive!
Boat storage was a minus!

But, not doing what others wanted and not working overtime has been the biggest savings.

The roads are cold and snowy. Tomorrow is a sleep-in!...................:D

[Spaf]

The way I figured it, for retirement.
For FERS: The civil service annunity should be about 40%.
..............The Social Security payment should be about 40%.
..............TSP should make up the remaining .....20%.

All figured with a COLA!

Rough figures!

[rondalw]

I just retired as I have mentioned before. Have yet to receive the lump sum A/L check but I understand that can take about 30 days.

I figured my retirment, less deductions made during employment would be equal to my salary. Besides after almost 32 years and being under the LEO provisons, I was paying 1.7 towards retirement but after 20 years only getting 1% a year.

[Sunnyskies]

Good Forum Spaf!

I retired 18 months ago. I received a buy-out and was able to leave 3 months before age 55 (twist my arm)!! Net to net (work to retire) I lost about $700 a month in income; however, much of that was made up in reduced expenses from working. The rest was made up when DD graduated with her BSN and married. I no longer needed to pay school fees, car insurance, etc. We just bought an RV and plan on seeing the sites!

I don't plan on drawing from TSP until age 70, and with the help of this site it's going to be much more than I originally had planned on!!! :) :)

[vol46]

Tax question for retirees?

Are fed and state taxes deducted from your retirement checks, or is that something you have to deal with yourself?
Thanks, Vol46

[EW_ret]

By default, the interim monthly pay has just federal taxes withheld. The adjustment paycheck had federal taxes, health insurance, and life insurance payments withheld for all interim monthly pays. The state taxes are not withheld from either interim or your full retirement annuity pay. You have to either telephone OPM retirement or enter the OPM retirement services internet site. You will need your CSA number and PIN to access either system. You have to calculate yourself the amount of federal and state taxes to be withheld in terms of US dollars.

I retired September 30, 2005 from the Department of Navy as a CSRS annuitant, and the entire process has gone much faster than I expected! I received my annual leave lump sum with my final paycheck on October 7th. By November 2, 2005 I had received not only my first interim paycheck (Nov 1st), but also the adjustment paycheck (Nov 2nd). This is the retroactive, makeup pay. Added together the two paychecks totaled my full annuity. This was totally unexpected!



Tax question for retirees?

Are fed and state taxes deducted from your retirement checks, or is that something you have to deal with yourself?
Thanks, Vol46

[Spaf]

Vol46,
I'm on Oklahoma. Oklahoma taxes everything! I have an accountant and I'll just leave it up to her. Probably, I'll need to send the state some money ever so often. The first year in retirement is very unnerving in this respect.

I can't figure out why I have to buy a trout license when I already have a fishing license. Nor can I figure out why I have to get a motor registration when I already have a boat registration.
Spaf

[rondalw]

I am in California and they also tax everything. We just purchased property in Nevada (no income tax) and are having house built and will be leaveing taxifornia as soon as wife retires (2 years).

[Brett]

http://moneycentral.msn.com/content/Retirementandwills/Retireinstyle/P135696.aspWhich states tax retirement? Here is an article from MSN Money:

[rondalw]

Just received my lump sum A/L payment. They took $6800 out in taxes. Whew, I hope to get some of that back in tax refund next year.

[hunters]

http://www.retirementliving.com/RLtaxes.html

You might enjoy looking into this one as well. Seems to be more up to date.

[hunters]

rondalw -
Too late now but you could have changed your withholding in anticipation of that lump sum. Now you can adjust your retirement withholding for your pension on the OPM site to make up for the overwitheld amounts from that lumpsum. No need to loan Uncle Sugar all year long and get it back in a refund.

[OMA]

Completing 20th year in the military. Two more years to go before retirement with 55% of a $7,200 monthly income. Current portfolio is worth $470,000. I do not own a home. I have a Master's degree in the field of nursing. I'm single without children.

I've recently read a lot about retirement (several newly published books) - but none really talk about early retirement when someone is in their forties.

Any retirees have thoughts about retiring before the usual age? I have enough hobbies (golf, travel, exercise) to keep me occupied - and can always volunteer my skills to the community (Tampa, FL) if I get really bored with not working.

Can a single forty-year old live off of approximately $40,000/yr in FLA.

Thoughts?

[Tempest]

I don't know. I live in Hawaii (not cheap).
My advice is - your a catch-your going to be in Florida with all those women (widows, divorcees). Seriously they will find you. Razor tape, 'arty' and gunship are not going to keep them away from you. You are potential 'soul-mate' material.
It doesn't matter if you lay low and don't advertise yourself. They will find you out.:laugh: :laugh: :laugh:
Love has a way of fiddling with the EXCEL spreadsheet.


Now-you can't say you weren't warned.:D

[Birchtree]

Tempest,

I plan on visiting Oahu to see my 1Lt daughter in December, she is with the 25th ID. I also plan to buy a nice set of pearls for the Mrs. while I'm there.

OMA,

When you decide to reseek employment the folks hunting you will be from the IRS - that monthly income cannot be hidden. You'll have to find ways to get some tax deductions to offset other income - you have a challenge.

Dennis

[Tempest]

Birch
December are usually wet-except this year. 25th (Taro Leaf) is just up the road from where I live. Central part of the island-cooler and wetter. You will definitely see big waves on the North Shore that time of year. Rent a car-it's easy to get around. Bus is only 2 dollars and drivers are friendly.
If you go to the Arizona Memorial-go early in the morning-always a lot of people.
Waikiki Beach where the Hale Koa Hotel (military only)is is very nice. And the restaurant in Hale Koa is excellent. If you have to park in Waikiki with your daughter park at Hale Koa-it's cheaper with the military ID on a Hale Koa/Ft DeRussey military facility. Everything in Waikiki is within walking distance.

[Birchtree]

Thanks Tempest. I call the patch the "Electric Strawberry". I have one on my car to show support and irritate the Kerry lovers around here. Hooah.

[TRAFFIC_DOG]

Completing 20th year in the military. Two more years to go before retirement with 55% of a $7,200 monthly income. Current portfolio is worth $470,000. I do not own a home. I have a Master's degree in the field of nursing. I'm single without children.

I've recently read a lot about retirement (several newly published books) - but none really talk about early retirement when someone is in their forties.

Any retirees have thoughts about retiring before the usual age? I have enough hobbies (golf, travel, exercise) to keep me occupied - and can always volunteer my skills to the community (Tampa, FL) if I get really bored with not working.

Can a single forty-year old live off of approximately $40,000/yr in FLA.

Thoughts?

Check out this...www.retireearlyhomepage.com/
The 4% rule gets a lot of play.
Get into the disscussion forums, there are a lot of diverse situations represented.

[OMA]

Thanks for the tip. Will visit the site.

[rondalw]

Lesson learned again from the FED.

As stated previously I retired on 1/31/2007 after 32.8 years service (10 years military) as an LEO/FF.

OPM has worked on interim payments while processing final calculations. Received email from OPM today saying the agency mis-calculated my Military re-deposit and did not include the ineterest. Needless to say, OPM now says I owe additional interest on deposits I thought were finsihed in 1999.

OPM has been very good in contacting me and keeping me informed. It was my agency (and probably me for trusting their calculations) for the mess up.

I just hope I can pay the interest and get on with it.

[lmorgan]

Another interesting website with good retirement information is www.federalsoup.com

[Spaf]

Retirement Center

Subject: Fishing
RE:http://www.urbanext.uiuc.edu/worms/facts/index.html

Question (Trivia): How do you tell the difference between the head of the worm and the tail of the worm?.........:confused:

[Spaf]

Allocation diversification
(trial allocation)

I was looking for a good allocation, one that had diversification. This was for the not so good months of May thru Oct. (Stock Traders Almanac).

2010.. gave a allocation of 43G, 7F, 27C, 8S, and 15I.
L-Inc. gave a allocation of 74G, 6F, 12C, 3S, and 05I.

The F-Fund has not been doing well, with interest rates high.

So, I came up with a modified intermediate allocation of:
60G, 00F, 20C, 10S, and 10I....Will see how this works.....;)

Will be using stops of 1% alert and 2% trail. I prefer the S&P [SPX].
I'll watch the top for high resistance. But, tops are hard to find! In the meantime I'll monitor the EbbChart!
With 40% in equities, a down turn would hurt, but would not be a disaster. Anyway, if it was fast and took out the trailing stop, I always have the cash to buy in low.
[Thats my story]

Regards, and be careful!....:).....Spaf

[nnuut]

Retirement Center


Subject: Fishing
RE:http://www.urbanext.uiuc.edu/worms/facts/index.html

Question (Trivia): How do you tell the difference between the head of the worm and the tail of the worm?.........:confused:
SQUEEZE them a little and you can tell!!:laugh:

[Spaf]

SQUEEZE them a little and you can tell!!:laugh:

Nnuut, I've been waiting!.................:D

You put the worm on the ground! It crawls in the direction of the head and brings up the tail.................:toung:..:laugh:.........Worm 's don't have a reverse!

[nnuut]

How bout that, the little slippery bugies!:toung: Ya got me on that one!:p

[SkyPilot]

Y
Another interesting website with good retirement information is www.federalsoup.com (http://www.federalsoup.com)

You can also find an old friend of ours posting there. She is known for her expertise regarding the I fund!

[roskopfm]

I got a better allocation (if you are young) 100% I Fund. I have been 100% I Fund for two years and have made off big time. I know, I know, the stock market will fall and I will lose all my money. on the TSP web site, it shows that on June 1st, 2003 the I, S, C, F, and G funds all hade a value of 10.00 per share. Today the I fund is worth $24.83 a share vs. 11.9% for G fund, thats a gain of 148% in 4 years. I know the market wasnt great in 2001 and 2002, but it is great now. I will stop investing in the I fund when I see something change in the market that shows the bull is over. If your young like me take some chances, but you have to watch the market and read everything you can to prepare yourself. GO I fund!!!!

[Spaf]

Allocation Diversification
(trial allocation)
Cont'd

Diversification is an investment strategy designed to reduce exposure to risk by combining a variety of investments, such as U.S. stocks, international stocks, bonds and cash, which are unlikely to all move in the same direction.

Basically this year Dec. 31 2006 to June 3, 2007
TSP (week ending)........G=11.95..F=11.26..C=17.13..S=21.01. .I=24.77
The end of 2006...........G=11.71..F=11.14..C=15.69..S=18.76. .I=22.22
---------------------------------------------------------------------
Yearly results...............G=00.24..F=00.12..C=01.44..S =02.25..I=02.55

G-fund is ok, safe, over the past 12 months it produced 4.92%
F-fund is not ok. Interest rates have kept bonds out of favor.
C-fund is ok, and has the least volatility.
S-fund is ok, but can be tempermental.
I-fund is ok, but carries a double edge blade; pricing and the US$.

In retirement the TSP account is a major leg in the three leg stool of the retirement portfolio. It's a major investment, and RISK vs REWARD has to be carefully evaluated.

In your 20's and 30's you have "do-overs"! In the 50's and 60's there ain't no "do-overs"! In retirement "risk" has a different meaning (somewhat).

Personally, I like protecting the TSP principal and only using gains. 4% is the maximum recommended withdrawl, and inflation is generally +/- 3%. So the G-fund will not be a salvation, but you only need gains of about 2.08%.

2.08% does not seem to be hard, or high risk. Unless, you go high percentages i.e., 100% I-fund. Keeping 50-60% in the G-fund and diversifying the remainder should reduce your risk. Using "stops" and monitoring this web site should keep you on track.

Only buy in when stocks are oversold and sell when they are overbought. If you make a mistake, sell! Don't let a small loss turn into a big loss!

[Spaf]

I get no respect!

Me and R.D. have a lot in common!...."My problem is that I appeal to everyone and anything that can do me absolutely no good."

5 AM, my wife wakes me up, complaining about a racoon in her back yard bird feeder.

$50 bird feeder completly destroyed!

Off to Feed & Seed. New bird feeder $50. Animal trap $70. Two cans of tuna $5. Landscaping timber $3. Brackets $5.

5AM, my dog wakes me up, coon in the can. Take the coon to the other side of the lake; gasoline $4.

5AM, my dog wakes me up, another coon in the can! $4 gasoline, more tuna $5.


:mad:
1655

How many Racoons does Oklahoma have?..........:notrust:

[Show-me]

My wive sez he looks sad. LOL I sez, of course he looks sad he got caught. LOL

[nnuut]

Spaf,
"$4 gasoline, more tuna $5." One can of CHEAP sardines and one #8 shotgun shell and you can save some money!!:D BYE BYE BICHO!:laugh:

[Spaf]

Norman,
Good idea with the sardines!...:) I take them over to the wildlife refuge and let them go! Being nearsighted I ain't to good with a gun! Might just shoot my dog or my pick up truck...:embarrest: Besides they need a life!....Just not in my bird feeder....:notrust:

[nnuut]

I know, I know.:o

[Spaf]

In-Fisherman Best Fishing Times


Link --> http://www.in-fisherman.com/reference/solunar/calendars/


Click the calendar image to enlarge


Best Times: A for A.M., P for P.M.
Darker shades indicate best days.

:)

[Spaf]

High Performance Trilene Knot.


[RE: http://www.berkley-fishing.com/


Great little knot!


1656

[EW_ret]

Spaf,

This looks to be an improvement over the knot I use. Thanks, good idea. I'll try it out. :)

[Scout333]

What kind of bait do you use? grins

[Spaf]

White Bass = various runners 4 - 16 feet. Trolling!
Crappie = Jigs, or minnows.
Racoons = Tuna or sardines......:D

[Spaf]

In market talk

We actually had [SPX] set up a double bottom and the trigger ocurred when stocks break above the mid point peak between the two troughs. And this was confirmed with higher-than average volume.

My 2 cents.......Spaf........;)

[Spaf]

Going back to my basic TSP allocation of 60/40 (60G, 00F, 20C, 10S & 10I).
Sold [IVV] back to 20%, leaving [IJR] at 10% and [EFA] at 10%.
Dang G-Fund is at 4.92%!
Could make my goal of 7% with no risk!.... NA! to much sporting blood!

[Spaf]

Managed trading is like trapping
Buy-an-hold is hoping they don't get into the bird feeders.


It's all a matter of .....the game!


1771

[Spaf]

The Retirement Chat Room
July 26, 2007


Patience

Don't think we should be to hasty on this one! Last February we had an adjustment caused by a scare in the market of China. The July adjustment might turn into a correction, maybe, maybe not! But the circumstances are different. This time we have woes in the credit market and housing.

The dust hasen't cleared on this adjustment (0-10%) or is it a correction (>10%). Really need to see how this one plays out!

Right now we hear "snorts" and don't know if it's a pot-belly-pig, or a mean old wart hog?

Where will the market find support?

What does the Slow Stochastics tell us?

Do we have a good trading signal for the bottom?

Regards, and be careful!
Spaf

[nnuut]

Managed trading is like trapping

Buy-an-hold is hoping they don't get into the bird feeders.


It's all a matter of .....the game!



1771

Stop feeding the BIRDS and the COONS won't come!:worried:

[Spaf]

Retirement


[Love it!....:D]


As you slide down the banister of life, may the splinters never point the wrong way.

:laugh:

http://www.websmileys.com/sm/party/fest24.gif

[ezmoney]

I'm two years away from retirement although I plan on working longer possible to 60/35 yrs or 62/37yrs. Should I keep my money in the TSP or would I profit more by rolling the TSP into an IRA. I guess everyones situation is different. I have not consulted financial advise from and advisor as of yet.

[Spaf]

ezmoney,
I opted to leave it with TSP: very low rates, good funds, trade ever day with no charge, etc.
However, you need to see a CPA to have your situation reviewed.
As you get older there can be some medical problems. For that you will probably want to itemize for tax purposes.
Spaf

[Rick]

Spaf
I am Thinking about doing the same thing with my TSP.
Did you take the life expectancy or the equal payments payments over 10 years?

[Spaf]

Rick,

Neither!

I have the withdrawl election with monthly payments on direct deposits.
I can change my election each year around the first of December, if needed!
With investing/trading my goal is 7% a year with as low of a risk as possible.
With the 7%; 3% is for inflation/cost of living, and 4% is for my election.
I'm kind of running my own annuity, but the principal is all mine.....:D

Regards
Spaf


Spaf
I am Thinking about doing the same thing with my TSP.
Did you take the life expectancy or the equal payments payments over 10 years?

[Pill]

I know the aswer but hearing it may help it make sense to my parents who are retired government employees. TSP account is small but have a good pension(CSRS)

I believe they should start a ROTH IRA. As of now they aren't investing that I know of. Is a ROTH the best thing for them? If they can afford they both should give $5k(what is the extra amount if over a certain age?) to keep it simple I was thinking a Target/Lifestyle fund. Vanguard or Fidelity most likely. Some thing that is simple for their style of investing. They are 62.

As a son I want the best for them. Any input would be greatly appreciated. Thanks

[Rick]

Spaf
OK I am Confused.
The TSP States only 2 options 1. Life Expecicty or 2. equal payments over 10 years to avoid the 10% penalty. where does it state that withdrawl election with monthly payments on direct deposits is an option, and what does that mean ??? I am an ATC FERS retiree @ age 50 with 30 years of gov. service

[Pill]

Well I tried to find the edit button but with no luck to correct my spelling on my last post.

So one of my answers to ROTH contributions is 5k plus an additional 1k if you are 50 or older.

I am still wondering what your opinions are on how they should be investions? After talking with them they are only putting money in a savings acount. I didn't ask but most likely its at their bank not doing any thing(2-3%). At the lest I know they should use a online bank offering 5% or so or a money market account doing the same. However being that they don't have much saved investing would be a better option in my opinion.

[budnipper1]

I'm not Spaf but hope this helps...:) (25 days and a wake-up):D

http://www.tsp.gov/features/index.html (http://www.tsp.gov/features/index.html)
http://www.tsp.gov/features/chapter13.html#sub4 (http://www.tsp.gov/features/chapter13.html#sub4)
What are the general rules for making a full withdrawal?
If your account balance is $200 or more when you separate from service, you can leave your money in the TSP or you can request to withdraw your entire account in either a single payment, monthly payments, or for amounts of $3,500 or more, a life annuity. You may withdraw your account by using any one or any combination of these withdrawal options. For example, you might withdraw your entire account in monthly payments, or you might take half of your account as a single payment and half of your account as an annuity.

If you choose to withdraw your account in a single payment, your entire balance is paid at one time. You can have the TSP transfer all or part of any single payment to a traditional IRA or eligible employer plan. Payments to you can be deposited directly into your checking or savings account by means of EFT.

If you choose to withdraw your account in monthly payments, you must also choose whether you want the TSP to compute your payments based on the IRS life expectancy table or whether you would like to receive a specific dollar amount each month. (See "Can I change my withdrawal after I receive it?".) If you choose to receive a specific dollar amount each month, you may be able to transfer all or part of your payments to an IRA or other eligible employer plan. This will depend on the number of payments you are expecting to receive. For additional information, read the tax notice "Important Tax Information About Payments From Your TSP Account.")


Spaf
OK I am Confused.
The TSP States only 2 options 1. Life Expecicty or 2. equal payments over 10 years to avoid the 10% penalty. where does it state that withdrawl election with monthly payments on direct deposits is an option, and what does that mean ??? I am an ATC FERS retiree @ age 50 with 30 years of gov. service

[Spaf]

Hi Guys!

Please download the TSP-70 form as it shows your options, it explains with information the various different ways you can do things. OR you might want to call TSP and they will send you the form (it's a bugger).

I have X% withdrawn from my TSP annually. Payable monthly in $X on direct deposit. Around the 1st part of December I have the option of changing my % (annual) withdrawl.

Life expectancy is a laugh!.....:laugh:.......That is someone pushing numbers and is not reality.

Regards, and be careful out there!

Spaf

[clester]

Spaf
OK I am Confused.
The TSP States only 2 options 1. Life Expecicty or 2. equal payments over 10 years to avoid the 10% penalty. where does it state that withdrawl election with monthly payments on direct deposits is an option, and what does that mean ??? I am an ATC FERS retiree @ age 50 with 30 years of gov. service
I am FERS ATC also and have done a lot of research. At age 50 (Your MRA is probably 56 or higher) you can't take monthly payments for a specific dollar amount. I guess you can, but you'll pay the 10% penalty. You really have 2 options that I would recommend. Leave money in TSP and take life expectancy payments (basically minimum distribution method) or transfer it to an IRA and then use the 72(t) rule and use the amoritization method. This is an IRS rule to allow you to take money out without the penalty. Go to www.72t.net and find the calculators. Play with those to figure out your possibilities. You can use any interest rate you want up to the max listed by the calculator. One negative with using this will be that those payments are a set amount until you reach 59 1/2. So you will have about 9 years with no increases. The supplement will be the same. A set amount until you're 62. The only cola will be your FERS pension.

[coach222]

Maybe this total does not include agency matching?

I haven't seen the statement, yet, but based on the amount my guess would be the total is contributions without matching.

[EW_ret]

I just checked my Annual Participant Statement from TSP and the lifetime contribution amount is $274.41 lower than what my Quicken account shows for my total contributions from February 1988 to September 2005. I had a $4,000 loan from December 1992 to August 1994. I suspect the interest I paid on this loan was $274.41. It just shows up as additional contributions in my Quicken account. Therefore, I see the lifetime contributions being accurate for my case. I was CSRS so there were no matching contributions.

[Idaho Dave]

Make sure the whole thing is right, not just the $. They spelled the beneficiary's name wrong on my statement.

[2moryrs]

Hello,

I am getting close to retirement and am doing a lot of reading and getting more confused by the day. So maybe some of you that retired under CSRS can answer a few questions I have:
1. I will have 34 yrs in 8/2008 and will have accumulated 2087 hours of s/l as of pp 26. Will those hrs count for a full yr for length of service computation?
2. Read that you could put all your pay from last two pp's (25 & 26) into tsp before actual retirement date. Is this true?
3. If I were to go ahead and use my 208 hrs of a/l (just keep 240) and then put that amount of pay based on the a/l hours used into amy Credit Union account; does that make any sense? Credit Union pays better than most other liquid asset accounts in my local area.

Thanks in advance for any thoughts and ideas! I've never retired before and this is very scary. I want to make the best (right) decisions for my future.

2moryrs (not!)

[Show-me]

1. 2080 hrs is a manyear, so yes.

2. I don't know, but as long as you do not exceed the $15,500 IRS limits I would GUESS yes.

3. Works for me. Cash is king.

[2moryrs]

Thanks Show-Me!

Do you remember when they changed the 2080 to 2087? I vaguely remember but I'm really fuzzy on the reason. I'm sure it was to the employer's benefit and not ours!

Next, I have to find out when I qualify to keep my health insurance into retirement. I woke up last night wondering if I really could retire on 1/3/2009 or if I had to wait another year!

2moryrs (maybe? ;^()

[The HalfBreed]

Do you remember when they changed the 2080 to 2087? I vaguely remember but I'm really fuzzy on the reason. I'm sure it was to the employer's benefit and not ours! I THINK it had something to do with "Leap Year".

The change from 2080 to 2087 happened in the early to mid 1980's if memory serves me correctly. During the Ronald Ray-Gun era. About the same time that they eliminated sales tax deductions, and formed the FERS system, because, as they said....'Federal CSRS Employees Make far too much in retirement.....but wait ! We have a Deal for YOU !!!'

And here it is ! FERS !!! :blink:

I'm glad I didn't 'jump' and move from CSRS.

[Show-me]

Thanks Show-Me!

Do you remember when they changed the 2080 to 2087? I vaguely remember but I'm really fuzzy on the reason. I'm sure it was to the employer's benefit and not ours!

Next, I have to find out when I qualify to keep my health insurance into retirement. I woke up last night wondering if I really could retire on 1/3/2009 or if I had to wait another year!

2moryrs (maybe? ;^()

Sorry, I don't.

[Show-me]

http://www.fedsmith.com/article/1453/

Here are some great article from Tammy Flanagan.

http://www.nitpinc.com/gov_ex_archives.html

[jon]

On public TV tonight I accidently tuned into the first of 2 part program called Retirement Revolution with Paula Zahn. Looks like a good program with lots of actual costs and financial benefits from federal programs, etc. Pete Peterson provides a lot of background info on how and why particular benefit programs work. Social Security issue is both depressing and infuriating that Congress and President just procrastinate.

[Gumby]

Thanks Show-Me!

Do you remember when they changed the 2080 to 2087? I vaguely remember but I'm really fuzzy on the reason. I'm sure it was to the employer's benefit and not ours!

Next, I have to find out when I qualify to keep my health insurance into retirement. I woke up last night wondering if I really could retire on 1/3/2009 or if I had to wait another year!

2moryrs (maybe? ;^()

Pay and Benefits Watch: Why your paychecks don't always add upBy Brian Friel September 9, 1999
letters@govexec.com (letters@govexec.com)
Have you ever noticed that your paychecks don't add up to the salary listed for your grade and rank on the government's pay tables?
Take a hypothetical federal executive who makes $118,400 a year, according to the tables. Under the formula Uncle Sam uses to calculate her paychecks, she'll only get $117,998.40 in 1999. What happened to the other $401.60?
To find out, let's break down the government's pay formula.
To determine the executive's hourly rate for the year, Uncle Sam divides her yearly salary by 2,087 hours:

$118,400 / 2,087 = $56.73

To figure out the executive's biweekly rate, the government multiplies the hourly rate by 80 hours:

$56.73 x 80 = $4,538.40
Then the executive's agency pays her $4,538.40 every two weeks. There are typically 26 pay periods in a year:

$4,538.40 x 26 = $117,998.40

Look back over the formula. Can you spot Uncle Sam's secret to making the $401.60 disappear?
The trick is in how many hours a year the government says its employees work. If you work 40 hours a week for 52 weeks, you work a total of 2,080 hours in a year. If you re-calculated the executive's salary at 2,080 hours instead of 2,087 hours, then she would receive just under $118,400. But the government tacks on an additional seven hours to the formula, so employees appear to get shortchanged seven hours' pay each year.
However, there is a method to Uncle Sam's madness. In some years, there are 27 pay days, instead of 26, because of the way our calendar works. Back in 1986, some sharp-eyed budget cutters noticed that the federal pay formula was based on 2,080 hours a year. So our hypothetical executive, under the old formula, would end up with a $4,500 bonus in years with 27 pay days while getting her full salary in years with 26 pay days.
Rather than give federal employees free money every few years, Congress changed the formula to 2,087 hours. So employees are underpaid in years with 26 pay days, and then overpaid in years with 27 pay days. Our hypothetical executive still receives $4,136.80 more than the salary listed in the pay tables in years with 27 pay days, but that's offset by the $401.60 deficit in years with 26 pay days.
Why do some years end up with an extra pay day? It works like this: A biweekly pay period includes 14 days. Typically there are 26 pay periods in a year. Multiply 26 by 14. You get 364. How many days are in a year? Of course, 365 in a normal year and 366 in a leap year. So over the years, those missing days add up to a full pay period, hence the extra pay day in some years.
Pay periods vary by agencies, so the last year with 27 pay days was 1996 for some federal employees and 1997 for others. It happens roughly once every 11 or 12 years, so it will be some time before most federal employees enjoy an overpaid year again.



This guy also got a big incentive award for screwing the Fed employees. What a deal.:sick:

[EW_ret]

1. One year of sick leave is 2087 hours according to unused sick leave conversion chart.

2. The 26th pay period in normally the final pay for a calendar year. The date you receive the pay is what IRS uses in determining the tax year. I do not understand why some believe this pay goes for following calendar year. If it did it would be pay period 1. You are limited to a maximum of $15,500 plus $5,000 catch-up contributions to your TSP account. This must come from your salary, and not the annual leave lump sum. Some retirees contribute nearly their entire salary the last few pay periods, and use the annual leave lump sum to live on. It normally arrives in your final paycheck, coming from your local payroll office.

3. Where to put the annual leave lump pay is really dependent upon your financial situation. I have ING Direct and Emigrant Direct savings accounts linked to my local credit union checking account. I transfer the extra money to these linked accounts because they pay higher interest (now at 2.75% to 3.00%) than anything the credit union offers. In two business days I can move money between the credit union checking and Direct accounts.


Hello,

I am getting close to retirement and am doing a lot of reading and getting more confused by the day. So maybe some of you that retired under CSRS can answer a few questions I have:
1. I will have 34 yrs in 8/2008 and will have accumulated 2087 hours of s/l as of pp 26. Will those hrs count for a full yr for length of service computation?
2. Read that you could put all your pay from last two pp's (25 & 26) into tsp before actual retirement date. Is this true?
3. If I were to go ahead and use my 208 hrs of a/l (just keep 240) and then put that amount of pay based on the a/l hours used into amy Credit Union account; does that make any sense? Credit Union pays better than most other liquid asset accounts in my local area.

Thanks in advance for any thoughts and ideas! I've never retired before and this is very scary. I want to make the best (right) decisions for my future.

2moryrs (not!)

[clester]

For anyone in FERS that has retired, How soon do you get your lump sums (AL)? Is there any delay on the first paycheck (FERS or Supplement) if you retire the last day of the month? (for example, if you retired Jan 31, did you get a check the first of march?)
How about TSP payouts, If you had monthly payments (say based on life expectancy)?

[Guest2]

For anyone in FERS that has retired, How soon do you get your lump sums (AL)? Is there any delay on the first paycheck (FERS or Supplement) if you retire the last day of the month? (for example, if you retired Jan 31, did you get a check the first of march?)
How about TSP payouts, If you had monthly payments (say based on life expectancy)?

Clester, although there's a lot of good information concerning the TSP
within these walls, I think the link provided below has excellant information
about your question. I hope it helps, you'll need to search with a related
keyword to help you navigate to the info a little quicker.

http://community.federalsoup.com/4/OpenTopic?a=frm&s=4944011921&f=2514011031

[2moryrs]

Thank you Gumby and EW_Ret! You folks have so much knowledge and you share it! I have enjoyed this site very much. I have finally decided to retire at the end of the year FOR SURE and I will be able to pursue other interests. I am going to become more active on legislative issues that affect current employees and retirees with my local NARFE chapter.
Thank you all for the education.

less than 2moryrs!