Sorry- Yes- the FERS Survivor deduction.
Here is the actual printout:
Attachment 46952
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Sorry- Yes- the FERS Survivor deduction.
Here is the actual printout:
Attachment 46952
I'm debating whether to lower the FEGLI. Currently I have 3X on that, and have had 5X until the last premium increase. Once you turn 60 it gets much more expensive.
I also am carrying another 350K in life insurance from WAEPA. That to was 500K until the last premium increase. I figure my wife is going to get a LOT of traveling after I die, unless we all are locked down for the next decade. If I live, great, but I wanted her to have a nice piggy bank if I didn't. I MAY lower my FEGLI to 2X right after I retire- I want to get the final OPM numbers all settled, and then see where I am at, before I fine tune the income/outgo stream around the end of the year.
Then I can start 2021 in a good place, intending to have positive cash flow and cross my fingers they come up with a good vaccine, so that I can do some traveling next year around Europe.
I have friends in dual working households that brag about $1M insurance policies if they die. It makes me wonder how much they have saved if they need a policy of that magnitude.
FEGLI basic, free after 65, seems like a good deal. It will pay for the cremation, pizza and keg of beer for the family get-together when I die. My thing with insurance is I don't trust ANY person trying to sell me something financial.
Anyone have thoughts on a FERS survivor annuity?
mine after all deductions..taxes, insurance is 4320 monthly + My SS, Wifes pension her SS, my VA and if I take 1500 per month from my TSP ( will last 43 years at 1% return) ( leaving hers alone until RMD), my net income will be 2k more per month then I make now,,,saving VA monthly
If you don't want to reduce the payout but want to reduce the premium, you might want to shop it around. I ran some quotes on USAA and they were significantly cheaper for the same payout. I have been told that when the Gov contribution goes away after you retire, FEGLI becomes a very expensive product. In fact, CPA Dan Jamison (FERSGUIDE) says FEGLI is "the most expensive life insurance on the planet, with no underwriting standards during open season or initial enrollment." Of course if you have pre-existing conditions, getting life insurance may be difficult/expensive but if you are in good health you might be able to find similar coverage at a much lower cost. Just a thought.
And therein lies the problem.
I'm age 60. Already had two heart attacks and triple bypass; have significant arthritis knocking me down, my wife is healthy and four years younger than me to begin with. That means I am far more likely to kick the bucket sooner, and I'd like to leave her with a decent pension. Nobody else will write me life insurance at this age/condition. What I have through WAEPAI got more than 20 years ago, and it is by far a good deal comparatively.
The FEGLI will have to get reduced, but not eliminated. I just am going to wait until everything is processed through to OPM before I scale that back.
I'm not 100% sure, but I think that the amount on your SS statement at full retirement age PRESUMES that you actually work until full retirement age. If you're retiring before then, your $$$ will be much less than what the estimate would be at FRA. It's hard to get a definitive answer on this, but I've asked one of our retirement seminar providers and a recent retiree who postponed claiming a few years after retirement and they both seem to say that it does no good to wait to claim SS after you actually retire as the $$$ doesn't go up very much at all (a little, but not much)
What your video fails to note, and it is VERY important- is that if you take reduced Social Security at age 62, you are limited to the earned income you can earn without that social security being reduced.
If you wait until your full retirement age, you can have unlimited earnings, and still collect SS. After age 67, they don't reduce your SS by your earnings.
If you are planning on taking SS the moment you turn age 62, and then you decide you need to work to supplement your income, it is possible to completely wipe away all of your social security inclme very easily. SS is reduced by $1 for every $2 in earnings that you have. With a $50,000 income from another job, you end up collecting nothing from SS, and it is permanently reduced.
That's why it MAY be a better plan to live off other income in that key 62-67 time frame. I plan to use TSP savings tp help me through there, although it is possible my side business will provide enough income that I won't need to dip into TSP just yet.
And, since I can't travel Europe anytime soon - (thanks, Covid), I might as well just enjoy and save money for now.