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Thread: My retirement journey

  1. #1

    Default My retirement journey

    Hello. I don't know if this will interest anyone, but I thought I would start a thread on the retirement process for federal workers. I have an old Chevy truck , and the forums have lots of "build threads" where owners document their journey building their rides.

    Kinda cool, thought I could do something along that line here. I do hope that others give me advice as I navigate these waters.

    What better way for people to learn as they approach this difficult process down the line, than to see the mistakes and successes of those who have gone before them?


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  3. #2

    Default Re: My retirement journey

    Ok, so this is where I am now:

    Federal law enforcement, mandatory retirement at the end of June, 2020. (I will be 57 years old).

    My TSP is currently around 250K. I messed up during the early years, only putting in the amount that the government would match - 5%. I was also way too conservative, riding G fund for years, totally ignoring the one day that I would need the money.

    Let me drop some advice here - don't be like me!

    Invest the most you possibly can in TSP, and watch it, learn and actively manage the TSP. You can also use the "year funds" - example 2020, 2030, etc. will manage it for you if you don't want to mess it up.

    I'm currently putting in the max, but man - I should have done this years ago.

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  5. #3

    Default Re: My retirement journey

    Here is some humble advice; and the part that I did get right:

    Stay out of debt! I made a rule for myself when I got my first credit card - I would never under any circumstances carry a balance. Now I know that there may well be emergencies in your life that make this impossible, but that sweet entertainment system that you can't afford does not make the list.

    I've been blessed, and can say I have never once in my life paid a penny interest on a credit card. The payoff? Until yesterday, I was totally debt free, and have a credit rating north of 800, which is an asset you want to have.

    My wife and I both have newer vehicles paid off. Mine has a bumper to bumper life time warranty from the manufacturer; her's has a life time power-train from the manufacturer. Hoping to avoid as much auto related retirement bills.

    Oh, I paid my home off early as well.

    We had to live less extravagant to do these things, but considered it worth the delayed life enjoyment.

    Just something to consider as you approach retirement.
    Last edited by dave123; 01-04-2020 at 04:20 PM.

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  7. #4

    Default Re: My retirement journey

    Ok, I just said I was debt free until yesterday. Here is why.

    Being 6 months out from retirement, I've found my retirement home (closed yesterday). I'm leaving the big city, with it's high taxes, high insurance costs, and just overall high cost of living. I'm moving to a small quiet town. I got a home by a lake. I really should have (and recommend) a downsize in retirement, but I splurged on a "dream home" on the lake. I'm not completely crazy, though, due to the fact it's in a small quiet area, it actually cost less than I believe I will get for my current, paid off, home. And the cost of living will go down for sure.

    Yeah, I'm six months early, which will cost me extra in tax/insurance, etc, but there are benefits to consider:

    1. I can move in at my leisure, no pressure. My current home will be empty and clean for buyers to view. My new home can get some upgrades while it is empty.
    2. 3.5% interest rate, VA with no down payment made it cost feasible.
    3. I didn't have to make a contingent offer when I bought the home. No stress of trying to balance moving into a new home while selling a home.

    The con here is that if I have problems selling my current home, I may have to dip into TSP to keep up with the cost of 2 homes after I stop receiving full pay. I've researched the market and my realtor is a personal friend of over 30 years; and she is confident that the sale will not be a problem for the amount of money I will need.

    Stay tuned to see how this part turns out

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  9. #5

    Default Re: My retirement journey

    How much money will I receive in retirement?

    We are truly blessed as federal workers to get a pension. Even more those of us that are law enforcement, as the credit for LEO is higher. How many of my friends have no pension at all? Too many.

    So, I got my retirement pension, or annuity as the govt. calls it, estimated by government retirement personnel. You can do this once every year once you are getting close to retirement. It's a "pretty close" ballpark estimate. If you have a question how to do this, PM me and I will give you the info.

    I recommend you do this to get an approximation of what you will receive in retirement.

    After tax and health insurance, it will be less than 1/2 my base pay. Ouch - I was hoping for more!

    This really scared me until I spoke to someone who helped me understand the numbers a little more. You have to remember that comparing this number to your current salary is apples to oranges.

    Don't compare this number to your gross pay, but rather to your take home (net) pay. I actually found that this number was, after all my current deductions, not that far from my net pay. I feel a little better now.

    I plan to take social security at 62 (when my FERS supplement) ends. I know this is a controversial decision, but give me more payments, money that I can use and invest now, rather than waiting until I'm really old for a bigger payment. This is something I think you should research if you haven't already - it's an important consideration with pros and cons on both sides.

    Remember, your retirement is a 3 legged beast:
    1. Pension
    2. TSP
    3. Social Security

    Don't forget to carefully consider your survivor benefit choice, full, partial, or none. This will impact the numbers, and more importantly, the money your significant other will receive if you die.

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  11. #6

    Default Re: My retirement journey

    Another thing about my projected pension; after I received the numbers, I adjusted how much money I have coming out of my pay going straight to my savings account to match - see if I can live on what I will be making on retirement! It's not a perfect example, we still have my wife's pay, and the cost of living will be less, but at the very least, it helped me add to my savings! Just something to consider.

    Ok so we are pretty much up to date. I was told by the finance center to contact them once I was 6 months out from retirement to get the paperwork started. Going to do that Tuesday. I will post the results.

    Feel free to add any advice or comments to this thread. I want to learn as much as I can, and hopefully avoid mistakes, as well as helping others.
    Last edited by dave123; 01-04-2020 at 05:22 PM.

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  13. #7

    Default Re: My retirement journey

    Quote Originally Posted by dave123 View Post
    Another thing about my projected pension; after I received the numbers, I adjusted how much money I have coming out of my pay going straight to my savings account to match - see if I can live on what I will be making on retirement! It's not a perfect example, we still have my wife's pay, and the cost of living will be less, but at the very least, it helped me add to my savings! Just something to consider.

    Ok so we are pretty much up to date. I was told by the finance center to contact them once I was 6 months out from retirement to get the paperwork started. Going to do that Tuesday. I will post the results.

    Feel free to add any advice or comments to this thread. I want to learn as much as I can, and hopefully avoid mistakes, as well as helping others.
    Just one thought, OPM and retirement processing is very slow. Can take anywhere from 2-6 months from your actual retirement date to receive your final correct retirement check. One idea is to save your annual leave which provides a nice little pot of money for the interim. Sounds like you may have this issue somewhat covered by adjusting your current pay which should give you a little nest egg until you get your retirement checks. Look around on the TSP site as there are a number of retirees who have posted their journeys. Best of luck to you!

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  15. #8

    Join Date
    Jun 2004
    Location
    Boiled Peanut, Georgia, USA
    Posts
    63,183

    Default Re: My retirement journey

    Yep, when I retired I cashed in the Maximum AL and received $17 Grand to hold me over. That Check only took 2 weeks to receive.
    10/23/2020
    LS CRUDE Oil
    =$39.85 a Barrel, Daily Status -$.79

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  17. #9

    Default Re: My retirement journey

    Thank you scout, I hadn't seen another thread like this, I will look.

    I failed to mention that I carried 240 (max) annual leave into this year and plan to take no leave this year. So I will get that money when I separate from service. Many of my fellow employees retire at the end of the year so they can get the 240 plus a whole year of unused pay - I prefer full checks until June and 6 months of exta annual leave; another thing to consider. Nice catch.


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  19. #10

    Join Date
    Oct 2008
    Location
    Stinking desert valley of bad air quality, AZ
    Posts
    2,872

    Default Re: My retirement journey

    Sounds like you have a good plan. FWIW my leave sell back came with my last pay check, the normal payday after my last work day.

    Somewhat scary time this is for everyone. If you have any questions, no matter if they seem trivial, post them. Best of luck and enjoy the new house.

    PO

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  21. #11

    Default Re: My retirement journey

    Looks like OPM wants me to wait until Feb 1st to get things started. Oh well. Just read Scouts thread on retirement, I do home I get paid quicker than he did!

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  23. #12

    Default Re: My retirement journey

    Dave , try the Retirement and IRA Talk Forum there are quite a few retirement story threads. Just scroll through. Lots of great information there!
    https://www.tsptalk.com/mb/retiremen...ent-story.html

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