Thrift Savings Plans Rollover: Taking Control and Managing Risk

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Thrift Savings Plans Rollover: Taking Control and Managing Risk

When it comes to retirement planning, there are few options as attractive as Thrift Savings Plans (TSP). These plans offer federal employees and members of the uniformed services a secure and tax-advantaged way to save for their future. However, as retirement approaches, many individuals face the challenge of what to do with their TSP funds. This is where TSP Rollovers into Indexed Annuities can provide a solution.

TSP Rollovers into Indexed Annuities allow individuals to take control over their TSP savings and manage the risk associated with market volatility. By rolling over their TSP funds into an indexed annuity, individuals can enjoy the safety of principal and the potential for lifetime income. In this article, we will explore the benefits of TSP Rollovers into Indexed Annuities and how they can help you secure your financial future.

Benefits of TSP Rollovers into Indexed Annuities

One of the key benefits of TSP Rollovers into Indexed Annuities is the safety of principal. With an indexed annuity, your initial investment is protected from market downturns. This means that even if the stock market crashes or the economy takes a hit, your principal will remain intact. This provides peace of mind and ensures that your hard-earned savings are secure.

Furthermore, TSP Rollovers into Indexed Annuities offer the potential for lifetime income. An indexed annuity allows you to convert your TSP funds into a stream of income that will last for the rest of your life. This can provide a stable and reliable source of income in retirement, ensuring that you can maintain your standard of living and enjoy the retirement you deserve.

How TSP Rollovers into Indexed Annuities Work

The process of rolling over your TSP funds into an indexed annuity is relatively straightforward. First, you need to select an indexed annuity provider that offers competitive rates and favorable terms. Once you have chosen a provider, you will need to fill out the necessary paperwork to initiate the rollover.

After the rollover is complete, your TSP funds will be transferred to the indexed annuity. From there, your funds will be invested in a combination of fixed and indexed accounts. The fixed accounts provide a guaranteed interest rate, while the indexed accounts offer the potential for higher returns based on the performance of a specific index, such as the S&P 500.

Managing Risk with TSP Rollovers into Indexed Annuities

One of the main reasons individuals choose TSP Rollovers into Indexed Annuities is to manage the risk associated with market volatility. By diversifying their investments and allocating a portion of their TSP funds to an indexed annuity, individuals can reduce their exposure to the ups and downs of the stock market.

Furthermore, indexed annuities offer a unique feature known as a participation rate. This rate determines how much of the index’s gain will be credited to your annuity. For example, if the participation rate is 80% and the index gains 10%, your annuity will be credited with an 8% gain. This feature allows individuals to participate in market gains while still protecting their principal.

Considerations for TSP Rollovers into Indexed Annuities

While TSP Rollovers into Indexed Annuities offer many benefits, it is important to consider a few key factors before making the decision to rollover your TSP funds. First, it is essential to evaluate the fees associated with the indexed annuity. Some annuities have high fees, which can eat into your returns over time. Therefore, it is crucial to carefully review the fee structure before committing to a rollover.

Additionally, it is important to understand that indexed annuities have a cap on the potential returns. This means that even if the underlying index performs exceptionally well, your annuity gains will be limited. While the safety of principal is a significant advantage, it is essential to weigh this against the potential for higher returns in other investment options.


TSP Rollovers into Indexed Annuities offer federal employees and members of the uniformed services a way to take control over their TSP savings and manage the risk associated with market volatility. By rolling over their TSP funds into an indexed annuity, individuals can enjoy the safety of principal and the potential for lifetime income. However, it is important to carefully consider the fees and potential limitations of indexed annuities before making a decision. Ultimately, TSP Rollovers into Indexed Annuities can provide a valuable option for securing your financial future in retirement. We have been helping Federal Employees for years and have moved millions into Indexed annuities, so let us help find the solution to fit your retirement needs. Contact us today.

Federal Retirement Help – Plan To Retire Happy

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Federal Retirement Help: Planning for a Bright Future

As a federal employee, planning for your retirement may seem overwhelming. However, with the right resources and guidance, you can ensure that your golden years are comfortable and financially secure. By taking advantage of tools such as the Federal Pension, Social Security, and the Thrift Savings Plan (TSP), you can create a retirement plan that works for you.

In this article, we will explore the various options available to federal employees for retirement planning and provide practical advice for maximizing your benefits. From understanding the basics of the Federal Pension system to utilizing the TSP Annuity and Federal Retirement Calculator, we will cover everything you need to know to plan for a bright future.

Understanding the Federal Pension System

The Federal Pension system is a retirement benefit offered to federal employees who have worked for the government for at least five years. This system provides a guaranteed stream of income for life, based on your years of service and highest salary earned. The longer you work for the government, the higher your retirement benefit will be.

One important factor to consider when planning for your federal retirement is the age at which you choose to retire. The earliest you can retire and begin receiving your pension is at the age of 62, with a minimum of five years of service. However, if you wait until the age of 67, you will receive a higher monthly benefit. It is important to weigh the pros and cons of retiring early versus waiting to maximize your pension.

Maximizing Your Benefits with Social Security

In addition to the Federal Pension, federal employees are also eligible for Social Security benefits. Social Security is a government-run program that provides retirement, disability, and survivor benefits to eligible individuals. To qualify for Social Security benefits, you must have worked and paid Social Security taxes for a minimum of 10 years.

One way to maximize your Social Security benefits is to delay your retirement age. The longer you wait to start receiving benefits, the higher your monthly benefit will be. For example, if you wait until the age of 70 to begin receiving benefits, your monthly benefit will be 32% higher than if you had started at the age of 66.

Utilizing the TSP Annuity

The Thrift Savings Plan (TSP) is a retirement savings plan for federal employees. Similar to a 401(k) plan, the TSP allows you to save for retirement on a tax-deferred basis. One unique feature of the TSP is the option to purchase an annuity with a portion of your TSP balance. An annuity provides a guaranteed stream of income for life, similar to the Federal Pension system.

When considering purchasing an annuity with your TSP balance, it is important to weigh the pros and cons. One advantage of an annuity is the guaranteed income stream for life. However, once you purchase an annuity, you cannot access your TSP balance for other expenses. It is important to carefully consider your retirement needs before making a decision. We suggest you speak to one of our Federal Retirement Consultants to find which one would be best for you.

Planning with the Federal Retirement Calculator

The Federal Retirement Calculator is a useful tool for federal employees to plan for retirement. This calculator allows you to estimate your retirement benefits based on your years of service, salary, and retirement age. It also allows you to compare different retirement scenarios, such as retiring early versus waiting to maximize your pension.

When using the Federal Retirement Calculator, it is important to remember that it is only an estimate. Your actual retirement benefits may vary based on a variety of factors, such as changes in the cost of living or changes in government policy. It is important to regularly review your retirement plan and adjust as necessary.


Planning for retirement can be overwhelming, but by utilizing the resources available to federal employees, you can ensure a comfortable and financially secure future. Understanding the Federal Pension system, maximizing your Social Security benefits, utilizing the TSP Annuity, and planning with the Federal Retirement Calculator are all important steps in creating a retirement plan that works for you. By taking the time to plan now, you can enjoy your golden years without financial stress. And Remember, Don’t Worry, Retire Happy and let us help guide you there. Request your Free review today.

Maximizing Your Retirement Benefits: Federal Retirement Planning Assistance

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Maximizing Your Retirement Benefits: Federal Retirement Planning Assistance

Planning for your retirement can be daunting, but with the help of Federal Retirement Planning Assistance, it doesn’t have to be. As a federal employee, you have access to a variety of retirement benefits, which can be overwhelming to navigate on your own. This article will guide you through the process of maximizing your retirement benefits with the help of Federal Retirement Planning Assistance.

Understanding Your Retirement Benefits

Before you can begin planning for your retirement, it’s important to understand the retirement benefits available to you as a federal employee. The Federal Employees Retirement System (FERS) is the retirement system for most federal employees, which includes three main components: a basic benefit plan, Social Security, and the Thrift Savings Plan (TSP).

The basic benefit plan provides a monthly annuity payment based on your years of service and highest average salary. Social Security provides a base level of retirement income and the TSP is a defined contribution plan, similar to a 401(k), that allows you to save for retirement with pre-tax dollars.

With the help of Federal Retirement Planning Assistance, you can understand the specifics of each component and how they work together to provide you with retirement income. They can help you calculate your projected retirement income, estimate the cost of living in retirement, and create a retirement income plan that maximizes your benefits.

Maximizing Your Annuity Payments

The basic benefit plan is a key component of your retirement income as a federal employee. It provides a monthly annuity payment based on your years of service and highest average salary. Maximizing your annuity payments requires careful planning and consideration of several factors.

One factor to consider is your retirement date. The longer you work for the federal government, the higher your annuity payments will be. Federal Retirement Planning Assistance can help you weigh the benefits of retiring earlier versus working longer to maximize your retirement income.

Another factor to consider is your survivor annuity option. If you are married, you can choose to provide a survivor annuity for your spouse, which will reduce your monthly annuity payments. Federal Retirement Planning Assistance can help you understand the costs and benefits of this option and make an informed decision.

Optimizing Your Social Security Benefits

Social Security provides a base level of retirement income for all Americans, including federal employees. However, the amount of your Social Security benefit is based on your earnings history and the age at which you begin receiving benefits.

With the help of Federal Retirement Planning Assistance, you can determine the optimal age to begin receiving Social Security benefits based on your individual circumstances. They can also help you understand how your Social Security benefit will be affected if you continue to work in retirement.

Maximizing Your TSP Savings

The Thrift Savings Plan (TSP) is a defined contribution plan that allows you to save for retirement with pre-tax dollars. Maximizing your TSP savings requires careful consideration of several factors.

One factor to consider is your contribution rate. Federal Retirement Planning Assistance can help you determine the optimal contribution rate based on your retirement goals and income. They can also help you understand the tax implications of your TSP contributions.

Another factor to consider is your investment strategy. Federal Retirement Planning Assistance can help you understand the different investment options available in the TSP and create an investment strategy that aligns with your retirement goals.

In Conclusion

Planning for your federal retirement doesn’t have to be complicated, but it does require careful consideration of several factors. With the help of Federal Retirement Planning Assistance, you can maximize your retirement benefits and create a retirement income plan that meets your individual needs.

Remember to take advantage of the retirement benefits available to you as a federal employee and seek the guidance of Federal Retirement Planning Assistance to ensure that you are making informed decisions about your retirement. For your Free Retirement Consultation, My Federal Retirement Help does Free 90 minute consultations. Contact us today to Schedule your Retirement review.

How Your FERS, Social Security and TSP Payments Get Taxed

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How is your retirement income, specifically your FERS annuity, Social Security, and TSP withdrawals, taxed for federal income tax purposes?  The taxable portion of each of these sources of income are taxed as ordinary income; that is, they receive no special tax treatment are taxed based on the bracket in which they fall.

The vast majority of your FERS annuity will be federally taxable.  You will not be taxed on the portion of your FERS annuity that is due to your already taxed contributions but, because you recoup your contributions bit by bit over your life expectancy, most of your FERS annuity is taxed.  The form 1099-R you receive from OPM will tell you how much is taxable.

It is quite likely that 85% of your Social Security will be subject to federal income tax at your rate for ordinary income, though some retirees will find that a lesser portion is considered taxable; the higher your income the higher the percentage of your Social Security benefit that is subject to federal income tax.  You will determine how much of your Social Security is taxable when you are filling out your tax forms.

Distributions from your traditional TSP are fully taxable for federal income tax purposes.  Distributions from your Roth TSP will be tax free if the withdrawals are qualified.  For a Roth withdrawal to be considered qualified, you must have had the Roth account for at least 5 years and be at least 59 ½ years old.  If your Roth withdrawals are not qualified, you will pay taxes on the portion of your Roth distribution that is due to earnings; withdrawn contributions are never taxable, because your contributions were made out of already taxed dollars.  In the Roth TSP (unlike a Roth IRA) Roth withdrawals come proportionally from contributions and earnings.

The above paragraphs tell how your retirement income is taxed – not how taxes are withheld from said income.  We’ll look at withholding in the paragraphs below.

Regarding your FERS annuity, you likely filled out a W-4P with your retirement papers and now taxes are being withheld from your monthly payments.  You probably based this withholding on the last W-4 you filed while still an employee and it will most likely cover all taxes due from your annuity.

On the other hand, Social Security will not withhold one red cent from your benefits for taxes unless you ask them to!  In order to be sure enough is withheld for taxes, you can:

Ask Social Security to withhold from your monthly payments.  You can do this when you apply (if you’re applying online, you do it in the “remarks” section of the form) or you can file a form W-4V after you have applied.

Make quarterly estimated tax payments.  These payments which are due on April 15, June 15, September 15 and January 15 (or a few days later depending on the day of the week the 15th falls on) require you to remember to set aside the money for the payment and remember to actually send it in.  I don’t trust my memory (or my ability to keep my hands off money that I have set aside) so, when I filed for Social Security, I requested that they withhold a percentage of my benefit for federal income taxes.  If I don’t see it, I won’t miss it.

The Thrift Savings Plan withholds taxes at different rates for different types of payments.  They have a booklet available on their website, tspbk26.pdf that contains a detailed table describing the withholding on each different type of withdrawal.  According to TSP statistics, the most common withdrawal is installment payments and with that type of withdrawal (if the payments are likely to continue for 10 years or more) taxes are withheld as if you were married, filing jointly, and claiming 3 exemptions.  This will almost certainly result in not enough taxes being withheld and might even cause a tax penalty.  Just because you’re not having taxes withheld doesn’t mean that you don’t owe taxes.

Most other types of payment from the TSP withhold at a 20% rate, which may (or may not) be sufficient to cover your federal income taxes.

Those of you who live in states that tax retirement income and/or Social Security should be aware that neither Social Security nor the TSP withhold state income taxes.  You will want to either make estimated payments to your state taxing authority or have more withheld from other sources of income.

If you’re just retired, or planning on retiring in 2023, plan on having enough money withheld this year to cover your taxes and avoid any penalties.  Remember, tax avoidance is OK – it’s tax evasion that’ll get you into trouble.

Finally, to get the best idea of where you stand going into retirement, we do suggest you get a Full Retirement Consultation with a Federal Retirement Consultant.  Please visit the contact us page to start the process to schedule your Free Retirement Review.

Congressional Democrats Propose an 8.7% Pay Raise for Feds in 2024

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The annually introduced bill would provide a 4.7% across-the-board increase in basic pay and an average 4% increase to locality pay.

Democrats in both chambers of Congress on Thursday introduced legislation that would provide federal employees with an average 8.7% pay raise in 2024.

The Federal Adjustment of Income Rates Act, introduced by Rep. Gerry Connolly, D-Va., in the House and Sen. Brian Schatz, D-Hawaii, in the Senate, would increase federal workers’ basic pay by 4.7% across the board next year, and provide an average 4% increase in locality pay.

The introduction of the FAIR Act has been an annual endeavor in recent years; last year, the bill proposed a 5.1% pay increase, split between a 4.1% across-the-board basic pay raise and a 1% average increase in locality pay. Although the bill is rarely acted upon, it could serve as an important marker as lawmakers and the Biden administration debate spending levels for fiscal 2024 as House Republicans demand cuts to government spending.

Connolly described the measure as a way to restore “years of lost wage increases” over the last decade due to government shutdowns, hiring and pay freezes and sequestration-related furloughs.

“For years now, federal employees have risked their health and safety working on the frontlines of this pandemic,” Connolly said. “They were subjected to the Trump administration’s cruel personal attacks, unsafe work environments, pay freezes, government shutdowns, sequestration cuts, furloughs and mindless across-the-board hiring freezes. Still, our federal workforce serves with dedication and distinction every day. Federal employees are our government’s single greatest asset, and they deserve better.”

The bill’s introduction drew swift support from unions and other federal employee groups.

“The 8.7% increase listed in the FAIR Act is not a pay raise,” said Randy Erwin, national president of the National Federation of Federal Employees. “It is a minimum increase needed to offset the dwindling checking accounts of public servants, and it is critical to recruiting and retaining the best possible workforce.”

American Federation of Government Employees National President Everett Kelley said that a sizeable pay increase is particularly important as the government tries to recruit new workers during a tight labor market.

“The latest report of the Federal Salary Council shows that federal worker pay lags behind the private sector by over 23%—making it difficult for agencies to recruit, hire and retain top talent and hurting the quality of services Americans receive,” he said. “The 8.7% pay increase included in the FAIR Act will not only reward federal employees’ hard work and help them keep pace with inflation, but it will also help government agencies remain competitive and deliver high-quality services to the American public.”

And William Shackelford, president of the National Active and Retired Federal Employees Association, echoed that sentiment.

“The FAIR Act proposes a strong pay raise to counteract a tightening labor market and increasing private-sector pay, rising costs of living and an impending federal retirement wave,” he said. “A strong pay increase in 2023 is critical to the recruitment and retention of an effective federal workforce, and we’re thankful to have Congressman Connolly’s support for this effort.”

So how would this raise affect your High 3 average going into retirement?  Let us run a Full Benefits Analysis Retirement Review for you so you can help plan and maximize your retirement.  Contact Us today to get YOUR Review!

Almost Every TSP Fund Ended Last Month (and Year) Down

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The vast majority of offerings in the 401(k)-style Thrift Savings Plan did not have a good month in December—or a good year in 2022 for that matter.

The S Fund, invested in small and mid-sized businesses, had the worst performance for December, losing 6.55%. It was down 26.26% for 2022.

The common stocks of the C Fund fared just slightly better. The fund lost 5.67% last month and 18.13% last year.

The international stocks in the I Fund were 1.85% in the red for December and were down 13.94% for the year 2022, while the fixed income bonds in the F Fund lost 0.65% for the month and 12.83% for the year.

Government securities in the G Fund were the one bright spot, inching up 0.32% for December and 2.98% for the year.

For the year of 2022, L Income lost 2.7%; L 2025, 6.72%; L 2030, 10.32%; L 2035, 11.65%; L 2040, 12.9%; L 2045, 14.03%; L 2050, 15.05%; L 2055, 17.6%; L 2060, 17.61%; and L 2065, 17.62%.

So with that being said, should you look into other investments where you don’t have to take ANY losses?  We call it Zero is our Hero.  Contact one of our Financial Retirement Consultants to learn how we help you plan for a better retirement.

No Time Like the Present: Retirement and Estate Planning in Your 20s and 30s

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When you’re young, saving for retirement may be the last thing on your mind. Yet, the financial choices you make in your 20s and 30s will dictate how well-off you are decades from now, and delaying retirement and estate planning until you’re older can be a decision you live to regret. Here’s how to start preparing so you’re ready for your golden years.

Money Management: Budgeting and Handling Debt

Living within your means is a habit best formed early in life, and it becomes even more critical when you’re earning a regular paycheck that must cover expenditures like rent, auto loans, insurance, and utility bills. To ensure you’ll meet your obligations, start by tracking your income and expenses; if the latter exceeds the former, you’ll need to either cut unnecessary spending or find a way to generate more earnings. Use your tracking to create a monthly budget, and then stick to it to avoid overspending.

If you’ve used credit wisely up to now, and you don’t carry any revolving debt, keep it that way. If not, add a line in your budget for paying down your cards so you don’t waste money on interest charges. Pay as much as you can above the minimum requirements, and remit payments on time to avoid fees and build your credit history.

Money Maximization: Saving and Investing

Once you have built a budget and are following it, you may be tempted to splurge with any extra cash. Although you shouldn’t live a life of hermetic deprivation, focusing on saving rather than spending will always have a better outcome long term. That’s because interest compounds, or builds on itself, so free money is added to what you’ve saved.

Speaking of free money, if your job offers a 401(k) plan, join it. It will make it effortless to build your savings, and if your employer provides matching contributions, then company money will be added to your plan every payday.

Buying a home is also a smart investment, as house values generally increase over time. Down the road, you can use your home’s equity as a source of liquidity when needed. When you’re ready to purchase, use a helpful online house appraisal to assess the asking price so you avoid overpaying and benefit fully from any appreciation.

Money Protection: Insurance and Estate Planning

Once you’ve committed to saving and investing for retirement, take steps to ensure you’ll hold onto that money until you or your loved ones need it. Always carry health insurance coverage, as medical debt can quickly deplete your savings. Having a life or disability insurance policy will also help preserve what you’ve accumulated if you die or become unable to work.

Although estate planning may sound silly when you’re beginning to save for the future, if you die without a will, your money may not go where you wish. By creating a complete estate plan when you’re young and then updating it when you marry, buy a home, have children or go through other life changes, you’ll rest assured that your assets won’t end up in the wrong hands.

No one ever says they wish they’d waited longer to be smart with their finances. By focusing on managing, maximizing, and protecting your money in your 20s and 30s, which may include taking advantage of your home equity or utilizing your 401(k) plan, you’ll set yourself and your loved ones up for a stronger financial future.

My Federal Retirement Help can assist you as you begin planning for your upcoming retirement. This way, you won’t have to spend your golden years worrying about your finances. Contact us today by calling 254-870-5959 Ext. 700 or texting 254-301-6571.

OPM Will Suspend Long Term Care Insurance Applications as a Sizeable Premium Increase Looms

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The deadline to apply for the program before a two-year suspension is Dec. 19, but officials want applicants to go in with “eyes wide open” that rates will likely increase substantially.

The Office of Personnel Management plans to suspend applications for the Federal Long Term Care Insurance Program for two years beginning Dec. 19, in anticipation of a sizeable rate hike.

OPM announced the unusual measure last month in the Federal Register, and noted that federal workers who submit their applications by the deadline will still be considered for enrollment. FLTCIP was created in 2002 and assists with health care costs for participants who need help with daily personal functions, or who have a severe cognitive illness, and covers home care, nursing home or assisted living benefits.

“OPM is suspending applications for coverage in FLTCIP to allow OPM and the FLTCIP carrier to assess the benefit offerings and establish sustainable premium rates that reasonably and equitably reflect the cost of the benefits provided,” the agency wrote.

The program will continue to operate normally for current enrollees, although they will not be able to apply to increase their coverage. There are currently around 267,000 federal workers and retirees participating in the insurance plan, and OPM typically receives only a few thousand applications to enroll per year.

The decision to suspend applications for the program came after John Hancock Life and Health Insurance Co., the contractor that administers the program, informed OPM that it is likely that there will a premium increase sometime next year.

In recent years, the long term care insurance market has been plagued by large premium increases, in part because people have been living longer and in part because long term interest rates have been at historic lows since the aftermath of the 2008 financial crisis. The Federal Long Term Care Insurance Program last saw premiums increase by an average of 83% in 2016.

John Hatton, staff vice president of policy and programs for the National Active and Retired Federal Employees Association, said it is likely that OPM will examine whether there is anything they can do administratively to improve the stability of the program or propose legislation to alter the program.

“Reading the tea leaves, instituting a suspension of applications shows that there’s a lack of faith or trust that it’s designed in a way that can be sustainable,” he said. “The first premium increase was around 25%, the second was as high as 125% [in some cases], and 83% on average. These premiums were quoted with the intention of staying stable for the lifetime of the coverage, which is someone’s life. And it’s not just federal workers’. They were just not priced correctly to begin with.”

After the previous round of premium hikes, OPM instituted “FLTCIP 3.0,” which allows current enrollees to adjust their coverage downward in order to reduce the impact of rising premiums. Even with that change, Hatton said OPM likely made the right decision by suspending applications.

“If you can’t accurately quote someone what the cost will be for a product, it shouldn’t be open ended,” he said. “That said, the reason these premiums are going up is costs are very high, and people have to figure out how to plan for long term care costs, and there’s no public option aside from Medicaid, which only provides catastrophic coverage if you’re completely impoverished yourself.”

Ultimately, Hatton said he thinks that OPM will wind up having to request legislation from Congress to make the changes needed to stabilize the program.

“OPM, for their part, has done—within the structure of the program, I think—what they can do,” he said. “They hired an independent actuary to look at the assumptions and make sure that they’re right, they hired a consultant to look at various options, and we’ll see where that goes and what flexibility they have in the statute or whether they’ll need Congress to provide some flexibilities. But at the end of the day, the options that would emerge are going to be ones that are maybe tied more to affordability and certainty, but also less coverage.”

We can also show you a better alternative to Long Term Care insurance using certain riders on our Income Annuity Products.  Why pay for something you may or may not ever use?  Contact us today to learn more.

health premiums

Federal Employees Will Pay 8.7% More Toward Health Care Premiums Next Year

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The Office of Personnel Management said increased use of health care services as the COVID-19 pandemic has waned has led to the sharpest uptick in health insurance premiums in more than a decade.

Federal employees and retirees will spend an average of 8.7% more on their health insurance premiums in 2023, a figure that marks the highest cost increase in more than a decade.

The government’s share of Federal Employees Health Benefits Program premiums will increase by an average of 6.6%, bringing the overall increase to 7.2%, according to an OPM document obtained by Government Executive. That overall premium increase is the highest the nation’s largest health insurance program has seen since costs increased 9% in 2011.

On average, federal employees enrolled in “self-only” plans will pay an additional $8.11 per bi-weekly pay period, while feds in “self plus one” insurance plans will pay $20.34 more per pay period. Federal workers enrolled in family coverage will pay an average of $20.87 more per pay period in 2023.

For the Federal Employees Dental and Vision Insurance Program, the average premium for dental plans will increase by 0.21%, while the overall average premium for vision coverage will decrease by 0.41%.

The FEHBP’s annual open season, in which federal employees can choose from a variety of national and regional insurance carriers and coverage plans, will run from Nov. 14 through Dec. 12.

OPM’s document attributed the jump in premiums to the “unprecedented volatility” in health care costs due to COVID-19, noting that the pandemic cost FEHBP about $2 billion in the testing and treatment of the disease in 2021, or roughly double what the disease cost the program in 2020, which has impacted premiums for next year. OPM also cited an increase in usage of health care services, following a period earlier in the pandemic when enrollees used fewer medical services.

The document described the overall 7.2% increase as “aligned” with increases in premiums by comparable large employers. But three of those plans’ reported increases are lower than FEHBP’s—CalPERS, which covers California government employees, projects an average 6.75% increase; a Business Group on Health survey of large employers projected a 6.5% average increase; and consulting group Aon estimated health costs will increase by around 6.5% next year. The Kaiser Family Foundation projects a 10% average increase for individual marketplace premiums, with “most rate increases falling between about 5% and 14%.”

OPM said it has worked with insurers this year to improve coverage of prenatal and postpartum health care services, as well as increase access to gender affirming care for members of the LGBTQ+ community. Insurers are also required to provide “adequate coverage” of anti-obesity medications. And four new plan options will provide assisted reproductive technology coverage, bringing the total number to 18 plans next year, and an additional plan will provide an optional benefit for discounted ART procedures.

National Treasury Employees Union National President Tony Reardon said in a statement Friday that although the premium increases are reportedly in line with other large employers, the spike in costs underscores the inadequacy of President Biden’s proposed 4.6% average pay raise for federal employees next year.

“These premium increases may be similar to those expected by other large employers in the private sector, but they will still cause sticker shock for federal employees,” he said. “These premium increases are yet one more data point in our argument that federal employees deserve a fair pay increase in 2023. NTEU supports legislation providing federal employees, on average, a pay increase of 5.1%, which would help them keep up with rising costs and save for retirement.”

If You Make $100,000 in Average Annual Income, Here’s What You’ll Get From Social Security at 67

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For anyone born after 1960, the Social Security Administration (SSA) determines that your normal retirement age, which is when you would be entitled to your full benefit, is 67.

But deciding whether or not you should retire at that age can be difficult. You can start receiving Social Security benefits as soon as you turn 62, but claiming early can significantly reduce your amount.

You can also wait until 70 to start taking Social Security (increasing your benefit to the highest amount possible), but perhaps you don’t want to wait that long. It depends on where you are in life from a financial perspective and how your health is doing.

Given all of these factors, it’s a good idea to figure out how much you might get when you start to claim benefits. Despite its complexity, you can break down the Social Security formula into basic parts to calculate your amount. Let’s see how much you would make if you earned about $100,000 annually (adjusted) over your career and retired at 67.

Breaking down the formula

To begin calculating your benefits, the SSA first calculates your average indexed monthly earnings (AIME), which looks at the 35 years of your work history in which you made the most money.

It looks at your nominal earnings over these 35 years and then indexes them (or adjusts them) to determine what the amounts would have been if you were making them in the present. So, essentially, the SSA would take your nominal earnings, from, say, 1982 and adjust them for wage inflation over the years to reflect what those earnings would be in 2022.

An example on the SSA website shows that nominal earnings of $13,587 in 1982 would have been equivalent to about $52,000 in 2022. But the SSA also has a wage base limit for what a retiree can get credit for. That number is $147,000 in 2022.

To finish getting the AIME, you add up your highest 35 years of annual earnings, which are now indexed to account for inflation. Then you divide by 35 to get the annual amount over that period and then divide by 12 to get the monthly amount.

Once you have your AIME, the next thing you need to do is calculate your primary insurance amount (PIA), which is your actual monthly benefit from Social Security for those receiving full benefits at the normal retirement age.

This is also not a simple calculation, but it can be done easily enough using these three steps and adding the amounts from each step. Here are the numbers for someone who turned 62 in 2022:

  • 90% of the first $1,024 of your AIME.
  • 32% of any amount between $1,024 and $6,172.
  • 15% of the leftover amount above $6,172.

What is your PIA on an annual income of $100,000?

If your highest 35 years of indexed earnings averaged out to $100,000, your AIME would be roughly $8,333.

  • 90% of $1,024 = $921.6
  • 32% of $5,148 = $1,647.36
  • 15% of $2,161 ($8,333-$6,172) = $324.15

If you add all three of these numbers together, you would arrive at a PIA of $2,893.11, which equates to about $34,717.32 of Social Security benefits per year at full retirement age. That’s not too shabby considering the maximum benefit is $4,194 per month, and that assumes you delay claiming until you are 70.

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