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Retirement - Advance Planning


Your Retirement Planning Checklist 


Start planning for retirement several years before your planned retirement date. If you didn't start early, start now, by following these guidelines:
 

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Please read all retirement information provided to you, and contact your retirement counselor (Benefits Specialist or Assistant) (PDF) if you have any questions. 

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Attend a pre-retirement seminar , if available. There are a variety of vendors and retirement seminars available to Federal employees. If you don't have an opportunity to attend a seminar, review the narrated powerpoint seminars on our web site.

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If you are uncertain that all of your prior military and civilian service has been credited, request a Certified Summary of Federal Service from your retirement counselor. Review it and take steps to correct errors or document any missing service. 

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Review the annual Personal Benefits Statement provided by the National Finance Center for a general overview of your retirement benefits. If you are within 3 years of retirement, ask your retirement counselor for annuity estimates for the date or date(s) you are thinking of retiring. You should be able to determine from the estimate whether your CSRS or FERS annuity, along with any expected income from other sources, will meet your needs at the time you plan to retire. The estimates will also give you information on whether there are any deposits for temporary or military service, or any redeposits for refunded retirement contributions, that you may want to pay to improve your basic annuity benefit. Although our retirement estimates should be fairly accurate, the Office of Personnel Management will make the actual calculation after you have retired from Federal Service.

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If you have performed active duty military service after December 31, 1956, you should determine whether you will be eligible for Social Security benefits at age 62, and if so, decide whether it would be to your benefit to make the deposit for the military service. You may read more about this in the “Post-1956 Military Service Deposit” information available from your retirement counselor. Don't wait until the last minute - interest accrues annually, and post-1956 military service deposits must be paid to your agency before you separate/retire from Federal service.

If you are a military retiree who may waive military retired pay to have the service used in your CSRS or FERS annuity, you need to decide whether you want to do this, by requesting annuity estimates with and without the military service, and considering the cost of the military deposit.

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Will you be eligible to continue your Federal Employees Health Benefits (FEHB) coverage as a retiree? If you are retiring with 5 or more years of creditable service, and were covered by any FEHB plan for 5 years of service immediately preceding retirement, or since your first opportunity to enroll, you are eligible to retain your health insurance coverage as a retiree. Your FEHB benefits will continue at the same coverage and cost that is available to employees. The deductions for FEHB will be taken from your monthly annuity check. If you are eligible to continue your FEHB, no action is required by you. Please be aware that you must elect a survivor benefit and also have a self and family FEHB enrollment in effect at the time of death in order for your surviving spouse to continue enrollment in the FEHB plan after your death.

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Will you be eligible to continue your Federal Employees Group Life Insurance (FEGLI) coverage as a retiree? When you retire with 5 or more years of creditable service, and you were covered by FEGLI for 5 years immediately preceding retirement, or since your first opportunity to enroll, you are eligible to retain your life insurance as a retiree. Double indemnity and dismemberment protection stops at retirement. Basic and Optional insurance will be continued according to your election on the SF-2818, Continuation of Life Insurance Coverage as a Retiree or Compensationer. For more information, review the SF-2818 (PDF; 54Kb ) & Instructions (PDF; 318Kb)

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Check any Designations of Beneficiary forms you have on file to be sure that they reflect your current needs. If you have not filed designations of beneficiary for retirement, life insurance, unpaid compensation, or the Thrift Savings Plan, make sure that the normal order of precedence for payments will meet your needs. For more information, go to http://www.opm.gov/insure/life/beneficiary/designate.asp.
 

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Find out if you will be eligible for a Social Security benefit. You should receive a Social Security Statement every year, about 3 months before your birthday. Call the Social Security Administration at (800) 772-1213 or visit their website at http://www.ssa.gov/ to request a Social Security Statement, or to obtain information about Social Security benefits. 

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The Social Security Statement provided by the SSA is not adjusted for the Windfall Elimination Provision, which is a provision of the Social Security law that reduces the Social Security-covered benefits of CSRS retirees. You also may be entitled to benefits based on the Social Security-covered earnings of your spouse or former spouse. However, this benefit may be affected by the Government Pension Offset, another provision of Social Security law, which reduces the Social Security benefit by two-thirds of the amount of your CSRS benefit. To find out more about these Social Security provisions, review the “Windfall Elimination Provision” (SSA Publication No. 05-10045), and the “Government Pension Offset” (SSA Publication No. 05-10007), at http://www.ssa.gov/ or contact Social Security at (800) 772-1213.

When you are within 3 months of age 62 or older, you may contact the Social Security Administration directly to apply for any Social Security retirement benefit you are eligible for, or you may delay your Social Security benefit to a later date. You can apply for benefits at the SSA website, by calling (800) 772-1213, or by visiting your local Social Security office.

When you are within 3 months of age 65 or older, you should contact the Social Security Administration to apply for Medicare benefits. For more information on Medicare, call 1-800-MEDICAR (1-800-633-4227) visit their website at www.medicare.gov, and read the pamphlet RI 75-12,The FEHB Program and Medicare.

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Have you determined whether you or your spouse will need long term care insurance? Call 1-800-LTC-FEDS (1-800-582-3337) or visit http://www.LTCFEDS.com for information and applications. 

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If you are enrolled in FSAFEDS, have you reviewed your Flexible Spending Account to ensure that you will be able to spend your account on eligible expenses prior to your retirement date? Your eligibility for the Flexible Spending Account ends when you retire. Go to http://www.FSAFEDS.com or call 1-877-FSAFEDS (1-877-372-3337) if you have any questions about your account or eligible expenses. 

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Review your Thrift Savings Plan (TSP) withdrawal options by visiting TSP's website, http://www.tsp.gov , which has a calculator to estimate your TSP annuity. When you retire, you will receive a TSP Withdrawal Package from Human Resources. You may not submit the TSP withdrawal forms to the TSP Service Office until at least 30 days after you have separated from Federal service. 

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If you have a TSP loan that has not been repaid, you cannot continue to make TSP loan payments after you have retired. You may repay the loan in full, or the TSP will notify the IRS that you have received a taxable distribution.

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If you have not already done so, obtain information about Federal and, if applicable, State taxation of your annuity and other income. 

If you do not submit a W-4 or W-4P Federal Tax Withholding form with your retirement application, Federal tax will be withheld from your annuity payments as though you are a married individual claiming three withholding allowances. You may make changes after your retirement according to instructions you will receive from the Office of Personnel Management. 

OPM provides a Federal Tax Withholding calculator at their web site:
http://apps.opm.gov/tax_calc/withhold_calc/index.cfm 

Although Federal civilian retirees are not taxed on the part of the annuity that represents their own contribution, the rest of the annuity is taxable, including disability retirement benefits. The Internal Revenue Service Publication 721, Comprehensive Tax Guide to U.S. Civil Service Retirement Benefits, explains the taxation of Federal retirement benefits, and is available by calling the IRS at 1-800-829-1040, or at their website, http://www.irs.gov

The following calculator may be helpful when you need to calculate the tax-free portion of your annuity when you file your taxes the years after you retire: http://apps.opm.gov/tax_calc/index.cfm 

State tax withholdings may be made if your State participates in the withholding program administered by OPM. Participating jurisdictions are: Arkansas, Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Georgia, Idaho, Indiana, Iowa, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Rhode Island, South Carolina, Utah, Vermont, Virginia, West Virginia, and Wisconsin. You will receive instructions from OPM after you retire regarding how to start or change state tax withholdings.

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What other sources of income will you have in retirement? Make sure to obtain current information about expected income from other sources when you are making your retirement plans. How much do you need for retirement? Visit Federal Ballpark Estimate , http://www.choosetosave.org and http://www.mymoney.gov for a variety of free financial planning tools which may help you determine how much income you may need to maintain a comfortable lifestyle in retirement.




(For employees of USDA Marketing and Regulatory Programs and the Merit Systems Protection Board)

 



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