Once you are eligible to retire from the government, life gets better. Lots of people, even those who keep working, say there is great comfort in knowing that you can leave anytime.

Once actually retired it (supposedly) gets even better. Sleep late. Live where you want (and can afford.) No more office uniform. Your dress code is, whatever…

Most of those pesky and substantial payroll deductions go away when you start getting an annuity.

Health insurance coverage is forever, and you will pay the same premiums (and join the same plans) as the youngest, healthiest worker. And Uncle Sam will continue to pay the lion’s share of the total premium.

Most retirees have the luxury of not having to listen to morning and evening rush hour status updates on the radio. Cost of living adjustments guarantee that you will keep up with inflation as measured by the government. Remember the 5.8 percent COLA a few years back? Sweet!!

The debate about the big BRAC moves in the Washington area, with its impending traffic tsunami, is largely academic for retirees.

But before you strike up the violins be advised that real wrinkles aren’t the only wrinkle in retirement:

• First, it seems to take forever for many retirees to get their first full annuity check. Many are getting interim (partial) payments for 6 months. Some say it has taken, or took longer.
• COLAs are contingent on inflation. Unless living costs rise by a certain level during a certain time period there is no COLA. Retirees found that out when (thanks in part to deflation and living costs actually dropped) they didn’t get an increase in January 2009 or 2010. They are on track for a raise in 2011, but it isn’t a done deal.
• Health insurance premiums continue to go up each year. Although the government pays most of the premium, many retirees feel the pinch especially with their reduced income and lack of COLAs.

Rules Change

A growing number of retirement-eligible feds are wondering if they should bail out now before Congress changes retirement rules. Like tossing the high-3 rule and instead basing annuities on the employee’s highest 5-year average salary. The so-called High-5 Monster hasn’t been introduced in Congress. Yet… But it is only a matter of time.

A number of retired feds have also expressed concern that Congress might go after their benefits. That is, somehow change the rules even for people who are long retired. It seems like a long shot, but the fact that people are seriously worried about it says something about the times.

The high-5 Monster isn’t here yet. And chances are you would probably have plenty of time to get out of its way. Probably.

It is highly unlikely that Congress would change the rules (and benefits) for people already retired. But not impossible.

Update/Alert

Meantime here’s an update from Dan Adcock, legislative director of the National Active and Retired Federal Employees Association:

“Two proposals made by the President’s Fiscal Commission would affect all current federal retirees and survivors. They both continue to receive serious consideration during the budget process. In addition to these plans, a cancellation or delay of the Civil Service Retirement System and Federal Employees Retirement System cost-of-living adjustment (COLA) is a possibility.

• “Even more disturbing is the report’s plan to require federal employees and annuitants to pay an increasingly higher share of Federal Employees Health Benefits Program (FEHBP) premiums by limiting growth of the government/employer share to the Gross Domestic Product (GDP) plus 1 percent — merely cutting federal spending by shifting costs to enrollees. Given that increases in FEHBP premiums are likely to outpace the percentage increase in the GDP plus 1 percent, workers and retirees would be forced to pay a higher percent of the premium each year to the point where many could no longer afford health insurance.
• “In addition, the co-chairs’ proposal to use the so-called ‘Chained’ Consumer Price Index for All Urban Consumers (C-CPI-U) to set COLAs for Social Security (and other indexed benefits) has been estimated by the Congressional Budget Office to lower Social Security benefits by 3 percent after a 10-year period and would likely result in a similar reduction to federal civilian and military retirement COLAs. Rather than adjust the COLA to reflect the disproportionately higher health care costs paid by older Americans, the co-chairs’ proposal to use the C-CPI-U would further erode federal annuitant inflation protection.”

So don’t worry, be happy! But stay tuned, just in case…and check out NARFE.org for the latest in retirement-related legislation.

Long Term Care

So who needs it? And when? If so, how much and from whom?

Tomorrow at 10 a.m. experts from Long Term Care Partners will be our guests on the Your Turn with Mike Causey radio show. During the current open season feds can sign up for LTC and be required to meet only minimum underwriting requirements (meaning fewer medical-condition questions). LTCP handles the federal program but workers are also eligible to buy coverage (anytime) from outside companies. So what’s the best deal for you? And what questions do you have? Send them to me and I’ll ask the experts on the show. I’m at: mcausey@federalnewsradio.com

Nearly Useless Factoid
by Suzanne Kubota

According to SmithsonianMag.com, biologists “using high-speed and X-ray photography calculated the chameleon’s tongue speed to be 13.4 miles per hour.”

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