Summer special: Perform your own (financial) autopsy

Have you had your professional mid-life crisis yet? If not, this might be a good time to get it over with, to take stock of where you’ve been, where you are going and what happens when it’s all finished.

If you have regrets about having joined (much less stuck with) Uncle Sam in this age of short-attention span workers, think again. That’s especially true if you have a spouse, children or family you want to provide for while you are working and after you’ve gone. In many cases people with careers are worth more dead than alive, and that can be a good thing. Being a fed makes it better because unlike most American workers today, a career in government means health insurance, life insurance, an inflation-indexed monthly annuity for life and a survivor benefit, also for life. Then there is the low-fee Thrift Savings Plan with a generous 5% match from the boss.

The number of private sector firms offering employees a company pension gets smaller each year. Most now require workers to fund their own retirement with their savings, often from a 401K, and Social Security which was never intended to be the sole source of retirement income but is the sole source for millions.

When I say long-time government workers and retirees are worth more dead than alive, that is not a slur on their character or career, but rather the fact that over a lifetime many people accumulate wealth in a variety of forms. Maybe they have a house or other property, a car or several, insurance, a 401K or Thrift Savings Plan? Maybe they have a survivor annuity that will give their significant other a lifetime stream of income that is designed to keep up with inflation no matter how long he or she lives?

The number of private sector firms offering defined benefit pension plans gets smaller each year. So are the number who offer employees a 401K plan with anything more than a token employer-match.
In an article last year in “MoneyRates,” columnist Dan Rafter wrote, “If you like the idea of having a traditional pension plan, here are five tips on finding jobs that offer pensions: Fortunately, most feds have already done the primary thing which is make a career with Uncle Sam.”

  1. “Consider government work. Eighty-six percent of workers in state and local government jobs have access to a defined benefit pension, compared with just 18% of workers in the private sector.
  2. “Become a public school teacher. While access to traditional pensions is pretty high for government employees in general, it is virtually universal for public school teachers. Ninety-nine percent of primary, secondary and special education teachers in the public school system have access to a defined benefit pension.
  3. “Join a union. Much like traditional pension plans, unions are institutions that have declined in prominence over the past few decades. However, they are still around in some sectors of the economy, and their negotiating leverage can make a difference in gaining union employees more access to pension benefits than non-union employees. Among government workers, 94% of union members have access to a defined benefit pension, compared with 79% of non-union workers. In the private sector, the difference is even more dramatic: 71% of union members in the private sector have access to a defined benefit plan, compared with just 13% of non-union workers.
  4. “Work for a large company. While only 18% of all private sector workers have access to a defined benefit pension, this number jumps to 43% for companies of 500 employees or more.
  5. “Settle in the Northeast. In both the private and public sectors, employees in the Northeast have slightly higher rates of access to pension plans than the national average.

“Traditional pension plans may be something of an endangered species, especially in the private sector. However, you can still find them if you know where to look.”

So far, so good. Most of you reading this have or will have an estate that includes a TSP, a federal annuity, etc. Now what? Do you have a will and if so, what kind? And do you need more?

What about medical directives, a revocable trust — who needs what when? Tune in to our Your Turn radio show today at 10 a.m. EDT. to hear Washington, D.C. attorney Tom O’Rourke talk about what everybody, but especially members of the federal family, needs to know about estate planning. Listen at and on 1500 AM in the D.C. metro area.

Nearly Useless Factoid

By Amelia Brust

The three-position traffic signal, with an intermediate “slow down” speed between “go” and “stop,” and the gas mask were both invented by Garrett Morgan, a son of former slaves with a sixth-grade formal education. Morgan, who also created the Cleveland Call newspaper, patented the gas mask in 1914 and the traffic signal in 1923.

Source: Transportation Department

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