Top retirement tip: Have a cash stash.

If you’re an American male 5’7” weighing 197 pounds or a 5’4” female weighing 170 pounds, AND plan to retire at age 64 and 62 respectively, that makes you average.

So what? And why?

Because hardly anybody fits the exact dimensions of the average person. And that’s particularly important when planning to retire. Especially if you are retiring from the federal government. And after a long career that may include military service, or a break in service either to have or raise a child or children. And if your career included service in a number of different federal agencies. Most people who are planning to retire are awaiting their first full annuity payment, or have already retired knowing there is a backlog. Lots of reasons for it. Some of the delay is caused at your agency level, some at OPM. It’s not yet a 100% high tech procedure. Some files are still on paper and must be gathered and transported.

And while there is an “average” wait time for that first full check (or in some cases any payment), the problem for you is that you are not average. The payment could come in weeks or be delayed for months. If months, in most cases, you won’t have an income unless you are also getting or due Social Security. You may have to dip into your TSP account long before you planned. Or tap savings that are for a rainy day, if it’s been raining since you retired. The landlord and the car payment won’t wait, especially as we come out of COVID and things start to resemble life before March 2020. The pros differ on how much anyone, average or not, needs in that emergency cash fund. But you can (and should) work that out. Sooner rather than later. You hope for the best and plan for the worst.

So how bad could it be? Check out this from an email we got from a fed who retired Dec. 31, 2020. He contacted me in February, then. Still nothing. Then check out this very recent update he sent last week:

“Hi Mike,

I liked your recent (December 2020) article on the retirement backlog. But unfortunately it’s much worse than what you wrote. At least for me. For example, but unfortunately it’s much worse than what you wrote.

After 35 plus years as a Fed, I retired end of December. I was warned about OPM, in fact USDA which processes DHS payroll has their own 45 day backlog. So I was prepared for the wait. However my preparation included the 383 hours of unused annual leave. I was told that the payment would be end of January to February 12th. Well as of 2/12 I not only do not have the money, I have no assurance as to when it will arrive. Others have received their payments but I’m told to be patient. Too many people retired on the same date that there is a delay.

What I did get was a letter from HR saying that the backlogs at USDA and OPM could mean I will not get interim payments for 6-12 MONTHS. The letter says they understand the extreme hardship this puts on the retiree and that they were doing everything they could to speed up the process. It also says that these other agency delays will not stop payment of the unpaid annual leave. I guess they forgot to mention their own backlog.

In researching, I cannot find anything on a date the annual leave must be paid by. There also is nothing about paying interest. The real lesson here is once you retire you have no power and it’s easy to just say sorry we are working on it please be patient.

Thanks for all the articles through the years.”

UPDATE:

“Retired 12/31/2020. My retirement package finally made it to OPM from USDA National Finance Center on 4/5/2021. I thought that meant interim payments soon. Stupid me. More delays. My case as of this morning (4/23/2021) is still not in active status. That means no one has been assigned. They can escalate after 6 weeks. So nothing can be done until 5/17/2021. So 138 days to even get to the point of escalation. Ouch!!!! I retired as a GS-15 step, well that doesn’t matter since I hit the ceiling. Anyway, I can pay my bills but what if I retired as a GS-9? Anyway, already on plan B, maybe a congressional inquiry will help.

Also, any idea what happened to the briefing Rep. Gerry Connolly (D-Va.) asked for from USDA? I retired to Las Vegas (from Northern Virginia) so he’ no longer my congressman and you can’t send anything to them if you’re not in their district?”

Nearly Useless Factoid

By Adrian Dannhauser

The English language owes a great debt to playwright Shakespeare. He invented over 1,700 common English words by changing nouns into verbs, changing verbs into adjectives, connecting words never before used together, adding prefixes and suffixes, and constructing words wholly original.

Source: Shakespeare Online

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THRIFT SAVINGS PLAN TICKER

Dec 06, 2021 Close Change YTD*
L Income 23.2749 0.0534 4.32%
L 2025 12.0495 0.0532 7.70%
L 2030 42.6371 0.2567 9.58%
L 2035 12.8165 0.0845 10.38%
L 2040 48.5420 0.3486 11.19%
L 2045 13.3063 0.1023 11.85%
L 2050 29.1714 0.2393 12.55%
L 2055 14.3728 0.1467 15.21%
L 2060 14.3727 0.1466 15.21%
L 2065 14.3726 0.1466 15.20%
G Fund 16.7198 0.0021 1.26%
F Fund 20.9605 -0.0656 -1.14%
C Fund 69.2546 0.8053 23.16%
S Fund 81.8771 1.173 11.80%
I Fund 37.9805 0.2575 6.04%
Closing price updated at approx 6pm ET each business day. More at tsp.gov
* YTD data is updated on the last day of the month.