Busting Common Retirement Myths

March 21, 2022 on ForYourBenefit, host Bob Leins, CPA® welcomes Tammy Flanagan, Senior Benefits Director, NITP.

“I believe legends and myths are largely made of truth.” – J.R.R. Tolkien

Today’s show will tackle some of the current urban myths that frequently circulate in pre-retirement seminars and among Federal employees who have heard these stories from a friend of a friend or they may have even read about them somewhere. Here are some that you may have heard:

Retirees need 70% to 80% of their current income in retirement.
Maxing out your Thrift Savings Plan is all you need to do to save for retirement.
At retirement, your investments should become very conservative.
If you have coverage under the Federal Employees Health Benefits Program, there’s no need to enroll in Medicare when you turn 65.
Only those people in good health should consider a high deductible health plan.
You can’t count on Social Security for your retirement years.
Those who retire in 2022 will receive the 2022 COLA in their January 2023 retirement benefit payment.
For those who retire after the January 2022 annual General Schedule pay adjustment takes effect, their high-three average salary used to compute their CSRS or FERS retirement benefit will reflect this new rate as one of the three years.
If an employee dies before retirement, the benefits available to his or her survivors come only in the form of lump-sum payments.
Federal retirees cannot receive Social Security spousal or widow’s benefits.
For questions or comments, email us in advance at ForYourBenefit@nitpinc.com