In what’s become the administration’s evergreen budget plan, the White House has again proposed that federal workers kick in more of their salary toward their retirement plan in return for smaller lifetime annuities that are frozen when they retire.
Most people stop looking forward to birthdays after they first become eligible to drive, or vote.
NARFE president Ken Thomas says last year’s White House budget proposal “breaks promises to both current and future retirees.”
The decision to pull the plug depends on the job, your family situation, health, financial goals and, maybe, whether you’re a glass-half-full versus glass-half-empty type.
Some experts in retirement planning believe that many feds with memories of the Great Recession of 2008-2009 are working longer than they have to.
But the one way to anger many feds is to tell them or remark that they are lucky to have such a good pension — then stand back.
Many people decided to ride out the Great Recession so they could miss the downside and return to the TSP’s C, S and I stock funds when things got better. Eleven years later, some still haven’t returned.
While your income will likely go down in retirement, moving to a more tax-friendly state could increase the cash value of your annuity.
Federal workers this month are getting a 3.1% total pay and federal-postal retirees are getting a 1.6% cost of living adjustment.
To protect their annuities from the ups and downs of the stock market, many active and most retired federal-postal workers have a major chunk of their Thrift Savings Plan account in the Treasury securities G fund.