Agency Spotlight–FBI Worker Injuries/Conditions

conditionsTo conclude our series on the Federal Bureau of Investigation, we’ll look at some common ways an FBI worker can get injured during work. FBI employees often engage in dangerous work, particularly their work environments and dealing with people of special investigation. The nature of their job puts them at a significant risk for intentional violent injuries. Below are a few clients we have helped/are helping.

Investigative Specialist

A person in this position uses a variety of equipment and must infiltrate businesses or homes without being detected. They must follow subjects unnoticed, collect and disseminate intelligence, organize surveillance teams, and offer advice to Special Agents.

This particular client is part of FBI’s elite Special Surveillance Group. This group is tasked with conducting physical surveillance of FBI targets of investigations. His conditions include:

  • Cauda Equina Syndrome—an extreme version of never compression or inflammation in the lower part of the spinal canal, and considered a surgical emergency if left untreated because it can lead to permanent loss of bowel and bladder control and paralysis of the legs.
  • Neurogenic bladder and bowel
  • Severe lumber Disc Degeneration
  • Spinal stenosis
  • Dysesthesias in the right foot—an abnormal sensation caused by lesions of the nervous system (peripheral or central) and involves sensations such as burning, wetness, itching, electric shock, and pins and needles.

Due to these conditions, he is no longer able to stand, sit, or walk for more than 10 minutes without severe pain, numbness, or weakness. He loses his balance. He is unable to climb more than 15 steps. Applying self-defense and driving techniques is near impossible. He is also unable to “run from a hazardous situation”.

Operational Support Technician

A worker in this position performs data analysis on phone records, maintain case documents, conducts physical surveillance related to national security and criminal investigations, and helps Special Agents and Intelligence Analysts.

This person is suffering from cervical herniated discs, bulging lumbar discs, Fibromyalgia, generalized anxiety, and thyroid disease. Because of these conditions, she is no longer able to carry heavy items, limited to desk work such as typing, however, she is unable to sit for prolonged periods of times, including while driving.

Special Agent

This persons’ job is to investigate crimes and enforce laws, interview suspects, participate in raids, arrests, search warrants, and other dangerous activity. They are likely involved in investigations of large scale criminal activities such as organized crime, drug trafficking, terrorism, and cybercrime. The position is on duty 24/7.

This client is suffering from failed inguinal hernia mesh repairs. This occurs when tissue, such as part of the small intestine protrudes through a weak spot in abdominal muscles, resulting in chronic pain.

He has difficulty standing, sitting up, and walking. He cannot move with ease, run, jump, or engage a subject due to his lack of mobility.

Supervisory Program Analyst (Unit Chief)

A person in this position is responsible for:

  • Supervising the development of complex studies
  • Analyzing staff activities related to long-term planning
  • Determining goals and objectives in their unit
  • Preparing reports on management initiatives and studies the overall coordination of the allocation of resources
  • Directing and monitoring the progress of administration activities
  • Coordinating and facilitating the processing of all administrative issues such as staffing and recruiting
  • Managing and overseeing workforce management, intern program, HR management, auditing, and inventory management
  • Receiving and resolving a variety of complex employee matters
  • Preparing and presenting briefs to FBI management

She is suffering from:

  • Lumber facet arthroplasty—degeneration and arthritis in that part of the back
  • Lumber facet disease
  • Sacroiliitis—inflammation of one or both sacroiliac joints (where the lower spine and pelvis connect)
  • Migraines

Because of these conditions, she can no longer have great attendance at work, which is required by supervisors, sit, or stand for long periods of time, or concentrate or focus due to the chronic pain.

If you are an FBI employee who has found you can no longer perform the duties of your job because of your medical condition, you may qualify for federal disability retirement. We offer FREE consultations, so please don’t hesitate to reach out to us. Call us at 877-226-2723 or fill out this INQUIRY form.

Tagged , , , , ,

New Ways to Measure Future COLA’s?

measure

The 2018 Cost of Living Adjustment is set using the Bureau of Labor Statistics CPI-W index, however, there are other possibilities for making the adjustment in 2019 and beyond. The BLS has several measures of inflation. The CPI-W is one of the oldest for making COLA’s for federal retirees, Social Security recipients, and others.

The CPI-W measures goods and services purchased by hourly wage earning or clerical workers, which applies to a smaller and smaller percentage of the population. Congress has pushed for an alternative method of computing COLA’s. Below are a few options.

CPI-U

The BLS produces another major index called the Consumer Price Index for All Urban Consumers (CPI-U). This includes expenditures by urban wage earners and clerical workers, professional, managerial, and technical workers, self-employed, short-term workers, unemployed, retirees and others not in the labor force.

This index is most often cited when talks of inflation occur because it reflects a much larger share of the U.S. population than the CPI-W. The CPI-W and CPI-U closely followed each other for the 12 months ending in July. The CPI-U rose 1.7 percent, while the CPI-W rose 1.6 percent.

Moving to this index may be less controversial than others.

CPI-E

The BLS also produces a monthly index focused on the purchasing habits of the elderly (CPI-E). It tends to rise faster than the two mentioned above. It measures the average change in prices over time for a fixed market basket of goods and services for Americans age 62 or older.

The National Active and Retired Federal Employees Association (NARFE) has advocated for the use of the CPI-E. Richard Thissen, president of NARFE, said,

“The fact that we do not use the CPI-E already is shocking. Instead, COLA’s for seniors collecting Social Security and federal civilian or military retirement benefits are based on costs experienced by ‘urban wage earners and clerical workers’, not upon the costs retired individuals experience. And that does not make a lot of sense. Worse yet, it is costing seniors, including federal civilian and military retirees, precious dollars every year. The 2019 COLA was 0.3 percent, and the year before, there was no COLA at all. Yet, over these 2 years, the actual cost of living incurred by seniors increased by 2.7 percent—2.1 percent in 2016 and 0.6 percent in 2015. That is what seniors should have received and that is what this bill would provide them. For the average federal annuitant, that would have meant an increase of approximately $950 per year.”

Currently, the BLS says that the CPI-E has methodological limits which make it unreliable as a substitute for CPI-U or CPI-W. With more funding, the CPI-E could develop into a statistically reliable index.

C-CPI-U

A more controversial measure of inflation, known as the Chained CPI (C-CPI-U), is designed to mathematically “use expenditure data in adjacent time periods to reflect the effect of any substitution that consumers make across item categories in response to changes in relative prices. The new measure is designed to be a closer approximation of ‘cost of living’ index than existing BLS measures”, according to the BLS.

This index gets closer than other indexes by better reflecting how consumers react to changing prices. An example is if the price of pork increases while the price of chicken doesn’t, consumers may shift away from pork to chicken. The C-CPI-U accounts for this type of substitution between CPI item categories.

The BLS has determined that the C-CPI-U tends to show a lower inflation rate than other indexes. For this reason, NARFE has opposed using the C-CPI-U in calculating federal retiree COLA’s because lower COLA’s would reduce the long-term cost of providing federal retiree and Social Security benefits.

Elimination of the Automatic COLA

“Congress enacted the COLA provision as part of the 1972 Social Security Amendments, and automatic annual COLA’s began in 1975. Before that, benefits increased only when Congress enacted specific legislation,” according to the Social Security website.

Prior to automatic COLA’s, Social Security benefits were sporadic. Congress moved to an automatic formula because some saw Social Security increases as too generous and others argued they failed to keep up with inflation.

Losing an automatic COLA would mean retirees would have to go to Congress each year and compete for funding against other government programs.

Tagged , , , ,

Postal Workers Get a Raise, Less Benefits

postalA new labor contract has formally been agreed to this week that will give more than 200,000 Postal employees a raise. However, those same employees will see a decrease in benefits as well.

The National Association of Letter Carriers, representing 213,000 city mailmen across the country, ratified an agreement it struck with USPS management, to avoid binding arbitration.  NALC members voted 94 percent to 6 percent to accept the contract.

This agreement takes effect retroactively on May 21, 2016, continuing through to September 20, 2019. All city carriers will receive a 1.2 percent pay raise retroactive to November 26, 2016, and 1.3 percent increase effective November 25, 2017. Those on the second level of the 2-grade pay scale will receive a 2.1 percent raise in 2018.

Employees will also receive a series of seven cost of living adjustments throughout the life of the contract.

The non-career employees represented by NALC will see a boost as well. The substitute carriers will receive payments adding up to a dollar per hour over the course of their first year at the Postal Service. They will also earn more generous wage increase than their career counterparts.

The USPS will also start converting non-career employees for at least 30 months to career positions. Those working as letter carriers for at least six years are now exempt from any potential layoffs during the duration of the contract, which also means their work can’t be outsourced.

There is, however, a setback in this agreement; health care plans. The USPS is lowering its contribution toward employee health care plans by three percent through 2019. Even with this, the USPS will pay a maximum of 76 percent of any given plan, while the top contribution of other agencies caps at 75 percent.

A Postal Service spokeswoman called this agreement a win for all parties. It “addresses important financial and operational considerations of the Postal Service, serves interests of the American public, and is fair to our employees,” she said.

Tagged , , , ,

Recent Headlines from the FBI

fbiBelow are some of the most recent headlines out of the Federal Bureau of Investigation.

Plans to Move FBI Headquarters Halted

The General Service Administration, along with the FBI, have decided to scrap plans to build a new FBI headquarters because of funding gaps. The GSA initially asked Congress for $1.4 billion for the project in FY2017, and only $523 million was appropriated, leaving an $882 million funding gap.

The funding gap made it too risky to pursue the project because it could make the government vulnerable to cost escalations. Further, it would potentially reduce the value of the FBI’s current property, the J. Edgar Hoover building. The GSA had planned to trade the building into a developer for additional funding.

“The cancellation of the project doesn’t lessen the need for a new FBI headquarters. GSA and FBI will continue to work together to address the space requirements of the FBI,” GSA said.

A few Senators/Representatives oppose the move saying it could endanger national security. “This is a decision that will have a major impact on the security of our country. The core missions of the FBI are being compromised by the decision made by the Trump administration today. It puts our homeland security at greater risk, and our national security at greater risk,” Maryland Senator Ben Cardin said.

FBI Director James Comey is Fired

President Trump made a shocking announcement in May by firing Director James Comey. The Trump administration attributed his dismissal to the handling of the investigation into Hillary Clintons’ email server, however, some suggest his firing was because he was getting too close to the White House with the probe into Russian ties.

Law enforcement sources said that Comey learned of his firing from TV, as he was addressing the FBI workforce in Los Angeles.

A signed letter from Trump informed Comey he was “hereby terminated and removed from office, effective immediately” and that he reached the conclusion Comey was “not able to effectively lead the Bureau”. Also in the letter was, “It is essential that we find new leadership for the FBI that restores public trust and confidence in its vital law enforcement mission. I wish you the best of luck in your future endeavors.”

Comey’s term wasn’t due to end until 2023. FBI directors’ tenure is a decade long to shield them from being drawn into politics, however, the position is subject to dismissal at the pleasure of the President.

FBI Arrested NSA Contractor for Allegedly Leaking Classified Information

Back in June, a federal contractor, Reality Winner, who had Top Secret clearance, was charged with “removing classified material from a government facility and mailing it to a news outlet”. Prosecutors said that when confronted with the allegations, Winner admitted to intentionally leaking the classified information.

An internal audit revealed she was one of six people who printed the document but the only one who had email contact with the news outlet.

“Releasing classified material without authorization threatens our nations’ security and undermines public faith in government. People who are trusted with classified information and pledge to protect it must be held accountable when they violate that obligation,” Deputy Attorney General Rod Rosenstein said.

Winner faces up to 10 years in prison if convicted.

Tagged , , , ,

More Losses for the Postal Service

postal

The third quarter of FY2017 saw a $2.1 billion loss for the Postal Service, including $587 million in “controllable losses”. Higher transportation costs accelerated controllable costs. They don’t include their mandatory payments to pre-fund healthcare expenses for future retirees as a controllable expense, which made up the bulk of its remaining losses.

This is a significant increase over last year. Revenue in this quarter stayed about the same as it did this time last year, at $16.7 billion.

Increased losses came from declining mail volume, which is being replaced with costlier shipping businesses. First class mail revenue fell by nearly 7 percent. The agency must gain $2 in shipping revenue to offset every $1 in lost mail revenue.

Postmaster General Megan Brennan noted that the USPS’ pricing system is “fundamentally unsuited” for the current market because it fails to account for changes in volume/cost. She said, “Our financial situation is serious but solvable. The continuation of aggressive management actions and legislative and regulatory reform will return us to financial stability and enable the Postal Service to maintain the long-term affordability of mail, invest in America’s mailing and shipping industry and best serve the American public.”

The National Association of Letter Carriers noted that USPS would have turned a profit of $1.5 billion if the Postal Regulatory Commission hadn’t forced them to roll back an emergency price hike instituted in 2014. That was only the second time ever, and the first time in 97 years, that the agency decreases the price of stamps.

“Addressing these external financial burdens would allow USPS, which is based in the Constitution and which enjoys broad public and political support, to continue providing Americans and their businesses with the industrial world’s most affordable delivery network,” said NALC President Fredric Ronaldo.

The PRC, an independent panel that oversees USPS, will conclude its 10-year review of the Postal Services rate setting system soon. They will likely give postal management freedom to raise the cost of postage stamps beyond the rate of inflation. A final decision is expected next month. Postmaster General Brennan said, “we’re clearly looking for the PRC to establish a new pricing system for us. From a financial perspective, the Postal Service continues to face strong financial headwinds.”

She also said, “This year, we’re seeing an acceleration in first class volume decline, so this dynamic puts even more financial pressure on the organization, given that our first-class mail pays our bills and defines our network requirements.”

The agency also warned it will likely default on $6.9 billion in future retiree health benefits for the fifth year in a row. According to a Government Accountability Office report, the USPS has more than $120 billion in unfunded liabilities, mainly for retiree health and pension benefits. That same report also said that if Congress expects the Postal Service to pay for the same level of benefits for its retired employees, it ultimately puts American taxpayers at risk of needing to bail out the organization.

“Large unfunded liabilities for postal retiree health and pension benefits—which were $78.9 billion at the end of FY2015—may ultimately place taxpayers, USPS employees, retirees and their beneficiaries, and the USPS itself at risk. If GAO wants these benefits to be maintained at current levels, funding from the U.S. Treasury, and hence the taxpayer, would be needed to continue the benefit levels. Alternatively, unfunded benefits could lead to pressure for reductions in benefits or in pay. Thus, the timely funding of benefits protects USPS employees, retirees, beneficiaries, taxpayers, and the USPS enterprise,” GAO said.

Tagged , , , ,

Why the Slow Processing Times at OPM?

processing

Some officials at the Office of Personnel Management attributed a slowdown in the processing times of retirement claims to the hiring freeze that occurred earlier this year.

July saw an increase in the number of retirement claims—10,070 up from 6,141 in June. This brought the backlog of claims up to 17,091, an increase of 18 percent over June. Before last month’s influx, OPM was making progress on its inventory, with the backlog steadily decreasing since February. (13,000 is considered a steady state)

However, the percentage of claims processed within 60 days since the beginning of FY2017 (October 2016-September 2017) lagged behind the rate of previous years. Last month, only 55 percent of claims in that time had been processed within 60 days, compared to 79 percent a year ago.

A spokeswoman at OPM said that one factor in the slowdown was the hiring freeze earlier this year. “The hiring freeze did impact the percentage of claims processed within 60 days. Retirement Services has mitigated the impact of staff shortages in the retirement claims process by implementing process improvements and working with agencies to improve the quality and timeliness of their submissions,” OPM said.

They also said there are procedures in place to ensure retiring federal employees don’t feel the brunt of government issues. One of these procedures is retirees are placed in an “interim pay status” within 5-7 days of OPM receiving their claim. From then until the claim is fully processed, the retiree receives an estimate of what their post-employment annuity will be based on final salary and length of service. Generally, the estimate equals about 80 percent of their final retirement pay.

Representative Gerry Connolly (D-VA) called this lag “unacceptable” and linked it to lack of agency leadership. He said, “It’s troubling that the percentage of retirement claims processed within 60 days is trending in the wrong direction compared to last year. Continued backlogs are unacceptable. This issue needs the attention of OPM leadership and highlights the importance of having a Senate confirmed director and deputy director in place to help address the problem.”

OPM also has said, “RS has the authority and flexibility to address workload spikes, including the ability to move qualified employees to areas of greatest need. However, our ability to maintain desired processing time will depend upon the extent of the increase in the number of cases received.”

They also noted that some cases just take longer than others because they involve “more complicated situations that may require additional information from agency or employee”.

Tagged , , , ,

Branches of the FBI–Part 3

science

Science and Technology Branch

Established in 2006, this branch uses advanced scientific techniques and operational techniques to help counter terrorism and criminal threats. Workers in the branch are experts in areas such as biometrics, forensic science, and tactical operations.

Mission

Their mission is to support the FBI mission by discovering, developing, and delivering innovative science and technology capabilities that enhance intelligence and investigative activities.

Vision

Be the premier provider of applied science and technology capabilities.

Forensic Science

FBI’s scientists, lab technicians, engineers, and forensic examiners perform the following:

  • Biometric Analysis—provide accurate, complete, and timely forensic analysis, including reporting, training, testimony, and technical support for latent print and DNA exams.
  • Scientific Analysis—provide accurate, complete, and timely forensic analysis, including reporting, training, testimony, and technical support for cryptanalysis, chemistry, firearms/tool marks, questioned documents, and trace evidence exams.
  • Operational Response—Identifying, documenting, and safely collecting, preserving, transporting, and exploiting evidence—which can include chemical, biological, radiological, or nuclear materials—from crime scenes within the U.S. or abroad.

Operational Technology

The following are some of the services provided by this branch to ensure national security:

  • Digital forensics—collecting and examining digital evidence gathered from computers, audio files, video recordings, images, and portable electronic devices.
  • Electronic surveillance—developing and deploying tools to perform lawfully authorized intercepts of wired/wireless telecommunications and data network communications
  • Tactical Operations—deploying tools, systems, and equipment used in covert searches.

Information Sharing

The following are a few types of information sharing by the Science and Technology Branch:

  • Crime reporting—collecting and publishing crime statistics from nearly 18,000 law enforcement agencies.
  • Biometrics—expanding traditional law enforcement tools such as fingerprint identification to new forms including palm prints, iris, and voice and facial patterns.
  • Criminal background checks—network of databases including federal/state records for use by law enforcement during investigations and arrests.
Tagged , , , , ,

Avoid These Costly TSP Mistakes

mistakesThe Thrift Savings Plan is one part of the Federal Employees Retirement System, so it’s an important part of your retirement income. The following are mistakes you should avoid when it comes to your TSP account.

Not Updating Beneficiary Forms

This can have surprisingly large consequences. These beneficiary forms override any beneficiary designation stated in your will. If you haven’t updated these forms and you pass away, TSP pays out in the following order:

  • Spouse
  • Child/children equally, and descendants of deceased children
  • Parents equally or surviving parent
  • Appointed executor or administrator of your estate
  • Next of kin entitled to your estate under state laws in which you resided at the time of your death

If you haven’t selected a beneficiary but want to change who it is, submit a new form (TSP-3) and that one supersedes any previous forms.

Contribution Mistakes

If you want to change your existing TSP allocation, do an Inter-Fund Transfer. To change how your contributions are going into your TSP, do a Contribution Election change. And to change your existing TSP allocation and your contribution election, do both. The mistake here is most people who want to change how their money is allocated only do a contribution election.

Not Taking Responsibility of your TSP

The TSP is unlike your CSRS/FERS annuity in that there isn’t a magic formula for knowing what your benefit will be at retirement. You determine how much you contribute (up to the IRS limits), what’s best; a Traditional TSP, Roth TSO, or a combination, and how your TSP funds should be allocated based on your comfort level.

Having an Outstanding Loan at Retirement

If you leave federal service with an outstanding loan balance, you have the option to pay it back within 90 days of the date of your separation. If not paid back within those 90 days, the IRS will declare it as a taxable distribution. You also may be subject to the IRS 10 percent early withdrawal penalty unless you’ve separated from service in the calendar in which you turn 55 or older.

Not Keeping Money in Your TSP After Retirement

If you rollover all your TSP funds to an IRS and later decide you want to roll them back to the TSP, you won’t be able to. Be sure to leave some money (minimum of $200) in your TSP if you do a rollover to an IRA, just in case you ever decide to roll them back to the TSP.

Transferring to an IRS Before Age 59 ½

If you retire at age 55 or later and need to access your TSP, there will not be an early 10 percent withdrawal penalty. However, withdrawals taken from an IRA prior to age 59 ½ will be subject to the 10 percent penalty. If you are transferring to an IRA, make sure to leave enough in your TSP to cover any withdrawals needed prior to age 59 ½.

Not Contributing to the Roth TSP

Be proactive in the tax planning and take advantage of the Roth TSP. If you are a federal employee eligible to contribute to TSP, you’re also eligible to contribute to the Roth TSP. A Roth allows you to pay tax on the starting investment.

Also, keep the following in mind when choosing a Roth TSP:

  • You pay tax now in today’s known tax environment
  • Most people have fewer deductions in retirement
  • Most other retirement income sources are taxable

Planning for retirement takes just that; planning. The TSP plays a vital part in your retirement years. It’s important to do your research and fully understand the rules and regulations regarding your TSP. Doing so will help you avoid most, if not all, of these mistakes and maximize your investment.

Make sure to check out more costly mistakes by clicking the link below.

Costly Thrift Savings Plan Mistakes to Avoid

Tagged , , , ,

Branches of the FBI–Part 2

branch

In the first part of this series, we took a look at four of the six branched within the FBI: the National Security Branch, the Information Technology Branch, the Criminal, Cyber, Response, and Services Branch, and the Human Resources Branch. This post will look at the Intelligence Branch.

Intelligence Branch

This branch oversees intelligence policy and guidance. They ensure that the FBI’s intelligence production remains objective and strikes the correct balance between strategic and tactical work. The intelligence branch is responsible for all intelligence strategy, resources, policies, and functions.

“Intelligence” is defined as information that has been analyzed and refined so it’s useful to policymakers in making decisions, specifically about potential threats to national security. The FBI and other organizations that make up the U.S.  intelligence community use the term “intelligence” three different ways:

  • A product that consists of information that has been refined to meet the needs of policymakers.
  • The process through which information is identified, collected and analyzed.
  • Refers to both the individual organizations that shape raw data into a finished intelligence product for the benefit of decision makers and the larger communities of these organizations.

The Intelligence Cycle

The FBI uses the Intelligence Cycle for developing unrefined data into polished intelligence for the use by policymakers. It consists of 6 steps:

  • Requirements—identify information needs; what must be known to safeguard the nation. Requirements are developed based on critical information necessary to protect the U.S. from national security and criminal threats.
  • Planning and Direction—management of the entire effort, from identifying the need for information to delivering an intelligence product to a consumer.
  • Collection—gathering of new information based on requirements. Actions used include interviews, technical and physical surveillance, human source operation, searches, and liaison relationships.
  • Processing and Exploitation—converting a vast amount of information collected into a usable form. This is done through encryption, language translations, and data reduction. Processing includes entering raw data into databases where it is exploited for use in the analysis process.
  • Analysis and Production—conversion of raw information into intelligence. This includes integrating, evaluating, and analyzing data, and preparing intelligence products. Information is integrated, put in context, and used to produce intelligence.
  • Dissemination—distribution of raw or unfinished intelligence to consumers whose needs initiated intelligence requirements. The FBI disseminates information in 3 standard forms: Intelligence Information Reports, FBI Intelligence Bulletins, and FBI Intelligence Assessments.

There are various types of intelligences—military, political, economic, social, environmental, health, and cultural. The FBI uses 5 main ways of collecting intelligence, collectively referred to as intelligence collection disciplines, or INT’s.

  • Human intelligence—(HUMINT)—the collection of information through human sources. Within the U.S., this is the FBI’s responsibility, outside the U.S. the CIA generally conducts this.
  • Signals intelligence—(SIGINT)—electronic transmissions collected by ships, planes, ground sites, or satellites.
  • Imagery intelligence—(IMINT)—sometimes referred to as photo intelligence (PHOTINT), it involves designing, building, and operating imagery satellites.
  • Measurement and Signatures intelligence—(MASINT)—concerns weapons capabilities and industrial activities. Its primary use is to help identify chemical weapons or pinpoint specific features of unknown weapons systems.
  • Open source intelligence—(OSINT)—refers to information and sources that are generally available including information obtained from media, professional and academic records, and public data.

The last post in this series will look at the Science and Technology Branch.

Tagged , , , ,

Retirement Phases and Your TSP

phases

When you begin work in the federal government under the Federal Employees Retirement System, your agency automatically sets up a Thrift Savings Plan. Each pay period, they deposit an amount that is equal to one percent of your basic pay into that account. Of course, it is highly recommended that you deposit at least five percent of your basic pay to take advantage of the matching by your agency. It’s important to start depositing money into your TSP as soon as possible. The following will show how waiting to invest in your TSP can affect the different phases of retirement planning.

Early Career

This is the best time to take advantage of investing in your TSP. The best asset available to you at this point is time. Saving for retirement early in your career means you not only have years to save but also, it’s easier to weather any market fluctuations and gain the maximum benefit from compounding.

The table below, from TSP.gov, shows the power of saving as early as you can.

Savings per Month Years of Investing Rate of Return Value at 65
Scenario 1 $200 40 6.0% $400,289
Scenario 2 $200 35 6.0% $286,367

 

As you can see, just waiting 5 years to start saving, as in Scenario 2, significantly decreases your savings at age 65. In fact, using the numbers from the table above, the person from Scenario 2 would have to save $280/month for 35 years to achieve the same results as the person from Scenario 1.

*And if you’re a FERS employee, you should contribute no less than five percent of your salary to your TSP to receive the maximum agency matching contribution.

Mid-Career

If you haven’t started saving, it’s still not too late.

Catch-Up Contributions

If you’ve gotten a late start or maybe you don’t have as much accumulated as you wanted at this point, you can take advantage of catch-up contributions.

  • You must be 50 years or older in the year you plan to make the contributions
  • You must expect to contribute the max amount allowed of regular employee contributions for the year

Remember to do the Following

  • Check your asset allocations
  • Review investment experience and TSP balance
  • Reassess your retirement income needs and investment goals
  • Consider risk tolerance and make any necessary changes to your asset allocation
  • If necessary, increase your TSP contributions

Nearing Retirement

Even though retirement may be just a few years away at this point, it’s still not too late to start contributing to your TSP. And if you have been contributing your entire career, keep doing it as long as you can. Again, you can take advantage of catch-up contributions in this phase, if needed.

Tagged , , , ,