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Thread: The Reality...

  1. #16
    Join Date
    Oct 2004
    Location
    Hot dang...I made the medal stand...
    Posts
    920
    One last thing folks...took TSP two days to send me my monthly check after I submitted the request which is great...but I again want to maybe provide perspective to those close to retirement and those saving for retirement...in short, I am now bringing home more money in retirement than I was when working and I'm drawing down my monthly TSP balance around $800 a month...how does that happen you ask?

    My TSP balance is close to 7 figures and I now, for the time being, have the entire balance in the G fund...income of $1500 a month with a withdrawal of $2300 equals a $800 drawdown monthly...all things being equal...and they aren't...my TSP will run out of money when I am 123...add the $2300 to the pension/supplement payment and I now net $1500 more a month than when working...

    The deductions are drastically reduced in retirement...and I will be in a lower tax bracket...and have more money to spend...until all the kids are in college...so, in my opinion, anyone like me is nuts to be working...

    The very last thing I'd like to share regards tax preparation...former co workers told me they wanted to keep working to have as much as possible in the TSP for their kids upon their death...nuts!...if you want to give money to your kids do it while alive and in retirement...that will allow you to draw down the TSP a little at a time suffering less of a tax hit than waiting til 70 and a half when the IRS makes you take it out and pushes into a sky high tax bracket...and your kids will be growing their retirement accounts over the long haul instead of waiting for you to kick off...

    Talk to a reputable tax and investment advisor to make your plan...CC
    "Every hero becomes a bore at last." Ralph Waldo Emerson

  2. #17
    Join Date
    Mar 2004
    Posts
    1,941
    Quote Originally Posted by Can't Commit View Post
    One last thing folks...took TSP two days to send me my monthly check after I submitted the request which is great...but I again want to maybe provide perspective to those close to retirement and those saving for retirement...in short, I am now bringing home more money in retirement than I was when working and I'm drawing down my monthly TSP balance around $800 a month...how does that happen you ask?

    My TSP balance is close to 7 figures and I now, for the time being, have the entire balance in the G fund...income of $1500 a month with a withdrawal of $2300 equals a $800 drawdown monthly...all things being equal...and they aren't...my TSP will run out of money when I am 123...add the $2300 to the pension/supplement payment and I now net $1500 more a month than when working...

    The deductions are drastically reduced in retirement...and I will be in a lower tax bracket...and have more money to spend...until all the kids are in college...so, in my opinion, anyone like me is nuts to be working...

    The very last thing I'd like to share regards tax preparation...former co workers told me they wanted to keep working to have as much as possible in the TSP for their kids upon their death...nuts!...if you want to give money to your kids do it while alive and in retirement...that will allow you to draw down the TSP a little at a time suffering less of a tax hit than waiting til 70 and a half when the IRS makes you take it out and pushes into a sky high tax bracket...and your kids will be growing their retirement accounts over the long haul instead of waiting for you to kick off...

    Talk to a reputable tax and investment advisor to make your plan...CC
    CC, some questions

    what pay grade and step did you retire at ?

    how much is your SRS Special Retirement Supplement check a year ?

    THANK YOU !!!

  3. #18
    Join Date
    May 2004
    Location
    New York
    Posts
    1,207
    Satpak, I don't know about CC, but my supplement is almost $13K/year and I retired at 13/10. Most of my peers who retired at my same grade and about the same step got about the same amount for their supplement.

  4. #19
    Join Date
    Oct 2004
    Location
    Hot dang...I made the medal stand...
    Posts
    920
    Quote Originally Posted by satpak77 View Post
    CC, some questions

    what pay grade and step did you retire at ?

    how much is your SRS Special Retirement Supplement check a year ?

    THANK YOU !!!
    Retired a 13/10 with a high three very close to $150,000 because I live in a high cost region. Grade, region, and time all influence the amount of your pension/supplement. Your agency has designated HR reps to prepare your anticipated retirement amounts. You call them up and tell them three possible retirement dates and they give you three different amounts based on your anticipated accumulated earnings. And they end up being pretty darn close. My generally round numbers resulted in a gross pension/supplement close to 72k. After medical insurance deductions, spousal annuity deductions, and fed, state tax deductions, the amount is sizeably less at 57k. Still, throw in the TSP withdrawals as explained above and I'm netting more now than when working AND following a smarter income tax strategy. And listen, this is perfect for my situation, a very particular situation. Which is why it might not be good enough for anyone else.

    As smart as you have to be to be an 1811 I still get deer in the headlight looks from folks when I try to explain the reality of money to them. We do an awful job in this country of explaining money and finance to...I don't know...everyone.

    Before I finish I will leave this idea to consider...

    The Savings and Loan Crisis resulted from the feds deciding everyone should be allowed to start a lending institution. The housing crisis resulted from the feds deciding everyone should own a house. The college tuition crisis, now resulting in over a trillion dollars in student debt for which the government will certainly be held to pay for, resulted from the feds deciding everyone should go to college. Whenever the feds start a policy with the word "everyone" your money will be impacted...

    Right now the US stock market is near an all time high while interest rates are at a near all time low and production is tepid at best and central bankers are printing and printing and printing. And central bankers around the world have decided to charge people to lend their countries money. Um, this has never happened before. It appears the fed and others have decided that everyone should have more money. When you make more of something it inherently becomes worth less...CC
    "Every hero becomes a bore at last." Ralph Waldo Emerson

  5. #20
    Join Date
    Mar 2004
    Posts
    1,941
    Quote Originally Posted by Can't Commit View Post
    Retired a 13/10 with a high three very close to $150,000 because I live in a high cost region. Grade, region, and time all influence the amount of your pension/supplement. Your agency has designated HR reps to prepare your anticipated retirement amounts. You call them up and tell them three possible retirement dates and they give you three different amounts based on your anticipated accumulated earnings. And they end up being pretty darn close. My generally round numbers resulted in a gross pension/supplement close to 72k. After medical insurance deductions, spousal annuity deductions, and fed, state tax deductions, the amount is sizeably less at 57k. Still, throw in the TSP withdrawals as explained above and I'm netting more now than when working AND following a smarter income tax strategy. And listen, this is perfect for my situation, a very particular situation. Which is why it might not be good enough for anyone else.

    As smart as you have to be to be an 1811 I still get deer in the headlight looks from folks when I try to explain the reality of money to them. We do an awful job in this country of explaining money and finance to...I don't know...everyone.

    Before I finish I will leave this idea to consider...

    The Savings and Loan Crisis resulted from the feds deciding everyone should be allowed to start a lending institution. The housing crisis resulted from the feds deciding everyone should own a house. The college tuition crisis, now resulting in over a trillion dollars in student debt for which the government will certainly be held to pay for, resulted from the feds deciding everyone should go to college. Whenever the feds start a policy with the word "everyone" your money will be impacted...

    Right now the US stock market is near an all time high while interest rates are at a near all time low and production is tepid at best and central bankers are printing and printing and printing. And central bankers around the world have decided to charge people to lend their countries money. Um, this has never happened before. It appears the fed and others have decided that everyone should have more money. When you make more of something it inherently becomes worth less...CC
    Quote Originally Posted by Chaser199 View Post
    Satpak, I don't know about CC, but my supplement is almost $13K/year and I retired at 13/10. Most of my peers who retired at my same grade and about the same step got about the same amount for their supplement.
    Excellent points, thank you. I agree, I have self-studied personal finance and the ins/outs of the TSP, and wanted to get the "real world" 2016 SRS amount. Yes, 1811's by default are all college degree folks, but sadly a lack of knowledge (a severe one) exists as to the TSP, retirement in general, etc etc. At my agency, they are putting together GREAT retirement seminars, thankfully, but my opinion is that overall, a severe lack of knowledge exists across all agencies.

    Not sure if anyone has seen the same

    EDIT: Question for retired folks: Is you FEHB Federal Health insurance cost the same in retirement versus on-duty ? I think it is, but wanted to double check
    Last edited by satpak77; 05-04-2016 at 23:20.

  6. #21
    Join Date
    May 2004
    Location
    New York
    Posts
    1,207
    Quote Originally Posted by satpak77 View Post
    Question for retired folks: Is you FEHB Federal Health insurance cost the same in retirement versus on-duty ? I think it is, but wanted to double check
    Yes, except you pay monthly rather than bi-weekly.

  7. #22
    Join Date
    Mar 2004
    Posts
    1,941
    roger that


 

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