Retirement is an exciting time in your life, but it can also be a daunting experience if you’re not prepared. When it comes to retirement under the Federal Employees Retirement System (FERS), there are specific steps you should take at various points in your career to ensure that you’re ready when the time comes. Knowing what those steps are and when to take them can help make sure that your retirement is as smooth and stress-free as possible. In this blog post, we’ll look at some of the key actions to take at 1 year, 3 years, 5 years and 10 years before retiring from FERS.
At 1 Year to Retirement:
1. Make sure you’re taking advantage of the Thrift Savings Plan (TSP) and contributing the maximum amount allowed each year. This is a key way to maximize your retirement savings for FERS and ensure that you have enough funds when it comes time to retire.
2. Take some time to consider your financial situation and plan for the future. Retirement can be expensive, so it’s important to make sure you know how much money you will need each month to cover basic expenses.
3. Start researching retirement options available through FERS such as purchasing additional years of service credit or annuitizing your TSP account balance. Knowing what options are available to you and the costs associated with them will help you make an informed decision when it comes time to retire.
At 3 Years to Retirement:
1. Begin reviewing your Social Security statement and other retirement plans, such as IRAs or 401(k)s, to determine what you might receive in benefits. This can help you plan for how much money you’ll need each month in retirement.
2. Start thinking about how you want to spend your time in retirement. This is a great opportunity to explore hobbies, volunteer work or travel—all of which can help make your retirement that much more enjoyable.
3. Consider any other income sources you might have available, such as rental properties or investments. This can help to supplement your FERS retirement benefits and provide extra income in retirement.
At 5 Years to Retirement:
1. Begin preparing your federal retirement application, which you’ll need when it comes time to officially retire from the Federal government. This should include information about your TSP and other sources of income, such as Social Security or private retirement plans.
2. Research health insurance options so you’ll know what coverage is available to you once you retire from the government. This will help ensure that you have the coverage you need in retirement.
3. Start planning for long-term care costs and consider purchasing additional insurance if necessary. This can help protect your assets and provide peace of mind in case you need long-term care in the future.
At 10 Years to Retirement:
1. Review your overall financial situation and create a budget for retirement. This will help you make sure that your savings are on track and that you know how much income you’ll have each month once you retire from the government.
2. Take a look at the FERS retirement calculator to determine how much money you can expect from your monthly annuity and any other benefits you may be eligible for. Knowing this ahead of time will help you plan for your future expenses.
3. Start talking to other federal employees who are retired about their experiences with FERS retirement. This can help you gain a better understanding of the process and what you can expect in the years ahead.
By taking these key steps at each point in your career, you can ensure that you’re well-prepared for retirement when the time comes. Taking the time to plan for your future now will make all the difference when it comes to your financial security in retirement. Good luck as you plan for your FERS retirement! We wish you the best of luck in the years ahead.