By Tammy Flanagan | National Institute of Transition Planning | September 21, 2017
Whether you’re concerned about proposed congressional changes that could impact your future retirement benefits or you’re simply at or near eligibility for retirement, you may have been thinking lately about your future plans.
If you’re considering leaving sometime soon, it’s a good idea to think about how prepared you are. Here’s a quick way to assess where you stand.
For each of the 10 questions below, choose the answer that best describes your situation.
Which of the following best describes your contributions to the Thrift Savings Plan?
- I’ve increased them within the last two years
- I plan to increase them with my next salary increase
- a and b
- I’m already contributing the maximum
- I can’t contribute due to a six-month ban on contributions after taking a financial hardship in-service withdrawal (there’s anexception to this for recent hurricane victims)
- I can’t afford to contribute more than I currently am contributing
- I do not participate in the TSP
When was the last time you reallocated your TSP funds or rebalanced your overall retirement investments?
- Not recently, because I am invested 100 percent in one or more of the lifecycle L Funds, so I don’t need to rebalance or reallocate
- I am 100 percent invested in the G Fund because I have other retirement investments outside of the TSP that are diversified
- I check at least once per year and rebalance as necessary
- I’m aware of the ups and downs when investing for long-term growth, so I watch my investments, but don’t touch them very often
- I’m not sure
- All of my retirement savings are in the G Fund
- I know I should, but I don’t know how to do it
How do you plan to handle your TSP funds in retirement?
- Delay my withdrawal until I’m fully retired or until I’m required to take a distribution after I’m 70 ½ and retired
- Leave my money in the TSP to take advantage of the simplicity, low management and administrative fees, and options for withdrawals
- Move some or all of my TSP investments to an individual retirement arrangement to take advantage of more flexible withdrawals and more specific investment options
- a and b or a and c
- Cash out a large lump sum of my TSP and use it to pay down debt or pay for a long-awaited retirement expenditure, such as a home remodeling project
- Move my money to an investment a friend of mine said was doing well
- I don’t participate in the TSP
Which of the following best describes your beneficiary designation forms for retirement benefits, life insurance, TSP and unpaid compensation?
- I think I have copies of some or all of the forms in a safe place where my beneficiary can find them
- I didn’t file some or all of my beneficiary designation forms because I’m comfortable with the standard order of precedence for payment
- a and b
- I’m pretty sure my designations are up to date, but I’ll add checking on this to my to-do list
- I didn’t know there were so many beneficiary forms
- I don’t think I updated my forms and am not sure how to change them
With respect to planning for those within five years of retirement eligibility, which of the following best describes your situation?
- I’m more than five years from retirement eligibility, so this question doesn’t apply to me
- I’ve received an estimate of my retirement benefit or have requested an estimate
- I’ve reviewed my Electronic Official Personnel Folder and have made copies of documents that show my health benefits, life insurance coverage, beneficiary designations, beginning and ending dates of creditable service, changes in my retirement plan or work schedule, and any other documents that might be relevant to my retirement benefits
- b and c
- I’ve reviewed the annual benefits statement provided by my payroll system
- I’m not sure how to get a retirement estimate
- I’m sure I can estimate my benefit on my own, so I don’t need my human resources office to provide an estimate
Where do you stand when it comes to factoring Social Security into your retirement planning process?
- I’ve created a mySocialSecurity account
- I’m not eligible for Social Security benefits because I haven’t earned 40 credits of coverage
- I’m already receiving Social Security retirement benefits (or spousal or widow’s benefits)
- a and b, or a and c
- I’m not ready to begin receiving benefits, but I have considered when I might file for benefits
- I’m not sure when to file for benefits
- I haven’t considered Social Security retirement as part of my retirement plans, although I do have 40 credits of coverage
Which of the following have you done to learn more about retirement planning?
- Attended a mid-career or pre-retirement seminar, webinar or class
- Learned about my benefits by conducting online research
- Scheduled or attended a personal retirement consultation with my agency retirement specialist, a financial adviser, a benefits specialist, an accountant or other retirement planning professional
- Any combination of a, b and c
- Discussed retirement with my co-workers, family and friends
- I haven’t really done too much yet to plan for retirement; it seems too far away
- I really don’t have time to think about retirement at this stage in my career
What have you done to prepare for the possibility of needing long-term care later in life?
- I’ve considered the possibility and researched options for cost and type of care
- I’ve already purchased coverage if it was clear I couldn’t self-insure against the potential need for long-term care
- I already know I’ll need long-term care and have a plan in place to get it
- a and b
- I’m sure my family will take care of me, if needed
- I don’t want to think about the possibility of needing long-term care
- I have no idea how to assess long-term care options
What is your life insurance situation?
- I’ve recently reviewed my current life insurance coverage and determined it is adequate for my needs
- I’ve reduced or increased my life insurance coverage within the past five years as my needs have changed
- In addition to using Federal Employees Group Life Insurance for my basic needs, I’ve considered purchasing additional life insurance
- All of the above
- I’m not sure how much life insurance I need, but I have FEGLI in the same amount that I had when I was first hired
- I haven’t given serious consideration to my life insurance needs
What is your understanding of health insurance?
- I always review my insurance needs during the annual open season or when I have a major life event
- I’ve changed my health plan at various times in my life to coincide with my specific health needs
- I take advantage of tax savings by using flexible spending accounts, health savings accounts, and making sure I pay my health insurance premiums with pre-tax dollars (if still employed in government)
- Any combination of a, b, and c
- Health insurance options confuse me, so I enrolled in a plan that a co-worker, friend, or family member recommended
- I have the same health plan I chose when I was first hired, and haven’t reviewed my coverage options
For every answer, assign the following point value:
a. 4 points
b. 4 points
c. 4 points
d. 5 points
e. 3 points
f. 1 point
g. 1 point
40-50 points: You’re doing a great job preparing for retirement. Keep up the good work!
20-39 points: You’re hitting the mark on some retirement planning issues, but may need to address others with a little more research and preparation.
10-19 points: There are items that are important to your future financial security that you need to address. One good way to start is by making a to-do list of items you need to assess based on the questions above. Then focus on the first two items on the list. Retirement planning can be overwhelming, so it makes sense to start small.
Photo: Flickr user Quinn Dombrowski
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