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Retirement Planning


Whether you are close to federal employee retirement or just starting out in your career, this is the place to share ideas with your federal colleagues on creating a secure financial foundation.


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LSA  
#1 Posted : Saturday, March 24, 2012 2:06:13 AM(UTC)
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What percentage of Pre-Retirement income do you feel comfortable with in retirement and why?





LSA2012-03-24 10:12:07
postalvet  
#2 Posted : Saturday, March 24, 2012 2:52:50 AM(UTC)
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I am receiving around 70%.  with no house payment, not have to pay for so much gas, and not having to have an extra set of work cloths and less taxes, I am probably 90% living the same.
 
 

plus the wife and me have not touched our TSP.postalvet2012-03-26 09:50:40
Retired postal worker of 38 years who is willing to help even though some do not want to hear the truth.
Fed1969  
#3 Posted : Saturday, March 24, 2012 4:41:00 AM(UTC)
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I want a minimum of 90% of my pre-retirement take home pay. I don't want to lower my standard of living.  This 90% comes from a combination of my federal pension from OPM, Social Security and TSP.

Being retired I no longer contribute to the retirement fund, Social Security, TSP, or FEGLI, hence that expense went away.  

One reason I only need 90% of my pre-retirement take home pay is I no longer pay taxes on the contributions to the retirement fund, Social Security and FEGLI. 

Another reason I only need 90% of my take home pay is I only pay federal income taxes on 85% of the Social Security benefits I receive, and only pay taxes on 90+%  my OPM pension.  I pay no state income taxes on my Social Security benefits.  Of course all payments received from TSP will be 100% taxable.
texasvet54  
#4 Posted : Saturday, March 24, 2012 1:55:36 PM(UTC)
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I was maxing out my TSP for the last few years so between the 7% CSRS contribution and the TSP, I never saw around 25% of my salary.  With that in mind, when finalized, I will be taking home, after taxes and insurance, 90% or so of what I was taking home before I retired.

texasvet


mtg2005  
#5 Posted : Sunday, March 25, 2012 10:43:53 PM(UTC)
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Like texasvet54, I was saving more than spending except I am FERS. In fact my husband's and my retirement income TAKE HOME (after tax and insurance deductions) is 50% higher than what we were living on before retirement. However our gross income is over 50% less. The best number to use to determine your need if you are close to retirement is your current real expenses (plus tax). So I agree with texasvet's thinking. In my case, I was living on less than 25% of our gross income prior to our retirement. mtg20052012-03-26 06:53:05
simchief  
#6 Posted : Monday, March 26, 2012 12:50:58 AM(UTC)
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With inflation my answer is "it’s up to you" what do you feel safe with?

 

Having experienced so many retirees that did not save; I initiated my retirement plan at 16-years of age for my future family.

 

It has worked; as my last estimate has us at 137% of our full pay upon planned retirement.

 

It was not an easy task, now I can reap awards of good fiscal planning; thanks to my parents mentoring.

 

My advice is to start saving early.

I'll be shoveling along: <br />Digger O'Dell
martyb  
#7 Posted : Monday, March 26, 2012 1:09:48 AM(UTC)
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If I retire in January, my net will be 100% of my current net, but that's with me currently maxing my TSP including catch-up.  That's the amount I'm accustomed to living on, and does not take into account any withdrawals from TSP, only my CSRS pension.  I'm currently contemplating whether to go ahead & punch out in January or to work a little longer....  In 5 yrs, I'll start drawing an additional $18k per year for my reserves retirement.  Wife has a 401k, but is currently only 51 yrs old, so no access to those funds anytime soon.
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The HalfBreed  
#8 Posted : Monday, March 26, 2012 10:04:01 AM(UTC)
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I agree with all the above, especially mtg2005. I look at expenses first and foremost.
Not including TSP and ROTH, my retirement take home pay will be about 40% greater than it is now.
No house payments, 10 months left on car notes, AND 57 years of age at the end of 2012.

That'll be a pay raise !   Thumbs Up



The HalfBreed2012-03-26 18:10:20
RETIRED 12/19/2012 !!! Good Bye Tension !!! Hello Pension !!!
martyb  
#9 Posted : Monday, March 26, 2012 11:10:18 AM(UTC)
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Hey...gotcha beat on the car notes.  2007 Camry's been paid off for almost 4 yrs, and the 2010 Camry SE has another $698 to go...0% interest!  Wink  However, you beat the crap outta me on the house note..I have to buy one.  Cry
martyb2012-03-26 19:16:20
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SuzFed  
#10 Posted : Tuesday, March 27, 2012 1:00:35 AM(UTC)
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About 45%, which will work because the house will be paid off and I'm currently throwing a lot of extra $ at the mortgage. When that's gone, I be gone.
The HalfBreed  
#11 Posted : Tuesday, March 27, 2012 11:12:10 AM(UTC)
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martyb wrote:
Hey...gotcha beat on the car notes.  2007 Camry's been paid off for almost 4 yrs, and the 2010 Camry SE has another $698 to go...0% interest!  Wink  However, you beat the crap outta me on the house note..I have to buy one.  Cry


On the car, it was a zero interest rate for 3 yrs, last payment in Jan 2013...

however....

I want to be more like you !  I wanna sell this place and RENT till  I DIE !  Lots of expense for repair, real estate taxes (almost $7,000/year) and more. I can RENT a real nice place for 1K/month (lack of real estate tax will pay for MORE than HALF of that), and when I croak, the kids can just say, "He ain't coming back", then terminate the lease.

I think YOU got it right !  I'm just trying to be like you.
RETIRED 12/19/2012 !!! Good Bye Tension !!! Hello Pension !!!
martyb  
#12 Posted : Tuesday, March 27, 2012 11:20:32 AM(UTC)
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lol....well, thanks...I guess!  You're right though about 1 thing.  Before my current job assignment in TX, I lived in a nice small city in southern Wisconsin, population around 65k.  I was renting a brand new 3 bdrm, 2 bath house with a full basement and a 3 car garage, in a great neighborhood, right behind a small shopping mall and walking distance to Starbucks, Fuddruckers, Cabelas, a movie theatre etc.  Nice place!  All for $1000 per month.  We were the 1st and only occupants of the house and the landlord took care of everything, not that there was much for him to take care of.  I can see the plus side of renting vs. buying.....a huge plus being it's much easier to pick up & relocate anytime I want a change of scenery.  Just have to convince the wife....
martyb2012-03-27 19:26:57
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68gto  
#13 Posted : Tuesday, March 27, 2012 6:52:55 PM(UTC)
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FERS -- it will be about 52%. 32% FERS (32 years) + 10% supplement + 10% TSP.  Its hard to get much above that on a FERS retirement, especially if they take the supplement away.



kgkistari  
#14 Posted : Wednesday, March 28, 2012 2:58:49 AM(UTC)
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FERS:  My retirement take home money is equal to my working take home pay.  This includes the FERS basic, my TSP withdrawal and the Special Supplement.  I figured my TSP out for 30 years.
 
Lodell  
#15 Posted : Wednesday, March 28, 2012 5:01:18 AM(UTC)
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I'm eligible to retire in 2017.  And your high percentages are encouraging.  However, have you considered inflation?  Do you expect to be as comfortable as you are now in the next 10 years or so?
RetirednHappy  
#16 Posted : Wednesday, March 28, 2012 5:11:11 AM(UTC)
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You do need to keep things in perspective. That is one of the nice things about a civil service retirement: if the inflation rate is significant and continuing, future retirement annuities are adjusted up! Hang in there.  
mtg2005  
#17 Posted : Wednesday, March 28, 2012 7:15:08 PM(UTC)
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I'm Fers, I get diet cola. I always considered that agency automatic 1% in the TSP to be the source of revenue for the missing 1%. (Of course this assumes it grew enough to cover me for life.)
 
Inflation is just something all retirees face (or fear) even those with COLA.
mtg20052012-03-29 03:21:06
kcman  
#18 Posted : Wednesday, March 28, 2012 11:41:36 PM(UTC)
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My current net is about 100% of what my net was when working (retired two years ago).  Actually, at this point I now have more disposable income each month since our retirement house is paid off and our property taxes are about 1/3 what they were when I was working ($1,500 a year instead of $4,500 per year on a larger and nicer home).  Also, no State income taxes has helped a lot as well.  Bottom line is if you relocate to a State that has lower taxes and you are debt free going into retirement, you can live the good life.  Good luck to all those who are currently or soon to be retired.  

<br />"The problem with socialism is that you eventually run out of other people's money." - Margaret Thatcher<br />
lorsteluc  
#19 Posted : Thursday, March 29, 2012 2:20:40 AM(UTC)
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I am waiting for my retirement to be approved and I have an annuity from a prior employer that covers all my expenses plus money for extras and a small amount into savings, home is paid off, car is paid off, not touching TSP, pretty frugal most of my adult life.  I agree it is important to look at net $, not gross $.   However, I think am pretty indicative of retirees who after a lifetime of being frugal, have a hard time enjoying the freedom of financial security.  I have friends who are fellow retirees who haven't been able to turn that frugal switch off.  Just wondering how other retirees have integrated that hard-won financial sucess with a more relaxed and frivilous lifestyle.
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