Your Turn with Mike Causey
Summary: Federal News Network Senior Correspondent Mike Causey discusses everything of interest to federal employees, from pay, benefits and retirement, to buyouts, COLAs and pay freezes.
The start of a new year, any new year, is a logical time to take stock, reflect and look ahead. The fact that we are the midst of a deadly, frightening pandemic this time around makes self-reflection all the more important. A lot of things, many we never even considered important, have changed. Maybe forever. As individuals we certainly have. And its not a matter of debate or opinion. It’s true. By now most of us have figured out we are not immortal. We’ve seen parents and family members age — some better than others — and know that some things are inevitable. Ignoring them is an option, but not a very good one. As the end of the year approaches, a common question directed to an estate planning lawyer is, “What should I do to update my estate plan before year end?” Tom O'Rourke is a D.C. tax attorney and estate planner. He's my guest on today's episode of Your Turn to help us answer that question.
While many businesses have closed or cutback operations and even state and local governments are trimming their payroll, a job with Uncle Sam has been a blessing (compared to the alternatives) during the year of the COVID-19 panic. And its only going to get better according to Kathy Troutman, who is the Daniel Boone of scouts when it comes to finding a federal job. She founded The Resume Place Inc. and has been helping people get government jobs, and helping government workers get BETTER jobs, for four decades. Qualifying for and actually getting a federal job has never been easy. Something most bureaucrat-bashers don’t get or want to consider. But its true. Finding job openings is relatively easy. But then what? Are there buzz words and key phrases you need to use to guarantee that your CV will be looked at and seriously considered? Are there tricks to the trade? Very much so says Kathy, who will be my guest on today’s Your Turn.
Do you hate change, or making decisions? Is the car you are driving right now the same one you’ve owned since Jimmy Carter occupied the White House? Are you planning to finally have air conditioning installed in your home this year? Are you waiting for vinyl records to make a total comeback? Do you tend to put things off? Or try not to think about worst-case-scenarios — like a car wreck, or major illness — because it is depressing? Or can wait maybe until the current pandemic is over? Still not completely comfortable in the 21st century? Welcome to the club. According to the experts, many federal workers — and some retirees too — have excellent health insurance coverage. But most, thanks to the power of inertia, are paying too much in premiums. Consumer Checkbook’s Guide to Federal Health plans says “most people can save $2,000 or more in premiums next year, if they do something between now and Dec. 14 when the health insurance hunting season ends. My guest is Walton Francis, a retired former government official who wrote the book — literally — on the various plans in the FEHBP program. He’ll be talking about how to find the best buy for you and your family. And maybe save lots of money.
Walton Francis, editor of Checkbook’s Guide to Federal Health plans, believes that too many people are in the wrong health plan. Wrong as in too expensive. He says all the plans are good to excellent BUT some simply cost too much because their premiums are too high since they are top-heavy with what the industry calls “heavy users” — retirees who are older, sick, have higher prescription drug prices and who remain in the same plan year after year while younger and healthier workers move from plan to plan. Walt Francis says many people can save $1,000 to $2,000 in premiums next year if they’ll spend a couple of hours shopping online over the next few days. In addition to the free health plan shopping guide provided by the Office of Personnel Management, many agencies have subscribed to the excellent Checkbook Guide so you can comparison shop from home. It’s worth seeing if your agency provides that perk. He'll join us to discuss on today's episode of Your Turn.
The federal government has offered workers and military personnel Long Term Care insurance for years. The idea is people can enroll at group rates which are generally more reasonable than buying a one-person policy. But premiums for LTC insurance nationwide have jumped dramatically in recent years. People are living longer and need services. Enter FLTCIP 3.0, which became available last month for feds and military personnel. It’s administered by LTC Partners on behalf of John Hancock. And that’s the subject of today’s episode of Your Turn, where my guest is Joan Melanson, a top official of LTC Partners, who will explain how the program works and what you should consider.
According to the latest projection, there is at least a 20% chance you are in the wrong health plan. And that you are very likely paying more than necessary in premiums. This is especially true for retirees who may have been in the same health plan for years. So, is that BS... or fact from more reliable sources? Walton Francis is again our guest on Your Turn. He talks about what you should be looking for, and what to avoid, while navigating this year's open season. Walt spent many years in a top job at the Department of Health and Human Services. No BS data in his knowledge base. Just facts.
Suppose you or a family member get the coronavirus next year and DON’T die? Suppose you come out of it, maybe with many medical problems to come, but alive. Then what? Between now and early December, you will be picking the health plan that will cover you and yours — during what may be one of the greatest pandemics in history — in 2021. This is not one where you throw a dart at a board and pick whatever gets hit. This requires some homework. To help us with that we are joined by Walton Francis, longtime editor of the Washington Consumers Checkbook Guide to Health Plans.
Worried about your financial portfolio, your job, and your retirement, not to mention the future of the nation, if that idiot (fill-in-the-blanks) wins Tuesday? Tip from a Washington D.C. insider: The next president’s last name has 5 letters. You take it from there! Seriously. What if you really, for-dead-certain, knew right now whether President Donald J. Trump will be reelected or whether former Vice President Joseph Biden will replace him. Knew for sure. Would that knowledge change whether you decide to add more stocks — the C, S and I funds — to your portfolio? Or would you move more, perhaps everything, into the “safe” Treasury securities G fund? And if you had known last December what 2020 was going look like, would you have done any better? Would your investments — especially those based on political emotions — have been any better? Arthur Stein, a Washington area financial planner, says politics should NOT be a part of your investment strategy. And he talked about it on today's episode of Your Turn.
People under the Civil Service Retirement System (CSRS) program will get larger annuities and full cost of living adjustments (COLAs) to keep pace with inflation. But the majority who will this year and in the future are under the Federal Employees Retirement System (FERS). They will have to live with smaller monthly annuities, diet COLAs, and depend on their Social Security and TSP investments for their retirement income. Long range planning isn’t just important, it is absolutely essential. Federal benefits expert Tammy Flanagan thinks this upcoming December-January may produce the tidal wave of retirements experts have incorrectly predicted for decades. But maybe this time it will happen. But whether you are going out this year, next summer or departure day is years away, plan ahead. Starting yesterday. But beginning now is better than nothing. A lot better. Tammy will be my guest today on our Your Turn. She is going to cover the waterfront and focus on the 7 things you should NOT do when mapping out your retirement. Her list is a long one, but trust me your retirement will seem a lot longer and leaner if you skip it.
News that they will be getting a 1.3% cost of living adjustment in January 2021 is getting a mixed reception from federal, military and Social Security retirees. The inflation catch-up will to go roughly one in six Americans. And its more than some analysts had predicted based on the low inflation rate over the past 12 months And its 100% more than most retirees — who depend on pensions promised by their private sector employers — will be getting. We talked with many, many feds and picked up more questions and suggestions on the way. So today’s guests on Your Turn will have the answers. They are Jessica Klement, NARFE’s staff vice president for policy and programs, and legislative specialist John Hatton. Listen. Could save you lots of time, money and grief.
Retired Gen. Mike Meese is president of American Armed Forces Mutual Aid Association (AAFMAA) and an expert on the tax deferral plan and its impact on federal and military paychecks. He talks about how you can avoid going in a financial hole by setting aside your 2020 take-home pay raise to augment or create an emergency fund for 2021 or the future.
Most people know they are worth more dead than alive. But many — including those who survive them — don’t know how much more. Or where the treasure (if any) is buried. And how you want it to be handled. Many federal workers and retirees, especially if they own property or have TSP accounts and life insurance, are easily worth a million dollars or more. Deciding who gets it (Uncle Sam, the state, your children) isn’t easy but it isn’t rocket science either. And you doing it now can save lots of grief, ill will and money down the road. Might help keep an otherwise tight-knit family from falling apart. So we asked estate and tax attorney Tom O’Rourke what he tells his clients. Most of them are current or former feds.
Many, if not most people, are familiar with the phrase “shouting fire in a crowded theater” — even if they might have trouble recalling who first said it (Justice Oliver Wendell Holms in a 1919 case before the Supreme Court) — and why. The modern day equivalent of the panic-starter is to bring up the subject of the Government Pension Offset or Windfall Elimination Provision in any venue — theater, retirement community, house of worship — with a large number of retired federal or state government employees, or their spouses. The initials may not mean much, if anything, to you, but ask your federal parents or grandparents, then watch their blood pressure go off the charts. So what’s the big deal? Tammy Flanagan will be my guest today on Your Turn. Meantime, for background, each has agreed to share answers and observations from someone seeking help and clarification from Social Security about WEP and GOP issues.
Some savvy investors say the President has a major impact on the economy and the stock market. Others say events — not whoever is elected POTUS in November — will determine whether your Thrift Savings Plan languishes or takes off like a rocket over the next four years. Bottom line: What do you think? Is it all important that your candidate win? Or does it really matter when it comes to building and growing a nest egg that, depending on the breaks, may supply anywhere from one third to one half of all the spending money you have in your golden years. Will they be 24 carat, or something less? We asked D.C. area financial planner Arthur Stein for his thoughts on the importance of the November election on the economy in general — and your TSP in particular. Stein has a wide background in economics. He’s also a long-time financial advisor whose clients include several TSP millionaires.
Kathryn Troutman is a job-hunter/promotion finder coach and author of more than 30 books on getting a job or promotion. And she is the founder of The Resume Place. Kathryn talks about navigating your way OUT of your current federal job into a new agency and position. And why it's a great time to get out of the private sector and into the federal government, which is hiring!