Micah Shilanski 00:00
Hey welcome to the plan your federal retirement podcast. I’m your co host Micah Shilanski and with me for this special Live episode, we have the amazing Tammy Flanagan, hey Tammy,
how’s it going?

Tammy Flanagan 00:15
Good! Hi everyone. Welcome to our program today. I’m excited because it’s been a while and it’s a new year. And it’s a time where a lot of people are retiring. So I think we have some
important things to share with our audience today. As usual.

Micah Shilanski 00:29
Yes, yes as you would for those who are attending or watching on YouTube, you’re gonna see I’m not in my normal suit and tie attire I am vacationing and so but with this podcast is booked
and I was like it was really important. I wanted to do it. So hopefully the casual attire is okay.

Tammy Flanagan 00:43
Absolutely. I’m always casual. You don’t have to dress up anymore.

Micah Shilanski 00:50
I’m good. Well, Tammy as we kind of kick off this new year we had some really are as we’re kind of pre gaming as usual. We got talking about a whole lot of things, but really wanted to stay focused on a successful retirement in this year. And what that means whether you’re going to retire in the next couple months, end of the year, in several years and almost doesn’t

matter. They’re still the same things you need. To deal with. The only difference is your timeline might change on how soon you need to get these things done. But we want to talk a little bit about the timeline, which is really important. We were talking about a handout we have for that as well. But we also want to be able to talk a little bit more about what mistakes we see
how to avoid these mistakes and there’s some country addictions and difference of opinions are definitely coming out. I think from OPM and HR is in our opinions. Right? So which one is right, and how to deal with those statements. That sounds fair.

Tammy Flanagan 01:37
Absolutely. And I’ve been seeing a lot more of these lately, and I’m not sure exactly why it’s happening. But I haven’t seen some errors in terms of the employee how they’re applying for the benefits, you know, just not knowing, you know, you’ve only retired once so how do you know exactly how to do it? So I’ve been seeing some errors there that aren’t being caught
beforehand. I’m also seeing some questions coming from employees regarding what their payroll offices are doing with their human resources office are doing or not doing. So yeah, we are seeing some things that are a little concerning. And luckily for some of these shots, they can contact us and get it worked out. But it makes me think that there must be many more people out there who don’t know that maybe they’re being shortchanged on something they’ve worked very hard for so that’s my goal is to try to help people avoid any underpayments or any mistakes in their processing. Try to make it go as smoothly as possible.

Micah Shilanski 02:36
And, Tammy, this is huge right these are the benefits you have earned right you the listener have earned these benefits and we want to make sure you get 100% of what you’re supposed to get, but also not over because eventually OPM will find out and they’re gonna come back and take back some extra benefits you’ve received. So you need to know what those benefits are. You need to have a really good understanding of the rules because when an issue comes up, and Tammy, we’ve talked about it before on previous podcasts, like the error rates that
come out from OPM, right? I mean, they published these numbers and these are kind of the known errors, not the unknown errors that are out there. So these are really important things to do. So Tammy, what do you think about we kind of kick this off, and I know we’ve heard some issues not only with some immediate retirements and things I want to talk about, but recently a lot with postponed and deferred retirement. So what do you think we kick it off first talking
about what the rules are, let’s make sure we’re on the same page with what the rules are, then we can kind of step down to those documents. And I think this is key because this is the exact process that you and I go through when working with an individual right it’s not what retirement you want. It’s what retirement you qualify for, right? What are the rules based on
your service that’s going to dictate what retirement you’re going to get?

Tammy Flanagan 03:43
That’s, that’s right. And really, there’s two basic ways to retire. One is immediate, and the other one is deferred. So I always start off teaching retirement planning by defining those two terms. Like when we say an immediate retirement we’re talking about when you leave the government, your first check is going to be paid out within 30 days. That’s an immediate retirement you’re gonna leave the end of January. In your first retirement check is the month of February. So that’s a deferred is whenever I’m younger, I might be 38 years old, and I’ve got 10 years of service and I’m leaving, invested I have enough service to be eligible for retirement, but I can’t go like that at age 38. I gotta wait till I’m old enough until at least I’ve reached my minimum retirement age. So when you’re not going to collect that benefit immediately upon your separation, that’s called a deferred retirement. So we really need to understand, you know how those two are different with immediate retirement, you’re typically going to keep your health benefits your life insurance. You’ll get that immediate benefit starting the month after you leave. And sometimes between that your Social Security and taking money from your Thrift, you can stop working, where if you’re leaving at age 38, it’s pretty unlikely that you’re not going to start working someplace else. But don’t forget that you have that benefit waiting for you when you’re older.

Micah Shilanski 05:06
Amen. Right. So this is things that it’s great to have a retirement timeline and a calendar that you’re gonna be able to put out when these things should come up. So Tammy, but one thing I
want to pull that thread a little bit more you said on the medium retirement, you’re gonna get paid the month after you stop working if you go out with an immediate retirement. Well, yes
and no, right. You’re you’re eligible to be paid the month after you stop working, but you probably won’t get that check for at least a few months and that’s going to be an interim retirement check. Then it’s going to be several months more before your retirement is adjudicated or finalized and then OPM is going to go backward once it is finalized, and they’re going to back pay you so you’re gonna get the equivalent of a check of the month after you retire under an immediate retirement. However, this is where cash flow is king, right? Really understanding how much a month am I going to have coming in and where that income is going to come from, Tammy, to your point, right? Maybe your pension your supplement than your social security than a TSP, maybe that’s enough for your retirement, maybe it’s not, but knowing how much you spend is right up there in my opinion with the importance of understanding not only the rules of retirement, but can you afford to retire?

Tammy Flanagan 06:13
Right! And the more you can do while you’re still on the payroll the smoother that transition is going to go and possibly the quicker it can go as well. It’s not always the fact that you did or
didn’t prepare that makes it go faster or slow but it certainly can hurt. So you always want to make sure that that application has been filled out properly. You want to make sure you’ve
signed everything that you didn’t leave any blank spaces, have somebody look it over, make sure that looks like you didn’t leave anything out. You know, I always do that with my clients
and I always find either something’s misspelled or they forgot to answer something or they didn’t answer it correctly. So always double and triple checking if you can have somebody else
that understands this stuff, look it over with you. Because that can really help. If you’re fortunate to have a Benefits Specialist at your agency who really does provide retirement counseling, that’s, that’s a goal. If you have that even these days, it’s really kinda rare in many cases to find someone with enough experience and wisdom to really look at that and tell you okay, here’s a point where we need to think this over to make a really good decision on this
T

answer to this question that could really have a lasting effect on your future retirement. There’s a lot of important questions on that application that you want to make sure you put down the
right answer.

Micah Shilanski 07:32
Now, to help with that, though, one of the things that we are going to be coming out with relatively I’m going to say soon, loosely, right, but is a review of your retirement, not yours, but
a review of the retirement application. How do you fill that out all of these little details that’s there? So we do want to give you our listeners a little bit more resources. So that’s a video
series that we’re working on, and he’s gonna come out you’re gonna get more in depth on that one. And then, Jamie, let’s talk a little bit about the timeline of an immediate retirement as well
because I ran up some questions with this just recently. And another thing we want to give our listeners is if you’re watching this live, which is great, we’re going to push this out to is a
handout that you can get off of our website, Plan-your-federal-retirement.com and it has the seven month things you need to be thinking about three months before retirement the month
and three months after it has a nice little checklist for you and all those things that you need to do. And this doesn’t mean you start retirement planning three months before retirement, but
this is a lot of the paperwork process. Now Tammy, some agencies though, will allow us to request a retirement application like six months in advance now not just three months is that right?

Tammy Flanagan 08:35
Yeah, I’ve even there’s even some that will let you actually turn it in up to a year before you leave. If you don’t, these are larger organizations. If you’re in a smaller agency, you know that
only has a few 100 employees, then 30 days notice might be enough because you might be the only person retiring next month. But when you’re in DOD or HHS or CIA, you’ve got hundreds of people retiring. With you. So you want to get to the head of the queue. You want your application to be there well in advance of the day of your separation, which is so important
because if there is a mistake, if there is something missing, you got time to fix it while you’re still getting a paycheck. Where if you just turned your application in the week before you’re kind of leaving it up in the air, and you may not have the time to go back and fix a mistake or go back on the payroll if you weren’t quite eligible to retire yet. You really want someone to look this over.

Micah Shilanski 09:29
And Tammy it actually just came up today actually, I got a message that one of our clients is retiring in a few months and they talk with us. They work at a big agency, and their agency was like I just turn your retirement application in 30 days before you’re going to retire. And I was like oh hold up. I was like that means they’re not going to look at it properly until days before you retire. Then if there’s an issue which hopefully there’s not right but if there’s an issue now you have to fight it while you’re not getting paid, you know, I would rather have to fight things while I’m getting a paycheck. While I’m in. I like to say when you’re in your guest when you’re out your past. I promise probably dealing with your HR is probably easier most of the time than dealing with OPM and the delays it takes in that communication. So I want to flush out as much potential issues as I can while you’re actively employed. That’s why in my world said minimum of 90 days, three months before you want to retire, I want to request and submit that retirement application so you got to request it, you got to get it you got to fill it out, go through it in detail. Again. We’re gonna have a class on that coming up. Go through it in detail, and then submit it and then have it scheduled when you’re going to follow up with your HR on this as well. Right? When are they going to review it? And then this is a great time if you haven’t done it already, is start downloading your entire ELP app, your electronic official personnel file, all of your SF 50s, right, your pay stubs and you’re gonna say Holy crap, that’s a lot. Yes, but Tammy, how many times have you come across that you probably can’t be counted that you’ve needed these documents after someone’s retired to prove their service?

Tammy Flanagan 10:58
Yeah, you can say all you want about what my agency told me or what I heard or what I read, but I can’t go to bat for you unless you can show me the proof like this is the day I started. This is the day I left this was my retirement coverage. This is when I went part time. This is what I went on leave without pay. All of that information is really relevant to your length of service, to
your high three average salary, all of us on those SF 50s. Those are critical documents. I would say if you don’t know which ones to keep, keep them all. At the very least keep the ones that show when you started working when you left. When you change retirement coverage. When you change your work schedule. Those are the ones that are really, really critical and if you paid a military deposit, keep a record of that summary of service you know, the all the duty to 14 or if you had reserve active duty we need those dates. When did you start, when did you get discharged? Was it active duty for training, you know what was it that we’re getting credit for? And if you have military service, you probably paid for at least hopefully you did, so that you can count that time. So keep a record of that payment. Keep a record of the estimated earnings then you have the report back to show how much you actually were paying his base pay. That’s what that deposit was based on. Keep all of that stuff I’m not a big clutter person, like to keep a
lot of stuff hanging around. But those are things that are critical. Those are things you want to put in that safe box that you have that’s not going to burn down if your house burns down. You know those are so important to making sure that everything is validated and that you get what you deserve. I can’t tell you how many times I’ve had to gone gone to bat for people and the only time I can be successful is if I know exactly what I’m working with. And it’s not based on someone’s opinion or someone’s recollection. It’s based on that hard evidence. That’s really what you need to say in you know you hoped like you said we hope everything goes smoothly. We hope that you know everything comes out exactly like we think it is. But there’s enough times when it doesn’t. And you want to know when it’s wrong so that you know that it’s time to question it or time to go back and ask for more information. Yeah, because otherwise you’ll keep getting that benefit and you have no idea if it’s the right amount or not.

Micah Shilanski 13:16
Tammy I tell to some clients, I hope this is a giant waste of your time. I really do. I hope that we request a lot of this information, we spend time reviewing it and you go into retirement and OPM gets everything 100% Correct. And you look back at it and say Micah, I didn’t need to do all that work. I would be really delighted if that is the case. Ideally, what’s gonna happen is you’re gonna have a smooth retirement. But if it’s not, if you’re one of the ones that there’s a question on your retirement, you got to have team members can echo what you said we got to have the evidence to support going through this

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Tammy Flanagan 14:53
I have seen this enough times that I know how vital it is and I know I can be successful if I know what I’m dealing with. So that’s when I’ll take on a client whenever I know that they have a solid case because otherwise sometimes we’re wrong. You know, we think we’re entitled to something but yet we’re really not. And that’s a whole different problem. That’s a whole different issue of trying to understand where did I go wrong? What did I misunderstand? And again, you want to get those questions answered prior to leaving the government because once you separate it’s kind of hard to come back. It takes long to get things straightened out and squared away. You know if there’s any discrepancies if there’s any issues if there’s any questions about what counts what doesn’t count try to get that clarified before you leave. Yes, OPM will straighten it out for you, but it may not be the answer that you want. And it can take a long time. If they have to go back and request records or if they have to make a determination of something that wasn’t clarified before you leave. So do your prep work. You know, ask those questions. Try to find someone at the agency who is a specialist in HR, because they’re going to be the ones who can really help you sort this out and they’re out there. Like I said, not all agencies have a lot of experience but many of them do. But you just got to know the right person to call.

Micah Shilanski 14:53
See what we talked about immediate, which is really, really important. Right? So let’s also talk about postponed and deferred because there’s a lot of confusion that comes from this. One of the things I hear often is that says well, I’m going to choose a postpone retirement like wait a second, you don’t get a choice, right you either qualify for postpone retirement or you qualify for a deferred retirement or an immediate retirement. Right. It’s what do you qualify for? So if you don’t qualify for an immediate retirement, but you still have, you know, four to five years of federal service, but then you either qualify for postponed or deferred and it’s all based on your age, right? It’s meeting that minimum retirement age, and having 10 years of federal service, if you got that or more now we’re eligible for this postponed retirement. If not, then that’s where the deferred retirement comes in, is that right?

Tammy Flanagan 16:15
Yeah, let me let me give a little example. I think it’ll help people put themselves into the box. So let’s start with somebody who has 20 years of service in their 48 years old. So yeah, 20 years of service and if you look at the eligibility rules, you can retire with an unreduced retirement when you’re 60. Or at your minimum retirement age, you could retire with a an immediate reduced benefit. So if I’m leaving federal service at age 48, I can file for a deferred retirement as early as age 57. If that’s my minimum retirement age, which if you were born in 1970 or later, that is your minimum retirement age. So I can either file for that benefit at age 57. Or I can postpone the application until I’m 60. Because I had 20 years when I left, it will be unreduced. So that’s the first thing you have to figure out is when I’m leaving what am I eligible for today, if anything, and then if I’m not eligible for an immediate benefit, because I’m too young. What happens if I file in my MRA versus what happens if I wait a little longer whether it’s age 60 If I had 20 or more years when I left? Or age 62 I might have to wait. If I had less than 10 years. Now I have to be invested to have ownership of your retirement you have to have a minimum of five years of civilian federal service. Right. So you know, I had one guy one time with two years on the job as a civilian employee and five years of military service.

Micah Shilanski 18:31
He thought he was good but he’s not.

Tammy Flanagan 18:33
Yeah, not gonna get a return. We got to spend another three years as a civilian, then we can count the military service. So five years minimum, but like you said, Micah, if you have 10 years, that opens up the window of the reduced benefit at your MRA which was 57 If you were born in 1970 or later or an unreduced benefit, either at 60 or 62. Now know when you’re filing for these deferred benefits or postponed benefits, you’re kind of on your own. So this is when it’s really important that before you separate from the government, get an estimate, ask your HR specialist for a deferred retirement estimate of postpone retirement estimate. Get that printout of that benefit estimate so that you know what you’re expecting to receive and then you can look at it to see if you have any questions. The other thing I’d recommend, like you said download that OPM, download that official personnel folder with all of your documentation.
So when you file for that request for that application for retirement, you can attach to that here’s the date I started. Here’s the date I left. So you’ve got those exact dates. It’s not like around 1992. It’s August 15 of 1992 is when I started and I was under FERS or I was under FICA and then I switched over to FERS you know, after three months, whatever the case may be so that you want to have those details. Then the third thing I would recommend is get the application don’t send it in if you’re not a filing for an immediate retirement, but get that application for a deferred or postponed retirement. It’s one in the same application. It’s a retirement and insurance form our RI 92-19 and fill it out fill it out when you’re living at age 48.

Even though you’re not going to turn it in for another 12 years. Fill it out now so you know what they’re asking you it’s gonna be fresh in your mind now 12 years from now you’re going to
forget everything about working for the government, you won’t know what its service computation date is or what your start date is or when do you want that retirement to commence but you don’t want to send it into OPM, the Office of Personnel Management until about 90 days, 60 to 90 days before you want the benefit to start. But one thing I have to emphasize really strongly because this is not clear on the instructions, you’ve got to read them 10 times over, is the date you want that benefit to begin. I’ve had several clients recently who picked a date they were turning 62 Let’s say they turn 62 November 15. Well, they asked for their retirement to commence on December 1, After they turned 62.

Micah Shilanski 21:13
The first of the following month after they turned 62 is what they went with.

Tammy Flanagan 21:16
By doing that they want health insurance for the rest of their life. What a silly mistake. I mean seems like common sense it OPM would have seen that and said oh, we just got to back this up a month and make it effective November 1. OPM doesn’t do that. They send you back the letter saying Guess what? You’re not entitled to health insurance because you pick the date after you turn 62 and all that a person was trying to do was to avoid the age reduction by waiting and postponing that retirement until they turn 62. They wanted to make sure they were already 62 And you can’t do it that way. You’ll lose your reinstatement of any of your insurance.

Micah Shilanski 21:54
That’s so painful, because that is like the best benefit you have as a federal employee, right is your health insurance and the ability to maintain that into retirement and by this person, not
understanding that date, right, which it seems so silly and so trivial because you and I look at this back okay. This person really was insulting for delaying the benefits right now. We’re trying to fill this out. You hear so much. It’s the you know, your pensions affected the first of the following month after you retire. Okay, well, November 15. Is my birthday therefore December I mean, all of that kind of passes a straight face test. But that’s where the details on this really matter. And now you’ve entered in postponed rules, which are different and postponed Island, you’re off by yourself. There’s no one with you to help with this application. And that’s what becomes a little bit more daunting as little mistakes like this and that Tammy, what are the odds of like appealing missed opium and getting them to adjust this and to fix it?

Tammy Flanagan 22:48
Unfortunately, I’m trying but so far have been unsuccessful. I had another client who waited too long to file the application. So they wanted OPM to go back and pay them for that postponed annuity back to age 60. And they didn’t file for it until they were 62 right not only would not go back the two years but again because of when they started that claim after they turned 62. They not only lost two years of benefits, they also lost reinstatement of insurance that one did go to the merits Ward and they lost MSPB upheld opions decision to deny those benefits.

Micah Shilanski 23:24
Wow. In that case, that’s where we were going to talk about us on a previous podcast and more details but the OPM gave him the wrong information and they did what OPM said to do. It was wrong and they lost health insurance for life.

Tammy Flanagan 23:37
Yep. Yeah. Just based on the advice from the people who are supposed to give you the good advice is crazy.

Micah Shilanski 23:45
Yeah, that is absolutely nuts.

Tammy Flanagan 23:46
I’ve been trying to figure out a way to get this to change somehow to somehow come up with a valid reason for OPM to either rewrite the instructions on that form or to provide some type of counseling to people who have left federal service. And we’re kind of on their own figuring out when do I file this application? How do I fill out the form? what date do I choose? These are critical things that can really impact not only your retirement but also your reinstatement of insurance. So the only thing I can say at this point is read those instructions with a fine tooth comb, read them twice, read them 10 times if you have to man really pay attention to when that benefit is supposed to begin that commencement date of that retirement especially if you’re trying to reinstate your insurance. And don’t wait until you before you know file this before you turn 62 or before you turn 60 If you have 20 years.

Micah Shilanski 24:41
Yeah whatever you’re eligible Yeah, assume you can now super important to and and I had this on a on an app postpone retirement application as well. I said to end at the same time and one of them went through just fine and the other one, it got rejected and they told my client is oh, you filled out the wrong form, fill out an immediate retirement application. And then here’s what your benefits will be. So not only do they postpone their retirement, and they told them to fill out the wrong form, and then we’re going to apply it 30% penalty to their retirement
because there was an immediate retirement and they didn’t meet the eligible rules at the time and blah blah but like Well, no, it was great news. The question she got that she was she called me she’s like, I don’t think this is right. I was like, Thank you for not filling this out. This is 100% Wrong. We’re gonna have an education opportunity with OPM, but had she had filled I don’t even know what would happen if she filled out the form, but how do we give an OPM permission for that? That’s when it opens the doors to mistakes right? When OPM pushes back and says this is wrong. I don’t have to follow their instructions. Pause, which is the most important thing to do. Pause we go back to the FERS handbook. What do the rules say not a letter from OPM? Not an email from your HR department not the first estimate the benefit that you receive? It says all of your reserved time counts, but it actually doesn’t. Right. We go back to the written rules, what do the rules say in this case, and we reread those we make sure we’re on the same page. Then we go from there, but just because somebody including us, just because we say it then you gotta have the evidence to back your case up otherwise, you may not be in a good position.

Tammy Flanagan 26:10
Yeah, that’s civil service and FERS handbook. You can find that at OPM website in that is OPM interpretation of the actual law. That’s the rulebook that OPM is supposed to follow when they’re processing your application. And like you see on every single retirement estimate that your agency HR office gives you, it says right on there, this is just an estimate. OPM has the
final authority over this. And even though OPM does have the final authority over you can still challenge it. If you think it’s wrong, if you have proof that OPMs calculations are off. Absolutely challenge it absolutely get back to them and say listen, I had different amount of service. I have proof of that, you know, why isn’t it being credited and everybody makes mistakes. You know, I myself included that you want to make sure that you hold them accountable to that because this is your money. Now, I had a client recently who was the former spouse of a law enforcement officer who retired and so she was supposed to get 50% of the marital share of his retirement, which OPM processed and paid her 50% of the marital share. The problem was OPM neglected to use the law enforcement formula and on top of that, they neglected to give her credit for his law enforcement availability pay which is part of his basic pay. So she was getting paid on well about $800 a month less than she should have been receiving.

Micah Shilanski 26:10
So that’s a lower high three is what they’re looking at and a lower percentage in their calculation, right they they took that lower dollar amount Wow, that’s that’s that’s money of 800 bucks every single month.

Tammy Flanagan 27:49
And luckily she realized it was too small and that’s when she contacted us and she had all the proof she even knew what his salary rates were. She had one of his pay stubs so we’re able to
piece together enough evidence that we can show OPM Listen, the I think this is right. We need to go back and recompute this which they did, you know they they did compute it again and
now she is getting the correct amount that if she didn’t know, it was wrong, she would have no idea she was being underpaid. You know, there’s so many that have where we just don’t know
because we don’t understand the rules.

Micah Shilanski 28:21
So understanding these rules, understanding the timeline of these rules of when to do things is.

So understanding these rules, understanding the timeline of these rules of when to do things is really, really important, right? So this is where you got to start sooner and really kind of map
out on a calendar when these things need to be happening. And again, I want to go back to when errors are made, right, whether it’s on the employee front, which to be fair, we’ve been kind of bashed a little bit on OPM and HR, but I gotta say everybody makes mistakes, right? So it’s not about bashing on them. Even us or even the employees I often see Missunderstand the rules, and I always hate it because I gotta be the bearer of bad news. That’s my own selfish reason, right? But it’s when we don’t understand those rules and how we’re applying them. We fill out the forms wrong, right? We interpret what they say versus reading what they say right? I don’t want you interpret what the retirement form says is what they say is how we answer these questions in that sometimes work can get a little confusing,

Tammy Flanagan 29:14
And unless that leaves a payroll office out…

Micah Shilanski 29:18
This is airing of grievances episode

Tammy Flanagan 29:22
it’s when we find out where there’s weaknesses is whenever we find a mistake, or find something that’s not happening the way it should. And the one here that’s kind of relevant to this time of the year because we have so many people who retire at the end of the year to maximize their lump sum annual leave payment. So let’s say I had 440 hours of annual leave on December 31 When I retired and there was a big pay increase 5.9% pay increase on January 14, coming up. So most of them annual leave all but about 80 hours of it is to be paid at that new pay rate. And I’ve had several people come to me saying that their HR office told them no one is going to be paid at last year’s pay rate. Well, your HR office may not know because they’re not the ones who make that payout. It’s a payroll system. If your payroll office is doing it wrong, then you have a legitimate right. But um, keep in mind that that lump sum leave payment has to be projected, as if you could have used that leave How much would you have been paying for it if you could have gone on leave on January 1 And that’s the rate of pay you should be getting for that lead right in here. In particular, that’s a pretty significant amount because we’ve had the highest pay increase I think since 1980. Something Yeah, so you know, not too often do employees get over a 5% pay increase in January. So this is like kind of a unique year for that

Micah Shilanski 30:45
IOn that I would be remiss as a financial planner, if I didn’t kind of throw out there. I know that my 50-50 Rule anytime we get unexpected money and a 5% pay increase, I’m gonna say is
unexpected money. I love that 50-50 rule for our employees that are still working, put 50% away towards the future, as increase your TSP fund those Roth IRAs, something of that nature in the future. Allow 50% to come to the bottom line, help pay the bills, help do things etc. When we keep on track with that, that 50-50 Rule pay increases, you’re setting yourself up for success in the long term with retirement, right. When you don’t do that you fixed your savings at a certain dollar amount and then you start getting more and more money and you’re spending more and more and spending more and more but you don’t increase that savings. You don’t wind up on track for retirement. So make sure you’re looking at that 50-50 stuff really important.

Tammy Flanagan 31:31
We live without it last month so you can live without it this month. A little bit of that race, right? Not sleeping the maximum in your thrift. Do yourself a favor and increase those savings
because that’s the key that I’ve seen to anybody successful retirement, you know, to avoid having to work until you’re 72 Unless you really want to like I do. But um, but if you really want
to be doing something else with your time when you’re in your 60s, then you’ve got to say because that’s about the only way to retire comfortably to have the money left over to take those vacations to spend that time volunteering to pursue those new hobbies. You’ve got to have the money to do it. You’re gonna need as much money in retirement if not more than what you were living on while you worked aiming. So it’s really important to accumulate that

Micah Shilanski 32:21
well Tammy, I know we’re going a little long here but a couple other things. I’d love to sneak in if you still got the time for it. That’s alright. One of the things that often comes up, you’d
mentioned it earlier, but I think it’s important enough that we kind of bring it up in its own little section on military time. Now we did a series on buying back military time, which you haven’t
watched that it’d be really good to kind of go through but especially with reserves, because this when you’re reservists it’s different and there’s some confusion out there especially about drill time and drill time they can correct me if I’m wrong here but drill time does not count towards that active duty military service because you have your reserve retirement, but you also have this active duty time was your call up you were deployed, etc. And then that time actually gets to count as a military time to make a deposit for is that right?

Tammy Flanagan 33:07
That’s right. Yeah, I had sometimes people show me the list of their points is in the military shore reserve. You get active duty points, you get points for this and that and that’s what gives you qualification to get a reserved retirement. Well, on the civilian side, when we’re crediting military service. We have specific rules for what service can be credited. So you can be a retired reservist who is under Title 10 is going to get a reserve retirement usually at age 60. I know sometimes it’s a little different, a little sooner. Yeah, we can count that active duty
anything that’s on a DD 214 It’s going to show the date you entered active duty is going to show that they you were discharged. If you had active duty for training, you would have had orders saying your order to active duty on July 15. You’re discharged from active duty on August 31. So those orders would be stamped. Now not everybody saves all of their active duty records, right? No, you don’t save all those orders from summer camps and all that stuff. So what you might need to do is to request from the Military Records Center in St. Louis, Missouri, request a statement of your active duty saying you want the specific beginning and ending dates of each active duty period of your military career. So then now we have proof that this is when your active duty started. This is when it ended. And then the next step is to pay for it. Once you have that documented proof. Then you have to make that military deposit to your agency not to OPM that you’re going to pay your agency for military service. And once that’s completed once it’s all credited and you have the documentation of the paid up amount, then you can retire don’t retire before you’ve got that military deposit taking care of you.

Micah Shilanski 34:55
Yeah, definitely creates another set of issues that it’s just good to avoid it. And again, while you’re working kind of a good distinguishing window, I go to OPM and talk to them versus when do I talk to my HR if you’re working you talk to your HR, right while you’re still employed. That is your HR you’re going to go through for all of these things. After you separate it. That’s when OPM is going to come back into that mix back into it is when it first comes into that mix, right? But you want to again, I just can’t stress this enough. Sometimes I have clients that say Micah, just one out I want to retire all solve all this stuff after I’ve retired. I’ll have more time. Like I’ll have more time when I retire to deal with this and to fix my service and whatnot. No, no, some of these things we can’t fix after you retire and it’ll be so much more stressful and painful because you’re not getting a paycheck. So let’s make sure we’re fixing these while you’re
working. Then sometimes Tammy I don’t know about you. I’ve had recommended clients they postpone they should be they extend their retirement date. Right? Because it says look you
don’t have your ducks in a row and we’re rolling the dice on your retirement and boy that’s that’s just risky

Tammy Flanagan 35:56
It’s very risky. Yeah, very, very risky and while you’re in what I call no man’s land, you know you’re off the payroll, but OPM has an assigned your case yet. So there’s a couple of weeks, sometimes a month or so. When you don’t you’re not an employee but you’re not yet on the OPM rolls. That’s where you want to take somebody’s name, phone number email address from your HR office. You can find out when did my application go to OPM and before you leave, get a copy if you can get a copy of what the agency is submitting to OPM, get a copy of the signed applications in any documentation is going with that to verify your health benefits your life insurance. You know all of that you should have copies of so you know exactly when I left the agency when you should be expecting to hear from OPM. Usually it’s within six weeks. If you’ve been retired for six weeks and haven’t heard hide your hair from OPM. It’s time to call my
agency to find out when did you submit that claim? Maybe it’s still sitting in payroll, maybe still sitting on the HR office desk.

Micah Shilanski 36:56
I agree with Tammy, and if you get our retirement timeline which we’re putting out in this podcast. It’s on our website planner federal retirement.com. That’s an actual step in there. We’d like to tell the agency in advance we’d like that before retirement then you follow up with them at retirement and then after if you need to get a copy that team I can’t tell you how many times I’ve gotten that from a client and thumbed through it like oh, we’re missing the health insurance information. Oh, we’re missing survivor benefits information. You know, military time was like all of these things and now I got a heads up so now I’m working with the client and to get that missing information ready so that once we’re in the queue with OPM, I can now start submitting them things and make sure we’re on top of it. And it’s so much better to see these problems coming down in advance that be surprised by them afterwards.

Tammy Flanagan 37:41
Exactly. Yeah. Unfortunately, there are little places where the devil is in the details. So it’s really important to dot your i’s and cross your t’s before you walk out the door because you’ll be much happier knowing that you have a good idea of what you’re expecting to receive when it’s going to happen. So that if things don’t happen according to that schedule that you kind of have in your mind. That’s when you can start asking questions to that timeline. Provide is really important.

Micah Shilanski 38:09
Well, Tammy, I want to keep going because I think this is enjoyable. However, we’re probably slightly over time, which is always fun. But before we end, this is all about action items that our listeners can take you guys can implement into it. A couple of things is number one if you’d like the live podcast, you know we’re going to air these where you’re probably doing what sport you like them because we want the questions and we’ll get the feedback from you. So a little bit more interaction. Let us know that you’re shooting us an email, make sure you let us know give us a little bit of questions. Do you want to have a topic for the next one? Making sure you’re telling us about that would be fantastic. Tammy. What’s another action item for our listeners to take this week?

Tammy Flanagan 38:43
Well before you separate from the government, get a final retirement estimate and make copies of your personnel documents

Micah Shilanski 38:51
So that you could go to all of them and keep them in your personal possession not on your government computer. Right? Exactly. Yep, also going to throw out there as well. Do training on your federal benefits, right? Go to another in person class. If you haven’t gone to one, make sure you go we’re having one in Alaska coming up here in a couple of months. So you’re welcome to come to our training. There’s definitely training throughout the country. I highly, highly recommend it. And again, if you start hearing discrepancies between what Tammy and I say every HR says or anyone else great. This is when we go to the rulebook, right? And we look at the rules and you got to make sure you weren’t charging retirement. So I would say your
action item is find it in person training that you can go to this year and to get signed up for it.

Tammy Flanagan 39:32
And if you’ve already been to one go to another one. Every time I have people come as repeat customers to training. They always learn something new because you can’t absorb in six hours customers to training. They always learn something new because you can’t absorb in six hours or three hours of training all that much information at one scoop. So come back again and you’ll learn something new every time I still learn new things and I know you do too. Micah.

Micah Shilanski 39:53
Oh, I love it. Yeah, absolutely. During the training, I never get offended when people come back for another round to learn more. I think it’s fantastic. Tammy, thank you so much for taking the time and doing this to all of our listeners. We greatly appreciate it. Share the podcast, make sure you’re getting it out there. Our goal is to have another 1 million federal employees with their retirement. The only way we get to do that is with your help. So thank you for allowing us to grow. Send out this great information and Tammy until next time, happy plannin