Busting Common Retirement Myths

March 21, 2022 on ForYourBenefit, host Bob Leins, CPA® welcomes Tammy Flanagan, Senior Benefits Director, NITP.

“I believe legends and myths are largely made of truth.” – J.R.R. Tolkien

Today’s show will tackle some of the current urban myths that frequently circulate in pre-retirement seminars and among Federal employees who have heard these stories from a friend of a friend or they may have even read about them somewhere.  Here are some that you may have heard:

• Retirees need 70% to 80% of their current income in retirement.
• Maxing out your Thrift Savings Plan is all you need to do to save for retirement.
• At retirement, your investments should become very conservative.
• If you have coverage under the Federal Employees Health Benefits Program, there’s no need to enroll in Medicare when you turn 65.
• Only those people in good health should consider a high deductible health plan.
• You can’t count on Social Security for your retirement years.
• Those who retire in 2022 will receive the 2022 COLA in their January 2023 retirement benefit payment.
• For those who retire after the January 2022 annual General Schedule pay adjustment takes effect, their high-three average salary used to compute their CSRS or FERS retirement benefit will reflect this new rate as one of the three years.
• If an employee dies before retirement, the benefits available to his or her survivors come only in the form of lump-sum payments.
• Federal retirees cannot receive Social Security spousal or widow’s benefits.

For questions or comments, email us in advance at ForYourBenefit@nitpinc.com