Author Mike Miles

Mike Miles is a Certified Financial Planner licensee and principal adviser for Variplan LLC, an independent fiduciary in Vienna, Virginia. Email your financial questions to fedexperts@federaltimes.com and view his blog at money.federaltimes.com.

Q. If I take a deferred retirement at age 60 (I’m 48 now with 23 years of FERS service), can I buy an immediate Thrift Savings Plan annuity through Met Life without a penalty? A. Yes, as long as it’s a life annuity.

Q. Starting about October 2008, I’ve read and heard opinionators state that based on the country’s poor economic situation and long-term market performance, e.g., the performance of the S&P 500 index over the past 10 years, that strategies, such as “buy and hold” low-cost, tax-advantaged, index funds such as TSP’s C, F, S, and I funds, “dollar-cost averaging,” and invest for the “long term”, are no longer valid ways to invest and save for one’s future retirement. Could you share your opinion on the whether we’re in a “new paradigm” (and what is it?) and whether the “average, unsophisticated investor”…

Q. Do financial planners have to be accredited? Do they have to be certified, registered by states and/or do they have to take courses like accountants do to keep up with the latest information? What about testing? How do I learn about a financial planner’s experience, etc. What is a financial services adviser — just what the title says, advises you about your finances? Is there a site that checks for any complaints and/or if a person really is accredited or does he/she have a degree? What is required to become a financial planner? A. Anyone can call themselves a…

Q. My wife started receiving her own reduced Social Security benefit at age 62, about a year ago. I am younger and plan to start receiving my own benefit at full retirement age (66). Since my benefit will be substantially higher than hers, I know that she is entitled to a spousal benefit equal to one-half of my benefit. However, since she started receiving reduced benefits under an age penalty, would her spousal benefit (i.e., half of mine) also be reduced forever due to the age penalty? A. If your spouse claims her own benefit early and then later claims…

Q. I would like to know if there are financial adviser services knowledgeable in federal retirements that can review a person’s current situation on a one-time basis and make recommendations. What would be a ballpark price range for this type of service and do you think this type of review is worth the effort? Basically, I have been doing most of my own financial planning and I am about 10 years from retirement and would just like an expert to do a one-time review. A. There are financial planners who specialize in federal retirement planning (I’m one), but finding them…

Q. I am having a hard time finding a retirement calculator for a federal retiree that can help me determine if my current retirement income (from 30 years under CSRS), plus my investments, will be sufficient for me and my wife. Most calculators assume one is still working, contributing to a 401(k) etc., and they want to sell you their investments products. Could you direct me to a calculator (if one exist) for a retired federal employee that allows one to input his yearly retirement benefit plus having allowances for adding inputs for investments with future returns so that I…

Q: My 2010 “annual” required minimum distribution from my Thrift Savings Plan will be approximately $8,500 (about $710 per month). My “monthly” withdrawals will be $2,000.00. If I roll over to a Roth IRA that part of my withdrawal that exceeds my required minimum distribution, can I start deposits to my IRA of $1,290 in January and each month after that, or do I have to wait until May, at which time my entire “annual” required minimum distribution will be met before I can make deposits to my Roth IRA? A: The limits are annual limits, so what matters is…

Q: After contributing $22,000, including age 50 catch-up contributions, in calendar year 2009, may I also contribute $6,000 to a traditional (nondeductable) IRA, which includes the standard $5,000 plus $1,000 age 50 catch-up? A: Your participation in the Thrift Savings Plan should not prohibit you from making the maximum nondeductible contributions to a traditional IRA in 2009.

Q: I regret that I can’t remember where, but I read that legislation or an amendment was being considered that would allow Voluntary Contribution Program funds to be transferred at retirement to a Thrift Savings Plan account. If this is the case, would there be a cap on what could be transferred? A: Currently, you may direct that the interest portion of your VC account be transferred to your TSP account, but not the principal. I can’t predict what may or may not be permitted in the future, or what limits might apply.

Q: I will be retiring on Jan. 1. I recently contributed $50,000 to my Voluntary Contribution account. This is my first contribution to this account, and upon retirement I would like to transfer the entire balance directly to a Roth IRA. I have an existing Traditional IRA (never taxed and balance of approximately $65,000) and a Thrift Savings Plan account of approximately $245,000. My goal is to transfer the entire amount of my voluntary contibution directly to an existing Roth IRA upon retirement. My thought is that the only tax I would owe on this conversion would be the few…

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