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. I am scheduled for full/voluntary retirement in February 2023. I currently have my TSP contribution at 100 percent in the L2030 fund. I am getting a little nervous about the volatility of the market, so I am inclined to do something like reallocate to 50 percent L2030 and 50 percent G Fund just to try and mitigate any potential losses. Of course, I would like to increase my current $253,000 balance, but wouldn’t be averse to it not increasing that much by retirement. Conversely, I would hate to see a loss on what I have and not be able to…

Q. My ex-husband has given me the forms to receive money from his TSP account, but what form do I use to roll it over into my IRA account?  A. The distribution request form should contain a section where you can direct the proceeds to be paid to your IRA custodian for your benefit. If not, you’ll have to roll the funds over yourself using your IRA custodian’s deposit form.

Q. I had 12 years service under CSRS, a break of 13 years in the private sector, and have been a CSRS Offset employee since 2003. I understand that the government pension offset could reduce my wife’s Social Security spousal benefits by $2 for ever $3 I would receive from my CSRS annuity. Does this apply just to the annuity earned while a CSRS employee or the annuity I would receive for my total government service? Since she has earned her own Social Security benefit from non-government service, and I have 30 years of substantial earnings under Social Security, including the years…

Q. I am currently a CSRS Offset employee. Between private sector employment and Offset employment, I will have over 30 years of paying into Social Security. By the time I retire, I will have 30 years of combined CSRS (12 years) and CSRS Offset (18 years) employment. Is there some formula that weighs pure CSRS vs Offset employment. Will the WEP still negatively affect my Social Security payments? A. There is no simple formula for this. You’ll need to calculate your benefits under each system to compare them. The WEP will affect your Social Security benefit unless you have 30…

Q. I am about to turn 65 and I have FEHB. Is there any reason to sign up for Medicare part B. The literature on this is confusing and never really answers the question yes or no. Does paying the extra cost of part B make sense? What is the advantage? A. There is not one-size-fits-all way to make this decision. You should only apply for and pay for Medicare Part B, in addition to comprehensive major medical coverage, if you are confident that you will recover at least as much in additional benefits than you will pay in premiums…

Q. I am vested with TSP should I separate from the Department of Veterans Affairs. If I get fired due to unapproval of a previously approved accommodation, will it affect my eligibility for my full TSP funds in the future? A. No. Your vested TSP funds are yours to keep.

Q. I was offered VERA at office. I would like to accept, but have a TSP loan balance for a home loan that won’t get paid by the 90-day deadline. My retirement is set for July 2020. When I separate and still have outstanding balance, how will I get taxed and at what percentage rate? I was not due to retire until May 2027. Also, will it affect annuity payments, and how long do I have to pay the loan back? A. Any unpaid balance will be declared a taxable distribution and added to your tax return for that year as ordinary income. The tax…

Q. I’m a CSRS person. Will my survivor annuity increase as my CSRS pension increases due to COLA? Will this occur if I select less than a full survivor annuity? A. Any survivor benefit you elect will increase for inflation at the same rate as your benefit.

Q. Which would be more advantageous to reduce my annual federal tax bill: contribute more into TSP or withhold more and have more from my salary go toward federal taxes? Am I correct that contributing more into TSP would go toward retirement savings, reduce my taxable income and lower my federal tax bill? A. It’s impossible to say which will be “best.” One is prepaying your federal taxes, and the other is deferring income tax from the current year into a future year. If you can do both, do both. If you can only do one or other, then pay…

Q. I will turn 60 next year and plan to retire with 30 years of service. I am invested in the L2020 Fund. Upon retiring, can I stay there or do I need to move my money? A. You may keep your TSP account, and manage it as you like, for life.

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