L-fund plus life insurance


Q: I have $37,000 in my TSP L-Fund plus a $21,000 cash value on my life insurance policy. I plan to leave the USPS with 32 years of CSRS service at the age of 58. I have had a financial adviser suggest I put the combined money into an annuity-life insurance combination he says will give me a better rate of return over a period of time, without the $40 life insurance premium, for transfer of wealth to my family. I have put the extra money into the TSP to use for extra expenses after retirement (new roof, newer car, etc.) after I reach the age of 59 1/2. I am afraid the annuity-life insurance will restrict my access to the money when the need arises. What is your advice, leave the money where it is or go with annuity-life insurance with no monthly premium any longer?

A: Annuities pay big fat commissions and sales people (agents, Registered Representatives, etc.) have no obligation to place your interests ahead of theirs. My advice is to find someone other than a salesperson to help you with the decision. Sounds like you’re getting a sales pitch rather than true advice, and I suspect that this sales pitch will do the salesman more good than you.


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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.

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