What’s really changing for federal employees retiring in 2025? In this episode, Tommy and John break down the new retirement process, including survivor benefits, electronic filing, and the realities of interest rates, refinancing, and investment risks. You’ll hear clear guidance on how to navigate these updates, what to watch out for in “no closing cost” mortgage offers, and how to make confident financial choices during this pivotal transition.
Listen in to learn about the emotional side of retirement, such as overcoming the fear of running out of money, balancing survivor benefits for peace of mind, and planning for your go-go, slow-go, and no-go years. Whether you’re preparing to retire soon or planning ahead, this conversation will help you understand what’s possible, what to avoid, and how to build a retirement plan that works for your unique situation.
Listen to the full episode here:
What you will learn:
- Why you can’t predict interest rates. (7:30)
- What it’s like going through an electronic filing for retirement. (15:17)
- When you should activate Social Security. (26:00)
- The importance of survivor benefits. (30:00)
- How to overcome the fear of running out of money in retirement. (45:00)
- Why you need to be proactive versus reactive in retirement. (54:00)
Ideas Worth Sharing:
- “When somebody says a zero closing cost, do a little bit of due diligence because it’s often misleading.” – Mason & Associates
- “The decision to retire is not necessarily linked to your decision to activate Social Security.” – Mason & Associates
- “If you can’t afford to retire with survivor benefits, then you can’t afford to retire.” – Mason & Associates
Resources from this episode:
- FEFP: Fork in the Road: Understanding Your Federal Retirement Options (EP86)
- FEFP: Social Security: Family and Survivor Benefits (EP37)
- Mason & Associates: LinkedIn
- Tommy Blackburn: LinkedIn
- John Mason: LinkedIn
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Read the Transcript Below:
Congratulations for taking ownership of your financial plan by tuning into the Federal Employee Financial Planning Podcast, hosted by Mason & Associates, financial advisors with over three decades of experience serving you.
John Mason: Welcome to the Federal Employee Financial Planning Podcast. In this episode, we’re discussing 2025 federal employee retirements, specifically the new retirement process. You know we have to talk about survivor benefits as well as the standard rules around a federal employee retiring. We have recorded previous episodes the year before and the year of retirement.
In this episode, we’re kind of gonna slam those together and also provide some guidance and some new updates to those episodes. We’re gonna talk best days to retire and more. Folks, remember, unlike many content creators, we’re financial planners first, and we do this second, and each episode we share real-life experiences from decades of helping federal employees navigate the complexities of your benefit package, as well as all areas of your financial plan.
Tommy, welcome to the Federal Employee Financial Planning Podcast.
Tommy Blackburn: Thanks, John. Intro’s great as always. Looking forward to talk about this. We are, as I think our audience, so where we’re often drawing from what we are seeing as advisors, both individually and as a firm as a whole. So hopefully this is all relevant and yeah, just always, some of these evergreen topics, if you were, there are always changes that happen, but, and new concerns that pop up, but just good common themes and topics that come up. And we just recorded on the end-of-year planning, which the year of, and year before and when you retire is not necessarily always gonna be an end-of-year thing. However, it’s not uncommon which we’re continuing to see.
And I think part of that is just retiring at the end of a pay period or maximizing your annual leave tends to tip, kinda get us towards the end of a year. You did December retirement and some of that might even be mental. As I think about it, John, just kind of a clean break. Like, “Hey, I got 2025, I’m working. 2026, I’m retired.”
John Mason: I think you’re right. I think it feels good. and a lot of federal employees, the fiscal year ends and the fall, they want to get through their departments through the fiscal year. Then they have to decompress, maybe get the new person on board who’s gonna take over for them. So it does feel, in my experience over 15 years, that November, December, retirements tend to line up for all of these reasons, as well as starting off the year fresh, not working. In Virginia, it can be a little cold, though, so we have seen people that just work through winter and retire in the spring too.
Tommy Blackburn: Or plan to travel. You don’t necessarily wanna be here either, be out where it’s really cold and you can enjoy some winter sports if that’s your thing, or go ahead and migrate with the sun and go somewhere where it’s nice and warm.
John Mason: So today, audience, is September 10th, 2025, second episode of the day, releasing sometime in October. So we’re definitely getting close to the end of the year. We have a couple quick hit. Not PS, not public safety announcements, but service announcements. One, we hit on this one in the last episode. Interest rates have come down as of 9-10. So we’re talking about 6% on a 30-year note or 30-year mortgage.
VA loans even more, reduced rates. So take a look at REFIs if you’ve bought a house recently, if your kids or friends have bought a house recently, or if you’re looking to retire and move, it may not be as daunting or scary as it was before, when we were approaching 8% on a 30-year mortgage. So that is service announcement number one.
Service announcement number two and three, we’ll just combine it. A, we’re hiring, so look for our job posting that is on masonllc.net. Two or three, I guess, is we’re actively onboarding new families. By the time this release is, we’re probably going to be cutting off end of year onboarding of new clients.
What that means to you is if you want to be a new client and you’re hearing this podcast, that process starts at masonllc.net. You’ll request an intro call. That should take place before the end of ‘25. But the real planning sessions will begin in January of ‘26. So just keep in mind that we have to protect our clients and our process and make sure that we maintain our process for success.
We do that by limiting the times of year where we accept new clients. So I think, Tommy, those are the three service announcements we wanted to get out.
Tommy Blackburn: Yeah, I think you covered it. Yeah, I think that’s all great. As typical, I wanna dovetail a little bit on what you’re saying, ’cause you said it all, well, just elaborate or just some thoughts that came to mind. On the hiring, you mentioned on our website.
I don’t think it’s publicly visible on the website. So I think if you Google Mason & Associates, associate financial planner, particularly September 15th, when it’s supposed to go live, you should be able to find it, and then some of the folks that we’re working with to help us manage this process, it is on our website.
But you have to have the link, which I don’t know if you wanna put that out there, John, or if just go through the process and you’ll get the link at that point.
John Mason: Yeah, I think maybe we’ll put the link down in the description. And then also, I know we’re posting on LinkedIn, I believe, as well as FPA and CFP.
And then we’re gonna be advertising, I think, to our contacts at Virginia Tech as well, to get in touch with alumni from there. So we’re growing our team, we’re expanding our team after financial planners, then operations, and then eventually, we have a big, beautiful website now that we worked really hard on.
Eventually, on that website, we’re going to have, hopefully, a Careers page that talks about what it’s like to be a team member and what it’s like to grow your career here at Mason & Associates. That’s not live yet, but our first national hiring campaign, we’re pretty excited about.
Tommy Blackburn: Absolutely. And on the interest rates, agree, definitely pay attention, take advantage.
We like Cap Center because we believe they’re transparent. We’ve had good experiences working with them, and where my mind is going here, John, is I’ve had conversations with some people, not clients so much, ’cause most of them had already locked in good rates. Although some folks have moved and has been, I guess, some of the conversation.
It just hasn’t gone this way. Some younger folks that I’m friends and acquaintance with is where this conversation comes from. They bought houses recently and they’re watching rates go down and one, I feel like everybody is an expert on things they’re not an expert on, because I’ve definitely had conversations of like, “My uncle says this is gonna happen with rates.”
And I’m like, “Well, no offense to your uncle, but if he was so great about where our interest rates were gonna go, why isn’t he a financial planner and why isn’t he the richest person in the world?” Because he can make a ton of money if he was an expert in it. I just say that to be, I always have like this healthy skepticism when I hear these comments of like interest rates, predicting them, while it can seem very clear where they’re gonna go, predicting them is incredibly difficult to do with accuracy.
Almost like timing the stock market difficult. So yes, we would agree. It seems apparent that interest rates are gonna come down. But we’ve been saying this many people for a year or more that in. So it’s difficult. What’s happening now is not only is the Federal Reserve changing some of their mind, and I pointed this out too, as the market moves before the Federal Reserve, which is why rates have already begun to come down, is it appears that maybe the economy is weaker than it had been told.
So that is changing the math on interest rates as well. And all of that to say ultimately, typically as I’m talking to folks about Cap Center is, I mean, it doesn’t cost you anything to refinance. If I were you, most of the time, I would go ahead and take the win now, that’s in front of you, which would already save you substantial money.
And if the economy, if things don’t change drastically, chances are, if rates continue to drop, you’ll have another opportunity to do it at no cost again in four to six months with Cap Center or someone similar. So I just say all that ’cause I know I’ve had some conversations where people are like, “Hey, should I wait? ‘Cause I hear it’s gonna get down to five.” Maybe it does. I would, again, I would ear on the side of caution, take the win now, take it again if it’s there.
John Mason: Well, you and I, like normal, agree on almost everything. And the 30 year VA loan, just for reference, I’m seeing 5.6 compared to 6.1 on a conventional.
So we’re like, we’re back into like really solid rates here. And you have the interest rate reduction, the EARL is an option on a VA. You have traditional refi. Cap Center doesn’t charge any fees. So elaborating on what you said is you just refi every four to six months and keep going. And if you’re so convinced that the interest rates are going down, there’s no risk to you to refinancing on the way down.
It’s like the only risk to not doing it on the way down is if you literally think that in the four to six months after you refied, that it’s gonna bottom and shoot back up again.
Tommy Blackburn: Exactly.
John Mason: I mean, that’s literally the call that you’re making by not doing it now is you think that somehow in the window where you can’t, it’s going to bottom and skyrocket. If we think we’re on a sustained path down, you just keep going and–
Tommy Blackburn: That’s my point.
John Mason: And every quarter point and every quarter point is a win.
Tommy Blackburn: We’re on the same page. Exactly my thoughts, very well surmised there
John Mason: So, audience, forgive us because we’re on a tangent, but we’re gonna tangent for a little bit longer, is I have one client who I know is listening to this podcast who maybe just purchased a house.
And we were talking through some of the scenarios. One 6% is much better than seven or eight, so that made the house purchase very easy, but they’re selling their home and buying a new home. And unfortunately, this particular client did not take our advice to open up a home equity line of credit in advance of this process, which would’ve made everything really, really easy.
That’s okay, because we’re gonna put 50 to 70,000 down on the new home. We’re gonna sell the existing home. Then we’ll probably do a loan recast, or loan modification, or we’ll refi, depending on where rates go. So, just saying that even with a home buying or relocation, think about your options.
Think about loan modifications or recast. Think about having a home equity line in place to have you have flexibility to make a large down payment before you sell your current home. I personally, anytime I hear, Tommy, like, “I need to make a cash offer.” It’s like, where’s this cash offer thing?
Like, the only reason a cash offer seems valid to me is if we need to close in seven days, or–
Tommy Blackburn: No due diligence.
John Mason: Yeah, no due diligence. Or if the buyer or seller, the seller doesn’t think that somebody with two or $3 million in a 850 credit score can’t get qualified for a loan. It’s like, I don’t see how it’s any different to the seller regard, whether it’s cash or financing, unless we’re just convinced that the financing’s gonna fall through,
Tommy Blackburn: I guess. Yeah, I guess it’s just if you’re the seller, like who’s easier to work with, and cash, like maybe what I’m thinking there is the appraisal doesn’t come back right. And now if you’re borrowing money through normal financing, yeah, maybe you gotta shore it up or like figure out how do we make the math work for the lender.
So maybe, but I largely agree with you. It’s like outside of that, you’re getting cash as the seller. I guess one is maybe feels more of a sure thing, but I don’t even know how true that is. People still pull out of deals all the time in these situations, so yeah. And truthfully, you hear a lot of the advice from real estate agents is like, “Oh, why don’t you do an indirect rollover out of your IRA? You got cash.” Or it is, let’s say we’re gonna make a cash offer, which indirect rollover, we got 60 days to put it back, or we’re taxed on it. So, and sometimes they’ll call it your IRA loan, which doesn’t exist, by the way.
We’re just, we’re calling it the wrong thing. And then the other is like, let’s just say we’re gonna make a cash offer and hope that the financing comes through in time so that again, the seller has their cash that they’re expecting, and if not, we’re gonna have to go hit our IRA or some other way to come up with this cash.
So I suppose, definitely on a soapbox tangent here, I’ll take a step back, John, it seems like, I know you got, I think you got something you wanna dovetail there, but I just was thinking on the Cap Center thing. Truly zero closing cost. And my soapbox here is we’ve seen there are other lenders, I believe, out there who operate like them, but there are many who also say, “Hey, we do know closing costs.”
And what we see, the truth there is, when we get those closing estimates, is they’ve just rolled the closing cost into your mortgage. So no, there are still closing costs. You’ve just hidden it. And now I have a higher mortgage payment. So Cap Center doesn’t do that. The interest rate is the interest rate.
There’s no closing costs. There are funding of escrows and things that, that’s not their cost, that gets in there. But just transparency there. And I guess a word of caution, when somebody says zero closing costs, do a little bit of diligence because it’s often misleading.
John Mason: Good point. Hey, audience, if you’re thinking about relocating, have the rates moving down to 6% or sub six?
Does that change the stars for you? Does it change your ability or willingness to think about moving? Share with us via email or in the comments section below. Also, if you’re hearing these rates and you’re not refinancing for some reason, we’d love to hear from you why. So maybe we can help you overcome that objection.
So Tommy, retirement 2025, you’ve already helped one client go through this process. I think DOGE largely had, Department of Government Efficiency, largely was responsible for this. But we finally now have a digital electronic filing for retirement, with a caveat that maybe it’s not all digital. So in a few words or minutes, however long you need, share with me, share with the audience what was it like to take your first client through this new digital experience?
Tommy Blackburn: It was a positive experience. It seems like it is a good change. However, there are some things that seem a little unclear and I’ll elaborate. And one of the clients were actually, we did this together online, and I got to see this experience, said that their experience was, is that it was very difficult getting to that step of, I guess, getting into the system or getting it kind of queued up so they were eligible to do it.
I wasn’t part of that. I wasn’t a participant in that part of the process, so I’m not exactly sure what all goes into the, at this point, like, “Hey, you can actually go online and do the application.” But once we got to the application, it seemed very much like the typical paper form, which also, I guess a best practice in my mind, is we can go pull those old paper PDFs, I believe, is it the 3107? Is that correct, John?
John Mason: Standard Form 3107, Application for Immediate Retirement. That’s the, I believe that one’s first. There’s a different one for CSRS, I’m not mistaken.
Tommy Blackburn: Yeah, I thank you. You are correct. But anyway, we can go pull those and pre-fill it if you just want to be able to kind of roll real quickly when you go through this online application, but it follows along, it seemed, as you would expect for a digital experience. Now the oddities are, which I haven’t gotten confirmation yet, exactly how this is supposed to work, is as far as like vaguely continuation of insurance, they ask you the questions like you would on that form of, “Do you have basic, do you want to continue it at nothing? 100%, 75% reduction?” Those type of questions, do you have the other options of FEFLI? So you fill that out online, like you would the form, makes sense. Then it says like, “Hey, we need you to attach the form signed.” It was like, why? Why did we have to, why did we even fill this out online if you’re just gonna ask me to attach a PDF of the same information?
So not clear if that’s actually the requirement. That’s certainly what it appeared to be. And the other was, as far as tax withholding, typical to the retirement application, do you wanna have taxes withheld? Yes, we do. We wanna have it withheld, like it’s been withheld. And then it said, “Well, that’s great. We need you to attach a W4P.” Which is like, that’s different. Previously, it was if you’re gonna just keep it withheld, how your current withholding is, we don’t need anything. If you wanna change it, we do. So why do we have to attach that? So it was just odd. There were some attachments that wanted, which also as we walk clients through this, I guess a peak of to what we’re talking about is, yeah, we want, taxes withheld and let’s not get too wrapped up on it, because what’s gonna happen is once you’re adjudicated, we’re gonna tell you or go, or with you onto services online massage or federal withholding to what we think is correct, as well as add state tax withholding.
Because by default, that’s not part of that. And usually, we need some state taxes withheld. So again, we try not to get too wrapped around the axle on the withholding on the front end. Like let’s just keep the process moving. On this one, the recommendation was, since they’re making us, or at least appear to make us submit an actual withholding election, “Hey, just do single and zero.”
That way we’ll have the most withheld, which is probably overkill, but we’re gonna rapidly change it once we can get into the system and customize it.
John Mason: I think maybe for the first time in my life I have nothing to say.
Tommy Blackburn: Yeah, I guess you haven’t been through it. It’ll probably come up as we go.
John Mason: Well, it’s funny ’cause as you were talking, I wrote down tax withholding, single zero, change after adjudication state. I wrote down all the same things in case you didn’t hit on ’em and you did. So good job. I guess maybe the one thing that we can also say is we can make tweaks on withholding via IRA distribution or we can make a tweak via withholding or on social security.
So we have quite a few options there. Remember this is a combo episode, the year before and the year of, as well as retiring in 2025. So understand that TSP distributions are a little bit more complicated as far as tax withholding goes. A, it’s a pain to dial in the federal, and then B, they don’t let you set up the state.
So that’s why we much prefer taking IRA distributions over TSP distributions. Question is, well, I guess one statement, then question is you still have to know the answers to the questions before you log into the system. So I think, to your point, is very valid about downloading the 3107, downloading the 2818, and all these other forms, knowing the answers to your question, watching the Mason & Associates YouTube videos and podcast, knowing what all the 75% reduction means and et cetera, so that way you feel educated and empowered. So when you’re filling out these forms, it’s not like you’ve never seen these variables before. So that’s one. Where were these people when you applied? Were they at work? Were they at their house? Could you connect via Zoom? Because so many things are accessed via these, like special DOD or federal employee, I think they call them cat cards.
And it’s like sometimes you don’t even know your passwords to things and they just stick the magic card in and everything works. So how did this work?
Tommy Blackburn: Yeah, I love it. And so this was, they were at home, so federal employee, husband and private sector wife were at home for this meeting.
And a lot of, I think, a good kind of story to unpack here about leading up to retirement and keeping the confidence of this decision going forward. But to answer your question is it almost reminds me of our previous episode, you said like, “I was surprised when I showed up and the client’s children were in the room. Like I didn’t know they were gonna be there. It was great to have them.” But, and that’s kind of how this went. I knew we were talking about the process and I was like, “Well, I guess, you probably can’t share the application. You probably gotta be like at work on a secure computer that’s not gonna let you jump into this meeting.”
To my surprise, John, they said, “Well, actually, I’m in it right now and this other laptop that was not a work laptop.” So I guess you can get to it without being in that ultra-secure environment. So they joined the Zoom meeting from the other computer that they happened to have with them. I think they were laughing that they had like three computers going at during this meeting as they were looking at different things.
So it wasn’t behind that like secure work firewall setting. We were able to get in there at least, based on that experience and see it, much to my surprise.
John Mason: Well, that’s really cool that you were able to do that. And I’m kind of joking around in my head right now, but I’m like, I wonder if the website is http:Iwanttoretire.
And it’s like, it’s not even a secure website. I really hope that’s not the case. I’m sure it’s secure, but it just, one of those things that pops into my head. It’s like, “Maybe it’s not even a secure website.” Anyhow, that’s just me being funny. But it’s awesome to be able to take clients through the process.
We’ve been doing it, me for 15 years, Tommy since 2019, helping federal employees fill out these forms and printing them and signing them and notarizing them. So it’s just nice for us too to be able to now actually help with the click pattern. Tommy, it doesn’t matter how many times we can educate our clients on these things.
Ultimately, even like Social Security and Medicare, the Medicare Part B application. I am sorry, audience, or I’m sorry, clients, if this makes you feel bad. Couldn’t get much easier. It’s like a few buttons, “Yes, I want it,” and then you’re done. But when you’ve never done it before and it’s your first time and only time ever applying for Medicare A and B, what seems so basic to us is still scary to you.
And I’m really excited now to be able to help people through that click pattern because there was a certain amount before where you’d help them fill the forms, but then they’d have to mail it or turn it in and it just felt incomplete. Now it feels a little more complete with what you’ve been able to do.
Tommy Blackburn: Oh, I love it. Oh, because if we can continue doing it of just like, “Hey, let’s actually submit that thing online together. I’ll walk you. Yeah, walk right beside you.” And even on these attachments, so that was part of it as well, was like, “Okay, well, here’s the FEGLI continuation form, how it should be filled out. Make sure you sign it, attach it. Here’s your W4P.” So just really trying to make it as easy as a process as possible for clients, as we go through it, which they seem to be very much appreciative. Same thing with Medicare and Social Security, John. Like, we go through it and it’s like, “Yeah, this isn’t really,” hopefully, this isn’t offensive or anything to anybody, it’s not like rocket science, right? But we do it all the time. And I was thinking about your Medicare example. So we’re efficient. One of the questions on that very easy application, when you do them enough, is do you have group health coverage? And I think that question trips up people every time they see it, particularly for our clients, because they do have group health insurance, by their definition, as a retired federal, you know, they have FEHB. And so it’s just very quickly explaining, “Hey, if that question is asking, do you have group health insurance to your current employer that you’re employed, actively working?” Yes, you have group, but you are not actively employed.
That’s what they’re looking for here. So no, you do not have group health coverage for purpose of this question. So it’s just one of those things where we can very quickly clear the fog, ’cause we do it. It’s not overly complicated, but I definitely get when it’s your first time seeing something, just like what exactly?
And they’re we’re all as a society, I guess at this point, particular federal employees is very cynical and skeptical and untrusting, right? So you see a question where you’re like, “That could be interpreted multiple ways. And I’m not gonna answer it until I fully understand it.”
John Mason: So maybe continuing on the Social Security and Medicare, the year before a year of retirement, many federal employees are gonna retire at 57, have the first supplement. But there’s a lot of people that’ll retire 62 or later. And I think it’s important just to quickly hit on, Tommy, that the decision to retire is not necessarily linked to your decision to activate social security. And generally speaking, we’re fans of one person activating early, the other person delaying until 67 or 70.
That tends to be a really good sweet zone for us for a lot of reasons. and you can go back, audience, to previous episodes and listen to that, but that’s tends to be our recommendation. So just think about that too. The decision to retire is not necessarily linked to when you activate social and the decision to activate social, hopefully, you’re educated and empowered to make a good decision and you’re not doing it out of fear. Common things would be like, “I want to activate my social because I don’t want to take a TSP withdrawal.” Or, “I wanna activate my social because I think the whole government’s gonna go bankrupt.”
Well, if that’s the case, then your first pension’s gone too. So we’re really up the creek without a paddle regardless there. So, and then we talked, Tommy, a little bit too, which I think will dovetail right into survivor benefits is, “I’m gonna live forever, or I’m gonna die tomorrow.” And people tend to say both of those things–
Tommy Blackburn: They don’t say it directly. You have to read into it to ultimately distill it down to that. And it is, but yeah. Yeah. So keep going with it.
John Mason: So the social security claiming scenario is like, “Tommy, I’m gonna die tomorrow. I need to get it while the getting’s good.” And it’s like, “Well, okay, and you also wanna decline survivor benefits. This doesn’t make sense.” Or then we’ll say we need some life insurance.
And like, “Well, I’m gonna live until 90.” It’s like, “Okay, well, which one is it?” We’re activating Social because you’re gonna die tomorrow, but we’re also gonna decline survivor benefits because apparently you’re gonna live forever. And it’s just funny to help people through this claiming process or claiming decision.
So maybe we can also just say, as you lead up to retirement in 2025, full survivor benefits is the answer 99% of the time. 0% or even the half survivor benefit, in our opinion, really not on the table for 99% of the people out there, in our opinion.
Tommy Blackburn: Yeah, I think you’re right. There’s always gonna be some exception case that could probably, you know, in an extreme enough situation, you could paint a picture where we could get on board with okay, this very rare case. Sure. But 99.9% of the time, yeah. Survivor benefits is the answer. John is, you and I talked years ago, a lot of times too, it’s okay. We agree that survivor benefits is part of the answer.
One because the pension and that benefit is valuable because we want our spouse to have access to FEHB, which means they have to have a survivor benefit to maintain that access as well as have been on FEHB. And so that means zeros, if we’ve gotten to the point of zeros out of the picture, well, now we’re at the 25 or the 50% and 50 being the full benefit, maximum benefit you could do there.
The cost difference at definitely we then we would say, is we’re not, it’s full survivor benefits. They’re, I mean, really, what are we talking about the cost difference here? So that’s part of that decision or logic of how we could get there. What we will see, John, too, easier, I think, for people to think about things a different way and we try to steer it back is if we have two federal, right?
And so that’s where I think sometimes the logic or the thought process is, “Well, I’m gonna have my pension. They’re gonna have their pension, they’re gonna be fine. They’re gonna have their own FEHB, so I don’t have to worry about SBP to leave FEHB health benefits to them if something happened to me.” Which we certainly have our thoughts on that as well.
John Mason: Yeah, need is always a very interesting word. And like. I’ll share with the audience. I bought a recently a 2006 Toyota Corolla, and the check engine light comes on sometimes for $700 because I didn’t wanna drive my $3,500 around town three to five miles a day.
I didn’t need that car. But I certainly didn’t need a 30, 40, $50,000 commuter car to go three miles a day either. What I’m getting at is there’s a lot of things in life that we don’t need. We don’t need to go on vacation. We don’t need maybe to eat organic. We don’t need to go out to eat. We don’t need to drive $70,000 vehicles.
We don’t need to wear designer clothes or have jewelry. So there’s a lot of things in life we don’t need that we choose to buy because we find value in them. We would argue that having full survivor benefits may not be a need, but it’s something that if one is properly educated on, you’ll see the value in it and you’ll believe that it’s a good purchase.
So I think that’s just such a good thing for people to–peace of mind, and the decisions that you make when you have full survivor benefits are just different. We’ll link, hopefully, our team will do this. Our number one YouTube video, I’m pretty sure, is Survivor Benefits. We’ve talked about this at length in other episodes.
Just a couple thoughts there, Tommy, if you can’t afford to retire with survivor benefits, then you can’t afford to retire. If that’s what’s gonna make or break your retirement is the pre-tax 10%, then you need to work another year or more to be able to get over that hurdle.
Another one that we’ve said for a long time is if you can’t afford to do without 10% pre-tax of your pension, how is your surviving spouse going to be able to do without all of it at your death? And these are just things that we help people understand. It’s like, what are we really talking about? And then keep in mind that declining survivor benefits nowadays, you’re also likely declining social security benefits for your spouse too, because we have a lot of dual-income families and you only get to keep one Social when one of you passes away.
So for a lot of folks, you can only protect half your income anyhow, and you’re voluntarily just getting rid of all that.
Tommy Blackburn: Forgoing it.
John Mason: Yeah, it’s hard.
Tommy Blackburn: Yeah, I love all of that, John. And I think part of conversation, too, was what, yeah, again, pointing out was like, hey, on the one hand you’re saying you’re gonna live forever, “so I don’t need survivor benefits.”
And also I’m not waiting until, “‘Cause I’m gonna die soon, I’m not waiting till that break even on social security. So I’m turning it on early,” which people usually enjoy that analogy as they think it’s friendly conversation. And usually we’re all chuckling as we reflect on it. Another part is navigated this recently, John, which I think we all would say it in some form or fashion you kind of already are, is it’s like, don’t let perfect get in the way of good enough is I think you’re trying to mathematically build this model in your mind of, “I’m gonna optimize everything and by not taking survivor benefits, I’m gonna invest it and it’s gonna grow to this or that.”
It’s like, well, what about the loss of the peace of mind that if it doesn’t work exactly the plan, how you’re sketching it out in your mind. And the other part that I believe resonated was I’m willing to bet you taking survivor benefits doesn’t change the enjoyment of your financial plan one bit. I am guessing that you are gonna have exactly the same enjoyment in your financial plan, but with a much greater peace of mind.
And to your point, like what does that free up mentally, knowing you have survivor benefits and how you navigate the rest of your plan? So I think those tend to resonate too, is like your enjoyment of your plan is going to be the same. Just one of these feels a whole heck of a lot riskier.
John Mason: And you’re gonna make the same or more money in retirement, more than likely.
Tommy Blackburn: Right.
John Mason: So you’re getting a pay raise and you have full SBP. Your decisions, audience, either complement or conflict. You either plan or you react. These are things we used to say when we were doing public seminars and it occurred to me, Tommy, that declining survivor benefits, because you’re gonna live forever, but then also activating social security, ’cause you’re gonna die tomorrow, is really a double whammy.
Like you’re getting hit both ways, because let’s say you do die at 63 or 64 years old, well, now you kind of messed up your spouse twice. One, we didn’t delay till 70, so there’s no gigantic survivor social and we declined SBP, so there’s no income there. You lose twice. so your decisions need to complement or they conflict.
Maybe there’s a world where I could get on board with declining SBP and delaying your social till 70 at least we’re hedging our bets a little bit. Or maybe it’s like, you know, take full survivor benefits and turn social honorly. Like, but it shouldn’t probably be…decline and–
Tommy Blackburn: That’s funny you say that. That’s even part of the conversation, which I believe in the scenario that I’m thinking of, we got to a place, as a advisor-client relationship of we’re going to turn on SBP and we’re going to delay social security for one, take the other early. But the delay of social security was, we’re probably looking at age 67, even though the math says, “I’d like you to delay it to 70. Like I realize that’s asking a lot. There’s a lot of things that go into this.” It was the don’t let perfect get in away a good enough conversation. It was like, I feel pretty strongly about Survivor benefits on that pension. Social security strategy, I can be a little more flexible on. I mean, ultimately it’s your decision. So we don’t wanna say that we’re dictating to clients.
Though if advice is never landing, we don’t know what the point of the relationship is. But all just to say social security timing, I feel a little more flexible on that, particularly if we can agree, we’ll take one early. Let’s try to delay yours as long as you’re willing to, but, so yeah, I think it’s dovetailing exactly to that conversation that you were talking about.
Thinking about maybe going back to maybe a little bit of like the process and prep for retirement and the confidence building, but don’t wanna move us off to where we are on the topic at the moment. There’s more you wanted to hit on.
John Mason: Well, like normal, we’re on the same page. So November 29, December 31.
Look like ideal times to retire, Tommy, at the end of this year. And quick recap there, end of a month, end of a pay period is typically what we’re shooting for under FERS. That just gives you the optimal time to retire, where you don’t have a gap in pay. So I think that’s important and I guess maybe we could just quickly talk about FEGLI, maybe, I don’t know.
Do you wanna talk about FEGLI elections? Do you wanna talk about maybe like TSP and service transfers and like preparing for your retirement income? Where do you want to go?
Tommy Blackburn: I think let’s kind of hit it all. So I’m gonna try to think about like, mentally, how this conversation, or kind of lead up goes.
So typically, we’re working together, building the plan, everybody’s feeling good, and then it’s like game time. Okay, we’re kind of like in the year before, or like right around retirement, so let’s rebuild confidence and make sure we’ve got the tactics down. So part of this is just like, “Hey, what’s the actual pension and cash flow? What’s it looking like here?” Like, my salary’s gonna get cut off. So it’s number one, here’s a quick recap of the process. You’re gonna retire, you’re then gonna get your final pay, you’re then gonna get your annual leave. So probably the first month of retirement doesn’t feel like anything changed.
In fact, probably feels like you got some bonuses. Then you’re gonna go into interim. Which maybe that’s going even faster with some of this, you know, doge electronic stuff, I’m not entirely sure at this point. But your interim pay probably about 70, 80% of what your final gross will be. But ultimately, when we adjust for taxes, FEHB and things, that interim pay is probably not gonna be that far off of what you’re actually adjudicated pay is gonna look like.
There may be some change, then you’re gonna be adjudicated. So that’s your new pension set. And we’re gonna go into services online, make any adjustments to withholding we want to. So that’s kind of the quick recap on the process. The other part is I think through a scenario of going through this with a client was, “Well, what exactly what’s my pension gonna look like?” And this one was, you mentioned a supplement, so it was like, “We’re gonna have a supplement and we’re gonna have the pension. We estimate it to be these amounts. And while there’s some variability in your tax projection right now, particularly ’cause the spouse’s income gets bonuses,” and stuff changes, right?
We have to dial it in every year. “Roughly, when we adjust for taxes right now here and we add, adjust for FEHB premiums, X is what we expect to hit your checking account. So that’s your net pay from these streams.” That’s helpful for our client to then be like, “Okay, well, now I know what I have been net, and you just told me what I will net. Thank you for making sense of that. What about the delta, assuming I want a full replacement?” Which is what we’re typically shooting for. And so that’s when it’s, hey, is anything in life changing that would change the need for it to be a replacement? But absent that, IRA distributions, TSP, most likely IRA is what we’re looking at to replace it.
Here’s the distribution percentage and this is healthy, not healthy. Our social security strategy comes into it, that’s when all of that’s laid out. And ultimately, we’re gonna take probably three to 5.5%. Maybe while we’re delaying Social Security, we could see even higher amounts depending on the situation.
Net it out for taxes. We’ll account for that. Here it is. Your cash flow stays the same. Everybody feels confident, Mason & Associates feels confidence in your plan. We’re good, right? So we’ve gotten through the cash flow part of it, and then we wanna talk about FEHB and FEGLI. And I think–
John Mason: Let me touch on just real quick. A lot of times we’ll do like mid-month distributions, Tommy, from the IRA, ’cause all the pensions tend to hit the first of the month. Federal employees like to get paid twice a month or every two weeks. So we can stagger those distributions, which I think is helpful. Beware the first supplement retirement gap, where you don’t get any interim pay for your supplement and that’s all back paid at the end.
So that’s something to be aware of. As far as like when to submit your application, what was communicated to us is that there is value and submitting the application well in advance of your plan retirement day. And what I mean by that, Tommy, is the retirement processing people are still gonna handle the June pile before they handle the October pile, right?
They’re gonna retire, they’re gonna handle those June ones first, right? But you could still be on top of the October pile. You could still be the number one in that list. So there is some value in getting your application in early. We typically say at least three, maybe closer to six months in advance.
Generally speaking, under the old system, Tommy, I mean we were seeing adjudications in two to three months. Pretty common. All over the internet, all over websites in Reddit and people are talking about six months, 12 months and I just have never seen that. So I don’t know if people are just A, very unprepared, or B, submitting very late, but historically we have not seen–
Tommy Blackburn: I guess these certain agencies are maybe better than others.
John Mason: Possibly, yes. And so plan for six, but know that it can happen in two or three. If you are divorced or you have special considerations, plan for 12 could be 24, because now all of a sudden we have spousal adjustments and spousal annuities.
Tommy Blackburn: Whole process. Yeah.
John Mason: A whole court-ordered process, which can be a nightmare. If you were to do a TSP transfer, Tommy, which we recommend that, is go ahead and do an in-service TSP transfer to an IRA, whether it’s at Vanguard, Fidelity, Schwab, or with somebody like us. Know that’s a process that takes 14 to 30 days.
Tommy Blackburn: Yeah. So we walked through this with our clients as well, and that was part of the scenario and really typically part of this process. So we’re firming up retirement, the decision. And as part of that, let’s get this TSP rollover in motion, which is how we continue our relationship, but also gonna give you flexibility, better service, ’cause we’re here processing things as much as we need to change withholding. And as part of that process, “Hey, let’s log on to TSP.gov together. Step one, if we’re in agreement, let’s get Axos as our custodian, Axos Advisor Services. Let’s get them,” or could be Vanguard or whoever in your situation, as a financial institution on file.
And the reason we do that in the IRA or and or a Roth IRA account number is it kicks off a blackout window, which I believe is 10 days. So just getting that on file is a good security measure. I get it. In case somebody who’s not supposed to be putting things on file does that, they’re gonna send a letter out and a text message saying like, “Hey, something’s changed. Nothing can happen to your account during this window.” That opens back up. Now we can actually process or submit the actual rollover application, which we’re big fans of partial rollovers, and the majority of your account being in that rollover.
We like to leave some money at TSP just in case we ever want to have money go back, as long as the account’s open, that door is a revolving door for a variety of reasons. Go through the wizard together online to get the application going of the partial rollover. Final step is one, we’re gonna send a security code to you, then if we have a spouse, which is typically the case, we’re gonna send a DocuSign to the spouse to say that they’re okay with this rollover as well.
So spouse has to execute that DocuSign, then TSP will begin the process of actually selling the funds in the account, cutting the check and sending it to the address that you’ve had said to have it sent to. So it’s good to get all that done ahead of time and then have the IRA ready, right? So it’s gonna show up in an example at the Mason & Associates IRA that we’re managing for you.
We’re already gonna have it linked to your bank account. We’ll handle the investments. All that’ll be happening. And then yeah, it’s distribute, it’ll be seamless for, you’ll either have a systematic monthly that we’ve already agreed to set up. If we need a one-off distribution, we can do that very quickly, if we need to adjust.
So it’s just a much more seamless, flexible situation and you’re not going in, ’cause if you didn’t do this and you retire, TSP, I believe, is gonna go into like a, “Hey, you can’t really do much of anything until X amount of time and we’ve like cleaned our systems up and even if you can do it because we’re switching you from employed to retired, and even if you can, we’re gonna force 20% withholding for federal and then state.” So it’s just, you can only do X amount, I think it’s one per month, but you know, it’s just far more seamless transition. Less feeling like emergency panics, around cash flow. Get that IRA ahead of time.
John Mason: Love everything you said, Tommy. Ultimately, one of your big choices here is what website do you like better? What customer service team do you like better? Where do you get the most flexibility? We would argue that for all of the greatness that TSP has, distributions are still challenging and it’s infinitely better than it was a decade ago.
But it’s still challenging. And as we think about distributions, I think what’s important for folks listening to this podcast to understand is that we understand that it is going to be a transition for you to spend your own money in retirement. You say this very well, Tommy. What served you well, what was a strength your entire career has now become a weakness. And if we’re turning on social security because we’re scared to take a distribution, that’s not a good reason necessarily to turn on social. You have your go-go years, your slow-go years, your no-go years. Understanding the plan, understanding what’s possible.
There’s a risk for all of our federal employees that they could run out of money one day and I’m only talking investment dollars because I don’t really think there’s a risk that their pensions go away. I guess it is a risk out there. I just don’t see it happening.
Tommy Blackburn: Very low on the risk totem pole.
John Mason: So yes, there is a scenario where federal employees, if they take distributions, could run out of investment dollars.
There’s also a risk that says you could die with three, four, or five times the money you started with, that you never got to enjoy any of it. And I could make an argument that both are equally bad outcomes, and maybe the worst outcome of the two is never enjoying any of your money and having it just stockpile up so that you can pay more taxes to the government one day.
Never get any enjoyment out of it. Create a tax nightmare for the people who inherit it. At the end of the day, I mean, inheritance is still good. At the end of the day, even if a lot of federal employees run out of investment dollars, their plan’s always gonna work. They just have to adjust to the fact that now they only have X amount of pension income.
Which for a lot of folks, they could still sustain life pretty well. So I think both are risky. 3, 4, 5% distribution rates are prudent. Audience, we hear you, we’ve done this for decades. We know that it’s scary. If you’re scared and you haven’t committed to that big retirement trip or spending your own money, it’s likely because you’re not confident in either the math that you’ve done or the math that your planner’s done.
Hopefully, that’s not us, by the way. Or maybe you just need to live it for a little bit, Tommy.
Tommy Blackburn: It’s normal.
John Mason: But it’s gonna take a little while, but you definitely need a team to help you get confident in the strategy that you’re going to use. Because it can be scary to pull money out of the piggy bank.
Tommy Blackburn: Sometimes it’s phases, too, right? Of like, let’s just get you confident, this is gonna work. And even without us getting you to enjoy life even more, just, hey, your cash flow is gonna be the same and get you comfortable, confident in that, get you retired and get you confident that all the rug’s not gonna get pulled out from under you.
And then we can continue working on the confidence of, hey, you should, and think about some of the other things you wanted to do in life. What are they and how can we help facilitate? And yes, you can do it, as we talk or as John has said before, and this is probably maybe from Mike or Kim, where you got it.
We’re also not gonna tell you fairytale. So you can rely on us to say like, “That’s not a good idea. That’s not sustainable.” Certainly, we want, that’s not where we want our default to be. And most of our clients are prudent responsible people. So again, it’s more of a conversation of you can actually, probably do more than you think you can.
But if it seems like we’re teetering on down in an unsustainable path, we’ll certainly let you know that as well. John, as I kind of thinking about some things to cover here, I think maybe we wanted to hit on, well, one, the estimate kind of leading, maybe we stepping back ’cause we had a situation, we see this occasionally where the estimate from GRB is not necessarily accurate.
It doesn’t mean that your. Retirement will be processing accurately, just means pay attention. So probably want to hit that. And then I was also thinking about maybe some like FEHB and TRICARE for life stuff maybe getting sprinkled in here.
John Mason: Yeah. So GRB could be wrong for a couple reasons. One, they don’t have your years in service time correct. Maybe they don’t have your high three correct. If you had a unique scenario, so that just understand your service high three, all the factors that go into this. Maybe it doesn’t capture your military time that you’ve purchased or your academy time that you’ve purchased.
Maybe you had a break in service, maybe you have a part-time factor. We’ve seen GRBs wrong on both sides, over and underestimating. Further to that, Tommy, is the GRB platform is going to assume what I believe what people tell it to assume. So tax withholding, FEHB elections in retirement, FEGLI elections in retirement. And oftentimes, folks will look at this and they’ll say, “oh my God, that looks terrible. I worked an entire career to make X.” And it’s like, well, wait a second. Taxes are way off. We’re gonna take the hundred percent reduction on option B, we’re gonna do the 75% reduction on FEGLI basic. And oh, by the way, we’re gonna scale you back from FEHB standard to basic and save two or $300 there, and all of a sudden you’re making that net go up rather than go down.
So GRB can be materially, for materially misleading, not maliciously, but based on user input.
Tommy Blackburn: Oh, it’s making assumptions and user input, like you said. And also, it’s not the entire picture, so we’re looking at your investment assets, your social security, kind of how does this all tie together.
But yeah, typically the net you get outta that system is not the same net we’re gonna end up as we start massaging things and customizing it for you. I have to say, as an aside, that academy time was really cool to see recently. So we see it on the LES that it’s been paid for. But man, talk about probably the best investment ever as far as buying that academy time.
It’s like $800 to buy it back, which had already been done and resulted in $800 more per a month in the pension, where it’s like, that is amazing. So yeah, always cool to kind of see that actually in real life taking place. But one of the things that doesn’t seem to be caught in that GRB estimate, so just be on the lookout for it.
And of course, watching it as you go through adjudication, that they are capturing that time correctly.
John Mason: I believe Tommy, the formula is 3% of base pay to buy that military time. So 3% of when you were in the academy is a very small number. If you don’t do it within two years of joining federal service, they start tacking on interest to it.
In this case, it still would’ve been a very reasonable purchase. This leads me down the path that says, if you’re thinking about retiring soon, have you purchased all of your time? Is all of your time paid for, whether it be military breaks in service, part-time service, whatever the nuances are, have you purchased or do you have credit for all of the things that you should have credit for?
And we’ve seen issues with people retiring under the reserves, not buying their active duty military time, not buying the academy time, breaks in service, or maybe you separated, took a refund and went back. I mean, there’s a lot to unpack here. Hopefully, you’re doing that well in advance of your retirement.
Our understanding is if you’re going through a adjudication and they uncover things that you could have paid for, they’re supposed to bring it to your attention. But a stronger position, Tommy, would be to have already done all of that in advance.
Tommy Blackburn: We want to plan, which is to be proactive and intentional versus reactive, as you just said.
So yes, maybe somebody will uncover it and you’ll get to react, hopefully appropriately. But yeah, we wanna be on the front end of all of this, so it’s a smooth sailing, no surprises.
John Mason: Maybe we can also say just from like an emotional standpoint, we understand that federal employees who make X who retire with Y and Y is less than X, just from a pension standpoint. And then seeing the GRB be low, we understand that can be emotionally troublesome, but if FERS is very low, but now we don’t have to have any taxes withheld on an IRA distribution, we’re okay, it’s our total income that we care about.
And I think sometimes people can get wrapped around the Excel where they’re like, “I need my FERS to be higher.” And it’s like, but your net is where we want it. It doesn’t really matter where we’re doing the tax withholding or where we’re paying the life insurance or health insurance premium store. It’s just a tool.
Tommy Blackburn: Yes. Well, yeah. Yeah. It’s all part of a bigger puzzle. It’s one realizing that, like your gross pay was never your pay, right? Because we had things like social security, Medicare, different deductions going out of that we were saving. So like what we’re really focused on is what were you netting and then what was your lifestyle, that net.
And then, yeah, we’ve got other assets, other income streams here to get you back to that or more. And we’re gonna show you. And John, I was thinking, we love our financial planning software. It is very powerful and it’s great for strategic projections, like really going to the bigger picture, somewhat maybe tactical kind of year by year, but it’s really a good strategic tool.
But oftentimes, for this conversation, good old Excel spreadsheet of just showing here’s your net from your first, here’s your net from social security, here’s your net from your investments, whatever they are to get you to X. Now does this all make sense, and then that’s just so easy and powerful for people to see like, “Okay, I get it now. That’s all I needed to see.
John Mason: A whiteboard, an Excel board. Sometimes the more sophisticated the software, the more concerning or troublesome or less under, like we start questioning.
Tommy Blackburn: It is harder to digest it. I think on particularly that kind of like, “Here’s your snapshot for the year,” like, which is very easy for you to understand.
And then we use this to see like, longer term, this is giving us some messages of how we’re going to take advantage of things and, but how, just your back of the napkin can be so powerful for somebody. I think it’s confident to see it both ways, right? Where they can see, “Man, it’s really neat to see like all the thought and the long-term strategy and how you guys are planning and how you’re gonna bob and weave based on what you’re seeing and add value. Like, that’s so cool, ’cause I’ve never done that strategic, or if I did, it wasn’t, I didn’t have faith in it. But then also to see like, just very digestible what this means to me this year. That’s awesome.”
John Mason: And maybe emotionally too, or from a demonstration of competence, having your financial planner be able to just like build something in front of your eyes at the exact instant to show you what your pension’s going to look like.
Or be able to walk through an Excel sheet and deliver something so simple. And so I don’t know if profound is the right word, but meaningful, it’s like, so it’s like we inherently don’t trust software, but like when you walk through a whiteboard or an Excel somehow, sometimes it seems like we have a little more credibility, like we actually understand how we got there maybe, where maybe people assume that the software just did it all for us.
Tommy Blackburn: I think the software, you might be right about that. I think it’s also just the software is overwhelming, the amount of information that it’s trying to convey and again, I think it’s a lot of times tilted for a longer-term conversation versus the like here and now.
So I think it’s just, yeah, kind of combining both of them. I do think if all an advisor is using his back of the napkin, I’d be concerned probably about that as well, because these are both tools, right? So, you need a professional and you need them to have their tools. One is highly relying on them and their ability to do it back of the napkin or on a quick Excel.
But the other is like looking at many complicated factors that go into a long-term plan and that they probably know, but to do it without a tool or something to help, just help make sure they don’t miss something in that longer term, and I just start thinking about things like, how are we layering all of our income?
We probably know intuitively, but software can help us think through that. What about RMDs? QCDs, inherited IRAs, any annuities? Like just, it can very quickly, long term, get complex and that’s where software helps a professional visualize it and then they should be able to present it in a way that’s understandable and what’s important to you at the moment.
John Mason: Agreed. So maybe a couple quick hit items, ’cause we’re almost an hour in. For FEGLI basic and FEGLI option B, option C, we have plenty of YouTube videos. Audience on all of this. We would say that generally speaking, the bulk of our clients take the 75% reduction on FEGLI basic. Generally speaking, if you can afford to retire, you can afford to die, especially if you have survivor benefits.
We’re typically either dropping option B or, if you’re close to 65, electing a hundred percent reduction. Similar for option C, option A just reduces down to 25%. So those are, those tend to be, Tommy, the recommendations, but you need a financial planner, you need to have a game plan of what you’re gonna do, so you can answer those correctly.
Tommy Blackburn: I gotta say, John, I love the, you just gotta restate, if you can afford to retire, you can afford to die. It’s a powerful statement. I know Broc Buckles from BC Brokerage love that statement. I recently used it to drive home a point to a younger client. As far as our firm is concerned, younger, they loved it.
So I just wanna shine light on it again because it’s a, apparently we do it all the time, so we take it for granted, statements like that. But I just find it to be very impactful when people hear it, they love it.
John Mason: That’s awesome, man. Five years. You have to have FEGLI for five years leading up to retirement to retire with it.
Same is true, Tommy, for federal employee health benefits, so just understand that, the five-year roles, we’re not gonna go into nuances on TRICARE for life and all of that right now. If you do have TRICARE for life as an opportunity, we would encourage you to explore what it means to enroll in federal employee health benefits and then suspend. Again, we’ve done episodes on this stuff before, as well as episodes with Brian Gay that talk about Medicare.
So I think we have a lot of content out there that if people really wanna, people keep saying this online. They wanna double-click it. If they wanna double click on this topic, we’ll go look at some of the other content that we’ve produced. You can double click a long ways and zoom in a long ways to go deeper into this stuff, so.
Tommy Blackburn: Well, when this episode airs, John, we’ll be over a hundred episodes, if I’m not mistaken. I think we just put out our 99th. and there’ll be a couple ones ahead of this. So really cool. A lot of content out there.
John Mason: We’ve gotta be one of the top-producing contents for federal employees, specifically around financial planning, tax planning, and retirement. Beneficiary designations, make sure they’re right. I’m trying to think of any other quick hit items. Let’s see, 75% reduction beneficiaries, keep in mind like your long-term care premiums and those rate increases.
Every dollar matters, Tommy. So if we can dial back what you’re paying to long-term care, then we can dial up a distribution to somewhere else, or we can take some stress off the portfolio. We get really excited anytime we can save a client a hundred, 200, $500 because it really does add up to a material impact over a lifetime.
Tommy Blackburn: I think it’s great. I know we don’t wanna go down it too much, but long-term care continues to be a troublesome area. For those with existing policies, you’re probably getting premium increases. Genworth is certainly front of mind right now for those private policies. As John has said in the past on a different subject, I think it was around FEGLI, these premium increases are, maybe it’s not like a license to shop, ’cause I don’t really know how much shopping there is to be done today, but it’s like a, it’s a license to consider.
So it’s not a license to drop it. We probably don’t want to drop it. You’ve been paying for it for a long time. We wanna retain the benefit ’cause it could be pretty powerful as well as freeing. But we don’t have to just accept whatever’s being proposed is ultimately where we’re going with this is that let’s slow down. Let’s see, maybe we accept it. Maybe that is the right answer. Maybe we can request some alternative options from them that they don’t present by default, which probably means a reduction in some form of your benefit on these other alternatives.
But maybe that’s what’s right for you and right for your cash flow. So don’t, let’s just, yeah, let’s just stop and take a look and think about our options.
John Mason: Great point, Tommy. Well, let’s do a big congratulations to everybody who’s listening to this podcast that’s retiring at the end of the year.
Thank you for your service. Thank you for serving our country. We hope that you have a wonderful retirement into 2026. If you’re a client, thank you for being on this journey with us both on the podcast as well as the relationship we have with you. If you’re somebody who is looking for a relationship like this, like we said, we’d love to help.
And that process starts at masonllc.net. Any closing thoughts for you, Tommy?
Tommy Blackburn: I think we’ve covered it all. Yeah. I’ll also support, our entire firm supports that. Hats off. Congratulations to anyone as you’re eyeing retirement, successful career. Great habits have gotten you to this point. If we can work with you, certainly welcome it.
But regardless, thank you. Thank you for listening, either an hour of this episode or the over a hundred we should now have out there, and we appreciate any feedback. So thank you. And John, thank you for doing this with me as always.
John Mason: Oh, it’s my pleasure, Tommy. And yeah, we have a lot to celebrate with a hundred episodes, and you and I keep moving the goalpost and our firm always moves the goalpost, but reflecting and enjoying the consistency that we’ve been able to deliver for our clients and audience is pretty, I’ll say remarkable, that we’ve been able to dedicate this much time to producing this much content and more to come.
Audience, here’s our request from you. A, thank you. Many of you have listened and became a client, which is wonderful, but B, like it’s motivating for us to see comments, emails, knowing that we’re helping. If you are feeling helped, if you are feeling like we’re doing a good job, leave us a comment. Shoot us an email, say, “Rock on, guys. You’re crushing it. Thank you for a hundred episodes.” Do something to show us that you enjoy it, even if you don’t wanna do it externally, where we can see it, share this podcast and what we’re doing in our YouTube channel with friends, families, coworkers. We know it’s changing lives.
And by that, every person you share it with, you’re changing their life and you’re being their hero at the same time. Thanks again for being on this journey with us.
Folks, is our content helping you make more informed decisions? Do you feel educated and empowered? Have you made positive changes in your plan since you started following our show?
Again, please do your best to continue to spread the word for us. Leave us a comment, shoot us an email to MasonFP@masonllc.net. Thank you for tuning into this episode in every episode of the Federal Employee Financial Planning Podcast. Remember, we’re financial planners first; we do this second. And as always, we hope you leave this episode in every episode feeling educated and empowered to make positive changes in your financial plan.
The topics discussed on this podcast represent our best understanding of federal benefits and are for informational and educational purposes only, and should not be construed as investment, financial planning, or other professional advice.
We encourage you to consult with the office of personnel management and one or more professional advisors before taking any action based on the information presented.