Federal Employee Benefits Analysis

Transcription

1 Federal Employee Benefits Analysis September 8, 2010 Sample Analysis 1234 Main Street Any Town, US Note: This is an example only and formats will vary between individual retirement planners and based on your personal situation? This example is provided by Charles E. Blackburn of.

2 Disclaimer This report illustrates estimates of cost and benefits for the Civil Service Retirement System (CSRS) or the Federal Employees Retirement System (FERS), Federal Employees Group Life Insurance (FEGLI), Federal Employees Health Benefits Program, Long Term Care (LTC) Insurance, Social Security System benefits, and the Thrift Savings Plan (TSP). Some estimates are based on assumptions, which may affect the results, and may differ from actual experience. Since future costs and benefits cannot be projected with absolute certainty, you should not base your financial decisions solely on the estimates of this report, and it is recommended to consult with your personnel office or the Office of Personnel Management (OPM), Retirement Information Office All employees or agents of expressly disclaim any liability from the use or misuse of this report.

3 Federal Employee Benefits - Summary Personal Employment Name: Sample Analysis Address: 1234 Main Street Any Town, US Date of Birth: Age: 45 Service Computation Date: Annual Salary: $150, Hourly Salary: $71.97 Annual Salary Increase: 3.00% (Estimated) Creditable Service: 21 Years 10 Months Sick Leave: 0 Years 5 Months Retirement Retirement System: FERS Employee Type: OTHER Employee Category: AIR TRAFFIC CONTROLLER Retirement Type: REGULAR Planned Retirement Date: Annual Salary: $207, Hourly Salary: $99.62 High 3 Average Salary: $199, Annual COLA: 2.34% Creditable Service: 33 Years 1 Month Sick Leave: 0 Years 11 Months Age: 56 Retirement Eligibility: Service and Age Requirements Met Monthly Retirement Annuity - FERS Survivor with a 50% Annuity Annuity Without Survivor*: $7,967 Annuity With Survivor*: $7,170 Survivor's Annuity: $3,983 Cost of Survivor's Annuity*: $797 Thrift Savings Plan (TSP) CURRENT STATUS START SAVINGS WITHDRAWAL Your Annual Contribution: $16, Age: 56 Govt. Annual Contribution: $7, Total Monthly Payments: See TSP Page C Fund Savings: $0.00 Monthly Payment: F Fund Savings: $0.00 Total Payout: G Fund Savings: $0.00 I Fund Savings: $0.00 S Fund Savings: $0.00 L Fund Savings: $426, Total Savings: $426, Total Savings Before Payout: $1,061, Federal Employees Group Life Insurance (FEGLI) COVERAGE AT AGE 45 AT AGE 56 AT AGE 61 Basic: $168, $210, $210, Option A: $10, $10, $10, Option B: $755, $1,040, $1,040, Option C: $0.00 $0.00 $0.00 Total: $933, $1,260, $1,260, ANNUAL PREMIUM: $1, $13, $21,811.00

4 Federal Income Analysis - Monthly Current Income First Year in Retirement Income Biweekly Monthly Monthly Gross Salary $5, $12, $7, Gross Annuity Retirement $74.85 $ $ Survivor Benefit TSP $ $1, $0.00 Early Retirement - Age Penalty TSP Catch-up $0.00 $0.00 $0.00 Unpaid Redeposit Social Security - OASDI $ $ $0.00 Unpaid Deposit Tax - Federal $1, $2, $3, Tax - Federal Tax - State $0.00 $.00 $.00 Tax - State FEGLI Basic $22.95 $49.73 $ FEGLI Basic FEGLI Optional $45.90 $99.45 $ FEGLI Optional Health Benefit - Medical $ $ $ Health Benefit - Medical (FEHBP) Health Benefit - Dental $50.22 $ Health Benefit - Dental Health Benefit - Vision $0.00 $0.00 Health Benefit - Vision Flexible Spending Account Long Term Care Medicare $89.80 $ Allotments $0.00 $0.00 Other - 1 $0.00 $0.00 Other - 2 $0.00 $0.00 Total Deductions $2, $5, $5, Total Reductions/Deductions $2, Net Annuity $1, Social Security / FERS Supplement $4, Taxable Income from Other Sources $0.00 Non-Taxable Income from Other Sources Net Pay $3, $6, $8, Net Income Net Retirement Income - Net Pay Today = $1, Impact of Inflation on Retirement Income Inflation negatively impacts your future income. The value of the amount of money you are saving today will not have the same value in the future. You will not be able to buy as much in the future with each dollar saved. In other words, inflation makes it necessary to save more because your dollars will be worth less in the future. This form estimates how much net income you will need at retirement to keep the same standard of living that you have today (Net Pay per Month Today). This information may help you analyze your financial planning needs. It is based on information and assumptions provided by you regarding your financial situation. You selected an Average Yearly Inflation rate of: 3% Net Pay per Month Today $7, Net Monthly Income at Retirement $5, that includes: Net Annuity + Social Security/FERS Supplement + TSP - In 11 years, the value of your net monthly income at retirement $5, will be $4, In order to maintain a standard of living equal in value to your current income $7,569.55, you will need a net monthly income at retirement in 11 years of $10, The difference between $5, and $10, is a shortfall of -$4, in monthly retirement income in 11 years.

5 Monthly Income - Government Income Analysis as of September Calculations based on a COLA (In Retirement) of 2.34% and a 50% Survivor Annuity. In addition, a Social Security COLA of 2.84% was used. Age Salary Annuity Social Security TSP TOTAL Change 44 $12, $12, $12, $12, $ $13, $13, $ $13, $13, $ $14, $14, $ $14, $14, $ $14, $14, $ $15, $15, $ $15, $15, $ $16, $16, $ $16, $16, $ $17, $17, $ Start Retirement 56 $7, $1, $9, $7, $8, $1, $9, $ $8, $1, $9, $ $8, $1, $10, $ $8, $1, $10, $ $8, $1, $10, $ $9, $1, $10, $ $9, $1, $11, $ $9, $1, $11, $ $9, $1, $11, $ $10, $1, $12, $ $10, $2, $12, $ $10, $2, $12, $ $10, $2, $12, $ $11, $2, $13, $ $11, $2, $13, $ $11, $2, $13, $ $11, $2, $14, $ $12, $2, $14, $ $12, $2, $14, $ $12, $2, $15, $ $12, $2, $15, $ $13, $2, $16, $ $13, $2, $16, $ $13, $2, $16, $ $14, $2, $17, $ $14, $3, $17, $ $14, $3, $18, $ $15, $3, $18, $ $15, $3, $18, $ $15, $3, $19, $ $16, $3, $19, $ $16, $3, $20, $ $17, $3, $20, $ $17, $3, $21, $505.95

6 Monthly Income - Other Sources Age Other Income Age Other Income 56 $4, $6, $4, $6, $4, $6, $4, $6, $4, $6, $4, $6, $4, $7, $5, $7, $5, $7, $5, $7, $5, $7, $5, $7, $5, $8, $5, $ $5, $ $5, $ $6, $ $6,192.68

7 Monthly Expense - Government Expense Analysis as of September Age Penalties Survivor FEGLI Health LTC Taxes TOTAL Change 44 $ $ $2, $3, $ $ $2, $3, $ $ $ $2, $3, $ $ $ $3, $3, $ $ $ $3, $3, $ $ $ $3, $3, $ $ $ $3, $4, $ $ $ $3, $4, $ $ $ $3, $4, $ $ $ $3, $4, $ $ $ $3, $4, $ $ $ $3, $5, $ Start Retirement 56 $ $ $ $3, $5, $ $ $1, $ $3, $5, $ $ $1, $ $3, $5, $ $ $1, $ $3, $6, $ $ $1, $ $3, $6, $ $ $1, $ $3, $7, $ $ $1, $1, $3, $7, $ $ $1, $1, $3, $7, $ $ $1, $1, $3, $7, $ $ $1, $1, $4, $8, $ $1, $2, $1, $4, $8, $ $1, $2, $1, $4, $8, $ $1, $2, $1, $4, $9, $ $1, $2, $1, $4, $9, $ $1, $2, $2, $4, $9, $ $1, $3, $2, $4, $11, $1, $1, $3, $2, $4, $11, $ $1, $3, $2, $5, $12, $ $1, $3, $2, $5, $12, $ $1, $3, $3, $5, $12, $ $1, $4, $3, $5, $14, $1, $1, $4, $3, $5, $15, $ $1, $4, $4, $5, $15, $ $1, $4, $4, $6, $16, $ $1, $4, $4, $6, $16, $ $1, $5, $5, $6, $18, $2, $1, $5, $5, $6, $19, $ $1, $5, $6, $6, $20, $ $1, $5, $6, $7, $21, $ $1, $5, $7, $7, $22, $ $1, $5, $8, $7, $22, $ $1, $5, $8, $7, $23, $ $1, $5, $9, $7, $25, $1, $1, $5, $10, $8, $26, $1,142.18

8 Retirement Benefits Employee Retirement: - Your Annuity at retirement is based on a current salary of $150,203 per year with 3.00% annual pay raises. Retiring at age 56 with 33 years of service will yield a Monthly Retirement Income of: $7,967 Employee Retirement with Survivor Benefit Plan (SBP): - Your Monthly Retirement Income after SBP Cost starting at age 56 will be: $7,170 Survivor's Benefit: - Under SBP, at your death, your widow(er) will receive a Monthly Income of: $3,983 Costs: - Your projected cost for a Survivor Benefit Plan (SBP) at Retirement will be: Cost Per Month: $797 Cost Per Year: $9,564 - Your Projected Accumulated Cost for a Survivor Benefit Plan (SBP) at age 66 will be: $118,419 - Your Projected Accumulated Cost for a Survivor Benefit Plan (SBP) at age 76 will be: $255,602 Important: You should consider taking at least the minimum Survivor Benefit Plan to guarantee your spouse the right to continue the Federal Employee Health Insurance Plan upon your death. If you elect not to participate in the Survivor Benefit Plan, your spouse may face a future need to obtain private sector health insurance at a potentially greater cost.

9 Retirement Annuity and Surviving Spouse Benefits Benefits Data Calculations based on a COLA (In Retirement) of 2.34% and a 50% Survivor Annuity. Year Age Monthly Annuity No Survivor [A] Monthly Annuity With Survivor [B] Survivor's Monthly Annuity Monthly Difference [A] - [B] * Annual Difference [A] - [B] Accumulated Annual Difference [A] - [B] , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , * Monthly Annuity No Survivor Minus Monthly Annuity With Survivor

10 FERS Supplement and Social Security Benefits Benefits Data Calculations based on a FERS Annuity COLA of 2.34% and a Social Security COLA of 2.84%. Age FERS Annuity FERS Supplement Social Security TOTAL Change 56 7,170 1, , ,338 1, , ,509 1, , ,685 1, , ,865 1, , ,049 1, , , ,761 9, , ,811 10, , ,862 10, , ,915 10, , ,970 11, , ,026 11, , ,083 11, , ,142 11, , ,203 12, , ,266 12, , ,330 12, , ,396 13, , ,464 13, , ,534 13, , ,606 13, , ,680 14, , ,756 14, , ,835 15, , ,915 15, , ,998 15, , ,083 16, , ,171 16, , ,261 16, , ,353 17, , ,449 17, , ,547 18, , ,647 18, , ,751 19, , ,857 19,

11 Thrift Savings Plan Current Contributions: You are currently contributing a regular amount of $16,500 from your salary and an additional $0 catch-up contributon for a combined Annual Contribution of: $16,500 Continuing Contributions: Your future Thrift Savings Plan projections are based on your annual salary increases, annual TSP contributions, catch-up contributions and, rates of return of each fund. You have chosen to distribute %, and % into the L-2020 Fund. Each quarter, your L-funds allocation will automatically shift to a slightly more conservative mix (less allocated in the C, I, and S funds and more allocated in the F and G funds). Withdrawal of Funds: At the age of 56 years and 3 months you elected a lump sum withdrawal of your funds amounting to: $1,061,429 Note: Earnings Rates are hypothetical - not guaranteed. The monthly income illustrated is based on a gross distribution without consideration for income tax.

12 Thrift Savings Plan Existing Savings There are six separate funds (C, F, G, I, S, and L) in which to accumulate savings. At this time you have accumulated $0.00 in the C Fund, $0.00 in the F Fund, $0.00 in the G Fund, $0.00 in the I Fund, $0.00 in the S Fund, and $426, in the L-2020 Fund for a total of $426, Projected Annual Return Rates The following rates were selected by you for calculating future earnings: C Fund 5.00%, F Fund 4.00%, G Fund 3.50%, I Fund 5.00%, and S Fund 5.00%. Contributions You are currently contributing a regular amount of $16, from your salary and an additional $0.00 catch-up contributon for a combined Annual Contribution of $16, This is divided into the six funds as follows: $0.00 (0.00%) in the C Fund, $0.00 (0.00%) in the F Fund, $0.00 (0.00%) in the G Fund, $0.00 (0.00%) in the I Fund, $0.00 (0.00%) in the S Fund, and $16, (100.00%) in the L-2020 Fund. In addition, the government's contribution of $7, is divided into the six funds as follows: $0.00 (0.00%) in the C Fund, $0.00 (0.00%) in the F Fund, $0.00 (0.00%) in the G Fund, $0.00 (0.00%) in the I Fund, $0.00 (0.00%) in the S Fund, and $7, (100.00%) in the L-2020 Fund. The total annual contribution of $24, is distributed as follows: $0.00 (0.00%) in the C Fund, $0.00 (0.00%) in the F Fund, $0.00 (0.00%) in the G Fund, $0.00 (0.00%) in the I Fund, $0.00 (0.00%) in the S Fund, and $24, (100.00%) in the L-2020 Fund. In January of each year, you anticipate a 3.00% increase in salary that will raise your annual TSP contribution. Projected Savings at Withdrawal You elected to start withdrawing funds at the age of 56 years and 3 months. The projected savings in the six funds at that age is $1,061, Withdrawal Option Selected You elected a lump sum withdrawal of your funds amounting to $1,061,

13 Thrift Savings Plan - Contributions and Projected Savings Summary of Annual Contributions and Savings in the C, F, G, I and S Funds: to End of Your Gov TOTAL C Fund F Fund G Fund I Fund S Fund TOTAL Age Salary Year Contrib Contrib Contrib Savings Savings Savings Savings Savings Savings , , , , , , , , , , , Summary of Annual Contributions and Savings in the L Funds (C, F, G, I and S): to End of Your Gov TOTAL C Fund F Fund G Fund I Fund S Fund TOTAL Age Salary Year Contrib Contrib Contrib Savings Savings Savings Savings Savings Savings ,203 16,500 7,510 24, ,936 36, ,939 86,003 53, , ,709 16,500 7,735 24, ,737 39, ,897 93,111 57, , ,350 16,500 7,968 24, ,929 42, , ,431 61, , ,131 16,500 8,207 24, ,523 45, , ,969 65, , ,055 16,500 8,453 24, ,530 48, , ,730 69, , ,126 16,500 8,706 25, ,960 51, , ,719 72, , ,350 16,500 8,968 25, ,824 55, , ,941 76, , ,731 16,500 9,237 25, ,132 58, , ,402 80, , ,273 16,500 9,514 26, ,894 62, , ,107 84, , ,981 16,500 9,799 26, ,121 66, , ,061 87, , ,860 16,500 10,093 26, ,806 70, , ,007 91,268 1,016, ,250 5,198 13, ,184 72, , ,567 92,952 1,061,429

14 Federal Employees Group Life Insurance Current Coverage and Costs: Your current coverage (Death Benefit) for FEGLI is: $933,300 Your current total FEGLI Monthly Cost is: $ The Annual Cost is: $1,790 Future Coverage and Costs: At age 56 your coverage (Death Benefit) for FEGLI will be: $1,260,00 0 Your total FEGLI Monthly Cost will be: $1, The Annual Cost will be: $13,072 The total Accumulated Cost for your FEGLI coverage will be: $57,653 At age 65 your coverage (Death Benefit) for FEGLI will be: $1,260,00 0 Your total FEGLI Monthly Cost will be: $2, The Annual Cost will be: $24,080 The total Accumulated Cost for your FEGLI coverage will be: $230,003 At age 70 your coverage (Death Benefit) for FEGLI will be: $1,252,50 0 Your total FEGLI Monthly Cost will be: $3, The Annual Cost will be: $37,060 The total Accumulated Cost for your FEGLI coverage will be: $363,384

15 Federal Employees Group Life Insurance Summary as of September At your current age of 44, your annual salary is $150,203.00, and you expect annual salary increases of 3.00%. Your life insurance coverage includes: Basic (equal to your rounded annual salary plus $2000), Option A (equal to $10,000), Option B (equal to 5 times your annual salary). You plan to retire on at the age of 56. You elected to continue your full Basic coverage at the age of 65. You chose to keep full Option B coverage at the age of 65. FEGLI Premiums and Coverage Age Annual Biweekly Monthly Annual Accumulated Total Basic Option A Option B Option C Salary Premium Premium Premium Cost Coverage 44/45 150, ,790 1, ,300 10, , ,300 45/46 154, ,449 4, ,000 10, , ,000 46/47 159, ,527 6, ,000 10, , ,000 47/48 164, ,605 9, ,000 10, , ,002,000 48/49 169, ,683 12, ,000 10, , ,032,000 49/50 174, ,761 14, ,000 10, , ,062,000 50/51 179, ,022 18, ,000 10, , ,092,000 51/52 184, ,133 22, ,000 10, , ,122,000 52/53 190, ,265 27, ,000 10, , ,158,000 53/54 195, ,376 31, ,000 10, , ,188,000 54/55 201, ,508 36, ,000 10,000 1,010, ,224,000 55/56 207, ,460 44, ,000 10,000 1,040, ,260,000 56/ , ,072 57, ,000 10,000 1,040, ,260,000 57/ , ,072 70, ,000 10,000 1,040, ,260,000 58/ , ,072 83, ,000 10,000 1,040, ,260,000 59/ , ,072 96, ,000 10,000 1,040, ,260,000 60/ , , , ,000 10,000 1,040, ,260,000 61/ , , , ,000 10,000 1,040, ,260,000 62/ , , , ,000 10,000 1,040, ,260,000 63/ , , , ,000 10,000 1,040, ,260,000 64/ , , , ,000 10,000 1,040, ,260,000 65/ , , , ,000 10,000 1,040, ,260,000 66/ , , , ,000 7,600 1,040, ,257,600 67/ , , , ,000 5,200 1,040, ,255,200 68/ , , , ,000 2,800 1,040, ,252,800 69/ , , , ,000 2,500 1,040, ,252,500 70/71 0 1, , , , ,000 2,500 1,040, ,252,500 71/72 0 1, , , , ,000 2,500 1,040, ,252,500 72/73 0 1, , , , ,000 2,500 1,040, ,252,500 73/74 0 1, , , , ,000 2,500 1,040, ,252,500 74/75 0 1, , , , ,000 2,500 1,040, ,252,500 75/76 0 2, , , , ,000 2,500 1,040, ,252,500 76/77 0 2, , , , ,000 2,500 1,040, ,252,500 77/78 0 2, , , , ,000 2,500 1,040, ,252,500 78/79 0 2, , , , ,000 2,500 1,040, ,252,500 79/80 0 2, , , , ,000 2,500 1,040, ,252,500 80/81 0 2, , , , ,000 2,500 1,040, ,252,500 81/82 0 2, , , , ,000 2,500 1,040, ,252,500 82/83 0 2, , , , ,000 2,500 1,040, ,252,500 83/84 0 2, , ,508 1,056, ,000 2,500 1,040, ,252,500 84/85 0 2, , ,508 1,125, ,000 2,500 1,040, ,252,500 85/86 0 2, , ,508 1,195, ,000 2,500 1,040, ,252,500 86/87 0 2, , ,508 1,264, ,000 2,500 1,040, ,252,500 87/88 0 2, , ,508 1,334, ,000 2,500 1,040, ,252,500 88/89 0 2, , ,508 1,403, ,000 2,500 1,040, ,252,500 89/90 0 2, , ,508 1,473, ,000 2,500 1,040, ,252,500 90/91 0 2, , ,508 1,542, ,000 2,500 1,040, ,252,500 Average Premium from Age 44 to Age 65 Basic Option A Option B Option C Total Premium Biweekly $ $2.64 $ $0.00 $ Monthly $ $5.73 $ $0.00 $817.15

16 Federal Employees Health Benefits Program Calculations based on current Health Insurance premium of: Biweekly = $ Monthly = $ Annual = $2, The current premium is projected to increase annually by 9.00% (compounded) Biweekly Health Monthly Health Annual Health Accumlated Age Change Form Previous Year Benefit Cost Benefit Cost Benefit Cost Cost 44/ , , / , , / , , / , , / , , / , , / , , / , , / , , / , , / , , / , , / , , / , , / , , / , , / , , / , , , , / , , , , / , , , , / , , , , / , , , , / , , , , / , , , , / , , , , / , , , , /71 1, , , , , /72 1, , , , , /73 1, , , , , /74 1, , , , , /75 1, , , , , /76 1, , , , , /77 1, , , , , /78 1, , , , , /79 2, , , , , /80 2, , , , , /81 2, , , , , /82 2, , , , , /83 2, , , , , /84 3, , , , , /85 3, , , ,045, , /86 3, , , ,142, , /87 4, , , ,248, , /88 4, , , ,363, , /89 4, , , ,489, , /90 5, , , ,625, , /91 5, , , ,775, ,316.18