When we cast our lot with the federal government years ago, we set ourselves on a track to have a better retirement than most people. Image: Andrew Angelov/Shutterstock.com
By: John GrobeIt seems that every time you turn around you are reading or hearing about the results of a survey. That’s no surprise as there are around 3,800 firms in the United States that are identified as market research or public opinion polling companies. Over and above that number are companies who will conduct surveys that help them focus their business or get them publicity that keeps their name in the news.
One such survey that I recently came across was taken by Credit Karma and said that 27% of Baby Boomers had nothing (yes, absolutely nothing) saved for retirement. Different sources will give you different estimates of the number of boomers. Most of the estimates are from 70 to 75 million, so I’ll take the number of 72.5 million. Twenty-seven percent of 72.5 million is 19,575,000. That’s a lot of people with no savings for retirement.
Given the fact that all Boomers are over age 60 today, and that the oldest Boomers turn 79 this year, that’s a lot of old folks with no money saved for retirement.
But all is not as bad as the results of the survey might lead you to believe. Boomers who have worked at least ten years in Social Security covered employment (and their spouses under most conditions) are either currently receiving or will be entitled to receive Social Security retirement benefits.
Most of the readers of FEDweek’s TSP Investment Report are either current or retired federal employees and will be entitled to or are already receiving a FERS (or CSRS for many) annuity.
Not only that, FERS employees, even if they don’t contribute a penny to the Thrift Savings Plan, have been receiving an agency 1% contribution to their TSP account.
When we cast our lot with the federal government years ago, we set ourselves on a track to have a better retirement than most people. Our parents and others from the Silent Generation and the Greatest Generation who advised us to get a safe job with a pension (the government, the gas company, the electric company, and the phone company) were on to something! Let’s be thankful for our government benefits.
If you do find yourself in a position where you fear that you won’t have enough money saved for retirement to supplement your Social Security and your FERS (or CSRS) annuity, what can you do?
You can plan on working longer.
You can plan on living on less during retirement.
You can get serious about saving and budgeting now, so that you won’t have to do so after you retire.
Longevity Risk
When we invest in the Thrift Savings Plan or other investment vehicles, we realize that we must accept some level of risk. The two most common risks are:
• Market risk. The risk that the entire market may go down; think 2001 and 2008.
• Inflation risk. The risk that your investments may lose purchasing power even as they “grow”. Think 2022.
Lately I’ve read about another risk – longevity risk, and Federal employees have a real advantage here.
John Grobe is a retired federal employee and retired retirement educator with over 30 years of experience in helping federal employees understand their retirement.
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Top 10 Provisions in the Big Beautiful Bill of Interest to Federal Employees
A Pre-RIF Checklist for Every Federal Employee, From a Federal Employment Attorney
Work Longer or Take the FERS Supplement Now: Which is Better?
See also
Alternative Federal Retirement Options; With Chart
Primer: Early out, buyout, reduction in force (RIF)
Retention Standing, ‘Bump and Retreat’ and More: Report Outlines RIF Process
