What is it?
The Federal Employees’ Group Life Insurance, or FEGLI, is the largest group life insurance program in the world. If you are a new federal employee, you are automatically covered by basic life insurance.
For basic coverage, your age does not affect the cost of insurance, and you share the cost with the government: You pay two-thirds of the total cost while the government pays one-third.
If you add any of the three forms of optional insurance, you pay the full cost and your age does determine the cost. The Office of Personnel Management goes into detail about each option available to you, and also includes a table to help you determine how much FEGLI will cost based on your age.
Basic Coverage
Optional Coverage
In addition to the Basic, there are three forms of Optional insurance you can elect. You must have Basic insurance in order to elect any of the options. Unlike Basic, enrollment in Optional insurance is not automatic — you must take action to elect the options.
Option A
Option A is the simplest form of optional life insurance. It provides your beneficiaries with a $10,000 death benefit in the event of your death.
Option B
Option B allows you to choose 1, 2, 3, 4, or 5 multiples of your base pay (rounded up). For example, if you make $50,000/year and elect to have 5 times your base pay, your Option B life insurance will pay $250,000 upon your death. The cost of Option B increases with your age.
Thee Thrift Savings Plan (TSP) is a critical component of your benefit package whether you are civilian employee or a member of the uniformed services. But if it is not properly managed, you could be hurting your chances of attaining a financially secure retirement. We’ll guide you through the nuances of the TSP and recommend other approaches to managing your TSP money so that you receive everything you deserve from your investment in this important government benefit.
What is it?
Like private sector 401(k) plans, TSP is a government-sponsored defined contribution investment instrument. It is another potential retirement income stream for federal workers enrolled in the Federal Employees Retirement System (FERS) and, the now nearly legacy pension plan from 1920, the Civil Service Retirement System (CSRS). They are both defined benefit pension plans, offering annuities upon retirement.
While we are not financial advisors, we suggest that you use the TSP, but choose your particular TSP investment fund wisely. Some are risky but offer a more generous return on your investment if the fund is performing well. Others are more conservative investments. But they tend to be achieve greater stability and predictable — yet potentially not as generous — returns.
Our benefits experts will help you understand what the TSP can do for your retirement and what it will cost you today in order to prudently invest in it. We’ll lay out your options during a free one-on-one benefits consultation. By law, we can’t pick your plan. But we can review your options.
We also may recommend positioning you away from the TSP at some point, because of severe restrictions with the plan that come into effect when you decide to retire. Depending on your goals and financial situation, we may recommend other financial products that could optimize the investment you have made into your TSP.
While we suggest utilizing your TSP, it is best to know as much as possible about how it works and what it can truly do for you during your career and after you decide to retire.
Who is eligible?
Federal workers enrolled in the FERS and CSRS can open a TSP account and invest in a wide range of funds. However, by law, workers enrolled in the FERS can receive contributions into their TSP investment from their agency. Workers participating in the CSRS, many of whom were hired prior to the early 1980s, are not eligible to receive contributions from their agencies.
Whether or not you receive an agency contribution, the TSP is still a valuable financial instrument that can work toward maintaining a similar standard of living in retirement that you were accustomed to during your career. According to a recent Office of Personnel Management Survey, the TSP had the highest rate of participation among federal benefit programs.
There are limits as to how much you can contribute to your TSP, as established by the IRS. The contribution limits are, however, subject to change. Alterations to the contribution limit are published on the TSP website and through other channels.
There are several different TSP funds in which to invest, with each offering widely different investment return rates. This information is periodically posted on the TSP website.
What can we do for you?
There are several aspects to be aware of regarding your TSP investment. Namely, you must decide when it is appropriate to withdraw from your fund. You must also decide how you should withdraw: whether as a life annuity, a single lump-sum payment, or in a series of monthly payments that is either for a fixed number of months or a fixed dollar amount until your TSP account is exhausted.
These options may not even be the best choices for your particular financial situation and retirement goals. During our one-on-one consultation with you, we’ll review all of your federal benefits including your available TSP options.
We’ve heard many wonderful stories about the TSP. And we’ve probably heard an equal number of horror stories. Our customers have lost liquidity. Some had a hard time accessing their funds. Or their survivors received a highly diminished version of the TSP you heavily invested in during your career.
Our role is to help you navigate these murky waters, riddled with regulations and unclear answers to your questions. We’ll also suggest other options that can help bolster this part of your retirement package.
Option C
Option C is for families, providing coverage for your spouse and eligible dependent children. Under Option C, all of your eligible family members are automatically covered. The coverage amount is determined in units – each unit represents $5,000 for your spouse and $2,500 for each dependent child. For example, if you elect 3 units and your spouse dies, you would receive $15,000 (3 x $5,000). If one of your eligible dependent children dies, you would receive $7,500 (3 x $2,500). The number of multiples you elect applies to all of your eligible family members. In other words, you cannot elect 2 units for your spouse and 3 units for your children. Furthermore, a child’s eligibility for Option C benefits ends once he/she reaches age 22, unless he/she is incapable of self-support because of a mental or physical disability that existed before the child reached age 22.
How can we help?
Not exactly what you had in mind for life insurance? Us neither. Sometimes, FEGLI is not your most cost effective option for life insurance. Sometimes, it’s smarter to cancel your FEGLI and try an alternative insurance plan, one that has fixed benefits and fixed premiums. The cost of your FEGLI goes up every five years—and that’s something probably no one has told you.
Sure it’s relatively inexpensive as a younger employee. But as you age, paying for federal life insurance can cut into your bottom line, and into your ability to save for a distinguished retirement. The years when you need FEGLI the most, it can become prohibitively expensive. We can provide leads to commercial alternatives for you. We will analyze your pay and your current FEGLI benefits, and in short time, we will know what direction to lead you.
Please contact us for a free consultation.
The Federal Employees’ Group Life Insurance, or FEGLI, is the largest group life insurance program in the world. If you are a new federal employee, you are automatically covered by basic life insurance.
For basic coverage, your age does not affect the cost of insurance, and you share the cost with the government: You pay two-thirds of the total cost while the government pays one-third.
If you add any of the three forms of optional insurance, you pay the full cost and your age does determine the cost. The Office of Personnel Management goes into detail about each option available to you, and also includes a table to help you determine how much FEGLI will cost based on your age.
Basic Coverage
- Basic coverage is pretty straightforward – it is equal to your base pay (rounded up) plus $2,000.
- For example, if you make $42,400/year, your basic coverage would be $45,000.
- Explanation: Base Pay = $42,400 Base Pay rounded up = $43,000 $43,000 + $2,000 = $45,000
Optional Coverage
In addition to the Basic, there are three forms of Optional insurance you can elect. You must have Basic insurance in order to elect any of the options. Unlike Basic, enrollment in Optional insurance is not automatic — you must take action to elect the options.
Option A
Option A is the simplest form of optional life insurance. It provides your beneficiaries with a $10,000 death benefit in the event of your death.
Option B
Option B allows you to choose 1, 2, 3, 4, or 5 multiples of your base pay (rounded up). For example, if you make $50,000/year and elect to have 5 times your base pay, your Option B life insurance will pay $250,000 upon your death. The cost of Option B increases with your age.
Thee Thrift Savings Plan (TSP) is a critical component of your benefit package whether you are civilian employee or a member of the uniformed services. But if it is not properly managed, you could be hurting your chances of attaining a financially secure retirement. We’ll guide you through the nuances of the TSP and recommend other approaches to managing your TSP money so that you receive everything you deserve from your investment in this important government benefit.
What is it?
Like private sector 401(k) plans, TSP is a government-sponsored defined contribution investment instrument. It is another potential retirement income stream for federal workers enrolled in the Federal Employees Retirement System (FERS) and, the now nearly legacy pension plan from 1920, the Civil Service Retirement System (CSRS). They are both defined benefit pension plans, offering annuities upon retirement.
While we are not financial advisors, we suggest that you use the TSP, but choose your particular TSP investment fund wisely. Some are risky but offer a more generous return on your investment if the fund is performing well. Others are more conservative investments. But they tend to be achieve greater stability and predictable — yet potentially not as generous — returns.
Our benefits experts will help you understand what the TSP can do for your retirement and what it will cost you today in order to prudently invest in it. We’ll lay out your options during a free one-on-one benefits consultation. By law, we can’t pick your plan. But we can review your options.
We also may recommend positioning you away from the TSP at some point, because of severe restrictions with the plan that come into effect when you decide to retire. Depending on your goals and financial situation, we may recommend other financial products that could optimize the investment you have made into your TSP.
While we suggest utilizing your TSP, it is best to know as much as possible about how it works and what it can truly do for you during your career and after you decide to retire.
Who is eligible?
Federal workers enrolled in the FERS and CSRS can open a TSP account and invest in a wide range of funds. However, by law, workers enrolled in the FERS can receive contributions into their TSP investment from their agency. Workers participating in the CSRS, many of whom were hired prior to the early 1980s, are not eligible to receive contributions from their agencies.
Whether or not you receive an agency contribution, the TSP is still a valuable financial instrument that can work toward maintaining a similar standard of living in retirement that you were accustomed to during your career. According to a recent Office of Personnel Management Survey, the TSP had the highest rate of participation among federal benefit programs.
There are limits as to how much you can contribute to your TSP, as established by the IRS. The contribution limits are, however, subject to change. Alterations to the contribution limit are published on the TSP website and through other channels.
There are several different TSP funds in which to invest, with each offering widely different investment return rates. This information is periodically posted on the TSP website.
What can we do for you?
There are several aspects to be aware of regarding your TSP investment. Namely, you must decide when it is appropriate to withdraw from your fund. You must also decide how you should withdraw: whether as a life annuity, a single lump-sum payment, or in a series of monthly payments that is either for a fixed number of months or a fixed dollar amount until your TSP account is exhausted.
These options may not even be the best choices for your particular financial situation and retirement goals. During our one-on-one consultation with you, we’ll review all of your federal benefits including your available TSP options.
We’ve heard many wonderful stories about the TSP. And we’ve probably heard an equal number of horror stories. Our customers have lost liquidity. Some had a hard time accessing their funds. Or their survivors received a highly diminished version of the TSP you heavily invested in during your career.
Our role is to help you navigate these murky waters, riddled with regulations and unclear answers to your questions. We’ll also suggest other options that can help bolster this part of your retirement package.
Option C
Option C is for families, providing coverage for your spouse and eligible dependent children. Under Option C, all of your eligible family members are automatically covered. The coverage amount is determined in units – each unit represents $5,000 for your spouse and $2,500 for each dependent child. For example, if you elect 3 units and your spouse dies, you would receive $15,000 (3 x $5,000). If one of your eligible dependent children dies, you would receive $7,500 (3 x $2,500). The number of multiples you elect applies to all of your eligible family members. In other words, you cannot elect 2 units for your spouse and 3 units for your children. Furthermore, a child’s eligibility for Option C benefits ends once he/she reaches age 22, unless he/she is incapable of self-support because of a mental or physical disability that existed before the child reached age 22.
How can we help?
Not exactly what you had in mind for life insurance? Us neither. Sometimes, FEGLI is not your most cost effective option for life insurance. Sometimes, it’s smarter to cancel your FEGLI and try an alternative insurance plan, one that has fixed benefits and fixed premiums. The cost of your FEGLI goes up every five years—and that’s something probably no one has told you.
Sure it’s relatively inexpensive as a younger employee. But as you age, paying for federal life insurance can cut into your bottom line, and into your ability to save for a distinguished retirement. The years when you need FEGLI the most, it can become prohibitively expensive. We can provide leads to commercial alternatives for you. We will analyze your pay and your current FEGLI benefits, and in short time, we will know what direction to lead you.
Please contact us for a free consultation.
