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Did you know that a significant portion of federal employees approaching retirement age discover they’re unprepared? A recent study by The National Institute on Retirement Security (NIRS) in their 2024 Retirement Insecurity report found more than half of Americans (55 percent) are concerned that they cannot achieve financial security in retirement. (1) 

The good news? Many common pitfalls can be easily avoided with proper planning. In this article, we’ll explore 10 critical areas where federal employees can make missteps and offer solutions to ensure a smooth transition into retirement. 

1. Skipping the Paperwork: Failing to Review Official Records 

Your Official Personnel Folder (OPF) is your federal service bible. Ensure all information, particularly Form SF 50 (Notice of Personnel Action), is accurate and up to date. This form details your retirement plan (CSRS, CSRS-Offset, or FERS) – crucial for calculating your retirement income. 

2. Missing Out on Time Credits: Unclaimed Deposits and Redeposits 

Did you serve in the military or have non-credited temporary service? Making deposits for these periods can significantly increase your service time and, ultimately, your retirement annuity. Review your options for maximizing your service credits. 

3. Beneficiary Blind Spots: Outdated or Missing Designations 

Keep your beneficiary designations current! This applies to various accounts, including: 

  • Unpaid Compensation & Unused Annual Leave (SF 1152) 
  • Federal Employees Group Life Insurance (FEGLI) (SF 2823) 
  • Thrift Savings Plan (TSP) (TSP 3) 
  • CSRS/FERS Retirement Contributions (SF 2808-CSRS/ SF 3102-FERS) 

4. Health Insurance Hiccups: Maintaining FEHB Coverage in Retirement 

Understanding the rules for keeping your federal health insurance (FEHB) in retirement is vital. Generally, you must retire on an immediate annuity or meet specific MRA + 10 provisions under FERS. Additionally, you must have been enrolled in FEHB for at least five years before retirement. 

5. Thrift Savings Trap: Under-Contributing or Poor Investment Choices 

The Thrift Savings Plan (TSP) is a powerful retirement savings tool. Federal employees, especially FERS participants reliant on TSP income, should aim to contribute the maximum allowed and take advantage of agency matching contributions. Invest for the long term, focusing on growth-oriented funds like the C, S, and I funds or Life Cycle funds (L) with heavy stock allocations. Avoid market timing and focus on consistent growth strategies. 

6. Incapacity Overlooked: Disability Income Planning 

Federal sick leave offers short-term disability coverage, but consider long-term disability insurance to replace a portion of your income if you become unable to work due to illness or injury. The federal government offers long-term care insurance, but explore options for both disability and long-term care insurance throughout your career. 

7. Estate Planning Evasion: Missing Crucial Documents 

A proper estate plan, created with the help of a qualified professional, protects your assets and ensures your wishes are carried out after you pass away. This may include a Will or Living Trust, a durable power of attorney, an advanced health care directive, and a Living Will. Designate beneficiaries for your financial accounts, including your TSP and IRAs. 

8. Retirement on Autopilot: Lack of Comprehensive Planning 

Retirement is a significant life change impacting income, housing, and lifestyle. Proactively plan for these changes to avoid financial stress or disruptions during your golden years. Consider the impact on your spouse or family members as well. 

9. Skipping Valuable Resources: Mid-Career and Retirement Seminars 

Many federal agencies offer informative mid-career and retirement planning seminars. These sessions cover crucial topics like retirement eligibility, annuity calculations, survivor benefits, TSP investing, Social Security, tax implications, estate planning, and lifestyle adjustments. Don’t wait until it’s too late – attend these seminars to gain valuable knowledge and identify any potential gaps in your retirement plan. 

Ready to Take Control of Your Retirement Future? 

Planning for retirement can feel overwhelming, but with the right guidance, you can navigate the process with confidence. Let’s schedule a complimentary consultation so we can help you identify areas for improvement and create a personalized roadmap to a secure and fulfilling retirement. 


(1) “Retirement Insecurity 2024: Americans’ Views of Retirement.” National Institute on Retirement Security, 15 May 2024,  


We are not affiliated with the Social Security Administration or any other governmental agency. Most life insurance policies are subject to medical underwriting, and in some cases, financial underwriting. Life insurance products contain fees, such as mortality and expense charges, and may contain restrictions, such as surrender charges. If properly structured, proceeds from life insurance are generally income tax-free. Life insurance agents do not give tax or legal advice. Insurance product guarantees are backed by the financial strength and claims-paying ability of the issuing company. Product and feature availability may vary by state. Investing involves risk, including possible loss of principal. No investment strategy can ensure financial success or protect against losses. Insurance product guarantees are backed by the financial strength and claims-paying ability of the issuing company. Product and feature availability may vary by state. This information is being provided only as a general source of information and is not intended to be the primary basis for investment decisions. It should not be construed as advice designed to meet the particular needs of an individual situation. Please seek the guidance of a financial professional regarding your particular financial concerns. Consult with your tax advisor or attorney regarding specific tax issues. 

Pinnacle Financial

The Pinnacle team’s primary objective is to provide holistic financial strategies. Our ultimate vision is to educate clients about their own personal financial challenges and potential solutions regarding complex financial issues.

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