Can You Retire with Only $400,000 in Your TSP? 

Outstanding. Best wishes.

annnnd when the FERS annuity supplement goes away/when you take your SS benefit, more than likely it'll be greater than that annuity supplement. Wouldn't be surprised if FERS pension + SS turned out to be 60-70% of your working net pay.

50%? Sounds bogus. Who did you work for ? That's unheard of and would be awesome

@@jessemarkle5413 Several factors as to why my working pay stub had so much withholding and why my OPM retirement net check is about 50% of my working net pay: (1) I was a federal scarce-specialty physician with seniority and for the last 3 years was making as much as the President of the United States (minus the perks and Secret Service) so a lot of my pay was in the top tier tax bracket. (2) While working, my pay was divided over 26 pay periods so it was like I was being paid 13 months/year as opposed to 12 months/year in retirement. (3) I was maxing out my annual allowable TSP contributions plus catch up plan (about $1,000 every 2 weeks or $2,000/month) but now with zero TSP contributions in retirement. (4) I retired at age 59.5 and qualify for the FERS annuity supplement until age 62 (bridge to Social Security) which is free bonus money of $1,764/month (again based on my high salary) in retirement that I didn't get while I was working. (5) My wife has her own state pension and we long ago paid off our forever home with zero debt and are beneficiaries of each other's 401k/TSP accounts and are in excellent health, so we both opted for no survivor's benefits with our pensions, thus maximizing our respective pension checks. (6) With a sharp drop in income we dropped down to a a lower tax bracket for markedly reduced federal taxes. (7) No SS withholding, less state tax withholding, and no Medicare withholding. (8) Dropped FEGLI while working which is a terrible deal once one gets 55+. (9) FEHB is still a great deal in retirement (my wife's state retirement health benefits cost 2.5 times as much). So my net monthly OPM check for 30+1 years of service pretty much equals my working 2 week net pay (or 50%). However, now that I am taking monthly installments from my TSP, I have increased federal and state withholding from my pension because it is easier to make those adjustments via OPM, although those taxes are really for the TSP income and not my pension income. When I turn 62, I will lose the FERS annuity supplement and I probably won't file for SS until age 67.

@@jessemarkle5413 , do the math for yourself.

​@@jessemarkle5413 It depends what ones working net pay looks like. If you're putting a big chunk of money into your TSP, your net pay will be fairly low. As I approach my MRA, my net pay is only about 1/3 of my gross with 1/3 going to taxes, insurances and other similar deductions and 1/3 into retirement savings. My guess is their net working pay may have been similarly low.

Most people dont want to even try to save.

@@inotill not true! You can’t save if you’re making below a living wage!

@@inotill Most people aren't receiving matching funds or even make enough to live on.

Fed service is not a bad gig. Been good to my wife and l. Not super sexy, but it does have some good financial bennies. TSP, SS and FERS and how you manage those three things can make for financial security.

Exactly ! The people who do not have a pension or TSP, support these systems.

Congratulations 👏🏼👏🏼👏🏼

You don’t get to be an SES without being success driven. Even those that retire end up in industry. Retirement is for people who really don’t like working.

@@Dave-sw2dm Retirement is not just for "People who really don't like working". You're not going to wish that you "Worked a few more years", just prior to meeting your maker. Working is a means to an end, unless you are a rare inventor or entrepreneur. An SES is neither, but a highly capable manager. None of these senior Defense Contractors work on weekends. Do they just "not like working on Saturday's" ? Same logic.

@@jayp4114 , I was making a generalization just like you did. None of us are promised tomorrow. Doing what you love is important. Some love their careers and would be bored with retirement. Some are able to balance the things they love to do outside of work with accomplishing their work objectives. No one should wait to retire to live life because you may not live that long. But retiring without being able to afford to have adventures would be boring. I do know people who said they wished they would have prepared better for retirement. I do know people who said they wished they traveled more when they were younger.

I did it. I had planned to work until 2025, yet in 2022, I abruptly retired to spend time with my aging parents and grandchildren. I don't have quite as much money as I had planned, yet it doesn't take money to enjoy and spend time with your loved ones.

@@Dave-sw2dm For most people - they don't continue working for the joy. That's a lie they tell people and themselves. Once you truly hold them accountable you'll heard the truth. It's economic. They can't afford to retire because they are either big spenders or afraid to lose their lifestyle. I consulted with many. Doctors, attorneys, Executives, educators and famous rappers. A popular professor said he wanted to work until 80. He was a CEO of the family six dealerships. They had to sell the business. He been an adjunct professor for 20 years. Convulse business environment turned college professor for the love of teaching over the age of 62. Really? Most top government officials don't have any idea about creating passive income.

Thank you so much for your support and commenting!

Glad you enjoyed it!

How can average TSP be that low? Is that including people who entered federal service as a second career? Then they may have a 401 K as well as the TSP. Being in the C fund for 30 years would have easily put someone over a million dollars.

@@Dave-sw2dm nope lot of other factors. Did they take out loans against the TSP over the years? I grade 9 would not have as much as a GS-15. Also did they put everything into G fund or C fund? $182K is not that low. Go check the average 401K balance to compare

@@bannertraveller5879 , considering that the OP said live conservatively and save for the future, After a 30 year career, 182k is a low balance at retirement. The purpose of the TSP is to save for retirement. Yes, there are a lot of reasons why some people don’t have more, but those people will probably struggle trying to live off SS and FERS pension so will probably have to work until 68 or longer.

Taxes kill everything

Yeah similar… r u making it?

@@felicia19061 Yes, i qualified for the supplement, so getting nearly $2800 a month and do a little Uber Eats on the side. Most importantly, i am MUCH happier and MUCH less stressed out.

I retired at 62 with 39 years and with my FERS annuity and S.S. I have not even had to think of drawing from my TSP. The 4% rule that this individual speaks of is a rule for individuals with S.S. and an IRA. Receiving a FERS annuity and SS should leave you enough to live on comfortably, if you don't have a mortgage any longer.

Getting ready to retire from the bop. Nobodies explained tsp to staff ever. Luckily I've put in but damn, sure ain't 400gs. This is crap. Would've been nice if we knew how odds and ends cause retirement pay seems poorhouse after all these years

Love the video. But. Who the heck is living on less than 2gs per month after all these years vested? Ridiculous and a shame. Ramen. Noodles and hotdogs ! Yeah

Unless you live in the high-cost area of the east or west coast your $1.5m is just plain silly. I retired with 39 years in FERS and S.S. and I have no need to even touch my TSP account.

Minus taxes😂

Except the years one's TSP is down 10% or more.

​@jojowhite9296 please what is FERS? Like a pension? Thanks

Sheesh...1mil is a lot though 😢...I mean we still have to live our life now and plan for retirement ....and how much does the average person make, plus dealing with inflation, caring for a family etc Sigh.... His video honestly gives me hope...because I keep hearing this 1-5mill number and it's seems impossible which makes retirement seem scary

Are you basing the 4% rule on G fund alone or a mixture of the funds

@@b.williams3095 Neither, really. This will only account for the first year or two. I want to roll over my TSP into a Roth outside the TSP and then do something else with it. Not sure what yet, but I am sure staying in the G fund would be a worst case scenario.

So glad!

WRONG

@@bradenhooper2850 Y

​@@bradenhooper2850 lol

@@bradenhooper2850please explain.

400gs? Wish I had that. Over 20 in and I can't invest all my pay from each check like that

I tried and IRS Penalized me saying I was saving too much. I need better understanding

You may contribute to a Roth but the government contributes their share to traditional TSP

That's fine if you can afford to contribute the maximum amount. Most people on a budget can contribute more if they do it pre-tax . And no matter how you slice it, starting out with more in your tsp is better. Let me put it another way. You're familiar with that exercise where you start out with a penny and double it every day for 30 days? Think how much you would have if you started with two pennies.

I got a lot less than that. But 30 years is long enough and I will make due with what I got. I will try to max out what I can in TSP but I am staying out of debt as much as possible. Maybe I can find a rich wife that wants a lazy husband. Lol. 😁👍

Well that sure sux.

@stevedavis3370 why do you care what others are doing. Hire a financial advisor and focus on your retirement plan.

@@Retired-jr3qs to test the theory, why else would you want to see those numbers???? Actually see the 4% rule working. Has nothing to do with hiring a financial advisor. I’m educated enough to not need a financial advisor. I’ve saved enough to be comfortable.

Jepi

yes and SSA will 'most likely' be much more than the FERS annuity supplement.

Bengen study used 60/40 (stocks/bonds). So for tsp would be C and F. Although, technically C is S&P 500. Tons of info on RU-vid and internet about that study and if it is still valid or applicable.

Not necessarily. It would depend on the person's deductions. Perhaps they are maxing out their TSP while working or almost maxing it out. Additionally, they may be maxing out their HSA or FSA, and may be paying for full family health insurance and high option dental and vision plans, as well.

This is because of how they lived. If they retired in the same area - not much should change in lifestyle. There no more TSP contributions, union dues, and other expenses. You're only replacing take home salary not gross.

The key is not having debt in retirement

No reason to estimate just look at income I. Retirement then go to tax tables and calculate tax liability or you can rely on GRB to calculate which I think underestimates it

Just remember, OASDI is a flat 7.65% that you get taxed on your employed income that doesn't get taxed on your pension. That's a clear 7.65% additional you'll receive just for not working

What agency did you work for? I have never heard of it takin that long get paid.

Wow! Sorry to hear that...How many X-Wifes did you have? My retirement went smooth. Everything was on time including my Annual Leave check. I started asking retirees at work questions & their numbers, 5 years before I retired.

Is your Roth deposit auto deducted from your paycheck? If so, then it won't go if you're over, it just comes to you on your paycheck, taxed.

You’re not able to contribute more than the yearly TSP contribution limit. This is why you’re cautioned to contribute only enough each pay period so you don’t reach the contribution limit before the end of the year and miss out on employer matching contributions. Once you do reach the yearly contribution amount, then your TSP allotment stops. If you had an allotment of $750 set up and only had $250 left to reach the yearly contribution limit for TSP, then $250 would go to TSP and the $500 left over would be added back into your gross pay. Your TSP allotment wouldn’t be reactivated again until next year.

No if you still have your federal insurance.

I retired 28 April. I had 22yrs in and took 15 months absence & had 5 years of PT. I reviewed my OP file and double checked all SF50s. After one correction, I filled in GRB. I found it to be accurate. If there are errors with OPM file then it might not. The real issues are getting reliable information from RSSO. You can ask 3 different people the same question and get 3 different answers. There has been a lot of turnover. To that extent many employees in training. Be patient & persistent. Best of luck.

Using the GRB for retiring with 30 yrs + my MRA, I will receive more, not including the supplement, than he states in this video and I make less than 60,000/yr. I also am not taking the health or life insurance with me - gonna wing it til I'm eligible for Medicare - pay cash - or die naturally, lol.

@@heatheresteubing-fisher9729 not a good idea. All you need is one event, and you would be bankrupt. That's an awful big risk to take to save some money. Also, many take their FEHB with them in retirement because Medicare pays 80% and their FEHB acts as a medigap which is highly recommended. That is because unlike when you are working, there is no cap on the 20% you have to pick up. Depending on your health, that can be quite costly.

That 4% is using the expected gain each year from your TSP, so you never have to touch the TSP principal. You live off the interest. Plus your pension, SS. etc.

It's a sloppy 2. he puts a line through his 7's so he's subtracting 225, not 275.

Your math doesn't add up, $12,500 - 20% = $10,000😮

@@b.coxemba6799 It was actually 40% they took for taxes.

Thanks for the feedback!

@@PlanYourFederalBenefits Thank you for considering.