1. Investing in Your Career
How to Maximize What You Get

2. Introduction
Vinay Gupta Director, Compensation and Benefits (202)

3. Benefits for Future-Career Employees
Benefits available to both career and future-career employees include:
Health Insurance
Flexible Spending Accounts*
Dental & Vision Insurance*
* After one year for future-career employees 3

4. USPS Health Benefits Plan
Available to all future-career employees
Provides comprehensive medical
Prescription drug coverage
Dental coverage
You pay (per pay period):
Self Only
$50
Self Plus One
$275*
Self and Family
$440*
*Premiums differ for CCAs and are based on years of service.

5. Health Benefits at a Glance
Features:
Annual physical and other preventive care covered at 100%
Preventive care medications covered at 100%
Routine dental exams and cleaning twice per year
Covered Services
Cost
Virtual Visits $5
Doctor Visit
$30
Specialist Visit
$60
Generic Drugs
$10
To learn more, visit:

6. Your Total Compensation
Presentation is for Career Employees only.
Your Total Compensation
Total Compensation
Pay
Health Insurance
Retirement
Life Insurance
Paid Leave

7. Civil Service Retirement System (CSRS)
Rules for Retirement
Civil Service Retirement System (CSRS)
62 & 5 years
60 & 20 years
55 & 30 years
Federal Employees Retirement System (FERS)
60& 20 years
MRA & 30 years
Minimum Retirement Age (MRA) is determined by your year of birth.

8. Calculating Your Annuity
Salary
Service
Service Factor
High-3 consecutive salary
Years of creditable service (including unused sick leave)
For FERS the service factor is 1% (1.1% if retiring at age 62 or later with at least 20 years of service)

9. OPM Proposal
Increase FERS employee contribution by 1% per year until equal to agency contribution.
FERS annuity calculation based on High-5 average salary instead of High-3
Eliminate FERS Annuity Supplement
Eliminate Cost of Living Adjustment (COLA) for FERS annuity
Reduce COLA by 0.5% for CSRS annuity

10. Retirement Example
For someone making $50,000/year with 30 years of service
Goal: Replace 100% of current income in retirement
FERS
Annuity
$15,000
Social Security
~$11,000
Total
$26,000
Gap from $50K
$24,000
TSP Balance Needed*
$600,000
* Assumes 4% annual withdrawal

11. Income – Expenses = Savings Income – Savings = Expenses
What is Financial Freedom
Financial Freedom
Financial freedom is not about income
It is about managing expenses
Income – Expenses = Savings
Income – Savings = Expenses
Savings^Time = Retirement $
Income - Expenses^Time < Retirement $

12. Thinking About Retirement
Understanding
Managing what you control
Setting goals
Making a plan to reach those goals

13. 5% 10% Contribute get in your TSP FERS Matching
Employees age 50+ can contribute an additional $6,000 above the IRS limit

14. Don’t Be Left Out

15. Your Participation (FERS)
Pacific Area 88.1%
Top District: Honolulu: 92.6% San Diego: 87.5%

16. Example: TSP $100 Contribution Employee in a 30% Tax Bracket
Contribution Election
$100 Traditional TSP
Tax Deferral
$30
Real Contribution accounting for tax Deferral
$70 take-home pay
USPS Matching Contribution
$100 Traditional TSP
Total Added to TSP Account
$200 Traditional TSP
TSP Account w/ 5% Return (1 year)
$210 Traditional TSP
Even though you only contributed the equivalent of $70 in take-home pay, you now have $210 in your TSP account. You have tripled your initial investment.

17. The Power of Compounding
Compounding allows you to grow money from earnings on your contributions.
Annual contribution:
$1K
Average rate of return (L funds): 6%
$84K
Nearly Tripled
You added $30K

18. Goal: Save $20 a week Manage Your Expenses Bills
Discretionary spending
Benefits Costs

19. Presentation is for Career Employees only.
Checkbook
Go to to access Checkbook

20. Presentation is for Career Employees only.
Checkbook
Go to to access Checkbook

21. Presentation is for Career Employees only.
FEHB Plan Comparison
FEHB Plan
Self and Family
(Annual Premium*)
Deductible
Copay
BCBS Standard
$7,071
$700
$25
BCBS Basic
$4,705 $0
$30
Kaiser High (S.Cal)
$4,690
$15
Kaiser Standard (S.Cal)
$2,880

22. TSP Investment Choices
L Fund
G Fund
F Fund
C Fund
S Fund
I Fund

23. FERS: TSP Contributions Value
30 Years of Service
Salary:
$50K
Average rate of return (L funds): 6%

24. Making Career Decisions
Moving the mail is the most critical job in the Postal Service
However, there are many other important jobs that help us meet our mission
When making career choices you need to look at both your current situation – but also where you want to be in the future
Let’s look at an example…

25. BASIC PAY Retirement Fact
Both your annuity and Thrift Savings Plan contributions are based on your
BASIC PAY
Overtime, night differential, or other income does not increase your retirement.

26. TSP Value After 30 Years $787K $745K $629K Employee contribution: 5%
Average rate of return (L funds): 6%
$787K
$745K
$629K
+$20K in Postal Service contributions
+$30K in Postal Service contributions

27. FERS Annuity After 30 Years
Level 6
$15,000
Level 17
$21,000
Level 20
$27,000

28. Difference in Retirement Future
Level 6
Level 17
Level 20
TSP
(4% withdrawal)
$16,000
$20,000
$21,000
Annuity
$15,000
$27,000
Total
$31,000
$41,000
$48,000
+$10K
+$17K

29. What’s Your Retirement Dream?

30. Last Years Before Retirement
I plan to retire in 5 years – what can I do?
Spend less
Save more
Work longer

31. TSP Withdrawal Options
As part of the 2017 TSP Modernization Act
(beginning September 2019):
Leave money invested in TSP funds
Take one or more lump-sum payments (including in-service)
Do equal monthly, quarterly, or annual withdrawals
Buy an annuity
You can also do a combination of all of these options or change your regular withdrawal election at any time.

32. Two Key Take-Aways Manage Your Money Today.
Find ways to reduce your bills and cut your discretionary spending in order to save more, including looking at your health insurance.
Maximize Your Retirement Savings.
Your basic pay and level of TSP contributions are two of the main factors in determining your retirement benefit.