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Posted on Sunday, 27th July 2025 by

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With many taking advantage of deferred resignation, early outs, or simply deciding it’s time to retire, start the military deposit paperwork immediately if you haven’t already done so. There is a free webinar at 7:00 pm on July 31st about savings for retirement that you may wish to take advantage of.

FERS retirees with post-January 1, 1957, military service will not receive credit or annuity computation for their military time without making a deposit. If a deposit is made, the employee will receive credit towards his/her annuity computation.

Under CSRS rules, if you served on active duty and will be eligible at age 62 to collect Social Security, your CSRS annuity will be reduced by the number of years that you served unless you buy back that time.

Options

Federal employees have the option of making military service credit payments for creditable military service before they retire. I bought back my 3-plus years of active-duty military time when I discovered that my CSRS retirement annuity would decrease at age 62 if I didn’t.

All FERS employees and CSRS employees who anticipate having at least 40 quarters or 10 years of work under Social Security at age 62 should consider paying back their military time. Otherwise, your annuity will decrease. In my case, the cost was minimal, $650 total, and I was able to pay $25 a pay until the debt was settled. Deposits for military service from the 1980s and up can be substantial because military pay increased dramatically.

The earlier you initiate the payback, the less interest penalties you will pay. I suggest buying it back early in your career, even if you are CSRS and aren’t sure you will be able to collect Social Security. You can always have the payment refunded before you retire if you are certain that you won’t have the 40 quarters necessary to collect Social Security. My military pay was meager, $97 a month, in 1969 when I was in the Air Force.

Confusion Abounds

There is considerable confusion about whether it is worthwhile to recoup your military time. If you make a military deposit, there is no effect on your other military benefits, such as medical benefits, base access, commissary, or VA benefits, including any disability payments from the VA. Visit our Military Credit section for complete information on this subject.

It only affects (active duty) retired military pay; you cannot receive 2 separate retirements (military and civilian) for the exact same period of service. If you are retired from active duty and elect to buy back your 20+ years of military service, your military retirement will cease once you begin collecting your federal civil service annuity. Reserve or National Guard members under Title 32 can collect both a federal civil service retirement and a Reserve or National Guard retirement.

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Disclaimer: The information provided may not cover all aspects of unique or special circumstances.  Federal regulations, medical procedures, investment information, and benefit details are subject to change. To ensure the accuracy of this information, contact relevant parties for assistance, including OPM’s retirement center. Over time, various dynamic economic factors relied upon as a basis for this article may change.

The information contained herein may not be suitable for your situation. This service is not affiliated with OPM or any federal entity. You should consult a financial, medical, or human resource professional where appropriate. Neither the publisher nor the author shall be liable for any loss or other commercial damages, including but not limited to special, incidental, consequential, or other damages.

Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, ESTATE PLANNING, FINANCE / TIP, RETIREMENT CONCERNS, SOCIAL SECURITY / MEDICARE

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Posted on Thursday, 24th July 2025 by

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Kiplinger Retirement Newsletter’s recent article, “How to Tell Your Own Life Story,” was on the mark. They say, “There is one vulnerable asset we tend to overlook: Our stories.” This is so true, and it was a driving force behind my decision to write and publish my memoir, “The Early Years, A Road Less Traveled, in 2020.

Book Cover for Memoir

This is not a self-promotion for my memoir, which is out of print. Actually, I gave away most of the copies. I wrote it for family, friends, and those who have followed my columns, blogs, and websites for decades.

I wanted my children and grandchildren to know how their ancestors lived and struggled to make ends meet, nurture, and raise a family during austere times. A personal family history that family members can cherish and pass on long after I’m gone. Hmm, where am I going?

Today’s generation and our children were raised in a completely different manner from how my wife, Mary, and I were raised in the 1950s and 1960s. What most people take for granted today were profound and unimaginable luxuries during my childhood.

Regrets – I have a Few

I can’t tell you how many times I regret not asking my mother, aunts, and uncles about their early lives. Just sitting down with them and having a frank discussion about their recollections would have been revealing. New generations need to hear about how different and difficult everything was for many of those who came before them.

Simple things – I loved my mother’s macaroni and cheese, and I don’t have her recipe. It didn’t have the consistency of today’s offerings; it had a burnt cheese crust that we fought over at dinner time. I’ve tried to replicate it several times without success. Fortunately, I have snippets of my family’s history that I included in my memoir.

I knew little about my mother’s early years; her parents had 10 children. They made ends meet, all they could do on a coal miner’s salary in those days. It could also be due to the fact that she, along with her brothers and sisters, never had much of a childhood at all.

My mother and most of her siblings were forced to drop out of school after the 6th grade and were sent to work throughout the Pittsburgh area. My mother worked as a maid for $2 a week, which included room and board. She was just 13 years old! Her father collected all but 25 cents of her weekly salary!

Here is What’s in the President’s New Spending Bill

Your Story

James Hagerty, the author of Kiplinger’s article, says, “Your story may be the best gift to your friends and family, and it’s a gift only you can give.” Yes, others know bits and pieces of your story, but even those recollections are often diminished by time and circumstance. You are the key to presenting the story firsthand without others’ interpretations.

Tom, a friend I worked with for many years, relayed stories of growing up in Swissvale in the 1960s. I lived just down the street in Wilkinsburg, PA. We would often swap tales of our misadventures, and Tom would talk about his escapades with his cousins, family, and friends, which I always found interesting. These adventures and our early memories are the foundation for starting a memoir or whatever you want to call it.

I wonder if Tom’s family knows about the huge model boat he discovered in the wall of a condemned building and what he did with it, or many of the other youthful antics. Probably not, but they would find them amusing.

On the Mark, Get Set, Go!

The hardest part of any endeavor is getting started; once you commit, a routine emerges, and things start to fall into place. My first step was to write the Preface, which essentially summarizes what the book is about from a personal perspective with succinct observations. An excerpt from my Preface follows. Can you envision where I was going with my memoir?

“Life in the mid-twentieth century was all one could imagine of that time, a Forrest Gump world running at a snail’s pace. The only cell phone we encountered was in the comic strips when Dick Tracy was all the rage. Computers were relegated to large research facilities, filling huge rooms with vacuum-tube equipment racks that emitted ambient light and illuminated the room’s interior.

Airplanes were becoming increasingly popular after World War II, but most still relied on trains and trolleys to get where they needed to go. The middle class bought cars and homes at a feverish pace, yet most could only dream about living the “life of Riley,” an expression coined from an early 1950s TV sitcom. We watched Father Knows Best, The Donna Reed Show, and others that represented the ideal traditional family, infusing our dreams with visions of a stable, satisfying life surrounded by family and friends.”

Towards the end of the Preface, I go on to state, “This is my story, a collection of recollections from a life filled with high expectations, daunting challenges, and a large dose of reality, experienced in a multitude of environments and circumstances. All of which helped me become who I am today. It’s a story of our family’s early trials, tribulations, and successes all rolled into one.”

A Preface sets the tone of the book; without it, it’s equivalent to traveling across the country without a map or GPS. I included the complete Preface, Dedication page, and Chapter One for all to read on my site.

As a courtesy to my dedicated followers, I’ll post a PDF file on my site each week with another chapter of my memoir. You can now read Chapter Two online. The chapter will be available for only one week, after which another chapter will be posted.

Your Story Outline

The next step is to develop a story outline that highlights the times in your life or events you wish to share with family and friends. I began with my mother and father’s early lives, including how they met, and provided a brief overview of their families. Then, I focused on each stage of my life, to age 35 and beyond.

Your story can focus on anything you wish to share with others, or on a specific event in your life. Jack Myrtha, a member of my parish, wrote an exceptional memoir calledThe Hunny Bunny: A Young Girl’s Life with a Congenital Heart Defect,” which is both tragic and beautiful. A heart-wrenching journey about his beautiful daughter Katie’s short life and the trials and tribulations they encountered through her life’s journey.

John and Krista Myrtha were staunch patient advocates for their daughter, questioning caregivers and researching her affliction to ensure their daughter received the best treatment possible from those who cared for her.

Charles Coulter, the father of good friends of mine, aggressively researched their family history throughout his life. He and other family members developed an extensive family tree, and Charles wrote a book on the subject many years ago that he passed onto to his children. The Coulter brothers have relatives across the country and believe they are related to John Colter, the famous western explorer, that was on the Lewis and Clark expedition.

What Story Will You Tell?

I wrote my memoir because my early childhood made me stronger, teaching me to appreciate what we have, spend with care, focus on the family, and save for a rainy day. Hopefully, it will help our children and grandchildren appreciate what they have and the support they received in life.

Many today still struggle to make ends meet and put food on the table, a situation I recall well from my youth. It doesn’t matter where you came from, whether you’re rich or poor; everyone has interesting and inspirational stories to share with others, what they did, and how they got to where they are today. Hopefully, with helpful suggestions and perspectives for those who will follow us in this life. The who, what, where, and why of our existence.

What do you want your family and descendants to know about your life? No matter what it is —a biographical sketch or a major event —once written, you will discover immense satisfaction from the effort, and your family will appreciate having your memories preserved and passed on to future generations.

The Long and Short of It

You don’t have to write a formal book; you can if you wish, and there are many companies that will help you compile your work if needed. It can be a handwritten journal, a file on your computer, or printed out using Microsoft Word or any other word processor. You can even package a photo journal at Walmart or other stores.

Bob and Gary Coulter, traveled cross-country from Pittsburgh, PA, to California and back twice over the past three years on Harley motorcycles. By the way, one of the two was 80 years old at the time! Bob’s daughter used their pictures to compose a beautiful travel journal at Walmart for her dad and uncle. A treasured keepsake that the entire family and friends enjoyed.

Gary & Bob Coulter’s Cross-Country Trip

Don’t be concerned about your writing style, grammar, or spelling; software programs will help you through all of that and much more. Once started, you will be drawn into the work and think of little else until it’s finished.

The beauty of writing a memoir is that no standard format applies; make it whatever works for you. Most of the memoirs I’ve read had few pictures; I used 144 photographs in my book, each accompanied by captions, and included a family history that I compiled over the years.

Pictures add a personal experience, such as my son’s first haircut, prom and wedding pictures, family gatherings, and so much more. Pictures can be lost, but a book is an archive of your life’s experiences and can be passed on for generations.

Don’t procrastinate; time passes, and your initial interest may fade along with your memories.  My memoir was on my bucket list for over a decade, and of the 28 books I’ve written, it was by far the most enjoyable project I’ve ever worked on. Two years well spent. Our time on this earth is finite, and at 76, I’m acutely aware of life’s limitations, which my body reminds me of daily.

As a final note, I was unable to provide a link to the Kiplinger article because it is only available to Kiplinger Retirement Report subscribers.

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Disclaimer: The information provided may not cover all aspects of unique or special circumstances.  Federal regulations, medical procedures, investment, and benefit information are subject to change. To ensure the accuracy of this information, contact relevant parties for assistance, including OPM’s retirement center.

Over time, various dynamic economic factors relied upon as a basis for this article may change. The information contained herein should not be considered investment advice and may not be suitable for your situation. This service is not affiliated with OPM or any federal entity. You should consult a financial, medical, or human resource professional where appropriate. Neither the publisher nor the author shall be liable for any loss or other commercial damages, including but not limited to special, incidental, consequential, or other damages.

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Posted in ESTATE PLANNING, LIFESTYLE / TRAVEL, RETIREMENT CONCERNS, SURVIVOR INFORMATION

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Posted on Thursday, 17th July 2025 by

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Please forward this to others needing retirement planning assistance.

Many federal employees are actively considering retirement today due to early, regular, and deferred options that are now or soon will be available as downsizing initiatives continue throughout the federal sector.

The reconciliation bill includes funding for the major reorganizations, reductions in Force (RIF), and relocations that will result from shedding 10 percent or more of the total federal civilian workforce. Now more than ever, those affected are seeking guidance on how to proceed and protect the benefits that have accrued during their careers.

Finding Your Way

Those planning their retirement and annuitants require accessible resources tailored to their specific situation.

It’s often frustrating and challenging to find competent help. There are many variables to what initially might seem like an obvious resolution; it makes sense to seek out clarifications. There are limits to what OPM can provide.

Retirement planning is, in itself, a complex process with numerous avenues to explore. Fortunately, help is available; what service you require depends on the complexity of the issues and the level of assistance you personally need. Please forward this to others needing retirement planning assistance.

LEVELS OF ASSISTANCE

  • General Assistance
  • Comprehensive Guidance
  • One-on-One Counseling / Assistance

GENERAL ASSISTANCE

Retirement Planning Seminars

Contact your HR department to sign up for a retirement planning seminar. They cover FERS and CSRS employees (including Special provisions) and may be offered in Full or Half-day sessions. The information is generally divided into seven key areas:

  • CSRS or FERS retirement annuity
  • Thrift Savings Plan (TSP)
  • Voluntary Contribution Plan (VCP) – CSRS and CSRS Offsets only
  • Federal Employees Group Life Insurance (FEGLI)
  • Social Security
  • Federal Employees Health Benefits (FEHB)
  • Federal Employees Dental and Vision Insurance Program (FEDVIP) and disability programs

OPM

The Office of Personnel Management (OPM) serves as the HR department for the federal government, administering the retirement benefits program. Active federal employees can research various aspects of retirement on OPM’s site. However, federal employees must contact their agency’s HR office to initiate the process. OPM has helpful retirement planning tools and guides that all should review and use when exploring their options:

OPM services the federal retirement community. If you are an annuitant (retiree), call or use their online services portal to obtain current benefit information, related documents, and payment statements online if registered for their service.

It’s not easy getting through to them by phone, and when you do, expect long wait times. OPM is the only entity that can effect desired changes or update your records.

Federal employees with retirement questions should contact their HR department; OPM only services annuitants and survivors. Your HR department will explain your benefit options and arrange for you to attend a retirement seminar.

COMPREHENSIVE GUIDANCE

Federal Employee’s Retirement Planning Guide (www.federalretirement.net)

I launched this site in 2004 when I was planning my retirement. It is designed to help federal employees and retirees find the information they need to make informed decisions about their benefits and retirement.

A site visitor commented, “I spent 3 hours on the web looking for answers to questions concerning federal retirement. After a Google search yielded your address, it took only 20 minutes to find all the answers I needed. Thank you!!!”

How to Find Essential Retirement and Benefits Information on This Site

Abundant retirement planning guidance is compiled from a multitude of federal agencies: OPM, Social Security, Medicare, TSP, the Department of Labor, and others. Use the main menus and search box at the top of each page to find benefit clarifications, financial planning guidance, FERS / CSRS eligibility determination, annuity estimates, and suggestions that you won’t find elsewhere. The related blog and weekly email newsletter offer advice on current topics of interest.

Federal Employee’s Retirement Planning Software (https://fedretiresoftware.com/)

This easy-to-use and reasonably priced software is uniquely designed for federal employees (full-time, regular CSRS and FERS) to calculate their federal benefits, from start to finish, throughout retirement. You can also add income and/or expenses from other sources.

This calculator is used by tens of thousands of federal employees as well as Federal HR departments to make informed retirement planning decisions. Check out their Sample Report to get a better understanding of how comprehensive their calculator is for federal employees planning their exit.

ONE-ON-ONE COUNSELING / ASSISTANCE

Often, individuals require expert assistance to address complex issues and make informed decisions about what is best for their situation. A professional federal benefits consultant can address your concerns and answer any questions that you may have.

Here is a list of those you can contact to help you address your concerns when the research you’ve done hasn’t provided an answer.

Pensioned Americans Retirement Company (PARCO)

This easy-to-use, free platform enables all Federal Employees (FERS, CSRS, Special FERS, and FSPS) to view all their benefits and optimize their federal retirement. PARCO’s Platform is what I wish existed when I was planning for retirement, and it is used by thousands of FERS and CSRS employees across the country and around the world.

Their team comprises the best federal fiduciary retirement experts who will help you maximize your pension and the benefits that accompany retirement. Their platform guides you through the process step by step.

Federal employees complete their online profile, and PARCO evaluates where you are and what you may need to do to achieve your retirement goals. They put you in touch with specialists who can address your concerns and recommend a personalized path to keep you on track.

 

Retire Federal

This consulting firm is owned by Tammy Flanagan, a federal benefits expert who has been assisting feds since her days of employment with the Federal Bureau of Investigation. She and her staff of experienced counselors offer invaluable fee-for-service personal consulting for civilian federal employees and annuitants, covering pre-retirement preparation to post-retirement decisions and events.

Their staff will assist you with a thorough review of your pre-retirement tasks and help you determine whether to enroll in Medicare Part B and which FEHB plan will best coordinate with your situation. They can address your concerns, answer questions, recommend options, provide details as to why one path is preferred over another, and put your mind at ease.

Consultant – Divorce Related Issues for Federal Employees

Ann Ozuna is a retired Personnel Management Specialist.  She founded Personnel Solutions Federal Benefits Counseling upon retirement from federal service in 1996. In addition to her 25-year federal personnel career, she holds an MBA from Gonzaga University and the Senior Professional in Human Resources (SPHR) and Chartered Federal Employee Benefits Consultant (ChFEBC) designations. She provides consulting services for federal employees facing divorce and attorneys working with federal clients.

If you need answers to retirement questions or don’t know what options are best for you and your family, use the resources listed above or other reputable services.

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Disclaimer: The information provided may not cover all aspects of unique or special circumstances.  Federal regulations, medical procedures, investment, and benefit information are subject to change. To ensure the accuracy of this information, contact relevant parties for assistance, including OPM’s retirement center.

Over time, various dynamic economic factors relied upon as a basis for this article may change. The information contained herein should not be considered investment advice and may not be suitable for your situation. This service is not affiliated with OPM or any federal entity. You should consult a financial, medical, or human resource professional where appropriate. Neither the publisher nor the author shall be liable for any loss or other commercial damages, including but not limited to special, incidental, consequential, or other damages.

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Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, ESTATE PLANNING, FINANCE / TIP, RETIREMENT CONCERNS, SOCIAL SECURITY / MEDICARE, SURVIVOR INFORMATION

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Posted on Friday, 11th July 2025 by

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The Department of Veterans Affairs announced on July 7, 2025, that it’s on pace to reduce the total number of VA staff by nearly 30,000 employees by the end of the fiscal year. Employee reductions through the federal hiring freeze, deferred resignations, retirements, and normal attrition have eliminated the need for a RIF.

During President Clinton’s term, he reduced the federal workforce by 400,000, with most of the staffing reductions achieved through normal attrition, the Voluntary Early Retirement Authority (VERA), often accompanied by a $25,000 Voluntary Separation Incentive Payment (VSIP), and by not filling non-critical staffing vacancies.

I believe much of the same will account for the majority of downsizing initiatives by the new administration, considering they also offered deferred resignations initially with almost 8 months of severance pay.  Other agencies will surely follow suit to avoid RIFs.

OPM’s Retirement Application (ORA) Portal Clarification

Paul, a site visitor who recently retired, sent clarification on accessing OPM’s portal using a private email address.

In my ORA article, I mentioned that only those with a .gov email address can access the portal.  Those who accepted a deferred resignation under the Fork in the Road program had no access to government resources or agency email accounts.

The former employee’s Human Resources office must submit their non-government email address, which they will use to complete their retirement application, to the portal. This email address must match the one provided by the employee to HR.

The separating employee then logs into the ORA portal using that email address via “Login.gov”.  Paul completed all required steps in the ORA portal using his personal Gmail address with no issues.

Paul advised that you can use a private non-government email address if it is “pre-authorized” by HR.

New Car Interest Deduction

This new deduction is not only beneficial for many new car purchases but also benefits American-made cars and foreign models assembled in the United States. The One Big Beautiful Bill Act allows auto loan interest deductions of up to $10,000 per year for interest paid on a qualifying auto loan, good news for many but not all.

Fortunately, this tax break starts with purchases made in 2025 and runs through 2028, and you don’t have to itemize to claim the deduction.

Qualifying Criteria

  • New cars must be assembled in the United States, excluding many imports including popular Toyota, Nissan, and Honda models.
  • The deduction is limited to $10,000 per year and is eliminated for individuals earning more than $100,000 or couples making over $200,000. This will exclude many households.
  • The deduction applies to cars purchased after December 31, 2024, and is limited to vehicles assembled in the U.S.
  • This is a temporary tax break, available starting this year and ending in 2028. These dates could be extended when they run out by the new Congress.
  • ATVs, trailers, and campers wouldn’t be eligible.

The Big Beauty Bill Act ends federal tax incentives for electric vehicles. It also reduces penalties for automakers that violate fuel efficiency standards.

No Taxes on Social Security Clarification

I received several comments about the article I wrote on this subject. A newsletter subscriber commented, “I believe your most recent article, ‘Social Security Tax Relief for Millions of Senior Citizens, ‘ is misleading. The bill does not contain any provisions to eliminate or even reduce taxes on Social Security. What it does do is reduce some people’s taxes through a new temporary $6,000 deduction for about 24% of seniors.”

He further states, “Social Security in a message many labeled as partisan, said the legislation included a provision that eliminates federal income taxes on Social Security benefits for most beneficiaries”. You parroted that message, yet it bears repeating that the bill does not contain any provisions to eliminate or even reduce taxes on Social Security.”

He referenced several articles from the Washington Post, CBS News, and The Hill.




My Reply

The Senate and House Parliamentarians didn’t allow changes to the Social Security tax code in the reconciliation bill. Hence, the House and Senate worked around that and developed a senior deduction that provided a similar result, fewer taxes for many seniors.

The bill provides relief in a way that could be included in the bill. The House only approved a $4,000 deduction, and the Senate increased it to $6,000. This bill, along with the new senior deduction, will be a huge help to many. The partisan articles you mention left out these details and didn’t credit Congress for what they did accomplish, tax relief for seniors.

I generally use source documents for my research; for this article, I used the One Big Beautiful Bill Act,  Social Security’s website, and the White House press release. I don’t copy other columnists’ work; instead, I conduct my research. When I do use quotes from others, I list the source often with a link to the referenced document.

The President promised relief on Social Security taxes during his re-election campaign, and the House and Senate approved this workaround to provide relief to millions of Americans.

Even Axios, which is considered a liberal news outlet, said in a recent article, “Trump promised to eliminate taxes on Social Security income. Lawmakers couldn’t pull that off entirely, given the constraints of passing a reconciliation bill and changing Social Security law. This break comes close.”

The End Result

I want to thank all those who subscribe to my newsletter, read my blog, and visit our Federal Employees Retirement Planning site. Your input is invaluable, and I appreciate your constructive feedback; it adds clarity to often-confusing and misunderstood subjects. Please keep your input coming.

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Disclaimer: The information provided may not cover all aspects of unique or special circumstances.  Federal regulations, medical procedures, investment information, and benefit details are subject to change. To ensure the accuracy of this information, contact relevant parties for assistance, including OPM’s retirement center.

Over time, various dynamic economic factors relied upon as a basis for this article may change. The information contained herein may not be suitable for your situation. This service is not affiliated with OPM or any federal entity. You should consult a financial, medical, or human resource professional where appropriate. Neither the publisher nor the author shall be liable for any loss or other commercial damages, including but not limited to special, incidental, consequential, or other damages.

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Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, RETIREMENT CONCERNS, SOCIAL SECURITY / MEDICARE, SURVIVOR INFORMATION

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Posted on Friday, 4th July 2025 by

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The reconciliation bill HR-1, passed by Congress and signed by the President on Independence Day, ensures that nearly 90% of Social Security beneficiaries will no longer pay federal income taxes on their benefits. This bill provides meaningful and immediate relief to millions of seniors.

Social Security Commissioner Frank Bisignano recently stated, “This is a historic step forward for America’s seniors. For nearly 90 years, Social Security has been a cornerstone of economic security for older Americans. By significantly reducing the tax burden on benefits, this legislation reaffirms President Trump’s promise to protect Social Security and helps ensure that seniors can better enjoy the retirement they’ve earned.”

The new law includes a provision that eliminates federal income taxes on Social Security benefits for most beneficiaries, providing relief to individuals and couples. Additionally, it provides an enhanced deduction for taxpayers aged 65 and older, ensuring that retirees can retain a greater portion of their earnings.

 

Social Security Taxation

According to a White House memo issued July 1, 2025, “88% of all seniors who receive Social Security will pay NO TAX on their Social Security benefits, according to an analysis from the Council of Economic Advisers.”

  • A senior who files as a single taxpayer and receives the current average retirement benefit (approx. $24,000) will see deductions that exceed their taxable Social Security income.
  • Married seniors who both receive the average $24,000 Social Security income — a total of $48,000 in annual income — will also see deductions that exceed their taxable Social Security income.

New Standard Senior Deductions

The new Senior Deductions, as noted in the following chart, will either eliminate or significantly reduce the taxes paid on our Social Security earnings. Married seniors will receive a $12,000 deduction, which compensates for the majority of any Social Security taxes they may be required to pay.

Before the passing of this bill, just over half of all Social Security recipients paid taxes on up to 85 percent of their Social Security benefits because their income exceeded the established threshold for taxation. This deduction significantly offsets the taxes paid for many, but not all, due to income limitations.

Deduction Examples

First, consider the case of a senior filing as a single taxpayer receiving the current average retirement benefit of approximately $24,000 (per Social Security Administration data).  The maximum amount of Social Security included in taxable income is 85% of the benefit, which would be $20,400 in this case.

Under the reconciliation bill, in 2025 this senior would be entitled to $23,750 in deductions – the $15,750 standard deduction, the $2,000 current-law additional deduction, and the $6,000 new law senior deduction – meaning that the reconciliation bill would lead to deductions that exceed the senior’s taxable Social Security income.

Second, consider a married couple of seniors both receiving the average $24,000 Social Security income.  The couple will have a total of $48,000 in annual income, of which at most 85% is taxable ($40,800).  Under the bill, this couple would be entitled to deductions that exceed their taxable Social Security income.

Six One Way, Half A Dozen the Other

This deduction is how the administration achieved its goal of exempting Social Security from taxation. Instead of changing the tax laws, they established a new senior deduction that achieved the same thing to a degree. Some will still pay taxes, but most individuals will benefit from this new standard senior deduction.

Income limits apply. Singles with income under $75,000 and couples under $150,000 qualify for the full deduction and it phases out gradually and ends completely for singles earning over $175,000 and couples over $250,000.

This tax break is available from 2025 through 2028 and may be renewed by future legislation.




Helpful Retirement Planning Tools

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Disclaimer: The information provided may not cover all aspects of unique or special circumstances.  Federal regulations, medical procedures, investment, and benefit information are subject to change. To ensure the accuracy of this information, contact relevant parties for assistance, including OPM’s retirement center.

Over time, various dynamic economic factors relied upon as a basis for this article may change. The information contained herein should not be considered investment advice and may not be suitable for your situation. This service is not affiliated with OPM or any federal entity. You should consult a financial, medical, or human resource professional where appropriate. Neither the publisher nor the author shall be liable for any loss or other commercial damages, including but not limited to special, incidental, consequential, or other damages.

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Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, ESTATE PLANNING, FINANCE / TIP, RETIREMENT CONCERNS, SOCIAL SECURITY / MEDICARE, SURVIVOR INFORMATION, WELLNESS / HEALTH

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Posted on Friday, 27th June 2025 by

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Last week’s article announced the launch of OPM’s retirement application (ORA) service. The process mimics the paper application process. FERS employees must fill out the SF 3107 form, and CSRS employees must fill out the SF 2801 online. Only those with a .gov email address can access the new application portal.

 

 

I tried to log in using my AOL email address, and OPM replied with this notice: “It looks like you logged in with a personal email address. If you’re an HR or Payroll specialist, log back in with your .gov email address. Otherwise, we’re working on adding support for retirees. Check back soon!”

The login screen cautions, “First time here from retire.opm.gov? Your old retire.opm.gov username and password won’t work. Create a Login.gov account with the same email used previously.”

Your online applications are submitted to your agency’s HR department for processing. I suggest downloading and printing out the appropriate form for detailed guidance, including the four pages of instructions included with each form. They will also help you gather the required information and documents when completing your online submission. This will save you time when applying online.

Here are the form links:

Streamlined Service

Starting June 3, 2025, federal employees’ retirement applications must be submitted online through OPM’s new Online Retirement Portal. This system replaces paper-based submissions. For security purposes, this service is only available through your Login.gov account.

You only have to register once for a Login.gov ID, and then you can use it for all federal sites, including OPM’s Services Online and Social Security. You also have the option to log in using your government ID.

The one caveat is that you must use your official agency email address to enter this system. Federal employees must register again using their agency’s email address if you used a non-government email address to join other sites, such as Social Security.




Applying for Retirement

The application requires detailed information about the employee’s service history, retirement system (CSRS or FERS), benefit elections, and survivor annuity elections. When you are ready to retire, you will receive an email with instructions on completing your application using ORA. You will enter your information and complete the entire process online.

FREE Retirement Report and Analysis

Here are the steps required to use this service:

  1. Create or Link to your Login.gov Account:

If you don’t have a Login.gov account, follow this guidance to create one. This is separate from the OPM Services Online account, which lets annuitants (federal retirees or their spouses, ex-spouses, and children) manage their accounts online.

  1. Access the Retirement Application:

Go to the OPM Online Retirement Application portal.

  1. Complete Forms Online:

Fill out the required forms, including the primary retirement application forms (SF 2801 for CSRS or SF 3107 for FERS) and any supplemental forms.

  1. Collect Supporting Documents:

You must provide supporting documents, such as marriage certificates, divorce decrees, or military service records, as needed.

  1. Send the Application:

Once the application is complete, submit it electronically through the portal.

  1. Agency Review and Certification:

Your employing agency will review and certify your application, including completing the SF 3107-1 (FERS) or SF 2801-1 (CSRS), and forward it to OPM. They will contact you if additional information or clarification is needed, such as military service or benefit election questions.

  1. Follow up with your HR Department

After submitting your application, you should receive a confirmation of receipt via the email address you used for the submission. Call HR to confirm receipt if you don’t receive a timely response.

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Stay Involved with the Process

Time will tell how efficient the new system is and whether or not it speeds up processing. OPM has provided training and support for agencies to utilize the new system. The key is for your HR department to have the same ability to fast-track and send your application electronically to OPM. They will need the staff to do this, just because it is online now, applications still require detailed reviews before sending them to OPM.

Issues around military service time often arise that the applicant and HR must resolve using the employee’s eOPF and other documentation. You should download your eOPF and review it for inconsistencies before submitting your application, especially when employed by different agencies, working part-time, or having military service to add to your annuity calculation.

Effective July 15, 2025, OPM will no longer accept paper retirement applications. Any paper submissions created on or after June 2, 2025, will be returned to the agency for digital resubmission.

when employees notify their HR office of their intent to retire, they will receive an email with detailed instructions for completing their application using ORA.

Helpful Retirement Planning Tools

 

Disclaimer: The information provided may not cover all aspects of unique or special circumstances.  Federal regulations, medical procedures, investment, and benefit information are subject to change. To ensure the accuracy of this information, contact relevant parties for assistance, including OPM’s retirement center.

Over time, various dynamic economic factors relied upon as a basis for this article may change. This service is not affiliated with OPM or any federal entity. You should consult a financial, medical, or human resource professional where appropriate. Neither the publisher nor the author shall be liable for any loss or other commercial damages, including but not limited to special, incidental, consequential, or other damages.

 

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Posted on Friday, 20th June 2025 by

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The U.S. Office of Personnel Management (OPM) launched a new online portal for federal employees on June 3, 2025. This portal is a fully digital federal retirement system that streamlines the retirement application process for employees, HR professionals, and payroll offices.

Getting Started

FREE Retirement Report and Analysis

You must use Login.gov to set up a new account or to log in for existing users. If you aren’t familiar with Login.gov, review the guidance I published when they first required this extra security level for many federal websites.

OPM’s Goals

Users accessing the platform are presented with a streamlined entry point tailored to both agency partners and members of the public. This reinforces OPMʼs broader goal of transforming the retirement process into a faster, paperless, and easier-to-navigate system.

“This is what modern government should look like—responsive, efficient, and user-centered,” said Acting Director Charles Ezell. “With every update to this new portal, weʼre improving the retirement experience for millions of public servants whoʼve dedicated their careers to this country. This launch brings us closer to delivering the fully digital, 21st-century retirement system they deserve.”

End Notes

This is just one of the first steps to enhancing government automation; many more are to come. Other initiatives coincide with this effort, such as the launch of the electronic Official Personnel Folder (eOPF) platform on June 5th.

Automation has come a long way since I started working in government. I’ve been fascinated with computers from an early age, starting with the VIC 20 and Commodore 64 and everything thereafter. My 1982 college degree was in microcomputer technology.

Significant Changes Impacting Federal Employees

When I worked at our Sector Office in Pittsburgh, PA, in the early 1980s, I was the only one with a home computer; there were only IBM Selectric typewriters at work. I would produce staff reports on my Commodore 64 and bring them to work. Our manager occasionally sent me home to work on special computer and spreadsheet projects he submitted to the region—a sea change from today.

Many early automation efforts hit brick walls and faded into the sunset. Today, with AI and all of the computer power, everything is or will soon be automated. Our parents won’t recognize what lies ahead these next few years, and I’ll also be amazed, from robots taking care of basic tasks to self-driving cars, robo-taxis, and everything in between, with few exceptions.

Is this the new golden age, or have we gone too far and fast without evaluating the impact on the billions of people still left in the equation?

Automation has advanced so much that what was impossible just a short time ago is commonplace.

Helpful Retirement Planning Tools

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Disclaimer: The information provided may not cover all aspects of unique or special circumstances.  Federal regulations, medical procedures, investment, and benefit information are subject to change. To ensure the accuracy of this information, contact relevant parties for assistance, including OPM’s retirement center.

Over time, various dynamic economic factors relied upon as a basis for this article may change. This service is not affiliated with OPM or any federal entity. You should consult a financial, medical, or human resource professional where appropriate. Neither the publisher nor the author shall be liable for any loss or other commercial damages, including but not limited to special, incidental, consequential, or other damages.

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Posted on Thursday, 12th June 2025 by

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This year’s 2.5% COLA for Social Security and the Civil Service Retirement System (CSRS) and 2.0% for Federal Employees Retirement System (FERS) decreased from the 2024 COLA of 3.2% % CSRS and 3% FERS.

The 2023 COLA was the highest in over 40 years at 8.8% for CSRS and 7.7% for FERS employees. Even though costs remain high for many segments of the economy, inflation is moderating as noted in the following charts.

May 2025 CPI Chart

I published the following 2024 CPI inflation chart in last year’s COLA update article; you can see the significant drop in inflation year to year, especially in the energy sector.

May 2024 CPI Chart

According to the Bureau of Labor Statistics, the costs of all items increased by around 2.4% in the current 12-month period ending in May, compared to 3.3% last year. The one area that didn’t show improvement year to year is food; it increased to almost 3 percent, and we all can attest to that fact: food prices at the grocery store and restaurant meals are still through the roof.

Our real estate taxes continued their upward climb again this year. Allegheny County real estate taxes increased 36% in just one year. Gasoline in the Pittsburgh area averages $3.34 a gallon, but at Sam’s Club or Costco, it is $3.15 a gallon, which is still one of the major catalysts driving up the costs of everything we use.

2026 COLA Estimated Increase

The 2026 COLA is calculated over the 12-month period from October 1, 2024, through September 30, 2025. The next three months’ CPI data will determine the amount of the next COLA, and it depends on the reported monthly inflation rates for these months, the last three months of this fiscal year.

Wilbert J Morell III, a retired Navy Engineering Project manager, tracks these statistics monthly and generates a comprehensive report on our COLAs under specific scenarios.

His research concludes that if there aren’t significant changes to the last quarter’s CPI, we can expect the following 2026 COLAs:

  • 2026 Social Security COLA: 2.6%
  • 2026 CSRS COLA: 2.6%
  • 2026 FERS COLA: 2.0%

As of June 11, 2025, the Senior Citizens League (TSCL) projects the Social Security Cost-of-Living Adjustment (COLA) for 2026 to be 2.5%. This is an increase from their previous forecast of 2.4%.

Review all COLAs from 1999 to the present with detail on how they are prorated for FERS employees and annuitants.

Retirement Processing Delays

As of May 2025, OPM has an inventory of over 24,000 claims to process. They received 15,040 claims in May and processed 9,739.

The good news is that OPM’s retirement claims processing times have steadily declined since 2022, from over 90 days to 52 days today. Now that retirement applications are submitted online, the days it takes to process a claim should be reduced further.

Significant Changes Impacting Federal Employees

Common Mistakes That Cause Delays

Any mistakes or omissions in your retirement application often cause delays. Common errors include:

  • Unsigned forms, online forms require an electronic signature (Guidance Provided)
  • Check that all forms are complete before submitting them.
  • Provide the correct contact information, not your work email and phone numbers.
  • Incomplete or incorrect SF 2818 FEGLI (Continuation of Life Insurance)
  • Missing health benefit information
  • Missing or incorrect marriage and spousal consent information
  • Missing or incorrect military service documentation

Preparing for Retirement, Start NOW!

The following list of articles will help anyone planning their exit to take the appropriate actions necessary to submit a timely retirement application:

Summary

The 2026 projected 2.6% COLA is much better than the ZERO COLAs we received in 2010, 2011, and 2016. Yet, the cost-of-living adjustment is based on the previous year’s statistics; we start at a yearly loss. My annuity has almost doubled since I retired 20 years ago. Many private-sector annuities aren’t COLA-adjusted, and private-sector retirees often find themselves hard-pressed to make ends meet 10 or 20 years after retirement.

Regarding retirement planning, it’s best to start long before you walk out the door. I started five years before my target date and attended several agency-sponsored retirement planning seminars that created more questions than answers. That’s why I developed and launched the Federal Employees Retirement Planning Guide in 2004.

One of our site visitors stated, “I spent 3 hours on the web looking for answers to questions concerning federal retirement. After a Google search yielded your address, it took only 20 minutes to find all of my answers! Thank you!!”

If you are contemplating retirement, start researching your benefit options early. There are many decisions to make, and most are irreversible after you leave. One example is life insurance. Several low-cost options are worth carrying into retirement, even if you think the coverage isn’t needed now.

Helpful Retirement Planning Tools

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Disclaimer: The information provided may not cover all aspects of unique or special circumstances.  Federal regulations, medical procedures, investment, and benefit information are subject to change. To ensure the accuracy of this information, contact relevant parties for assistance, including OPM’s retirement center.

Over time, various dynamic economic factors relied upon as a basis for this article may change. The information contained herein should not be considered investment advice and may not be suitable for your situation. This service is not affiliated with OPM or any federal entity. You should consult a financial, medical, or human resource professional where appropriate. Neither the publisher nor the author shall be liable for any loss or other commercial damages, including but not limited to special, incidental, consequential, or other damages.

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Posted in ANNUITIES / ELIGIBILITY, BENEFITS / INSURANCE, ESTATE PLANNING, RETIREMENT CONCERNS, SOCIAL SECURITY / MEDICARE, SURVIVOR INFORMATION

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