Episode Transcript
[00:00:00] Speaker A: Any examples used are for illustrative purposes only and do not take into account your particular investment objectives, financial situation or needs and may not be suitable for all investors. It is not intended to predict the performance of any specific investment and is not a solicitation or recommendation of any investment strategy.
Welcome to Reyna Retirement. Reyna Reyes has dedicated her career to helping people make small, smarter financial decisions. Reyna Retirement is all about breaking down complex financial concepts into language you can actually understand.
Now here's the co founder of American Federal Benefits Consultants, Reyna Reyes.
[00:00:40] Speaker B: It's the end of the year. What do we do? What's happening? It's fall festivals, it's holiday parties, it's candy. Holy cow, keep your candy. I can't do anything with it. But what do we care about in terms of retirement planning, money, life. And especially if you're a federal employee and you're watching my show, you're thinking, rena, what do I need to talk about at the end of the year specific to my Fed benefits? Well, let's just hit some of them up, right? What do we do? Here it comes. We've got holidays and turkeys and all kinds of things, but we don't want to be a turkey. And forget that open enrollment is here. So number one, open enrollment for health insurance, it's happening. It's coming up like this week, right? And it's only for like a month. Ish Federal employees. So a lot of y', all, you're paying for coverage that you're not in love with. Maybe you're paying, maybe you've got self plus one and you need self only. Remember enrollment codes though, we can change throughout the year. But if you're changing plans like Blue Cross to Giha to Aetna to, to wherever we're going, now's the time to change. So if you've been eyeing that other health insurance plan that your buddy has, now is the time to make the change. Usually you can just log into your HR portal or whether that's my pay grb, post lease, depending on what your agency is, obviously it should pop up and they'll say, oh, open enrollment, clickety click. And you can make those changes. Now, if you tried to make changes before and it didn't get done, you got some beef with them, you need to let them know. And remember, if it's not on paper or you don't have a proof of the online submission, it didn't really happen. So whatever you do, right click Print PDF, make it a PDF, save it, screenshot, it Take a picture. I don't care. Whatever it is, write it down. Pick a picture. I don't care. That's how you want to preserve what you've done. That way you can show proof to somebody, hey, I did this. Why didn't it happen? This was the date it's supposed to be done. Back date it, fix it. So health insurance, you can make changes. What other kind of health insurance happens? Right now, anybody who's over 65 or has a disability knows that it's Medicare season and your mailbox can't fit the stuff you're getting. So what do we need to consider during open enrollment of Medicare when. Well do I love my plan? Is my plan still going to be here this year? 2026, the an incredible wave of Medicare Advantage plans have disappeared. They're closing. They're no longer there, no more it.
And so we've got some. You've got some decisions to make. You got some explaining to do. Lucy, you got to go find another plan, figure it out and call yours truly, because me and my team can help you. Hey, Raina, I had XYZ PDQ Advantage plan, and I got a letter that says, too bad for you, we're not going to be here next year. You've got to take action. You've got to make a plan. Now, in general, the plans are going to continue. Like, if you've got a plan and it's actually going to be there next year, you don't have to do anything. But a lot of y' all are getting cancellation plans or cancellation letters saying it's not going to happen. So that's when you have to make a change.
And. And woe unto ye who have just entered into Medicare and you are greeted with this denial or cancellation plan cancellation letter. You're saying, what the heck, Raina? I thought you said that I don't have to do anything and it'll just follow into next year. Yeah, it would if it was staying. When the plans just continue, you don't do anything. You get your anoc, your annual notification of change, and then nothing happens. You just see the change. But this upcoming year, lots of cancellations. So reach out to either the rep that helped you or if they're not calling you, reach out to us. We can help you and make the right decision. See what's available in your area and go from there. And remember, while you're working, many of y' all have A and do not have B. You are protected from the penalty while you're working, but retirement is a Trigger that you may have to take action on postal employees. You got to turn it on right away. Part B, turn it on, on, on. It's a mandate, but now there's a few exclusions, but I don't have time for all that. You've got some exclusions, but the majority of you, if you're turning 65 or you already did and you're retiring, majority of you will have to turn on Medicare part B straight away after you retire in order to keep your postal service health plan. Federal employees, that is non postal, you don't have that same mandate. You've got an eight month window. We got all kinds of time and choices and things to talk about, talk about so we can go over that as well.
So health, health, that is major. Medical, health, Medicare health, some of y' all have drug plans and supplements and we can help with those as well.
Either way, whatever questions you have, bring them on. Tsp, what am I thinking about end of the year? Okay, take a look at your paycheck stuff. You're leaving earnings, your paycheck, whatever. See what amount of money you've put into your TSP for the whole year.
Was it 5%? Are you putting in your 5%? Heaven forbid. If you are putting in less, fix that straight away. Fix it now.
Don't go any further being less than 5% because if you're putting in less, you're not. You're giving up a match. You're just leaving on the table. Hey, Uncle Sam, I'm really benevolent. I just want to let you keep that money. Don't do that. That's no good. Some people say, me, I can't afford to contribute that full dollar amount. You know what comes after that?
No, you can't afford not to because you get a tax deduction and they're matching you dollar for dollar. When you're putting in five, you put in five, they put in five. Simple.
You put in 10, they put in five. So fix your percentages. Also check what you've done for the whole year. Are you maxing out? Are you wanting to max out? How close were you plan for the following year? Because come January you've got 26 pay periods of contributions into your TSP.
And that's going to allow you to determine the exact dollar amount that you contribute into the TSP for that 12 month or 26 week period.
So if you're trying to put in the full exact, whatever you're allowed next year, 33, 34,000. I already did the, the video. I can't Remember exactly what is. But let's say it's 34 grand divided by 26. There you have it. Start that for the first pay period of 20, 27. That way you're done. You don't have to do math again. It's the right amount for the whole year, and then you can decide if you want to do Roth or not.
You know, and that's something to consider. So this is a great time to take inventory of what you've already contributed and look at what you want to contribute next year.
Go ahead and look back and say, hey, I did this. I could have done this better. Let me go ahead and make it better now. Contributions, big deal. Okay. What if you retired? You just retired. You've been retired for a minute. You need to start maybe. Do we need to do Roth conversions?
Some people. This. This starts a whole. My goodness, just saying the word Roth conversion.
That's like saying politics.
It's. It's going to open up everybody's opinion from all different corners of the room and all different sources and thoughts and caveats. And Joo says this, and the talking head says this, and everybody says this.
We want to consider if it makes sense for you.
My favorite time, personally, is the end of the year. Why? Because the dust has settled on the surprises of your life. What's a surprise, Raina? My car died. I had to go grab 20 grand for a down payment for a brand new car. Paid the tax already.
Well, there we go. You already grabbed $20,000 out of your raw. Out of your traditional. Paid the tax.
Do we need to take another conversion?
Do we need to take another dollar amount and pay tax again?
Probably not. Maybe not. It just depends. It depends on your proximity to your next tax bracket. It depends on your proximity to IRMAA and whether or not we have a SSA 44 option. Meaning do I have a qualified life event that I can tell them not to charge me more for Medicare? Raina, what the heck are you talking about?
If you're saying that, jot down my number, 850-450-6500, and get scheduled. We do appointments. We don't even charge. We don't charge for this. How do you not charge? We work with all different groups. We work with unions, we work with small groups. We work with retired unions. We work with supervisors and plant managers, and they have us talk to their people.
And you can have us talk to your people. You need us to talk to a group. You need us to set up a workshop, a meeting, a webinar. We do it. We can do it. We have people peppered all over America, and we can make it happen.
But you say to me, raina, what are you talking about? This is why we do the individual reviews. Because some of this will apply to you, some of this will not. It'll apply to Sue. Who knew?
I bet you do.
So that's the thing. We want to know what matters to you. Do you care about Roth conversions? Do we have enough to convert? Does it make sense? And how close in proximity are we to the required minimum distributions? Why am I bringing this up end of the year stuff? Because at the end of the year, we might convert some to Roth, which means pay tax on some money that's never been taxed yet and get it into the Roth. So you pay the tax a little bit at a time. If you chisel away at the taxes, the big hit won't hurt so bad later because we're all barreling toward RMDs. You thought I was going to say a really sad word, didn't you? We're all barreling toward the required minimum distribution. That's where Uncle Sam says, hey, yo, I waited long enough. You got to pay some tax on this money that you've never paid tax on. And we say, okay, fine. How much? And he says, well, it's just a minimum, ME tell you. And it changes every year after your age, so it ends up being a very similar amount. But that's kind of thing we want to look at. Conversions, end of the year, that's another thing. So recapping health care, Medicare, TSP contributions, TSP withdrawals.
A conversion is a withdrawal. You pay the tax, but then it goes over into another bucket. You don't really bank the money. It sits in another account. Growing interest, with the goal of having that interest never be taxed ever. Which is great. We love that. We absolutely love that.
So what are some other things to consider at the end of the year? What are you paying for?
There's a lot of things that people look at, you know, the subscription guys, like, hey, send us all your stuff. We'll review your subscriptions and see if you're paying automatically for jargon that you don't use or care for. Used to be magazines, now it's, you know, newsletters and streaming and things like that. Same thing here. You may have stuff coming out of your paycheck, and it's just a bunch of grids. It looks. It's a blur of numbers on. On the grid when you look at it. But when you, you know, My dad always taught me, he says get a piece of paper and cover the line so you can read it line by line.
And when you do that and you see the line and you see the line, you say what the heck is this?
I've seen people in three different unions, some of which they can't even get access to, they don't, can't use. So they're paying due to a union, they can't do anything.
And then unions at the very specific time period of when you can enroll or dis enroll and all that kind of stuff.
That's something. Health insurance, we already addressed dental and vision. End of the year is open enrollment for the dental and the vision. The FedVIP also review what you're using. Do you have a family plan and no family?
That sounds depressing but do you have, do you, are you paying for a family plan? And maybe everybody aged out or. You know, I've seen people where they both have family plans. My little Twinkies, right? I've got a federal, two federal spouses and they're both paying for family dental coverage. And they both thought they were doing the thing. Doing it really well doesn't happen very often because usually you know, but in this example they just didn't talk a lot. And then when we brought it to the table I was like well hold on, you've got this and you've got that.
Do we have separate families here? Like what's happening? They're like no, it's the same.
So duplicate of the dental. So it's good to kind of get your stuff together. It's worth it.
Book a meeting with yourself, book a meeting with your spouse, book a meeting with your kids. It's okay to let the kids know some basics.
What you want. Hey listen, if something ever happens to me, put Reyna's number on the top 10 list. We help with claims, we help with all this stuff. There's a lot of advisors out there that couldn't tell you the first thing about Fed.
They have to Google it and that's fine. Google's helpful. You know, we keep all this stuff right at the tip ready to go. We've got emails ready to send you so you've got the documents. We've got people like me who can breeze through these documents very fast and get them pre filled for you. We've had people come in just to finish the documents and then you've got options at that point. That's a, that's a conversation. So prep the kids, prep your spouse. Hey listen Happy holidays. If something happens to me, I need you to know xyz, don't do the whole deep dive if you don't want to. Just give them top three. You know, hey, if something happens to me. Abc, abc. Here's some things you need to consider.
Re. Inventory your insurance.
This is one of the biggest conversations I have with people. What's up with my health insurance and what's up with my life insurance? You may have life insurance at the Fed with your job, and you may have life insurance outside.
Take inventory of what you have. Is it term insurance? Is it permanent? Is the price going to change down the road? Are you going to get a surprise bill for double, triple, quadruple what you were paying for?
Find out. Go look and see. They all have the grid of what the payments are going to be. If it's terminal, if it's whole life, you're going to pay the same price for your whole life. And it's permanent, and that's kind of cool.
And then it's building cash value. It's pretty great. But of course, the price for that is higher than term. So you've got to consider these things, review your stuff. Because you forget I'm in the industry and I forget. I got a mailer the other day says I have a $30,000 whole life policy with the company that I clearly. I know I used this company, but I forgot about it. I forgot my own health, my own life insurance policy. And I'm preaching to y'. All. Look at this. The pot in the kettle. Look at me.
Look at me. What's the Cuban saying? The same Cuba. They say the.
The blacksmith's horse wears wooden shoes and my horse is trotting around with wooden shoes while I'm shotting everybody else's horse with steel or iron or whatever they use.
So look at your own stuff and look at me when I'm pointing to you. I got three, four fingers pointing right back at myself. Take inventory of what you have. Look at your bank accounts, what's coming out, where's it going?
It's good. Wouldn't you rather do this once a year, every year? And you got even autumn up. The leaves are churning. The leaves are changing. In Florida, that doesn't happen. They're still green, but it's chillier. I don't have to. I'm not in flip flops today. I got socks on. That's an indicator if you're putting socks on. Floridians, you got to go check your stuff. Okay. If it's fall festivals and trunk or treats and everybody's inviting you to parties. Take an evening or a morning and check your stuff out. If you need help, My number here, 850-450-6500. Whether it's me or somebody in my team, we can help you look through this stuff. If you haven't done it ever. No time like the present. That's why they call it a gift. Reach out. We'll look forward to chatting with you soon and you have a wonderful end of the year.
[00:16:02] Speaker A: Thanks for listening to Raina Retirement With a strong commitment to ethical standards, Reyna works hard to find the right solution for each individual or family who reaches out for advice. To contact Raina directly, call 850-450-6500. That's 850-450-6500. Or to reach the team at American Federal Benefits Consultants, call 1-800-872-8857. That's 1-800-872- 8857. You can also go online to americanfederal.org not affiliated with the United States Government. Opinions expressed are subject to change without notice. These opinions are not intended as investment advice, nor do they predict future performance of any product. All information provided is believed to be from reliable sources. However, we make no representation or warranty as to the accuracy of any statement. The information is intended to be educational in nature and does not provide a guarantee or specific result. All copyrights and trademarks are the property of their respect owners. American Federal Benefits Consultants is an independent organization, not a government agency or affiliated with the Federal Government or any state government. The terms CSRs, FERs, FELI, and FEHB are all registered trademarks of the U.S. office of Personnel Management. American Federal Benefits Consultants, agents consultants, or any independent contractors do not provide tax, legal or investment advice and do not engage in the solicitation or sale of securities. Consult with your tax advisor or attorney regarding specific situations.
