Help! Federal Employee Financial advisors?? FFEBA? ChFEBC?

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Gelsomina
Posts: 5
Joined: Fri Feb 24, 2017 6:51 pm

Help! Federal Employee Financial advisors?? FFEBA? ChFEBC?

Post by Gelsomina » Sat Sep 29, 2018 2:11 am

Hi everyone,
I'm a federal employee just a few years away from retiring and have invested in the TSP pretty solidly, as well as a little Vanguard Target date index fund rollover IRA from my pre-govt days.

I'm careful with my money, have no debt, but I'm worried because I've never received trustworthy professional financial planning. I got burned many years ago by a nonfiduciary product, then fired Fidelity for poor active management a few years ago; that's when I read about Mr. Bogle and got my Vanguard fund which is doing nicely now.

Through an ad on Fedsmith I ordered a free federal retirement planning handbook (although I already have a great one from work), and got calls to meet with a planner.

I met with him today. I'm pretty sure he's not a CFP. He has FFEBA on his biz card and is on the ChFEBC website. But I'm not sure these really mean much. Do they?

It made me nervous when he alluded to some other type of savings vehicle that would be as safe as the TSP G Fund (no principal loss) but earn much higher interest. That sounded like bs to me. I am in a TSP Lifecycle (target) Fund right now. The other thing that seemed weird to me was that I asked if he had a fiduciary duty and stumbled a bit, he said he did make a profit on sales of insurance for example. I told him I don't need insurance, I'm single no kids, going to be cremated. I also felt weird when I told him my Vanguard has done well and he commented that everyone has done well in the past few years.

I like my Vanguard and TSP index funds. I will have SRS for 5 years, my FERS pension, and social security. I have a detailed budget with inflation added every year until I'm 99 years old. I think I want to do this myself but but just need somebody to look at my plan. I'm good with math but not with financial jargon. I get overwhelmed by most of the technical conversations on Bogleheads, but I managed to pay my house of 12 years early and max out my TSP contributions.

Am I being paranoid about this guy?
Can I really do this by myself without understanding all of the technicalities of investing?
Does a fee-only CFP who specializes in federal employees even exist?

Thanks,
Gelsomina

Gelsomina
Posts: 5
Joined: Fri Feb 24, 2017 6:51 pm

Re: Help! Federal Employee Financial advisors?? FFEBA? ChFEBC?

Post by Gelsomina » Sat Sep 29, 2018 2:15 am

The other thing he said was I really should be investing in a Roth. I'm only 3.5 years from retirement, moving to a lower cost of living areas will be living on lower income than my current salary. Maybe I should have done Roth before, but why would I under these current and future circumstances?

MichDad
Posts: 374
Joined: Sat Apr 20, 2013 3:50 pm

Re: Help! Federal Employee Financial advisors?? FFEBA? ChFEBC?

Post by MichDad » Sat Sep 29, 2018 4:54 am

Hi Gelsomina,

Welcome to the forum!

I'm a recently retired federal employee with a FERS pension, a very large TSP balance, and a lot of Roth IRA savings. You're clearly doing quite well with savings and no or minimal debt. I think you could probably do quite well without paying for "professional" advice. I encourage you to search this forum for such words or phrases as "TSP," "FERS," and "federal employee" to read threads of interest to you. There's a great deal of wisdom on this board. Once you've done your homework, start posting specific questions and I think you'll be very satisfied with the quality of the responses.

I retired earlier this year with about $300,000 in Roth IRA savings. Also, between May 2012 and March 2018, I invested only into the Roth TSP. So, in combination, I retired with about $500,000 in Roth savings. My wife has even more Roth savings than I.

When the TSP withdrawal rules are liberalized in September 2019, I plan on starting to convert sizable chunks of my regular TSP account to Roth IRAs each year. I'll do that until I turn age 70 in 2025 and begin to collect my Social Security benefits. I want (need) to reduce our Required Minimum Distributions that will affect both me and my wife as we age. It's my hope that we'll convert $1 million or so to Roth IRAs before I turn age 70. The idea is to smooth out our federal and state tax liabilities over the coming decades.

Good luck to you!

MichDad

mac2019
Posts: 4
Joined: Thu Dec 28, 2017 10:26 am

Re: Help! Federal Employee Financial advisors?? FFEBA? ChFEBC?

Post by mac2019 » Sat Sep 29, 2018 6:40 am

Careful Gelsomina. I'm a federal employee planning on retiring next year. I have watched some of my co-workers retire over the years and the one mistake several of them made was to listen to financial advisors who had them take their money out of the TSP and turn it over to the financial planner. In two cases that I am thinking of, it did not end well. In one case, the former employee lost so much money in the new investments that he needed to go back to work. I plan on using the TSP lifecycle fund that targets the life expectancy of my wife, who is six years younger than I am. The G fund will probably hit 3% plus in October and that seems awfully good for a "safe" investment if you want to hedge your bets.

retiredjg
Posts: 34207
Joined: Thu Jan 10, 2008 12:56 pm

Re: Help! Federal Employee Financial advisors?? FFEBA? ChFEBC?

Post by retiredjg » Sat Sep 29, 2018 7:38 am

Gelsomina wrote:
Sat Sep 29, 2018 2:11 am
I met with him today. I'm pretty sure he's not a CFP. He has FFEBA on his biz card and is on the ChFEBC website. But I'm not sure these really mean much. Do they?
I don't know what they mean, but there are numerous signs in your post that you do not want to use this guy.

It made me nervous when he alluded to some other type of savings vehicle that would be as safe as the TSP G Fund (no principal loss) but earn much higher interest.
Don't do it.

... he said he did make a profit on sales of insurance for example.
Do not mix investing and insurance. Also, someone who sells both is almost certain to have high fees and high fee annuity products which you don't need.

You are correct that you do not need insurance, but do keep what the government gives you for cheap or free.

I also felt weird when I told him my Vanguard has done well and he commented that everyone has done well in the past few years.
He was correct about that. A rising tide lifts all boats.

I like my Vanguard and TSP index funds.
There is no reason to use anything else.

I will have SRS for 5 years, my FERS pension, and social security. I have a detailed budget with inflation added every year until I'm 99 years old. I think I want to do this myself but but just need somebody to look at my plan. I'm good with math but not with financial jargon. I get overwhelmed by most of the technical conversations on Bogleheads, but I managed to pay my house of 12 years early and max out my TSP contributions.
You have financial know how. It is not important that you don't understand some of the technical conversations. BTW...I don't understand many of them either.

Am I being paranoid about this guy?
No. You have pegged him correctly.

Can I really do this by myself without understanding all of the technicalities of investing?
Yes.

Does a fee-only CFP who specializes in federal employees even exist?
Don't know, but you really don't need one.

Gelsomina
Posts: 5
Joined: Fri Feb 24, 2017 6:51 pm

Re: Help! Federal Employee Financial advisors?? FFEBA? ChFEBC?

Post by Gelsomina » Tue Oct 16, 2018 8:58 pm

Thank you everyone for your inputs! I forgot to post back, but for now I've decided to manage my retirement on my own. I will be taking all of your sage advice.
:) Gelsomina

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Taylor Larimore
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Joined: Tue Feb 27, 2007 8:09 pm
Location: Miami FL

Re: Help! Federal Employee Financial advisors?? FFEBA? ChFEBC?

Post by Taylor Larimore » Tue Oct 16, 2018 9:09 pm

Gelsomina wrote:
Tue Oct 16, 2018 8:58 pm
Thank you everyone for your inputs! I forgot to post back, but for now I've decided to manage my retirement on my own. I will be taking all of your sage advice.
:) Gelsomina
Gelsomina:

We look forward to helping you with any questions you may have.

Best wishes.
Taylor
"Simplicity is the master key to financial success." -- Jack Bogle

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