Your Retirement Pay Has a Plan. Do You?

Somewhere on my laptop there is a file called "RETIREMENT PLAN FINAL v2." It was created a while ago. It contains a title row, three column headers and a single cell that says "figure this out."

If you have a version of that file, you are in good company. Many of us spent our careers being very organized about everyone else's mission and somewhat less organized about our own money. The government took care of a lot of the details, and the details kept happening whether we paid attention or not.

Out here, paying attention is the job. So here is a friendly, general overview to get you started. One important caveat up front: this isn't financial advice. Rules change, everyone's situation is different, and the specifics really matter, so check the current rules and talk to a professional before you make decisions.

First, know what you actually have

Military retirement benefits vary a lot depending on when you joined, how long you served, how you separated and which retirement system you fall under. Not everyone who served gets a pension. Many veterans served honorably and left before reaching retirement eligibility. Others were medically retired, or fall under a different system than the people they served with. If you are not sure where you stand, that is the first question to answer.

A quick inventory to start with:

• Retired pay, if you have it. Know which system you are under and how your payments are calculated. Your account and statements are on myPay.
• Your Thrift Savings Plan. Many of us have a TSP balance sitting there, sometimes untouched for years. Log in at TSP.gov and look at your balance, your funds and your beneficiaries.
• Civilian retirement accounts. A 401(k) from a second career, an IRA, a pension from a federal or state job.
• VA disability compensation, if you receive it. It has its own rules and can interact with retired pay in ways that are worth understanding. VA.gov is the place to start.
• Social Security. You can check your estimated benefits through the Social Security Administration's website.

Write all of it down in one place. Yes, the spreadsheet. Today, not in 2019.

Then, ask the hard questions

Once you know what you have, the real planning starts:

Your money has had a plan for years. It is time you were read in on it.

When do you want to stop working, if ever? Plenty of women who served are on their second or third careers and have no plans to stop. Others are counting the days. Your timeline shapes everything.

What does your life actually cost? Look at your real spending, not your hopeful spending. Include the things that sneak up on you: home repairs, helping aging parents, a kid's tuition, the trips you've promised yourself.

Is your TSP set up the way you want? Many people leave their TSP on whatever default they had when they got out. That may be fine, or it may not match your goals anymore. Review your fund choices and know your options for keeping, rolling over or withdrawing, and check the current rules on each.

Are your beneficiaries current? Divorce, remarriage, kids growing up: life changes, and beneficiary forms often don't. Check them on every account. This is one of the simplest and most important things you can do this week.

What about survivor benefits and insurance? Decisions you made at retirement, or never made, can matter a great deal to the people you love. Revisit them.

Get a planner who works for you

This is where I put in a plug for professional help, specifically a fee-only fiduciary financial planner. Fee-only means they are paid by you, not through commissions on products they sell you. Fiduciary means they are obligated to act in your best interest. Ask any planner directly: "Are you a fiduciary at all times, and how are you paid?" If the answer is complicated, keep looking.

Bonus points for someone who understands military retirement, the TSP and VA benefits. They exist, and they can save you from expensive mistakes.

Be wary of anyone who approaches you at a veterans event with a hard sell, an urgent deadline or a product that sounds too good to be true. You spotted shady characters on duty. Trust those instincts.

Start smaller than you think

You do not need a perfect plan this weekend. You need a first step. Log in to myPay. Log in to TSP.gov. Update one beneficiary form. Open the spreadsheet and fill in one row.

Your money has had a plan for years. It is time you were read in on it.