#22 – Compression, W2s, TRICARE

Cassie
Compression, W2s and TRICARE on today’s Fenobabble. This is Fednobabble.com, where Kevin and Cassie make federal retirement benefits understandable for humans like you, these two don’t hold back as they answer questions from the Fed pilot workshops and webinars or from questions submitted by you at Fednobabble.com.

Welcome, everyone. Welcome back to Fednobabble.com. I am Kevin Jones and I’m Cassie Knight.

Let’s go ahead and jump in to today’s questions.

What we’ve got here is, number one, there is unused sick leave remaining after running the sick leave conversion into how many hours does that convert? I work a compressed schedule five, four, nine. So I need to know how to make best use of that overage.

What say you, Kevin. So here is one of the things that I find interesting is that federal federal employees a lot of times don’t understand how complicated their benefits are. It’s just it is really, really complicated. And sometimes when it’s really, really simple, they make it really, really complicated. It’s almost the opposite. Right. That’s the no fault of their own. And I totally get why I fully get it. So for, for example, another one that I another thing that I hear all the time is Leo’s law enforcement officers that a lot of times they say, well, we get that, you know, that, you know, it’s the wrong name, but they’ll call it special retirement supplement or the Gap insurance.

Right. And it’s and it’s us. LEOs. Well, actually, it isn’t just you. It’s any could be could be any FERS employee. And so wait, wait. I’m not special that way then. And I hear that, but it’s just not me. And so this one is so this one. OK, here’s a compression schedule, but it really isn’t different than any I mean, from the regular schedule of what it is when it comes.

Yeah. When it comes to sick leave, whether you’re a compressed schedule or a regular scheduled employee, whether you’re part time or what have you, it doesn’t matter when you are looking at the sick leave conversion. You simply use the sick leave conversion chart. Twenty, eighty seven sick leave conversion chart and that’s it. It’s going to come right at the same no matter what kind of schedule you’re on or anything like that. So.

Right. So OK, there we go.

It does matter. OK, ok. I do want to say that when you’re looking at retirement and you have sick leave being added to your retirement, if they don’t make a full month, then you will have extra days. A but it also depends on how many extra days you have in your regular service as well. So you have to figure out what those days are and how they can how we can make sure that you’re not having like two weeks where you’re not having the added to to your well, you’re losing them essentially because maybe you have one month and and two weeks.

So it’d be forty five days of sick leave. And then you are leaving at the time that you have exactly 30 years, you don’t have any extra days. And so then you’re losing out on two weeks. Right. So then obviously they want you to use those two weeks of sick leave to where you’re not before retirement. So that way you’re not just losing out on those days and not get paid for them. So that’s one thing that we help employees with, though, when they come to the adviser and they’re asking those questions on how many days of my going to have and with how much time do I need to use before retirement and all of that to where I have no extra days, then we can run those scenarios for employees.

Yeah, and I always say give yourself just a little bit extra just in case, because you don’t want to miscalculate. You want to get you know, you want to get you want to get close. Absolutely. And use all the days. I mean, if you have, let’s say, 14 days left over, let’s use the 14 days, but maybe give yourself a day or two or like in sick, leave you parlance a couple extra hours or two just in case.

Don’t go down right to the wire because you never know. And we’ve seen people say, OK, I’m going to get it right, I’m going to nail it. And then they get sick right before they have to retire. And then that eats into a whole month of calculations that they could have put into there for sure. So, you know, give yourself a little grace there, which would be kind of nice. Absolutely. OK, here’s a second one.

Social Security, OK, the SS.

So here are the special retirement. Like, what does it mean? They’re so OK. So I was talking about this with just a second ago when we said the LEOs call this. I mean, everyone calls it this really Social Security supplement or gap insurance or Social Security offset or whatever. And I’ve said this before on Fenobabble and I’m going to say it again. It’s the wrong. We’re calling it the. Wrong thing, and normally, if we call something the wrong thing is like not a big deal, but in this case, I feel like it is a big deal because it’s a big deal.

Calling it a security supplement makes you think that it comes from Social Security and it doesn’t have this conversation with the adviser just yesterday.

Oh, really? No. Do we even. And he said, look, this person’s coming in here tomorrow. And I just want to make sure that you included the Social Security supplement on her report. So I scroll down the page. I said, and it’s a special retirement supplement, if you call it the Social Security supplement. It’s not a Social Security benefit, number one. And number two, if they go to the Social Security office and ask about the Social Security supplement because they think it’s a Social Security benefit, they’re going to be talking about something way different.

Yes. Yes. The Social Security supplement, it is a federal benefit. It comes from first it it doesn’t come from the Social Security themselves. Right. OK, and that’s huge because, again, if you’re if you’re looking at disability income or something like that, it’s a very, very important that we have these things. Correct.

Right. So so what am I a little. No, no, you go ahead. I don’t want to be sexist.

Remember, this is what I think about the earnings test for the special retirement supplement.

Yeah, I think so. Is that right? I believe so.

OK, so if the income is strictly earned income, OK, so TSP is not going or income that you withdraw from TSP is not going to count because that’s retirement, just like your pension doesn’t count. That’s just earned income, whether you’re self-employed or an employee working for a company. Either way, whatever income is actually earned on all those profits or that you have coming in from your employment, that is what counts towards the earnings test for the special retirement supplement.

Got it. Now that. Yeah, that’s that’s a nice and easy one. I do want to add one more thing to that Social Security supplement that that name you gave a great explanation of why. I’ll say one more thing is that there are a number of overall I think it’s really important to name things what they are unless they conflict. So, for example, the pension and I don’t want to confuse anyone, but this just will give an example.

We know well, let’s say the TSP has annuities that you can choose. However, the pension is an annuity itself is a form of an annuity. So but we don’t call it that. We don’t call the pension anonymity because that’ll just confuse people as to what it is. And does it come from. I’ve heard people say, does my pension come from the TSP or and they get those confused. So the language that we use is really, really on purpose.

And it’s really important to understand what we use when we use it, because, number one, we don’t want to confuse things. Number two, the more we can the more we can label things correctly, the more of a better understanding we will have of it overall. So absolutely, there’s that. All right. Was that was that question number two? I think that was a question, yes. OK, then question number three, I will be eligible for Tricare.

OK, this is a complicated one. Ready? I will be eligible for Tricare Tricare at 60. Again, Tricare is the military’s version of FBG at 60 because I retired from the US Army Reserves. Good for him or her, whichever. I plan to carry my FBG into retirement at the end of this year and switch to Tricare when I turn 60. When eligible for Medicare, I would have Tricare as secondary is is this advisable? So this person right here has a lot going on, but I think we can kind of take this question and sum it up in when this very last part, when eligible for Medicare, would I have Tricare as secondary?

OK, so this is one of those things where it’s really simple. Yes. That is made very complicated. Exactly.

That seems to be the same. If you have Tricor, you must enroll in Medicare, period. Done. However, here is here’s where it can get complicated. If this person is a military reserve technician, then they will not have the availability for Tricare. And this is something that is misunderstood by a lot of these people because they think the military reserve and I’m a civilian employee, so I have the option to your own special breed. Yet if you are a military reserve technician, I will tell you right now you will not be eligible for Tricare period.

So you’re going to be stuck with me in retirement. OK, but if you are actually reserve and not civilian at the same time, so maybe they did have their separate service, OK, then they will be eligible for Tricare and that’s when you’re automatically have to enroll in Medicare anyways because you’re going to have Tricare.

Now there is a way for federal employees or retired reserves or retired active duty to have the option to be able to get back on their feet if they lose their TRICARE coverage. Right. So if they have to be at retirement, then they can suspend their fee in retirement and hop on Tricare. Obviously, you still have to enroll in Medicare. So you’ll have that in Tricare and Medicare will work together for that coverage. But if you’re in a location where your TRICARE pulls out or something happens, whether coverage is not great, then you can hop back on to the FB and reenroll during open season.

Or when you lose that, lose that coverage involuntarily and have a Medicare. And so that’s really, really strong. And I think something that really should be coordinated with people who have those different health care systems. And if they coordinate them right, then they can really set themselves up for success later.

Yeah, that’s a huge one that a lot of people can take advantage of. That is really, really good. Now, when I when I look at the end of this question here, is this is that advisable? So you said which is which is spot on. If you have Tricare, you have to do Medicare A and B, you have to do those to you just have to. So is it advisable? Well, when it comes to this being secondary, a lot of people say, well, how do I make it secondary?

It just happens. It’s not you don’t have to set it up as secondary. Once you get Medicare, it becomes primary, TRICARE becomes secondary. And that’s just the way it is. So is it advisable? Well, if you get Tricare, if you get Medicare, it’s just going to happen. So you’re not going to have a choice on that one. Exactly.

It’s pretty easy for Tricare that I would say. Yes, that is you have to have it in order for Tricare to pick you up on other coverage. But as far as who secondary in this primary, I think that boils down to who is covering what, who is your doctor, specialist, what have you. Some people take Medicare. Some people don’t want Tricare there. It depends on where you’re where you’re at. And and so I can’t tell you who’s going to be first or second in line.

But what I can tell you is they’re going to be one. Then the other person is going to get billed and they’re going to cover, you know, based on whatever those limitations are, because I’m assuming Tricare for Life. But there are other Tricare programs. True. So I don’t know what those specific limitations are. However, if you’ve got Medicare, you’re going to be 100 percent covered. And I want to say that even if you are not in Army reserves or active duty, you’re FEHB in Medicare.

We’re very good together as well because we. So that’s one thing that I’ll say it and I’ll throw this on the kind of the back end of this question. This gets this whole thing just I want to say the health care, but not only the health care, everything else gets really complicated when it comes to are you active duty or are you reserves? Did you retire one or the other or did you quit? Or is it disability or.

And and on and on and on and on and on, right, there are different things that you should do in different circumstances, even if your friend seems to have done the same thing that you did. It doesn’t mean that that is what you should do as well, because you you may be very, very different. So as soon as we add in military into the mix, it complicates things. And what I love about your reports is that all of this can be figured out.

It’s very it’s I don’t want to say it’s easy to figure out, but we Cassie I’ll just say this. You kind of make it you kind of make the magic happen in the background so that so that when a federal employee gets the report, it’s like, oh, that’s what it is. And this is how it works. And that’s great. But there’s a lot of magic that kind of like Disneyland, right? There’s a lot of magic that happens in the back end.

But you don’t you just get on a ride and you go and you have fun. Right. But there’s a lot going on in the background. And the person who comes to Disneyland doesn’t need to worry about all the extra stuff they just to get to enjoy it. And that’s the way I feel like federal employees are. They just get to come to this Disneyland. They get to sit down with one of our advisers. And I trust the network and just get your report and say, OK, there we go.

All the magic is done for me and here are the issues and the things that I need to figure out.

So that’s that’s what I love about it myself.

Our whole goal is to keep it simple. Yes. Keep it as simple as possible. These things are complex. These things are there’s exceptions everywhere. And it’s knowing what pertains to you and what doesn’t. And that’s our goal because we really want people to have that information and be able to use the information that works for them so they can financially succeed, whether that’s in employment or in retirement, which is apparently the ultimate goal, is to have the information and the tools and resources that you need for your situation to get to wherever you need to be.

What’s your what are your goals and aspirations? We want to make those happen for you and get you on your way to do that.

So, yeah, and it’s not only just for you, but it’s also for those around you because they’re retiring, too. So if you would please like and subscribe and share this with your with your co-workers, follow all that good stuff. Right. Because not only do you need to know this, but they need to know that we don’t want to see any federal employee have to get out of the of the system of working for federal government, for all of us for so long and then go, oh, I, I think I mentioned this before.

I had someone come back to my workshop twenty years after they were retired trying to figure out how to fix what they’ve broken, you know, so that’s what we’re trying to help people avoid is yes, please, please, please. So yes.

And last words of wisdom, Cassie, take action, get the report, find out what those benefits are for you. Let’s get you on whatever needs to happen for your situation. Let our advisors help you make those dreams come true for you.

So very good. All right. Thanks. Thanks for joining us. We’ll see you next time to get Cassie’s comprehensive report on your federal retirement benefits. At no cost, no obligation and no sales pitch. Go to Fednobabble.com while you’re there. Submit a question for them to answer on the show.