Here’s What’s Up with Federal Benefits in July

Pinnacle Personnel Services LLC  |  Debbie Hatch

 

This year has been so odd.  It seems like it’s flying by – it’s July! – but it also feels like it’s already lasted for ten years already.  Just me?

REMINDER:  taxes are due on the 15th.  If you haven’t done them yet (hello, mirror) you may want to get started.

 

Here’s what’s up in the world of federal benefits.

 

There were several big changes made yesterday with the Thrift Savings Program. 

 

First, L2020 is no more.  It has transitioned into L Income.  That’s normally what happens when we get to the year identified in a lifecycle fund so it’s not a surprise.  It does mean the account is now in its most conservative mix with  74% in G and, while it does change, it changes very little from this point moving forward.

 

Six new Lifecycle Funds were added to TSP on 1 July.  In the past, funds have been in 10 year increments; they are now in 5.  We have:  L Income, L2025, L2030, L2035, L2040, L2045, L2050, L2055, L2060 and L2065.  The idea is that we will be able to target our intended withdrawal date, and “appropriate” risk level, more precisely.  If you’re more conservative, or less so, than TSP’s “average” you can select the fund(s) you feel best for your personal situation.

If you don’t want to think about it, though, here’s what TSP suggests:

We have the ability (finally!) to request TSP withdrawals and loans, electronically.  Log into your Thrift account and select “upload form” from the menu.  A list of forms that will be accepted online, as well as detailed instructions on how to prepare your file for upload, are right there.

 

Mid-Year Flexible Spending Account (FSA) Changes

 

The Office of Personnel Management (OPM) released a Benefits Administration Letter yesterday.  Beginning on 1 July and continuing for the next 60 days, employees can make a one-time change to (increase or decrease) in the amount of their annual election. The “outside of open season” change period has been created because of COVID-19 BUT participants do not need to be directly affected by COVID-19.

 

If you enrolled in a Dependent Care FSA for 2019, you are now allowed to use those 2019 funds through 31 Dec 2020 (normally you only have until 15 March). The extended claim period is automatic. Additionally, if you experienced a change in the amount you are paying for dependent care, that is considered qualifying life event and you are authorized to amend your contribution amount until 30 Sept 2020.

The allowable annual carry over for the Health Care and Limited Expense Health Care FSAs has been increased from $500 to $550 going into 2021.

 

Fresh Start Effect 

Research shows we are more successful at reaching goals when we start them on a significant date.  This is one reason why so many people make New Year’s Resolutions and start diets on Mondays.  It’s not only a new month, but the start of the second half of our year.  What would you like to have accomplished by 31 December?  Write it down (that increases success too) and get started.  Monday’s coming!

What would happen if you came into the next 6 months

fully committed to the work that matters and the results you want?

 

As For Me

I’m in the process of having my website redesigned and am excited about the new look.  Several students have finished [Breaking] the Retirement Code online and feedback has been great.  Thank you!  I’ve had the pleasure of teaching “live” in Ohio, California, Texas, Florida, Maryland, Hawaii, Maine and Japan this past month.  The virtual environment is challenging, and amazing at the same time.  I’m thrilled to be working and able to reach employees around the world but sitting in my Nebraska office vice being able to walk on the beach after work is most definitely NOT the same.  Movers come next week but I’ll be teaching in Oregon, Hawaii, and Japan.  Hard to believe we’ve been in Nebraska for three years already but it’s true.  San Antonio is the next assignment.  My husband will retire after this.

 

I hope this finds you well, happy, and at least a little productive.

Take care of yourself.

Let me know how I can help.

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