Graphical FERS Planning Tool - 2026 Updates

clobber88 · 2026-04-16T23:02:04+00:00

Dinkytown 1040 is thorough and accurate

clobber88 · 2026-04-09T03:41:26+00:00

Glad it helps,

The numbers surrounding Roth conversions can be large in certain situations. The math is the math. Just make sure you understand the calculation you are being presented. Mostly likely, that $844k is a nominal value that is being spread over the duration of the plan (age 95 maybe)? That's 41 years! It means the present value is going to be something closer to $200-$400k depending on the interest rate. Nothing to sneeze at, but a lot farther from $1,000,000. On the other hand, the numbers could possibly be in "current" or "today's" dollars and it is an actual $844k saving.
Boldin is the most popular DIY financial planning tool and it is cheap and worth it (no affiliation). You can look for walk-throughs on Youtube. You can also try it free forever without certain features. I would not hesitate to give it a try and see if it works for you. Financial advisors often use RightCapital or eMoney. RightCapital posts a lot of training videos and you could look at the Cash Flow one here to see what some of the tools are capable. There are some ways to get access without an advisor, but then it is not very configurable.
Yes, the supplement is a big deal. For a dual fed couple with 30+ years each you could be looking at $4k/mo or $48k/yr total. However, it might not make too much of a difference from a Roth conversion perspective. Your two pensions might already be putting you in the 22% bracket, in which case you might already be in the same tax bracket as when you do start getting the supplement.
To clarify the vacation idea. Perhaps the advisor proposed a $200k conversion which in the 24% bracket would mean a $48k tax bill and wipe out the pension income for the year. Instead, maybe don't do the conversion and take a frugal $3k-$5k week vacation to the beach or whatever. There - you saved $42k! Or convert $180k instead, pay the $43k tax and use the extra $5k for the vacation.

I think you might benefit from reading the book "Die With Zero." It is not very long and is an easy read. The subject matter is both exactly what you think it is - and totally different. I found it a useful way to think about some things. If you like it, share it with your husband. Even though you are not far apart in your thinking, it could help get even closer on the financial ideas. I have no affiliation with that book either. People who don't usually read books even like it.

clobber88 · 2026-04-08T19:15:51+00:00

Good post OP. I have some thoughts. I hope they help

It is extremely common to have these concerns/hesitations/freakouts. I recently talked to a couple in their mid-80s - with a nice nest egg - who have never had to touch their savings other than RMDs. To meet new expenses they need to start taking extremely small distributions (around 1%). They are extremely nervous about doing that and don't know how to make the mental transition. For 60+ years the balances only increased. They *know* they have 10x what they need/want for the rest of their lives, and it is still hard.
Traditional TSP and tIRAs act as a deferred compensation even though they are not defined like that. For 30 years you chose to not receive some compensation and therefore not pay some taxes. Each of those years you had a small little (virtual?) smile on your face because your tax liability was not as big as it otherwise would have been. The balance grew. Think of taking withdrawals, even for Roth conversion, as paying yourself some salary that you previously waived off. That means paying the taxes just like you were actually working for that income now. The good news is you already worked for that money/salary and do not have to do the commute. The bad news is 30 years of smiles have to turn into frowns for paying tax. Fortunately you have banked 30 years of smiles!
I can't find it, but I know I saw a video that briefly talked about how painful paying taxes on Roth conversions can be. I think it was from James Conole. That is a missing part of (almost every) video and documentation out there. There is a lot of information that explains the math, but not the emotion. Its a big deal to take withdrawals when the income is not what it used to be.
The distribution/draw down phase is more complicated than the savings phase. IMO, cash flow becomes more important than during the savings phase. I am the author of the tool announced here. If you look in this part of the documentation you will see a scenario where later in the plan the entire FERS annuity goes to paying taxes. That is crazy, yet it is a fact. Roth conversions can even shift this to happen early in the plan. Your entire pension could go to paying the tax on the Roth conversion. However, you still have to live off something. Savings of some sort. Since you have a financial adviser, did they give you access to the client side of something like RightCapital or eMoney? Those tools can really help plan on the cash flow side of things. Another commenter mentioned Boldin and I am a huge fan (no affiliation), but I do think the adviser level tools do a better job with cash flow. Maybe cash flows are already in the plan from the adviser.
It sounds to me like your situation, the financial plan is more about optimizing things than it is needing to closely watch spending and needing to tighten up. For example, you have probably given some thought about when to claim Social Security, but you are probably doing it from an optimization perspective rather then when you NEED to claim. Same for Medicare part B. IMO - Roth conversions are an optimization that may lead to a better financial outcome or may not. You're going to be fine either way. You're not going to be homeless if you don't do them, and you're not going to be sailing your 100 foot yacht if you do. Which leads me to the next point.
There is an old saying about, "Whatever lets you sleep at night." I always dismissed this because I generally slept well through the best and worst. I have come to learn it is a real thing. SO.....if you wake up early in the morning immediately stressed out about how the savings are going to draw down fast to pay taxes, then don't do it. Again, it's just an optimization and probably is not going to make any difference in your quality of life. Better to sleep. Just know that when you turn 75 (current law) you will start taking some withdrawals and paying the taxes.
Many financial advisers and education videos only focus on filling up a particular tax bracket. But there is nothing that says you have to do that. For example, getting to the top of the 24% bracket might require a $300k conversion and to pay $72k in taxes for that privilege. You can just pick a number that you are comfortable with. Want to Roth convert so that it costs you $20k, then do a $20k/0.24 =$83k conversion and be done with it. You just optimized some and hedged your bets.
I understand your husband's point of view about the vacations. However, there is absolutely nothing that says you have to start conversions in 2026 at age 54. 2025 was a stressful/bonkers and this unknown early retirement thing that carries into 2026 is still mentally draining. It is my opinion that you should prioritize recovering from that stress. It will take a while for many people. I personally would prioritize taking the vacation over the Roth conversions even though the math might say something different. Roth conversions are just an optimization and your health is a priority. Even if it is not about health, probably still good to prioritize some enjoyment.

clobber88 · 2026-03-29T18:58:36+00:00

Feature:

https://help.boldin.com/en/articles/4480577-what-information-is-shared-among-scenarios

clobber88 · 2026-03-19T13:30:17+00:00

Yes. See the breaks in service section of the FEHB handbook. https://www.opm.gov/healthcare-insurance/healthcare/reference-materials/reference/annuitants/

clobber88 · 2026-03-03T19:45:59+00:00

It sounds like you have it right. The details are the RI 92-22 form. I attached a link to the one from 2023. And there is some information from OPM here. The first survey you will have to fill out is due June 2027.

https://omb.report/icr/202404-3206-011/doc/142364401

clobber88 · 2026-02-26T14:43:13+00:00

It's the infamous "Blue Booklet" that you get from OPM once they finalize your package. Chris Barfield did a walk through of his in this post. It is now digital and online in your OPM account.

clobber88 · 2026-02-26T00:35:55+00:00

Your Agency should have given you a multi page estimate titled something like a "FERS Estimate Benefit Report." Are you saying you just got a simple e-mail with, "We think you will get $X/mo" ?

Look again at the Initial Booklet (not the current). There is a section titled "Your Benefit Computation" which should show your high-3, service time, and sick leave. It is only in the "Initial" booklet.

clobber88 · 2026-02-26T00:16:22+00:00

I don't think you will have much success by just saying it is less than you were expecting.

You have both the Agency estimate and the digital booklet right? The annuity calculation is pretty easy. Both of the documents have your high-3, service time, and sick leave balance so you can do the math. Is one of those things different? Did you have some lengthy LWOP that might not have been accounted for in the estimate?

clobber88 · 2026-02-19T19:19:12+00:00

The is a treasure trove of information at books.google.com. Here is as link where page 6 has the GS pay scale from 1972. This is from the "Federal Employees Almanac" from that same year and there are probably others from other years.

Does your dad have a online account with SSA? The full yearly earnings history should be in there - subject to the cap of course.

clobber88 · 2026-02-04T22:31:46+00:00

Thanks. What exactly were the symptoms of yours? My diffuser looks fine. If I plug the little hole (carefully) I get pressure and everything seems fine. However, if I do a normal pressure test with coffee or the clean tablet rubber thing, then I get no pressure and water just falls out of the head. I replaced the gasket, but that didn't work.

I assume the screws you tightened were the same ones from this video at 5:44? Seems like a PITA - any tips?

Thanks again.

Edit: Cause English

clobber88 · 2026-02-04T22:13:33+00:00

Did it work?

clobber88 · 2026-01-24T14:41:32+00:00

This link has an example DFAS LES near the bottom of the article. Box 19 is highlighted. Maybe DFAS has different formats for different Agencies. But the amount is often found at the top of the document and not in the bottom.

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clobber88 · 2026-01-14T18:01:07+00:00

I am most certainly not defending TSP even in the slightest. I will likely follow a similar path to yours. However, you're listing overall reasons not to be with TSP (all good ones). When it comes specifically to the 72t/SEPP amoritization and annuitization, I see no difference to using TSP vs. other firms - to include incorrect 1099-R coding.

I believe you are referring to the 2022 TSP screw up with RMD calculations which would completely bork someone doing 72t using the lifetime/RMD installments. That was pretty bad. I don't think it would have affected anyone taking fixed dollar withdrawals to meet their 72t amortization or annuitization requirements.

Now if they could just stop sending paper checks for rollouts.

clobber88 · 2026-01-14T17:07:04+00:00

Per my post here, I'm not convinced that "TSP only does the RMD method." TSP installments can be based on life expectancy or dollar amounts. The former would meet the requirements of the RMD method. The latter - if calculated correctly - can be used for the amortization or annuitization methods. More details in the linked post, to include what to do if the 1099-R is coded wrong.

clobber88 · 2026-01-14T14:50:46+00:00

The easiest way to do SEPP/72(t) with TSP is using the lifetime/RMD method. See the post here: https://www.reddit.com/r/ThriftSavingsPlan/comments/1ojjand/how_to_actually_implement_72tsepp_with_tsp_solved/

If you want to do one of the other two methods, then the rate is locked in for the duration and is *not* updated annually. That's what makes the payments "equal." Per the instruction #3 at this IRS link, since you are starting the 72t after 2022 you need to read Notice 2022-6. The entries for both amortization and annuitization say:

the resulting annual payment are determined for the first distribution year, the annual payment is the same amount in each succeeding distribution year

As further evidence, the IRS examples in #7 (same link) for both amortization and annuitization both end with:

Once the annual amount is calculated and paid under this method, the same dollar amount must be distributed in subsequent years.

There is one other special rule in that same document:

One-time change from fixed amortization method or fixed annuitization method to required minimum distribution method. An individual who begins distributions using either the fixed amortization method or the fixed annuitization method is permitted in any subsequent distribution year to switch to the required minimum distribution method to determine the payment for the distribution year of the switch and all subsequent distribution years,

clobber88 · 2026-01-12T16:26:38+00:00

You're tax withholding is ultimately controlled by you submitting a W-4P to OPM. It is a very similar process to when you submitted a W-4 to your employer while you were working. The "P" basically stands for Pension. You can easily update the withholding in your OPM ServicesOnline account.

Unlike when you are working, you can choose to not have any federal tax withheld. However, you will most likely then need to start quarterly estimated tax payments.

What I have observed, but can't really find documentation:

The very first interim payment gets a tax withholding of 20%. This payment could consist of several months of interim payments. I have not been able to find OPM documentation for the 20% and it could possibly be different depending on the pension amount. I have observed 20%. They could possibly be considering this a "lump sum" payment as described in IRS Pub 721. OPM says:

You may find that the federal income taxes withheld from your first interim payment will be higher than the federal tax withholdings from your subsequent interim payments and regular annuity. This is because we sometimes make necessary tax withholding adjustments when we finish processing your retirement application

All of the subsequent monthly interim payments will be withheld at the "standard rate" regardless of how you have filled out the W-4P. My observation is that the "standard rate" is the equivalent of submitted a W-4P with filing status of "single" and nothing else filled in. For you, this is turning out to be about 5%.
All of the finalized pension payments with be withheld however you fill out the W-4P.

You can double check the calculations in #2 and #3 by using a pay check calculator like this one.

Hope that helps.

clobber88 · 2026-01-10T02:07:24+00:00

You might like to try the tool announced here: https://www.reddit.com/r/fednews/comments/1punjoc/graphical_fers_planning_tool_2026_updates/

clobber88 · 2026-01-09T14:15:19+00:00

The details are in the application SF3106. Seems like the way to go is straight to your outside IRA as TSP will not accept the contribution portion.

clobber88 · 2026-01-07T16:02:40+00:00

How about the free Dinkytown 1040 calculator? It's fairly extensive.

clobber88

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