The Foreign Service Journal - January/February 2018

60 JANUARY-FEBRUARY 2018 | THE FOREIGN SERVICE JOURNAL ence,” he says, “unless they are over 60 or have some special circumstance.” “There is credit for additional years of service past 20, and the high-three salary will likely increase, as well,” says Beagle. “Face it: you likely have the best paying job you will ever have. Don’t leave until the goals you have are met, or until you have a follow- on plan to do so.” Thomas Cymer tends to disagree. “There are certainly benefits that will continue to accrue, but depending on the person’s life priorities, it may be time to put their expertise to use in a different arena. With 20-plus years of experience, a person could potentially land a higher-paying private-sector job. So at this point it’s time to do a goal check-in, and see where you want life to take you next. ” Whatever you decide to do, Mandojana wants you to under- stand that “there are ongoing discussions on possible changes to government retirement systems,” and all FS members need to stay fully informed of those developments. The Life of Leisure Congratulations! You made it to the end of your FS career: You turned in your badge, and you’re ready for whatever comes next. Not so fast, though: You still need a plan. Many people splurge on Making Ends Meet in Washington, D.C. S ave as much as you can, and then save a little more. You know what you need to do, but how do you save anything at all when you’re posted to D.C. and just trying to make ends meet? Chris Cortese, a retired Foreign Service officer and founder of Logbook Financial Planning, advises his clients to estimate their cash flow before returning to Washing- ton, D.C. “Coming back to D.C. is going to require some changes,” says Cortese, because you will suddenly add rent, electricity, water, sewer, homeowner’s insurance and other big-ticket items to the budget. Software programs like Mint or You Need a Budget can help you get started. “Start with taxes, fixed expenses and a minimum of 5 percent into the TSP,” Cortese says. Then look at the variable expense side, and ask: Are there items I can eliminate or reduce to continue to fund the TSP at a higher level? As a former FSO and father of four, Cortese has plenty of ideas for cutting expenses. He suggests trying to live with just one car and finding alternative ways to com- mute. If you have homeowner’s insurance, consider rais- ing your deductible or bundling your coverage with your auto insurance. Food, he notes, can be “a budget breaker.” For families, he suggests using a credit card that gives cash back on groceries. For example, he says the American Express Blue Cash Preferred gives back six percent on groceries for the first $6,000; after their $95 dollar fee, this nets $265, which he calls “the easiest $22 a month in grocery coupons I don’t have to clip.”He also wants you to download your preferred grocery store app and, of course, brown-bag to work. To cut phone expenses, says Cortese, look at compa- nies such as Total Wireless or Tracfone, which “use the big networks, but usually are 50 percent cheaper.” Entertain- ment? “Time to enjoy all the free offerings in D.C. and Northern Virginia, along with the great public libraries,” he says. Instead of a gymmembership, his family uses online videos to work out. For clothing, he says, “the average American only wears 20 percent of their clothes,” so insti- tute a “something in, something out policy” to cut down on impulse clothing purchases. Cut the cable cord and read more, he advises. And finally, “a D.C. assignment is the perfect time to teach the kids about energy conservation.” Other ways to make ends meet? Save as much as possible in an emergency fund while you are posted outside the United States, so you have a cash cushion while in D.C. Don’t think of TSP contributions as optional. Continue to contribute as much as you can—because it is automati- cally withdrawn before you receive your paycheck, you shouldn’t miss it much. FS spouses should look for employment. “If there is any city where it pays for the spouse to work,” says WealthCrest ’s Patrick Beagle, “a high-cost area is it, because it also likely means higher wages for workers.” Finally, know what is coming your way. Take a deep breath, saysWilliam Carrington of Carrington Financial Planning, and “accept that money will be tight if you have just one income. Expect to burn through much of your cash reserves.”And, he says, whatever you do, don’t go into debt. —Donna Gorman