The Foreign Service Journal, April 2021

70 APRIL 2021 | THE FOREIGN SERVICE JOURNAL RETIREMENT SUPPLEMENT John K. Naland served in the Foreign Service for 29 years, including as director of the Office of Retirement. In the five years since retiring, he has facilitated retirement planning seminars at the Foreign Service Institute. He is currently serving as AFSA retiree vice president. For Everyone 1. Beneficiary Designations. There are sad cases every year of benefits not going to the immediate next of kin because the employee or annuitant neglected to update their beneficiary designations after marriage, divorce or other relation- ship change. Federal survivor benefits are paid to whomever is designated on beneficiary designation forms, even if there are different instructions in the person’s will. The forms are TSP-3 (Thrift Savings Plan), SF-1152 (unpaid compen- sation for employees), DS-5002 (unpaid annuity for retirees) and SF-2823 (Fed- eral Employees’ Government Life Insur- ance, or FEGLI). Employees and retirees who need to revise their TSP-3 should send it to TSP as explained on the form. Employees needing to update other forms should submit them to their agency’s human resources office (State employees to HRSC@state.gov) . Foreign Service retirees from all agencies should submit D uring my service as director of the State Department’s Office of Retirement, I spent a lot of time assisting employees and retir- ees who were facing the delay or denial of some federal benefit due to their own failure to take necessary actions. While there is no need for you to spend weekends studying the Foreign Ser- vice Act and the Foreign Affairs Manual, you do owe it to yourself and your family to do due diligence in key areas. Below are a dozen common retirement benefits pitfalls and how to avoid them. What to do and what not to do when planning for life post-career. BY JOHN K . NALAND 12 Retirement Pitfalls to Avoid ISTOCKPHOTO.COM/ALEKSANDRAALEKSEEVA non-TSP forms to HRSC@state.gov, except that retirees must send updated FEGLI beneficiary forms to the Office of Personnel Management as explained on the form. 2. TSP and Other Investments. Over the past 25 years, inflation has cut the purchasing power of each dollar in half. If you or your survivor anticipate draw- ing on your TSP savings or other invest- ments such as IRAs and mutual funds several decades from now, most experts recommend investing in funds contain- ing more stocks than bonds to increase your chances of generating long-term rates of return that outpace inflation. From time to time, you should review the stocks-versus-bonds bal- ance in your investments to make sure the balance is appropriate for your investment timeline and risk tolerance. Consider talking with a financial adviser before making a major financial move. A list of financial and tax advisers who have assisted Foreign Service members