A chartered federal employee benefits consultant is a financial advisor who helps federal employees plan their retirement. These individuals undergo a course work covering civil service retirement system and federal employee retirement system annuities, thrift saving plans, and social security. They have extensive knowledge about FERS, CSRS, and other special provisions. How can CHFEBC help you, and why not any other financial advisors? Let's figure it out.
How can federal retirement planning consultants help you?
Federal employee retirement benefit plans are a bit different than the usual retirement. Their benefit plans are divided into three categories- thrift saving plan, social security, and basic benefit plan. Get a quick view of these benefits plans from the below points.
- Thrift Saving Plan
The basic benefit plan is one of the benefits under the federal employee retirement system. It is closely designed to be a private sector 401 (k) retirement benefit plan. Under the thrift saving plan, a federal employee has to contribute 1% of their basic pay. You can also make extra contributions that your agency will match (up to 5% of your pay). However, the extra contributions are subjected to taxes-deferred and are administered by the Federal Retirement Thrift Investment Board.
- Social security benefits
The contribution to the social security fund by federal employees is at the same rate as private sector employees. That means 6.2% of earnings will go into the social security fund with the agency matching your contribution.
- Basic benefit plan
Under this plan, a federal employee receives a fixed amount regardless of the amount they have contributed. That amount depends on the length of service and high-3 average. High-3 means three consecutive years of service, often the last three years of service; however, your highest paying position could be those years.
The above points clear the structure of the federal employee retirement benefit plan. However, the question still remains unanswered as to how a federal retirement planning consultant can help you and why not any other financial advisor. The financial industry is full of financial advisors who can help you with other financial advice but may not be suitable for your federal retirement needs. Understanding the federal retirement benefit structure is important before providing any kind of advice to a federal employee. A usual financial planner may lack the knowledge and experience to provide guidance. On the flip side, CHFEBC has extensive training and knowledge related to federal employee benefit plans.
CHFEBC can better understand the needs of federal employees and help them align their financial needs with their goals. They won't take your time unnecessarily because they know what questions to ask and how to identify the best financial plan. Other financial advisors may fail to identify the best plan aligned to your retirement goals.
How can you find CHFEBC?
- Consider the area of expertise
What are you looking for in a consultant? Many consultants specialize in different areas of finance, such as insurance taxes strategy and retirement planning. So, if you need guidance for retirement planning, you can avoid working with insurance experts.
Once your niche is down, start your research for the expert. Try to find a few candidates and research their backgrounds; this will help you determine what skills every candidate can bring to the table. After shortlisting a few candidates, contact the few potential consultants who suit your needs, and you are good to go!
- Consider their qualifications
Education and Experience is the prerequisite to becoming a ChFEBC. Many individuals call themselves financial advisors but don't hold the appropriate qualification to carry out the task. Before you meet a potential candidate, ask them about their qualification. The education requirement may contain either three years of financial experience or hold series 6, series 7, series 24, series 66, registered investment advisor, or advisor representative designation. They must also hold a chartered financial consultant (ChFC) designation.
The Bottom Line
Retirement planning is a tiresome process and requires an expert's advice. They can simplify the complex financial-related terms, help you choose the best financial plan, and tell you how to calculate federal employee retirement benefits. Therefore, work with a savvy federal retirement advisor who can make the retirement process easier for you.
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