07 Dec

Beyond the Pension: Being Honest about Retirement

If you’re reading this, chances are you’re a police officer. Your retirement options are unique and there’s no one size fits all retirement planning for police. However, there are a few harsh realities that you’ll thank yourself for facing now, and not waiting until your retirement date is fast approaching.

Harsh Reality: You MAY find it hard to plan for how to spend your post retirement days.

There are many reasons for this.

  • You have more retirement to plan for since you have option to retire after 20 years of service. Retirement planning for police needs to take this into account!
  • Your job and your fellow officers are unique and your identity is tied to being a police officer. Therefore, while other people can disassociate themselves with their job – your line of work makes that difficult.

Solution: Figure out NOW what you want to do in retirement

  • Remember that we often enjoy doing things we excel at. Meaning, if your post retirement plans include “taking up something” or “exploring xyz” it might be wise to try it out now to see if it will be a short lived experiment.
  • Research of retirees indicates those who are happiest in often answer the question, “What will you do with all that time?” with responses like “giving back” and “discovering a sense of purpose”. Volunteering also helps maintain social interactions we previously had at work.
  • Make a list of how you would fill in an entire week if you weren’t working. What new things would you like to learn about and what new places would you like to see? Where would you like to live? What experiences would you like to have?

Harsh Reality: Your ideas about how to spend time MIGHT NOT align with your spouse’s ideas.

For example, you may want to hit the road in an RV and she or he would rather stay close and spend more time with the grandkids.

Solution: Have honest conversations and find common ground now to avoid disaster later. Spend time, without distractions, to discuss what you each envision for your retirement.

If they ARE ready to hit the road, RMLEFCU offers RV loans!

Harsh reality: Unless you change as easily as a chameleon, your spending habits likely won’t look much different in retirement.

Solution:

  • If your tastes are expensive, have a plan to still bring in money if there is a gap where your savings and spending do not meet.
  • Look at downsizing or moving to a location where the cost of living is more affordable. We have some Colorado suggestions in this blog.
  • You may be able to use your home’s equity to improve your cash flow during retirement. There are a few reasons this could be a viable option for you.

Harsh reality: Not everyone reads the fine print of their pension

Solution: Now, rather than when you’re approaching retirement, is the time to familiarize yourself with the rules, timelines, and options affecting your pension plan. Do not try to read before going to bed. Read them very carefully.

RMLEFCU is Colorado’s only credit union dedicated to police officers and we understand retirement planning for police. For this reason, we have an in house financial planner, Debby Wilson, about your retirement plans. She’s been working with our members for 18 years and her expertise is invaluable.

05 Apr

Been There. Done That. Retirement Advice from a Fellow Cop.

Retirement Planning Advice for PoliceTerry Lucas served with the Illinois State Police for 28 years rising through progressively higher ranks mostly in the investigative field. Terry then served as the Law Enforcement Coordinator for the US Attorney’s office in the Central District of Illinois for 15 years. While with DOJ he served in Iraq assisting in the prosecution of Sadaam Hussein.

He has a few nuggets of advice for fellow cops.

On retirement planning: “You have to think outside of your pension.” Terry, father to five daughters, speaks from experience, “Don’t overlook something that is staring you in the face. Contribute to some kind of deferred compensation plan. Why not have that amount taken out before taxes and put into an account? It will hurt a lot less now than it will when you’re 55 and looking at starting over in another job.”

Asked for advice to cops nearing retirement age, he says, “Think very carefully about taking a large chunk of time off right after you sign those retirement papers to travel and just relax. Chances are you’re young enough that you’ll need to keep working, and the best time to get a job is when you already have one.” Read More