Feds, Start Your Engines!

The Federal Government maintains an insular environment for their employees with strict rules regarding vendor interactions with employees. I am speaking specifically about the retirement planning educational process. An agency can either provide educational seminars supported by their Human Resources department staff, or contract the seminars to an approved vendor. The seminar can be focused on the Civil Service Retirement System, the Federal Employees Retirement System, or both. The length of the seminar can be anywhere from a half day to a 3 day marathon. Where is the irony I mentioned at the outset of this article? After receiving information specific to the unique Federal benefits for 4 to 24 hours with the employees, they are then left to their own devices for implementation. In an effort to protect their employees from solicitation and conflict of interest, the Feds prohibit any recommendations of financial planners who specialize in Federal Retirement Systems. Imagine being handed the keys to a race car with no pit crew, nor a format of interviewing prospective pit crews.

To the uninformed, this may seem like a minor detail. Go on the internet and do a search for financial planning… Welcome to the casino of financial planning roulette. While there are many reputable planners in the industry, there are some parading as advisors and planners with limited licenses, credentials and experience. There is too much at stake to risk a bad financial outcome the same way you research wiper blades. 

To find the right fit, use the following questions to simplify the financial planner interview process:

1. Does the financial planner adhere to the Fiduciary Standard?
2. What securities licenses does the planner hold Series 7 & 65 or 66?
3. Are they a Registered Investment Advisor (RIA)?
4. Do they carry a Federal Benefits specific designation such as the Chartered Federal Employee Benefits Consultant (ChFEBC) designation?
5. Is a comprehensive financial plan part of the process?
6. How much is a plan? Do they have a sample plan?
7. How do they get paid? Fee Based, Hourly, Flat Fee or Commission?

These questions will help weed out the “generalist” advisor who either doesn’t understand the nuances of the Federal Benefits or, just as badly, treat the planning process identically to their private sector clients.

As a Federal Employee, what has been your experience seeking information about retirement planning?

PlanVest Federal

Michael C. Mattison, ChFEBC

555 Quince Orchard Road

Suite 280

Gaithersburg, MD 20878

(Direct) 301-938-4600 (Fax) 301-977-7124

Michael.Mattison@PlanVestFinancial.com