Hello-
I am a new state employee participating in our retirement program. Recently, I petitioned the state's retirement system to buy back 32 months of previous federal service. The cost is approximately $26k; I have the money and two more months to decide. The state's online estimator guesstimates a $332/month pension bump versus if I don't. The 32 months also gets me closer to vested status, which is 5 years for state employees. How long will I work for the state? I told myself a minimum of 5 years. Naturally, the longer you work for the state, the higher your monthly pension increases.
Additionally, this is where the doubt comes in whether I should pursue this further. I receive approximately $10k in pension right now. So, do I want to invest $26k now so that when I turn 67 and begin drawing a third pension, I receive an extra $332 a month? Or is that money best served somewhere else?
I assume that I will reach 67 and draw SS benefits (or what's left of them), as well as begin taking distributions from TSP and my other retirement accounts. I'm sitting in a good spot financially; I don't know whether to take that $26k leap.
Thanks,
A Retirement Quandary
byu/Forsaken_Tourist401 inMilitaryFinance
Posted by Forsaken_Tourist401