Planning for retirement

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The hubby decided he wants to "retire" in about 8 years from his current job (govt) and go work private sector for a few years before he retires for good. This was already anxiety producing since money is something I worry about all the time. Now I am trying to figure out the arcane federal retirement system and figure out what we will have to live on over time.
The online materials are horrible. I tried to figure out their annuity calculations but they failed to mention if the formula gave you your lump sum or a monthly allotment or what. All of this is on me to figure out. The hubby flat refuses to deal with anything financial. He refuses to even deal with paying a utility bill. Since I am not the one working I don't have direct access to the normal things the employees have like benefits orientation etc. So this is probably going to take a lot of uphill battle to sort out.

Since I lost all of my retirement between job hopping (mostly dot.com mergers etc) and my last employer screwing me out of my 401k I am totally reliant on his retirement. I thought about trying to find a consultant to help but so much of the financial advice out there is about as quality as an HR Block tax person. My dad was taken advantage of one when he got older. This guy convinced him to move all of his money that was in secure things into the stock market right before the market collapse and he lost almost everything. So I am guessing I have to figure this out on my own.

I keep having visions of being old, living in my car eating cat food. Anyone found any useful advice that isn't generated by the banks that just want to hold your investments?

I just learned a lot about annuities in settling an estate.

Major decisions: choosing a lump sum or monthly payout. The monthly payout makes more sense for folks who haven't been investing all their life.

Do you need the same monthly payment if he dies? Or is 50% after 10 years acceptable? Basically the longer the annuity can go the less the monthly payout--but the options are structured to meet the needs of couples in retirement.

Useful idiom--pigs get fat, hogs get slaughtered.
http://www.usingenglish.com/reference/i ... tered.html

Most of my investment money is now in broad based index funds. But even that may be too risky for your situation--hence the advantage of annuities. But, I've done really well so far in 30 years, which can't be said for a lot of investors. It helps that I do my own taxes, so I can take advantage of things like the Bush tax breaks--holding my breath that I didn't make too much money so I didn't slide into another tax bracket.

You really need to keep that money in tax sheltered investments--or you will really be screwed. I've carefully moved my money into tax sheltered accounts, or investing in things like municipal bonds that aren't taxed by the state or feds.

http://www.obliviousinvestor.com/single ... e-annuity/
I just talked about single premium intermediate annuities, which have the lowest commissions.

People make lots of money selling variable annuities.
http://www.forbes.com/sites/financialfi ... -a-ripoff/

But, she is talking about annuities doled out by the Federal Government, in which no commission is involved.

http://www.opm.gov/retirement-services/ ... -payments/
https://www.opm.gov/retirement-services ... survivors/

http://www.opm.gov/retirement-services/ ... index.html
This seems to be the page for figuring out what you get.

The federal government uses annuities to simplify things--you calculate what goes into your pot, then you decide how you want to take it out. As I mentioned earlier, you get more per month by reducing the payment period--waiting longer before you start taking money out.

https://www.opm.gov/retirement-services ... mputation/
You may want to start here, if you haven't already found it.

SPIAs are easily compared, hence competitive prices.

With variable annuities, only the rare expert knows what they are actually getting, so they can charge more and pocket a commission. And that expert won't buy them for himself.

IMHO, the best way to handle the interest rate risk is to save a lot of money, and learn to live well within your means. Ideally, you would have a portfolio of investments--the SPIA would pay for monthly needs, like groceries and running a household. You would have other investments, perhaps a bond index, if you are adverse to stocks, to handle the inflation rate risk. An SPIA would allow you to ride out market fluctuations, if you have a lot invested in stocks.

In the OP's case, it might be better to call it a federal pension, and hope that someone will pipe up about the exact terminology..

http://blogs.fedsmith.com/2014/10/22/1- ... employees/
She would get a cost of living allowance, just like those on SSDI or Social Security. There are inflation indexed versions of SPIAs.

Sad to say, but there are people who will intentionally confuse perfectly good retirement alternatives with shady ones in the hope of making a sale.

Thanks for all the input.
The entire financial system is quite a mess so who really knows what will be in place in 20 years.

The AARP.org site might be helpful.

Whether America can pay his retirement is topic for another forum. Politics, Philosophy, and Religion, to be exact.

You should focus on the best option for your needs, and not worry about what is best for the country.
I would guess that with a Federal Pension, you are likely to do as well as any other choice, given the lack of prior experience with investments.

Sort of like taking money out of the bank and purchasing your own guns for protection--guns are even more valuable than money for many thieves because they can't get them legally.