7 Steps Postal Employees Should Take Before Retiring to Make the Most of Their Benefits

Jason Anderson
May 21, 2025

Key Takeaways

Planning ahead for your retirement ensures you maximize your pension, healthcare benefits, and savings.
Understanding how your benefits change after retirement helps you avoid financial surprises and make informed decisions.

Start Planning Your Retirement at Least Five Years in Advance

Retirement may seem far off, but waiting until the last minute can result in missed opportunities and financial pitfalls. Ideally, you should start planning at least five years before your intended retirement date. This timeline gives you enough time to review your benefits, estimate your retirement income, and make any necessary adjustments.

Consider meeting with a benefits counselor or financial advisor to go over your estimated pension, healthcare costs, and Thrift Savings Plan (TSP) distributions. By planning early, you can take advantage of additional savings opportunities and ensure your retirement budget aligns with your goals.

Understand How Your Pension Will Be Calculated

Your pension is a significant part of your retirement income, and understanding how it’s calculated can help you estimate your financial security. Government employees typically receive a pension based on their years of service, high-3 average salary, and retirement system.

If you’re under the Federal Employees Retirement System (FERS), your pension calculation considers your high-3 average salary and years of creditable service. Keep in mind that early retirement may result in a reduced pension, so knowing the impact of different retirement ages can help you make an informed decision.

Review Your Health Insurance Options

One of the biggest concerns for retirees is healthcare coverage. If you’re enrolled in the Federal Employees Health Benefits (FEHB) Program, you can continue your coverage into retirement as long as you meet the eligibility criteria. However, costs and coverage may change, especially if you become eligible for Medicare.

By reviewing your health insurance options early, you can determine whether you’ll keep FEHB, enroll in Medicare, or combine both for comprehensive coverage. Consider factors like deductibles, out-of-pocket costs, and how different plans cover prescriptions and specialized care.

Maximize Your Thrift Savings Plan (TSP) Contributions

Your TSP is a crucial part of your retirement savings, and making the most of it before you retire can significantly improve your financial outlook. In 2025, the TSP contribution limit is $23,500, with additional catch-up contributions available for those aged 50 and older.

If you’re nearing retirement, consider increasing your TSP contributions to take full advantage of employer matching and compound interest. Also, review your withdrawal options, such as annuities, lump-sum withdrawals, and monthly payments, to determine the best strategy for your retirement income.

Consider the Impact of Social Security on Your Retirement Income

Social Security can supplement your pension and TSP withdrawals, but the timing of your claim matters. In 2025, the full retirement age (FRA) for those born in 1963 is 67. Claiming benefits before reaching FRA results in reduced monthly payments, while delaying benefits past FRA increases your monthly amount.

If you’re eligible for Social Security, assess how your benefits fit into your overall retirement plan. Some retirees choose to delay their Social Security claims to maximize their payouts, while others claim earlier to cover expenses. Factor in your financial needs, life expectancy, and other income sources when making this decision.

Prepare for Federal Employee Group Life Insurance (FEGLI) Changes

Life insurance needs change as you transition into retirement. If you’re enrolled in FEGLI, review how your coverage and premiums will change. Some options allow you to continue coverage at a higher cost, while others reduce coverage automatically after retirement.

Compare your FEGLI options with private life insurance plans to determine whether you need additional coverage. If you no longer require life insurance, adjusting your coverage can help reduce unnecessary expenses in retirement.

Plan for Retirement Paperwork and Processing Time

Retirement paperwork can take months to process, and missing deadlines can delay your pension and benefits. Submit your retirement application at least six months before your planned retirement date to ensure a smooth transition.

Check with your agency’s human resources office to verify that all necessary forms are completed, including your pension application, TSP withdrawal requests, and health insurance continuation paperwork. Ensuring everything is in order helps you avoid gaps in benefits or delays in receiving your first retirement check.

Make the Most of Your Retirement Benefits

Retirement marks a significant milestone, and proper planning ensures you enjoy financial stability and peace of mind. By taking these steps before you retire, you can maximize your pension, healthcare benefits, and savings while avoiding common pitfalls.

If you have questions about your retirement options, get in touch with a licensed agent listed on this website. They can provide expert guidance tailored to your unique situation, helping you make the best choices for your retirement.

Jason Anderson

For over 13 years, Jason Anderson has served as a Personal Financial Advisor, Estate and Retirement Planner, helping to educate individuals from all walks of life and income levels on wise money investment and planning for a comfortable lifestyle and retirement.

Over time, Jason Anderson has become the 'Go-To' leading authority on personal financial advising, financial planning, and analysis, as well as retirement planning and financial planning for SMALL BUSINESS OWNERS. He also provides HIGHLY Popular financial education seminars for groups. These financial seminars empower people to more effectively budget, plan, manage their money, and achieve their personal financial goals. As a result of the excellent results, praise, and feedback that their financial seminars have received, the City of Los Angeles, The AFL-CIO union groups, as well as several other organizations, have decided to partner with Jason to more effectively accomplish their mission. He was also honored to be showcased in the November 2014 issue of Forbes Magazine "Americas Financial Leaders" and has been dubbed by the media as 'The Financial Educator.'

Jason is passionate about the work he does because it brings him joy to help his financial planning and advising clients reach their financial goals. He finds excitement in assisting families in saving and paying for their children's college education without stress, thanks to the financial plans he designs for them. He also takes pride in witnessing clients reach retirement and enjoy it precisely the way they desire.

Personally, Jason finds joy in being a husband and father of two wonderful children. In his spare time, he enjoys traveling, sports, hiking, and reading.

He works with Employees, Business Professionals, Business Owners, and 'High Net Worth' People.

► Like to discuss your personal financial situation?
☏ Call Jason at (323) 481-1328 for a FREE Consultation
✉ Email him at [email protected]

Disclosure: All annuity and life insurance products are designed to supplement securities as part of an overall plan. The recommendation of annuities and life insurance is not designed to eliminate the need for securities in any way.