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Cashing in unused leave or using it before retirement is a decision that many employees face when they are nearing the end of their career. Both options have advantages and disadvantages, and it depends on individual circumstances which option is better.
Cashing in unused leave is a popular option for many employees because it provides an immediate cash payout. This can be helpful if you need to pay off debt, cover unexpected expenses or boost your retirement savings. However, cashing in leave also means that you lose the opportunity to take time off and rest before your retirement. This is especially important if you have been working for many years and need a break to recharge.
Using your unused leave before retirement can be a great way to take a break and enjoy some rest and relaxation before you start your retirement. This option allows you to use your leave time the way it was intended, which is to provide a period of rest and recovery from work. However, using your leave also means that you won’t receive a cash payout, which can be a disadvantage if you need the money for other purposes.
Another advantage of using your leave before retirement is that it provides an opportunity to transition into retirement slowly. You can reduce your working hours gradually, take extended breaks or work part-time, which can help you adjust to the change and prepare for your retirement lifestyle. This can be especially helpful if you are worried about the emotional and social aspects of retirement and want to take time to adjust.
Ultimately, the decision to cash in unused leave or use it before retirement depends on your individual circumstances and priorities. If you need the cash for immediate expenses or want to boost your retirement savings, cashing in leave may be the best option. However, if you want to take a break and enjoy some rest before retirement, using your leave may be the better choice.
In conclusion, cashing in unused leave or using it before retirement is a personal decision that should be based on your individual circumstances and needs. It’s important to weigh the advantages and disadvantages of each option and choose the one that aligns with your priorities and goals for retirement. Ultimately, the goal is to create a retirement plan that allows you to enjoy a fulfilling and satisfying life after work.
question wish to retire in 3 yrs do you do 1 on 1 i just want to see where i am in terms to retire and make any adjustments
Is umbrella insurance recommended for a middle class family with less than a million in assets?
Thanks!
This guy needs to call in sick a few more days…
Haws is correct, however in the case of CSRS which this person most likely is, once you have more than 41 years and 11 month's you have reach your maximum annuity amount or 80% and you will receive no more credit for time. The exception to this is your unused sick leave which can add more time to your annuity which can push you past the 80% mark. The timing of which month to retire is also interesting. Generally if you are a GS 14 or above retiring in the end of November has a tax benefit of your annual leave being paid in the same tax year and because you have exceeded the Social Security tax limit of $160,200 (2023) Social Security will not be withheld from this payment. Something to think about. Overall Haws is the man and he gives very good advice, that's why I follow him.
CASH OUT!!!
I couldnt follow this video because i needed to know the basics…. what are the basic options for both sick leave and annual leave at retirement? You basically told me to go find the basics on one of your other videos. Lol. With every video, assume I don't know the basics. That would help. Thanks so much.
Very useful info. I took terminal leave when I retired from the USAF and didn't know I could use it retiring from federal service. Like the commenter, I too have lots of sick leave and always carry over the max annual leave at the end of each year. I would rather use that to increase my retirement check for the rest of my life rather than a one time check. Thank you!
You are only authorized to use sick leave if you are sick or in a LS category.
Where I work , managers know that people are using all of their sick leave before retirement. You don't have to use it all at once buy take several sick days a month for appts., Many managers tell their people who nearlng retirement to use their sick leave .. as they say – You earn .. please use it.
Use your leave and leave early.
It makes more financial sense to use all of your leave before you Retire !! That means , Sick and Annual. I will use all my leave before retirement to push out my retirement date and get more years of service time which = more $$$$ in retirement for the rest of your life.
That person with 3000 hours of unused sick leave is a fool. Thanks for the sacrifice. You just made your employer ALOT of money. Every person has a different ability to live within their means. My current goal in life is to give the Fools in government as little (tax) money as possible. I'm taking the leave… and lowering my taxes. I am a USPS employee and see people sacrifice their health and not use their sick leave, I just don't get it. IT"S YOURS. There is a HIGH percentage of people who retire ONLY when their health fails. A way smaller percentage retire ASAP and are healthy and have 20+ years of retirement. Those people made GOOD decisions for 25+ years and are reaping the benefits. Invest early and invest often. Then get OUT at your Minimum retirement age. Anything over 6 months sick leave is a waste and will never be recouped.
Working is NOT a Hobby.
Since you would have been getting retirement pay during those last 2 months, it reduces the effective pay by that amount, say 35%, so if you take the lump sum, you get all of the pay, plus your retirement amount.
Please cover survivor benefits for social security
Disability retiree in the houz + mil buyback in the houzz!
My take is in retirement, you will have a surplus of time and a shortage of money. So for me, it was worth it for me to work two extra months and get the annual leave cash out. I affectionately called it my “name your own cash award” money.
Is the federal pension taxed before or after the survivor benefit deduction is applied
30K subs. congratulations.
Why don’t you cover SL? Whether it should be used or not? Everyone already knows what to do with their AL