Dental benefits, and bite they take, a year away

Don’t delay seeing your dentist because you are expecting a dental insurance package from Uncle Sam. It’s coming, but not this year.

The anticipated start date for benefits is July 2006. The open enrollment period for the dental-vision plan will be next spring.

Officials hope to offer several optional dental packages through the Federal Employees Health Benefits program.

Although premiums will be at a group rate, feds and retirees will not get any payment help from Uncle Sam. The government pays 72 percent of the premium for the government’s cradle-to-grave health insurance program, but Congress won’t let it pay anything toward the optional dental package.

Brace yourself (no pun intended) for the fact that dental benefits, even at a group rate, are expensive. Premiums will not be cheap.

IRA money to TSP

There were a lot of questions about a recent column on the surge of outside individual retirement account and 401(k) funds into the federal Thrift Savings Plan. Workers and retirees have moved almost $1 billion from outside tax-deferred accounts (not Roth IRAs, which aren’t tax-deferred) into the federal 401(k) plan. You can get information and the forms from the Federal Retirement Thrift Investment Board Web site at www.tsp.gov.

The maximum amount federal or private-sector individuals can contribute to a company 401(k) plan this year is $14,000. But people who are 50 or older, or whose 50th birthday is between now and Dec. 31, can make another $4,000 in catch-up contributions. So for the 50-plus crowd, that’s a total of $18,000.

Higher-income feds should be sure their biweekly contributions don’t hit the ceiling before the end of the year. Maxing out would cost them the matching 5 percent government contribution.

Where do you get the extra money to salt away? That is your problem.

COLA countdown

The one in five Washington-area adults whose monthly benefits are indexed to inflation can look forward to a minimum 2.6 percent increase in January. That means millions of people and many millions of dollars.

The cost of living adjustment (COLA) countdown has four months to run. So if inflation continues to rise, then the automatic raise will be even larger.

The in-the-bag COLA for retired civil servants, military retirees, Social Security recipients and people whose alimony or child support payments are pegged to inflation already exceeds the 2.3 percent raise President Bush has earmarked for federal employees in January. It could catch up with the 3.1 percent raise that Congress is likely to approve, overriding the White House for the 12th straight year and putting the civilian raise on a par with military personnel.

Although active-duty feds and military people get most of the attention in this government town, the retired community — bolstered by millions of people who get Social Security benefits as well as civil service annuities and/or retired military pay — is the biggest. And it has the most income, by virtue of its size.

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