Making the decision when to retire often comes with a lot of excitement and eager anticipation but there is much more to this decision than many officers consider. There are myriad questions one must answer when contemplating when to retire — and no two people will have the same set of questions or life circumstances — you might do well to begin with these three. Add your own questions (and answers) in the comments area below.
1. What is Your Bottom Line?
The first consideration is what your retirement paycheck will look like. You may be surprised to learn that your pension check may actually be more take home pay then the current check you receive while on the job. Of course, there are key points that will affect whether or not your paycheck is more or less upon retirement and your many states may have different variables that can influence the outcome.
Let’s consider your current pay while still on the job. Assume your pay currently grosses $7,917 monthly. Your deductions are taken out — Federal Tax $673.00, State Tax $255.00, Deferred Compensation $792.00, Pension Contribution $475.00, FICA $491.00, Medicare $115.00 and job related expenses $475.00 — bringing you in a monthly take home pay of approximately $4,641.
Now, let’s consider what your pension check may look like after you retire. Assume your pension check is $5,575 a month. We will have to deduct Federal Tax of $512.00 and State Tax of $209.00 which nets you $4,854.00 a month to take home. In this hypothetical situation, the retired officer actually brings home more money than he did while still on the job. This may be good news to many of you.
However, there are important issues that must be considered before you pull the pin. Many of your pensions have yearly multipliers that will affect your net for the rest of your life. You must consider that every year your pension battles inflation which decreases in value as the years pass.
2. Considering a Second Career?
Another factor is whether or not you plan on a complete retirement or working a second career after you leave the police force. Many of us are still young enough to have a second career upon retiring from law enforcement. If you plan on a second career of 10, 15, or even 20 years, then retiring from law enforcement at an earlier age may make better sense for you. Here’s one reason why: the second career may have a 401K or even a pension that only requires ten years to be vested. Making those financial investments into a 401K or a partial pension may be more lucrative than staying on the job ten years past your retirement eligibility date. So, you can still invest in retirement while increasing your monthly gross due to your pension check and your new career pay.
A second career after retirement has many advantages. The most important is you have a chance to increase your monthly take home pay as your receive your pension check and then your pay from the new career. With the right mind set and goals, a law enforcement officer retiring at the age of 50 or so can double his monthly pay with the right post retirement career. Then you also have to consider that you may be able to increase other benefits such as dental coverage, optical coverage and health care with the new career.
Many officers have the opportunity to purchase service time so that they can retire earlier. If a second career is on your horizon the ability to purchase service time is significant? The reason why purchasing service time is a great opportunity is because post retirement careers for law enforcement are very competitive as many officers seek the same jobs. If you retire at an earlier age that makes you younger than your competitor — which may provide you the advantage if all else is equal. Getting into the job market at 48 may be better than at 53. Something I have found is that cops looking for employment while still on the job are hired more frequently than cops already retired. Once you leave the job, you’re just another retired cop to civilian employers. Seek your next career while you’re still employed at the agency.
3. What Job is Best?
The final consideration in seeking a second career is knowing what jobs fit you best. You must consider your training, job assignments and talents as you determine what works for you. Then build a resume and please don’t do it yourself unless you are very knowledgeable about the process. A professional resume builder is worth the $200-$300 you may pay for their service. When you start looking you might be surprised how much easier finding jobs has become. The internet has incredible job search resources that make it much easier than what we remember from our younger years.
I remember the day I left the military to start my career in law enforcement. After being sworn in I calculated the year I could retire and that year was always in the back of my mind. With a blink of an eye 24 years passed and I retired younger than anticipated.
I am now employed in a second career. The transition wasn’t easy, I left a great job, serving in my dream capacity and left a lot of good friends behind. There were many sleepless nights after retirement as I ventured into my new career.
However, I am blessed by the opportunities afforded me and seeking retirement at an early age has been one of the best career choices I’ve made. A post-retirement career isn’t for everybody but for some it’s a blessing waiting to be gained.
