Broadcast Retirement Network’s Jeffrey Snyder discusses the impact of the new U.S. Department of Labor regulations on Federal Employees with Semper Why Retirement Planning’s Francis Xavier (FX) Bergmeister.
Jeffrey Snyder, Broadcast Retirement Network
Well, joining me now is Francis Xavier Bergmeister. He’s a certified financial planner, also the owner of Semper Why, and he’s also a former Marine. FX, it’s great to see you.
Thanks for joining us this morning.
Francis Xavier (FX) Bergmeister, Semper Why Retirement Planning
Thank you for having me.
Jeffrey Snyder, Broadcast Retirement Network
And FX, I just want to kind of tee up our conversation. You do a lot of work, you know, helping other people with their financial planning. We’re going to get into that in a couple of minutes, but you wrote a piece for FedSmith around these new Department of Labor regulations around maybe riskier assets.
I want to get your reaction to those regulations first, and then we can kind of go into some of the details. So when you read these regs, what did you think?
Francis Xavier (FX) Bergmeister, Semper Why Retirement Planning
Well, I believe on simplicity rather than complexity. And the idea is that this is a new idea that’s being proposed by the Department of Labor and by the administration. And I just wanted to give my two cents about where I feel this may be going.
Jeffrey Snyder, Broadcast Retirement Network
So the context of your article was really focused on members of the Federal Thrift Savings Plan. That is arguably the largest 401k-type program in the world of which many military members participate, you know, as part of the blended retirement system. So in your estimation, how do these regs, do these regs fit into the context of the TSP?
Francis Xavier (FX) Bergmeister, Semper Why Retirement Planning
Well, the Thrift Savings Plan, the TSP, is also used by people outside the federal government in different federal agencies. And it’s also used by our military. So every man and woman who’s a member of the armed services also has access to a Thrift Savings Plan.
But it’s a little bit different than a 401k plan. In other words, it fits into that category, but because it’s a federally run 401k equivalent, it has a little bit of a different, how would you say, treatment by the Department of Labor. And when I read what the Department of Labor was going to do, this has been discussed for several weeks now, but they made the formal announcement at the end of March, I wanted to see what I could do to tap down the anxiety of all those TSP members.
And FedSmith is a website that allows me to write articles and to share my two cents with that audience.
Jeffrey Snyder, Broadcast Retirement Network
So have you, in talking with members of the TSP, are you getting the sense that people are, that currently have accounts, they may be retirees, they may be active employees, are they concerned about these rules? I mean, are they sophisticated enough to understand what these rules mean and the process by which it’s kind of establishing? So what are they expressing to you?
Francis Xavier (FX) Bergmeister, Semper Why Retirement Planning
Well, that’s a great question. And the reason I write articles is a general officer said, FX has radar that’s pinging out beyond the horizon. I would venture to say the average military member federal employee is not even aware of this.
In other words, this is something so new, it takes a while for it to be known of. So I’m writing this as being proactive. I’m introducing those members who read FedSmith to this idea.
And I even included the Department of Labor announcement so they can read the news for themselves because that’s one of the things I have to do. They have questions, here, read the Department of Labor. So I included that in the article.
Jeffrey Snyder, Broadcast Retirement Network
And did that help clarify things? I mean, look, I’ve been in the retirement business like you, you’ve been in financial services after the Marines for a long time. These are very complicated things.
I don’t think they’re easily translatable to people who have different vocations and different skill sets and different day jobs than kind of what we do. But is it your sense that there’s a level of concern just based on your writing the article?
Francis Xavier (FX) Bergmeister, Semper Why Retirement Planning
Well, I come from that neighborhood, being a Marine, being a former FBI employee. And what I also do is I’m an advocate for the spouses and family. So there’s that first layer, but then there’s of the federal employees in the military, but then there’s that secondary layer beneath that topsoil.
There’s the spouses and the family members that may inherit a TSP. So I’m also the unpaid watchdog for those folks as well. And I’m thinking of them, and I thought of them when I wrote the article.
So it’s not just for the people that own the plans, but for the people who may inherit the plans.
Jeffrey Snyder, Broadcast Retirement Network
So FX, so you talked about training FBI agents. We were talking kind of in the quasi virtual green room, talking about your training of FBI agents. One of the things that you always have to ask, and this is why you named your firm Semper Why, is you gotta always ask additional questions.
When you look at these regs, let me just ask you about your opinion. What are some of the questions that maybe bubble up in your mind as a former FBI trainer and Marine?
Francis Xavier (FX) Bergmeister, Semper Why Retirement Planning
They want information, but they’re very guarded about where they get the information from. In other words, you gotta realize this audience is very secular with regard to they deal with former federal employees and federal employees. They deal with military and federal and former military.
And I don’t wanna say they’re suspicious, but they’re very guarded about new information because they wanna get their peers to weigh in. For example, if somebody’s gonna buy a car, they’ll ask someone that sits across the room, hey, where did you buy your car? If I need my landscaping done, someone to mow my lawn, who do you use?
Who’s your plumber? So they go in-house and this is a new idea. When they go and ask their person across the room or that person they’re working with outside the room from that community, what do you think about this?
They’re gonna give you what we call the second lieutenant shrug. They’re gonna say, I don’t know. When did this come about?
So I’m leaning forward. I’m thinking ahead and this gives people something to think about.
Jeffrey Snyder, Broadcast Retirement Network
So do you think there’s an opportunity or do you think that maybe, this is a process to select investments. Do you anticipate that there may be changes to the federal TSP? Again, that has to come through, I think it has to come through the board and also Congress has oversight of the TSP, but do you think that there will be material change or could be material changes to the TSP longer term?
Francis Xavier (FX) Bergmeister, Semper Why Retirement Planning
There may be, but we’ll see what will happen. That’s the uncertainty. It’s still in discussion.
The blueprints haven’t been printed yet. This is still in the exploratory phase.
Jeffrey Snyder, Broadcast Retirement Network
Yeah, and we’re waiting for, the feedback that I’ve gotten is that we’re waiting for obviously some comment period and then ultimately a finalization and then implementation or effective date. FX, we’re gonna have to leave it there. Great to see you.
Thanks for writing about this in FedSmith and sharing that with your colleagues in and around the federal government. Look, we look forward to having you back on the program again very soon, sir.
Francis Xavier (FX) Bergmeister, Semper Why Retirement Planning
Well, I’ve enjoyed it and thank you for all the work you do to help all the people you serve. Thank you again.