Clerkship ending -- what to do with retirement contributions?

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clerk7898

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Clerkship ending -- what to do with retirement contributions?

Postby clerk7898 » Mon Jun 19, 2017 6:15 pm

I'm wrapping up a one-year district court clerkship this fall, and this was my first job out of school so I don't have a pre-existing retirement account. I've been paying into a TSP account out of each paycheck and also getting a "FERS-FRAER" post-tax deduction on every paycheck. I'll be heading to biglaw in the fall where I'll be able to contribute to a 401(k).

What do people do with retirement savings from their time during a clerkship? Combine them with a 401(k)/other retirement account? Leave them be? Apologies if this is a dumb question, but like I said I haven't worked before and so this is my first time dealing with this stuff. I was also told vaguely by a former clerk that the TSP is a really nice perk and that you should keep it open post-clerkship in order to roll funds back into it later in life, but I didn't get much in the way of details from him.

Any advice would be greatly appreciated. Thanks!

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Re: Clerkship ending -- what to do with retirement contributions?

Postby Anonymous User » Mon Jun 19, 2017 6:19 pm

clerk7898 wrote:I'm wrapping up a one-year district court clerkship this fall, and this was my first job out of school so I don't have a pre-existing retirement account. I've been paying into a TSP account out of each paycheck and also getting a "FERS-FRAER" post-tax deduction on every paycheck. I'll be heading to biglaw in the fall where I'll be able to contribute to a 401(k).

What do people do with retirement savings from their time during a clerkship? Combine them with a 401(k)/other retirement account? Leave them be? Apologies if this is a dumb question, but like I said I haven't worked before and so this is my first time dealing with this stuff. I was also told vaguely by a former clerk that the TSP is a really nice perk and that you should keep it open post-clerkship in order to roll funds back into it later in life, but I didn't get much in the way of details from him.

Any advice would be greatly appreciated. Thanks!


http://finance.zacks.com/can-transfer-t ... -1238.html

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Rowinguy2009

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Re: Clerkship ending -- what to do with retirement contributions?

Postby Rowinguy2009 » Mon Jun 19, 2017 7:37 pm

For me, it was pretty easy to roll my law firm's 401k into a TSP account when I started fed gov employment. My understanding is that you can similarly roll your TSP into many 401ks. Why not just do that? If you go back to fed gov, you can then roll that 401k into your new TSP.

I don't really see the utility of holding onto a TSP that (I assume) only has a few thousand dollars in it.

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Re: Clerkship ending -- what to do with retirement contributions?

Postby wwwcol » Mon Jun 19, 2017 9:11 pm

I suppose I'm not questioning OP since he says he contributes to TSP, but has anyone else ever heard of a term law clerk participating? Under what circumstance (if any) can a term clerk pay into TSP?

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Re: Clerkship ending -- what to do with retirement contributions?

Postby rpupkin » Mon Jun 19, 2017 9:15 pm

wwwcol wrote:I suppose I'm not questioning OP since he says he contributes to TSP, but has anyone else ever heard of a term law clerk participating?

No.

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mjb447

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Re: Clerkship ending -- what to do with retirement contributions?

Postby mjb447 » Mon Jun 19, 2017 9:21 pm

wwwcol wrote:I suppose I'm not questioning OP since he says he contributes to TSP, but has anyone else ever heard of a term law clerk participating? Under what circumstance (if any) can a term clerk pay into TSP?

A clerk could come from an eligible federal position without a break in service (probably not OP's situation if this was his first job after school). I've also heard of judges having a "clerk" (lawyer just out of law school doing law clerk work) who's a JA or CRD or similar on paper, and I suppose a position like that might be eligible. You're right that it's not the norm, though, and it's specifically excluded from the list of benefits on OSCAR.

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Re: Clerkship ending -- what to do with retirement contributions?

Postby rpupkin » Mon Jun 19, 2017 9:23 pm

mjb447 wrote:
wwwcol wrote:I suppose I'm not questioning OP since he says he contributes to TSP, but has anyone else ever heard of a term law clerk participating? Under what circumstance (if any) can a term clerk pay into TSP?

A clerk could come from an eligible federal position without a break in service (probably not OP's situation if this was his first job after school). I've also heard of judges having a "clerk" (lawyer just out of law school doing law clerk work) who's a JA or CRD or similar on paper, and I suppose a position like that might be eligible. You're right that it's not the norm, though, and it's specifically excluded from the list of benefits on OSCAR.

If I had to guess, I'd say it was an HR mistake of some sort.

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mjb447

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Re: Clerkship ending -- what to do with retirement contributions?

Postby mjb447 » Mon Jun 19, 2017 9:24 pm

rpupkin wrote:
mjb447 wrote:
wwwcol wrote:I suppose I'm not questioning OP since he says he contributes to TSP, but has anyone else ever heard of a term law clerk participating? Under what circumstance (if any) can a term clerk pay into TSP?

A clerk could come from an eligible federal position without a break in service (probably not OP's situation if this was his first job after school). I've also heard of judges having a "clerk" (lawyer just out of law school doing law clerk work) who's a JA or CRD or similar on paper, and I suppose a position like that might be eligible. You're right that it's not the norm, though, and it's specifically excluded from the list of benefits on OSCAR.

If I had to guess, I'd say it was an HR mistake of some sort.

Based on my experience with court HR, that's also a strong possibility.

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polareagle

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Re: Clerkship ending -- what to do with retirement contributions?

Postby polareagle » Mon Jun 19, 2017 11:30 pm

If there's any chance you might go back to federal employment some day, I'd leave at least something in the account. That's not typically a great idea to do with old retirement accounts (unless you've got great investment options in the old account, which the TSP definitely doesn't). But when they change federal retirement provisions, they often grandfather in current members. If you go back in the future, it's possible that you'd get grandfathered in even if Tump/Congress change federal retirement benefits for the worse. None of this is high likelihood, but I think it's worth leaving $10 in there if you can do that.

ETA: Also, maybe don't draw too much attention because normal term clerks definitely don't qualify for a TSP.

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Re: Clerkship ending -- what to do with retirement contributions?

Postby clerk1251 » Tue Jun 20, 2017 1:28 pm

mjb447 wrote:
rpupkin wrote:
mjb447 wrote:
wwwcol wrote:I suppose I'm not questioning OP since he says he contributes to TSP, but has anyone else ever heard of a term law clerk participating? Under what circumstance (if any) can a term clerk pay into TSP?

A clerk could come from an eligible federal position without a break in service (probably not OP's situation if this was his first job after school). I've also heard of judges having a "clerk" (lawyer just out of law school doing law clerk work) who's a JA or CRD or similar on paper, and I suppose a position like that might be eligible. You're right that it's not the norm, though, and it's specifically excluded from the list of benefits on OSCAR.

If I had to guess, I'd say it was an HR mistake of some sort.

Based on my experience with court HR, that's also a strong possibility.


I'd be surprised if it was an HR mistake. I'd imagine that Judge's have a lot of pull when it comes to the benefits they want for their clerks. For example, I am in my second clerkship now and with this second Judge, the Judge offered me the option of being on the Leave Act. Term clerks are not typically allowed to join the leave act and my first judge would never have supported it. This judge sponsors you for it though, so you can join without a problem. I'm happily taking advantage of it so I can get paid out for any excess vacation days I don't take at the end of the term!

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rpupkin

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Re: Clerkship ending -- what to do with retirement contributions?

Postby rpupkin » Tue Jun 20, 2017 1:32 pm

clerk1251 wrote:
mjb447 wrote:
rpupkin wrote:
mjb447 wrote:
wwwcol wrote:I suppose I'm not questioning OP since he says he contributes to TSP, but has anyone else ever heard of a term law clerk participating? Under what circumstance (if any) can a term clerk pay into TSP?

A clerk could come from an eligible federal position without a break in service (probably not OP's situation if this was his first job after school). I've also heard of judges having a "clerk" (lawyer just out of law school doing law clerk work) who's a JA or CRD or similar on paper, and I suppose a position like that might be eligible. You're right that it's not the norm, though, and it's specifically excluded from the list of benefits on OSCAR.

If I had to guess, I'd say it was an HR mistake of some sort.

Based on my experience with court HR, that's also a strong possibility.


I'd be surprised if it was an HR mistake. I'd imagine that Judge's have a lot of pull when it comes to the benefits they want for their clerks.

They generally don't. And to the extent judges do have some discretion (such as with your experience with your second judge and the Leave Act), they usually don't want to bother departing from standard practices.

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A. Nony Mouse

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Re: Clerkship ending -- what to do with retirement contributions?

Postby A. Nony Mouse » Tue Jun 20, 2017 1:35 pm

My judge let his clerks get on the leave act too - I was told it was always an option in the district if your judge signed off. (I can imagine maybe some wouldn't, but it was presented to me as pretty common.) But I'm pretty sure TSP wasn't an option (unless is OP ex-military? I know there's a uniformed services option that's different. But probably that has nothing to do with here, I'm just blathering.)

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mjb447

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Re: Clerkship ending -- what to do with retirement contributions?

Postby mjb447 » Tue Jun 20, 2017 1:59 pm

A. Nony Mouse wrote:My judge let his clerks get on the leave act too - I was told it was always an option in the district if your judge signed off. (I can imagine maybe some wouldn't, but it was presented to me as pretty common.) But I'm pretty sure TSP wasn't an option (unless is OP ex-military? I know there's a uniformed services option that's different. But probably that has nothing to do with here, I'm just blathering.)

That's was true in my district as well, and (sorry to mention that OSCAR page again) a judge opting into the Leave Act is wholly consistent with the general list of law clerk benefits ("Law clerks are not covered under the Leave Act unless the appointing judges specifically choose to include them."). TSP coverage is not at the judge's discretion AFAIK.

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Re: Clerkship ending -- what to do with retirement contributions?

Postby Quichelorraine » Tue Jun 20, 2017 5:48 pm

Yeah, seconded. I've always heard of the Leave Act being a possibility, but I was told, in no uncertain terms, that TSP was completely off the table for all term clerks/staff attorneys/what have you.

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Re: Clerkship ending -- what to do with retirement contributions?

Postby Anonymous User » Tue Jun 20, 2017 7:45 pm

I worked for the feds, including a clerkship, for almost five years while getting FERS and TSP. I'm ending my clerkship in a few months. I just talked to our HR and from my brief discussion, this is what I learned.

I think all you can do with FERS is collect a payout. It doesn't vest (I think that's the word) unless you've been in the fed govt for five years. So, if you've only clerked for a year, I'm 99% certain your only option is getting a check. You have to fill out a short form though.

TSP: obviously, this depends on your financial situation and what you're going into. It's very heavily taxed if you withdraw it. The only other option, as far as I know, is transferring it to another IRA/401k. I'm transferring my TSP to my new job's 401k.



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