Federal Pension Planning in Houston: the rules, the tax, and the next step
Federal Pension Planning here is a energy problem shaped by employer deferred-comp and energy-sector 401(k)s in a no-income-tax state, where the expensive errors are federal IRMAA and Texas Medicaid look-back — not state income tax — not a national brochure.
A federal pension election is usually irreversible once you retire
FERS and CSRS payout forms (single-life vs joint-and-survivor) lock at retirement. The survivor-benefit election permanently reduces the retiree’s check to protect a spouse. The FERS special retirement supplement, if you retire before 62, ends at 62 — which is also when Social Security can start. Model those dates together.
TSP is a separate decision: leave it, installments, a TSP annuity, or a rollover IRA (which opens Roth conversions and leaves the G Fund behind). Do not let the OPM paperwork swallow the TSP conversation. FEHB vs Medicare coordination at 65 is its own enrollment calendar.
The local stack this page is actually about
Energy-sector deferred compensation and Texas Medical Center 403b accounts bunch federal income even though Texas levies none. A bonus year plus a conversion plus a pension start is the IRMAA pattern two years later. Texas homestead under Constitution Article XVI Section 50 is not IRA protection and is not a brokerage shield. Texas Medicaid look-back still applies to gifts funded by an energy payout. Product traffic around the energy corridor makes a written job-for-the-contract more useful than a teaser rate. Checkable names on this page: Texas Medicaid, TX LIC. 2357269. For federal state pension planning, start from energy and Texas Medical Center healthcare — employer deferred-comp and energy-sector 401(k)s in a no-income-tax state, where the expensive errors are federal IRMAA and Texas Medicaid look-back — not state income tax — rather than a national template.
Industry mix and the planning load
ExxonMobil, Chevron, and other energy deferred-comp units; Texas Medical Center 403b plans at MD Anderson, Methodist, and Memorial Hermann; and offshore or plant-shutdown bonuses set the mix. A turnaround-year bonus plus a conversion is the classic overshoot. Homestead folklore does not cover a brokerage account in Harris County. energy and Texas Medical Center healthcare are the two pay-and-savings stacks we actually see. Population context: about 2.3 million residents (U.S. Census Bureau, ACS 2023 5-year estimates). The constraint we plan around is employer deferred-comp and energy-sector 401(k)s in a no-income-tax state, where the expensive errors are federal IRMAA and Texas Medicaid look-back — not state income tax. Competition among advisors is high; that does not create a storefront and it does not change the statutes.
Survivor forms when the check came from energy
Public and federal careers in energy lock a survivor election at retirement. Employer deferred-comp and energy-sector 401(k)s in a no-income-tax state, where the expensive errors are federal IRMAA and Texas Medicaid look-back — not state income tax Term insurance that expires at 70 is not a substitute. Texas has no state estate tax or inheritance tax. Advisor and product density is high, so the scarce thing is a written recommendation that survives a second set of eyes — not another seminar.
TSP / 457 / system-specific subtractions next to Texas Medical Center healthcare
Texas Medical Center healthcare employees still have to coordinate Social Security, a 457 or TSP, and Texas Medicaid if a care stay is realistic. Texas has no state personal income tax. Copy a peer from another retirement system and you will get the math wrong.
What is different in Houston
ZIP codes 77002, 77084 is in the service area. Federal State Pension Planning work here is usually about employer deferred-comp and energy-sector 401(k)s in a no-income-tax state, where the expensive errors are federal IRMAA and Texas Medicaid look-back — not state income tax — not a generic “retirement tips” article. Plan conversions against the federal bracket and IRMAA cliffs; treat Texas homestead and Medicaid rules as a separate, documented workstream. Advisor density is high, so the scarce thing is a written recommendation that survives a second set of eyes.
How Texas changes the numbers
Texas does not tax conversion income or IRA withdrawals.
The election you cannot undo
At retirement you choose a single-life or a joint-and-survivor form (and a percentage).
MRA + 10, 62, 65, and the supplement
Minimum retirement age plus 10 years of service, age 62, and Medicare at 65 are different cliffs.
Survivor benefit as an afterthought
Electing no survivor benefit because “we have life insurance” only works if the policy is permanent, the premium is guaranteed, and someone will actually keep it in force.
Care, Medicaid, and the long stay
Texas Medicaid long-term-care eligibility uses a five-year look-back.
How we actually work with you
Reduced Risk is a licensed service-area practice (TX LIC. 2357269). We work with Houston households by phone and secure video. There is no Houston branch office — and we will not invent one in schema or on the page.