This is for sworn officers and deputies in California — municipal police, sheriff's departments, and the agencies that run their own safety plans. Your pension will be the largest asset you ever own, and you did not choose its terms; your hire date did. The money problem underneath the badge is a gap: an early retirement date, a benefit built on base pay, and a decade of your own life to fund before anything federal arrives.
What is actually different about your money
Start with a question no page can answer for you: are you a classic member or a new member under PEPRA? The Public Employees' Pension Reform Act took effect on 1 January 2013. Enter California public service on or after that date without reciprocity from earlier service and you are almost certainly a new member — which means a lower age factor, a later normal retirement age, final compensation measured across at least 36 consecutive months rather than twelve, and a statutory ceiling on the pay that counts at all. New safety members fall into one of three PEPRA formulas, the most generous of which tops out at 2.7% at 57. A classic safety member's formula may reach its maximum at 50 or 55. Same badge, same watch, different retirement. Every honest conversation about your money starts by confirming which you are, in writing, from the system itself.
The second fact is the one most officers have never had explained. PEPRA defines pensionable compensation as the normal monthly rate of pay for services rendered on a full-time basis, and it expressly excludes compensation for overtime — with one narrow carve-out for overtime as defined in 29 U.S.C. § 207(k), the federal work-period rule written for law enforcement and fire. How far that carve-out reaches is your system's determination, published in its own pay-code schedule, and systems differ. The blunt practical consequence for most new members is this: the income that pays your mortgage is not the income that funds your pension. Work a thousand hours of overtime a year, budget on the gross, and you are living a life your retirement formula has never heard of.
Then the arithmetic of an early date. Leave at 50 or 55 and the pension has to stretch across more years than almost any other worker's. Social Security cannot begin before 62, Medicare not before 65, and many officers earned little or no Social Security credit during their sworn years anyway. Two other things live inside that window, and both are decided once: a disability retirement, which is a real branch of this career rather than a footnote, and the survivor election made at retirement, which is generally permanent. A 457(b) is usually the only account you control that can bridge any of it — and it is the account most often left at whatever percentage somebody typed in during academy paperwork.
What you are usually sold
Public safety is a well-served market for people selling financial products, and most of them are neither dishonest nor unqualified — a fair number are retired officers themselves. What gets presented at the station, at the association meeting and at the pre-retirement seminar tends to be an insurance contract: permanent life insurance framed as a tax-free retirement supplement, or a fixed indexed annuity offered as a landing place for a DROP account or a separation payout. These are real products with real features. They are also commission products, and the commission is paid by the issuer rather than billed to you, which is why no invoice ever arrives.
The second pattern is the retirement rollover pitch — consolidate everything into one IRA, and it sounds tidy. For an officer retiring before 59½ it can be precisely the wrong move, because a governmental 457(b) loses its most valuable structural feature the moment that balance becomes IRA money. Ask anything put in front of you the same two questions: how are you paid on this, and what would the plain alternative cost me?
None of that is illegal and not all of it is wrong. But you are entitled to know how the person recommending it is paid, and to compare. Our standard · our fees, published · the difference between an RIA and a brokerage.
What we do instead
We begin by confirming what you actually are. Membership category, formula, tier or plan letter, final-compensation period, and the current cap on pensionable pay — obtained from your system, in writing. This is not a formality. A great many officers are quoting the formula of whoever trained them rather than the one printed on their own record, and everything downstream depends on getting it right.
Then we rebuild the household budget on base pay and treat overtime as what it is — variable income whose job is to fund the accounts, not to raise the standard of living. In practice that means setting the 457(b) deferral against the size of the gap rather than against what happens to be left at the end of the month, choosing pre-tax or Roth deliberately instead of by default, and checking whether the plan's special three-year catch-up is available to you before you are inside the window, because it cannot be claimed backwards. If a DROP account or a separation payout is coming, we decide where it lands before it exists.
We do not administer your pension, we cannot change your benefit, and we do not give tax or legal advice. What we do is model the irreversible decisions — retirement date, survivor election, what happens to deferred comp at separation — using your system's own figures, and then put the rest of the household's money behind whatever you decide. Disability questions belong with your system, your association representative and, where anything is contested, an attorney. We handle the money that has to work either way.
The retirement structures that actually apply to you: LACERA safety, LAFPP, OCERS safety, CalPERS safety, 457(b) deferred comp. Which of those fits depends on how you are paid and whether anyone else is on your payroll — the plan chooser walks through it, and this guide compares them honestly.
A first conversation, at no cost
Fifteen minutes on the phone. If your question has a short answer you get it on the call, and if we are not the right firm for you we will say so.
Where police officers and sheriff’s deputies are in Los Angeles and Orange County
We work across both counties from a principal office in Norwalk. These are the county guides, each naming the cities where this audience actually concentrates:
Our fees, published
No competing advisor page in this area publishes its fees. Here are ours.
| What | Fee |
|---|---|
| Investment management | 1.5% to 2.0% of assets per year; Advisers may set a rate below the standard schedule, as low as 0%, at their discretion — and whatever rate applies to you is disclosed in writing before you engage. Our Form ADV Part 2A, Item 5, states the fee as up to 2.00% of assets per year, subject to negotiation; the firm may waive all or part of it. Generally billed quarterly in arrears |
| Account minimum | No minimum account balance |
| Commissions and product fees | None — we are fee-only |
| Solicitor compensation | May be received or paid under disclosed arrangements |
| Initial conversation | Free, 15 minutes, no obligation |
Complete fee details in our Form ADV Part 2A, Item 5.
Questions
How do I tell whether I am classic or PEPRA?
Your system knows, and will put it in writing. Ask for your membership category and your formula — LAFPP, LACERA, OCERS and CalPERS all provide it. The date that matters is 1 January 2013, but the rule is not simply your hire date: reciprocity from earlier California public service can carry classic status through a move, and taking a refund of your contributions on the way out of a previous system can destroy it. If you have ever worked for another California public employer, raise that before you assume anything. LAFPP · LACERA · OCERS · CalPERS.
I worked 900 hours of overtime last year. Does any of it raise my pension?
For a new member under PEPRA, almost certainly not. The statute excludes compensation for overtime from pensionable compensation, other than overtime as defined in 29 U.S.C. § 207(k) — the federal work-period rule for law enforcement and fire — and each retirement system publishes which of your pay codes it treats as pensionable. Get that schedule from your system and read your own earnings statement against it. Classic members generally sit under older rules, which is one more reason to confirm your category first. Either way, overtime is the best funding source you have for the accounts you do control.
I plan to go at 52. Where does the money come from until Social Security?
Three places, in this order: the pension, the deferred-comp account, and anything you have built outside both. Deferred comp matters most here — a governmental 457(b) is not subject to the 10% federal early-distribution penalty once you have separated from the employer, at any age, so it is structurally designed for exactly your situation. Federal law also carries a public-safety exception that can allow penalty-free distributions from a governmental plan on separation at 50 or later, and SECURE 2.0 added an alternative test of 25 years of service under the plan. It does not extend to IRAs. Health coverage between separation and Medicare at 65 is its own line item and belongs in the plan before you file. The 457(b) guide.
Should I roll my deferred comp into an IRA when I retire?
Not reflexively. It is the single most common piece of private-sector advice given to retiring public employees, and for an officer under 59½ it can cost real money: the penalty-free access that makes a governmental 457(b) valuable does not survive the trip into an IRA. There are situations where consolidating is right — cost, menu, simplicity for a survivor. Sequence it deliberately, and get the answer before separation rather than during it.
What happens to all of this if I am hurt and cannot come back?
A disability retirement is a different calculation with different rules, and it is your system's to run — service-connected and non-service-connected provisions are not the same thing, and the terms have changed over the years. Start with your system and your association representative; if anything is contested, that is a matter for an attorney, not for us. What we can do is answer the financial half: what the household would actually need, which accounts could carry it, and what a reduced or differently-shaped income does to everything else already in motion.
What does this cost, and is there a minimum?
There is no minimum to open an account. We ask for $50 a month of continuing deposits, because a plan you do not fund is not a plan. Investment management is 1.5% to 2.0% of assets per year, billed quarterly, and it is published on the site — which is more than most firms in this market will tell you before a meeting.
Do I have to have a lot saved already?
No, and that is deliberate. Most firms set a minimum precisely to avoid people at the start of this. We built the opposite: $0 to open, and the same fiduciary standard whether the account is four figures or seven.
¿Atienden en español?
Sí. Atendemos en español, y buena parte de nuestro material existe en español, escrito originalmente, no traducido por máquina.