In the movie Marathon Man, the brilliant/crazy but definitely evil Nazi doctor (Laurence Olivier) keeps asking his American prisoner (Dustin Hoffman,) “Is it safe?” Because he isn’t sure what “it” or “safe” is, Hoffman fails to respond properly to the Nazi who, in turns, drills a tooth with each unsatisfactory answer.

Ouch!

I can identify with the prisoner.

Last week a reader took issue with my description of the G-fund as being “safe.” He made the valid point, which we have also made many, many times, that a TSP account invested exclusively in the Treasury securities fund can, in time, be shrunk by inflation. The most recent description of the dangers-of-playing-it-safe was this: click here.

That said, his point (which was also our point) is well taken. The G-fund is safe, but falling in love with it can be risky. When is safe not so safe? And what is your definition of safe?

Here’s what he said:

You refer to the government fund as the “safest” but you do not define safe. Maybe it would be worthwhile to ask one of the financial experts you quote just how “safe” an investment is if over the course of 30 to 50 years it will lose to inflation. Remember the young federal employees may be putting their money in the government fund for 30 years and then leaving it in there for another 30 years for themselves and their spouse. If one fund exceeds inflation of an extended period (say, a minimum of 20 years) and another fund does not, which is safe? Jerry W

Put away the drill, Jerry. Sometimes a thing can be “safe” and “risky” at the same time.

Sick Leave Credit

The Federal Managers Association kicks off its 70th national convention this morning and lots of folks have sick leave on the brain. That’s because Rep. James Moran (D-Va.) will formally unveil his legislative proposal to reimburse workers under the FERS retirement plan for unused sick leave.

Workers under the old CSRS program can apply their unused sick leave toward retirement, boosting the value of their life-time annuities which are fully-indexed to inflation. But most working feds are under the FERS program. While it offers a more generous 401(k) benefit and Social Security coverage, the FERS retirement formula gives them annuities equal to about 55 percent of the CSRS benefit.

CSRS employees also have a more generous cost of living adjustment system.

In many cases, people in each group think the other has a better deal. But the primary complaint of many FERS employees is the lack of any sort of credit for not using sick leave.

Moran’s bill would reward FERS employees, at retirement, for the sick leave they didn’t take. Backers say it could save the taxpayers money by curbing the so-called FERS flu that hit’s so many people in their final year of work.

While the Moran bill is a hit with many FERS employees, it is a long way from crossing home plate. This election-year Congress doesn’t have the time or inclination to do much more than get ready for the November elections. The Moran plan certainly has a shot, but almost certainly not this year.

Nearly Useless Factoid

In MentalFloss‘s list of “The 10 Most Bizarre Athlete Superstitions”, Kevin Rhomberg, Cleveland Indians is named Number One. Why? The site offers two very good reasons, including whenever someone touched him, he had to touch the other person back. Hilarity ensued. This may explain why he played just 41 games in parts of three seasons with the Tribe.

To reach me: mcausey@federalnewsradio.com

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