Federal workers as a group seem to have accepted their 2-year pay freeze the way many of us go along with visits to the dentist or flu shots: Not something we look forward to, but…
But when it comes to tampering with their lifetime retirement benefits, especially for those who have spent what seems like a lifetime in government, reactions range from fear to rage. Many feds view the plan (to base annuities on the highest-5 year average salary instead of the current high-3 system) as a breach of contract. As changing the rules, for many, in the middle or near the end of the game. Dirty pool! Not cricket! Foul!
If the high-3 to high-5 change actually happens (and it is a long, long way from becoming a reality) the annuity you’ve been counting on would be reduced several hundred, to several thousand dollars per year depending on your salary and service time. Either way you would get considerably less than what those figure-your-annuity computer programs currently project.
A potential high-5 retirement computation, compounded by the in-place 2-year pay freeze and proposals to trim future raises for active and retired feds have sent lots of people back to the drawing board. Some say they will retire early if it becomes apparent Congress and the White House are going to change retirement rules. But even more, according to the e-mails we’ve been getting, say the change might force them to work longer, in some cases much longer, than they originally intended.
So what if feds are forced to stay on past their intended time? Worst case scenario is that at some point government offices would start to resemble the House and Senate where the growing number of legislators-for-life make congressional hearings look like the bingo crowd at an upscale nursing home! Not that there’s anything wrong with that. Still…
Today at 10 a.m., on our Your Turn with Mike Causey radio show, we’ll be talking with Steve Watkins, editor of the Federal Times and senior writer Steve Losey. They’ll give us the latest assessment on what some of the proposed changes would mean to you, where they are now in the legislative process, and the likelihood the changes will survive the congressional/political meat-grinder. Losey also promises to drop a breaking-news bombshell on the show. That’s 10 a.m. EDT and you can listen by clicking the Listen Now button on your home page or, on regular radio in the DC area at 1500 AM. You can e-mail questions or comments at: email@example.com or call in during the show at 202.465.3080
Life Insurance Deal? Later in today’s Your Turn show John Montague will explain why younger and healthy feds can pay a lot less for life insurance, and why the federal life insurance program, FEGLI, may be a better buy for older workers with health issues. He’s executive director of WAEPA, a nonprofit life insurance program that regularly offers cash refunds to federal policy-holders. Some feds have FEGLI and use WAEPA or other outside policies to supplement their insurance.
Strategies for managers under CRs Federal managers are taking on the workload and stress of yet another continuing resolution. However, there are some tips that could help keep the workplace moving and prepare managers for a potential long-term budget.