CSRS vs FERS: The uncivil war

The intense rivalry between the Manchester United and Leeds United football (soccer) clubs is believe to have it origins in England’s War of the Roses. That was the 15th century but some grudges are long-lasting.

Closer to home the clash between Washington Redskins v. the Dallas Cowboys fans, in the other kind of football, run deep in both cities.

Since the 1980s some federal offices and postal stations have been divided by a form of pension envy. Older employees and retirees under the Civil Service Retirement System resent it when their more generous monthly annuities are compared to those of people under the Federal Employees Retirement System. FERS replaced CSRS, so although most feds who are actually retired are under the old CSRS program, only about 4% of those still working are in it. The rest are under the newer FERS program.

FERS workers contribute a smaller percentage of salary toward their civil service annuity. But they pay into Social Security and the government gives them — but not CSRS workers — a matching contribution of up to 5% to their Thrift Savings Plan, the federal 401k.

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People on the federal beat are aware that mentioning both at the same time can rekindle the rivalry. Regardless of the plan they are under, some feds feel what they contribute, get and deserve is falsely presented as the better deal. Earlier this week we reported on some possible upcoming plan to end the CSRS program.

That prompted this note from a reader — who asked to remain anonymous — who, like many other feds, thinks that many reports about their retirement program paint an overly generous picture which plays into the stereotype that feds have it made — that there is often too much emphasis on how “good” federal retirement benefits are without offsetting explanations about how much, compared to private pension plans, feds contribute to their own retirement. The original column was about a rumor to eliminate one of the plans with time credits. Her points are well-taken:

“In today’s column, as is often the case, you make comparisons of CSRS and FERS, without including much comparison data. You note that CSRS employees ‘contribute a small portion of their income.’ Seven percent is not a particularly ‘small portion’ to most people, and for a year or two wasn’t it 7.5%? There is no mention of the minuscule portion (0.8%) or small (2%-4%) portion paid by FERS employees, depending on date of employment. As the spouse of a CSRS annuitant, I am less familiar with the FERS system.

“And there is no comparison of the ‘more generous’ TSP plan for FERS versus CSRS — up to 5% government contribution for FERS vs 0% government contribution for CSRS!

“The issue of Social Security coverage is even more complicated, with FERS employees contributing 6.2% only up to the social security maximum wage, while CSRS employees do not contribute to social security on their government wages, but have always contributed the higher 7% on their full salary,  and any social security benefits earned by CSRS employees on wages outside of their government employment are reduced by the ‘Windfall’ Elimination Provision and the Government Pension Offset.

“These columns may encourage resentment of CSRS employees and annuitants, particularly when you end with ‘many CSRS workers … can retire … on more than double the benefit available under FERS.’ The ‘benefit’ is more than just the annuity.

“I don’t wish to get into an argument with anyone feeling particularly aggrieved under the FERS system, though I agree that for many employees, particularly those with very long service, the CSRS system is preferable …”

Nearly Useless Factoid

By Amelia Brust

For those who don’t find traditional pogo sticks enough of a challenge, extreme pogo, or Xpogo, is a sport wherein athletes ride and perform tricks — some as high as 10 feet off the ground. Since 2004, Pogopalooza: The Xpogo World Championship Series, has brought together the world’s best Xpogo athletes for competitions, exhibitions and setting records. The Pogopalooza 2019 was held in July at Wilkinsburg, Pennsylvania.

Source: Wikipedia

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