Downsizing your pay/pension for life

The FY 2021 budget plan is similar to previous proposals in that offers civilian federal workers a smaller January 2021 pay raise of 1%, than the 3% proposed for the uniformed military.

It would also change the way retirement benefits are calculated basing them on the employees’ highest five-year average salary instead of the current high-three formula. The National Active and Retired Federal Employees estimated this would cost future retirees $8 billion over the next decade.

The plan puts the FERS supplement benefit on the chopping block again. It is a payment that FERS employees get if they retire before they are eligible to collect Social Security. That gap payment, often worth tens of thousands of dollars, would be a gut punch to air traffic controllers, law enforcement officers, firefighters and others who are forced to retire up to five years before they are eligible for Social Security. NARFE puts the financial loss to them at almost $20 billion over 10 years.

To learn more about its prospects in Congress tune into our Your Turn radio show at 10 a.m. EST today. My guests are Kenneth J. Thomas, president of NARFE and Jessica Klement, vice president for advocacy.