A New Year, a new Congress: what does this mean to you?
If we use the past to inform our answer to that question, we’ll see another year of debate about your pay and benefits in Washington and whether they should yet again be put on the chopping block.
Analysts are predicting that Republican control of both chambers of Congress will more than likely mean an assortment of proposals aiming to reduce federal spending.
And if we turn to the past to cast a light on the future that will likely entail another round of proposals targeting your pay and benefits.
On the positive side of the ledger, you will see another raise this year — albeit a modest one percent — after enduring three years of wage freezes. Also, retirees will get a 1.7 percent cost-of-living adjustment. And federal workers using their vehicles at work will see an increase in their mileage reimbursement.
That’s some good news. But it’s not all wine and roses on Capitol Hill. (Has it ever been?)
In his farewell to public service speech, outgoing United States Postmaster General Patrick Donahoe said it may be prudent to abandon pensions and entirely replace it with a defined contribution plan, like the Thrift Savings Plan.
“I don’t think anyone would argue that the federal government isn’t massively overpaying for employee and retiree health care benefits,” he said, as reported by Government Executive.
That line of thinking is similar to many arguments we’ve heard coming from Capitol Hill, which also include hiking your pension contribution yet again.
Bill Dougan, president of the National Federation of Federal Employees, told Government Executive that you may even hear talk of eliminating “entire agencies or departments in the government” now that austerity is the talk of the town in Washington rather than big spending.
While lawmakers may not have the gumption to go that far, this year the Republican-controlled Congress has proposed bills that would enact across-the-board cuts to agency spending, up to 5 percent. The only exempted agencies are: Defense, Homeland Security, and Veterans Affairs.
Rep. Darrell Issa, R-Calif., also introduced a bill that would repeal the Affordable Care Act in favor of allowing all Americans to access the Federal Employees Health Benefits Program. No doubt that would cause some painful adjustments to your FEHB health benefits.
Where do you stand in this whirlwind? It’s hard to say. But it requires keeping a keen eye on the constant drama of Washington politics. We can help you sort through some of this mess by starting to plan for your retirement today. And we can help you get a better sense of your pay and benefits, what they mean today, and what they mean come retirement, so that you can rise above the noise and intelligently plot the course of your financial affairs after you leave public service.
Contact one of our benefits specialists today for a free consultation.
Know Your Options!
Claim Your Free Federal Benefits Workbook Today
Was this article helpful?
Thanks for your feedback!
Sorry about that
How can we improve it?