Feds Customize 2012 Survival Kits

Monday - 1/10/2011, 4:00am EST

A new and very different Congress, a halting economic recovery and an apparently growing anti-bureaucrat mood in the country have given professional tea-leaf readers (especially those who specialize in nightmare forecasts) a new lease on life.

The usual suspects - changes in the retirement formula, higher pension costs, furloughs and shutdowns - are rounded up each January only to fade away by mid-year. But this time veteran Washington-watchers say it could be different.

Starting with the bipartisan 2-year federal pay raise, politicians of both parties are looking at the plight of states (like New York and California) and un-funded or under-funded retirement liabilities.

There is serious talk about deliberalizing federal retirement benefits, increasing employee contributions, downsizing and buyouts. The Pentagon wants a first-in-a-long-time increase in Tricare premiums for military personnel to encourage them to buy outside insurance.

Judging from e-mails we get, lots of feds recognize that there are problems and that they'd like to help. But they don't appreciate being considered "the" problem." On a personal level, some say they will take early retirement to escape changes in retirement rules. Others say the same changes, including an extended pay freeze, mean they will hang on and die at their desks.

So what are your colleagues' reactions to the - maybe - changes under consideration? If you believe in the wisdom-of-the-crowd theory, check these out:

  • "Read your January 7th column. I must say it sure does make me think. I can go in 2014. I don't think the IRS can afford to reduce staff because I still believe we are understaffed. If the government is serious about cutting staff, I'm sure I'd be considered a prime candidate for a buyout. I know I will not go for just 25,000 buyout, they'd have to sweeten the deal somehow. More cash to go and possibly retire with full benefits with no penalty for going early. If that were offered I might consider it. My biggest concern would be if they change the retirement calculation from a high 3 to a high 5. That would hurt and I would hope that they would grandfather that in, because that hurts all that can retire with less than 5 years to go because at least for me the next 2 years my salary is frozen. I am due for an in grade raise this year but won't be eligible for another in grade for 3 years after that. I also am trying to accumulate my sick leave. I have about 830 hrs and need to get to 1040 in the next couple of years to tack on another 1/2 year on my pension. So if things really get bad I would have a lot to consider.

    With kids leaving the nest I've been increased my contribution from 5 to 10% 2 years ago and now will be increasing that to 15% or to the $16,500 max this year. So it would be beneficial to finish out the next 3 years and let that grow! I am not trying to live an extravagant lifestyle, I just want to be able to live comfortably enjoy my retirement not be a burden to the government or my children as I age. If after my wife and I are gone and there is something left the kids can have it. I must say I've been a loyal reader for the last layers and will continue to do so especially in this unpredictable time. AJK

  • "I reach my 'liberation age-55' this month and with 37 years of service am nicely placed for retirement. That said, I think I'd like to stick around for another four years primarily to keep adding to my TSP and to reach the magical 42-year max (with sick leave). The economy has a lot to do with that decision. I'm not ready to give up my salary (and TSP savings) quite yet. What might change my plan? A buyout @ $100K (buyouts have to be increased - the current $25K would not phase me!!). A switch to high 5 (though it's not that much of a showstopper if I stay four more years). It is disheartening to be the blunt of so much criticism these days. The vast majority of feds serve loyally and faithfully, and many truly sacrifice family and lifestyle to serve our country. Those members of Congress and the public who think feds are not worth the money we are paid should sit at our desks for just one day! Given our 'op tempo,' they'd likely run screaming and say they need more money to come back! (please sign me a long time DoD fed)"