Perfect storm: Your buyout lifeboat

That wave you see out there just could be the long-anticipated retirement tsunami, and if coupled with expanded buyout offers it could create the perfect storm,...

The number of federal agencies offering buyouts could easily double over the next few months. And those already offering buyouts on a limited basis could expand them to cover many more employees. That could jumpstart the already surging number of people putting in their retirement papers.

Most agencies are facing cuts, and Congress could easily pass an election-year winner that would require federal operations to make a 5 to 10 percent across-the-board cut. Defense operations, the tail that wags the government dog, are (pending some new blowup) in for major reductions. The plan is to eliminate—via retirement—lots of admirals and generals and perhaps revamp military pay, retirement and medical benefits.

Things may be lining up (budget cuts, buyouts and end-of-their-rope feds) to create the perfect retirement storm in 2012. And if you are hit by it, you want to be sure you have a place in the lifeboat.

For individual feds who might be offered a buyout, there are a couple of things to consider. Like the ability to purchase food and pay the rent. When most people retire they are given an interim annuity payment of anywhere from 40 to 80 percent of their expected full annuity. David Snell, Stephen Losey and Sean Reilly — along with NARFE’s David Snell — were guests Wednesday on our Your Turn radio show. They said it is very likely that Congress will go after the federal retirement system this year, and the White House might support extending the federal pay freeze another year. To listen to the entire show and an update on pay, pensions, health benefits and COLAs, click here.

Meantime if you are eligible for regular or early retirement, consider what you would, could and should do if a buyout offer comes along. You might have to make a quick decision. And bring cash. Lots of cash.


NEARLY USELESS FACTOID

By Jack Moore

Why do dogs swivel around a few times before plopping down? mental_floss points to dogs’ primordial pasts: “Walking around in a tight circle a few times would mat down tall grass to sleep on and also disturb and kick up any bugs or snakes that might be lying in the dog’s chosen spot.”


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