Contact your Senator and Congressman - Federal employee pay and benefits

[FundSurfer]

If you have not contacted your Senator or Congressman about the plan to reduce the federal deficit that hits federal employees pretty hard, then there is not time like the present.

Senator's contact information at:
http://www.senate.gov/general/contact_information/senators_cfm.cfm


(http://www.senate.gov/general/contact_information/senators_cfm.cfm)House of Representatives contact information at:
http://www.house.gov/representatives/


(http://www.house.gov/representatives/)Find your district if necessary:
https://writerep.house.gov/writerep/welcome.shtml


(https://writerep.house.gov/writerep/welcome.shtml)Tell them what you think of having a two year pay freeze and then a 5% after tax increase in what you pay for your pension. (5% after tax pay cut is what it amounts to)

Tell them what you think of changing the way that pension amounts or COLAs are calculated. They are planning to change the pension basis calculation from high-3 to high-5 annual salary. They also looking to change how COLAs are calculated which effectively reduces your benefit.

There are other things that you should have heard that they are considering which you can tell them about.

It takes just a few minutes to fill out the online form. Go do it now. Don't wait.

I know many in this group will have already done this. Educate your fellow federal employee.

[burrocrat]

If you have not contacted your Senator or Congressman about the plan to reduce the federal deficit that hits federal employees pretty hard, then there is not time like the present.

Senator's contact information at:
http://www.senate.gov/general/contact_information/senators_cfm.cfm


(http://www.senate.gov/general/contact_information/senators_cfm.cfm)House of Representatives contact information at:
http://www.house.gov/representatives/


(http://www.house.gov/representatives/)Find your district if necessary:
https://writerep.house.gov/writerep/welcome.shtml


(https://writerep.house.gov/writerep/welcome.shtml)Tell them what you think of having a two year pay freeze and then a 5% after tax increase in what you pay for your pension. (5% after tax pay cut is what it amounts to)

Tell them what you think of changing the way that pension amounts or COLAs are calculated. They are planning to change the pension basis calculation from high-3 to high-5 annual salary. They also looking to change how COLAs are calculated which effectively reduces your benefit.

There are other things that you should have heard that they are considering which you can tell them about.

It takes just a few minutes to fill out the online form. Go do it now. Don't wait.

I know many in this group will have already done this. Educate your fellow federal employee.

No offense, to each their own. I have been contacting my representatives, to give them support and encouragement for the difficult task that lies ahead. I'd rather see a decent row boat float than ride the titanic to the bottom (the above links will work for that too). You may want to consider rebooking your accomodations, those rooms are no longer available, although the band is pretty good, I hear.

If we don't take a little haircut now we may all end up bald. Anyone watching the international markets? Or the bond markets? Or gawd forbid the international bond markets?

It's like a 20 cent shift, pair o dimes, changing. Get right, or git left.

Jus' trying to educate my fellow fed employee.

[James48843]

It's no haircut, Burro. With all due respect, it's an intentional decapitation. The right wants to destroy the middle class in this country, including anyone who is a government employee.

[KevinD]

I think it's the BANKS that own the government that wants to destroy the middle class in this country, including anyone who is a government employee.

[clester]

I think the TEA party has brainwashed America into thinking the government is their enemy. That means everyone here. Don't be fooled. They are out to get you. Of course we have a budget problem. The solution is where the issue lies. The folks that got us here should pay. Not us. That means wall street and big banks.

[burrocrat]

I think the TEA party has brainwashed America into thinking the government is their enemy. That means everyone here. Don't be fooled. They are out to get you. Of course we have a budget problem. The solution is where the issue lies. The folks that got us here should pay. Not us. That means wall street and big banks.

Oh my, I just think I figured out why people take politics so personally ... when you denigrate a politician, you are actually insulting their stupid constituents.

I agree, the folks that got us here should pay. But folks should also drive 55, and not beat the wife and kids or steal from their brothers. What should happen and what does happen rarely are the same thing down here. It's ok, there will be a reckoning, and everybody will get what they got coming in the end.

But sitting around wishing for what should happen tomorrow doesn't put porridge in the pot today. With the exception of James48843, we seem to agree where the problem lies, but that's where they got us, over a barrel so to speak, and fighting with each other for a few scraps.

Bon' apatite, you can borrow my can opener when it comes to that, I prefer the fresh food anyway.

[nnuut]

We must not forgot that the Gov't forced the banks into the lending practices that crashed the economy. Fannie, Freddie Dodd and Franks along with ACORN demonstrating in front of the Banks and harassing the Bank Administrators if they wouldn't make loans to unqualified people that could NOT afford to buy a home. The banks Had to comply or be put out of business, just another example of sharing the wealth gone wild. They knew where it was going and couldn't stop it. I could go on and on, Bill Clinton and George Bush all pushed this thing for Political reasons. NOT THE TEA PARTY! STOP THE SPENDING!:nuts:

[FundSurfer]

Don't get me wrong, I am in favor of addressing the deficit. I think that everyone deserves to do their fair share. That being said, if you look at what is going on, federal employees have been demonized. There are a bunch of potential changes on the table which if implemented together will have a huge impact on federal emplyees. To me, that is not fairness. That is attempting to balance the budget on the backs of federal employees.

If you were to ask me, the federal pay system needs a major overhaul. Right now there are some job series that are overpaid and some that are underpaid. Congress does not have the stomach to fight the unions on pay system overhaul so instead they are doing across the board actions that affect all federal employees.

Although it does not affect me, I think it is a bad move to remove the federal pension from the benefits of new feds. This will eliminate the incentive for long term federal service. I probably would have left long ago for greener pastures; however, I stayed for the job security, benefits, and pension. The pension is golden handcuffs. You have to stay with the federal government for an extended period to get the pension. If you reduce the benefits, remove the pension, and reduce job security, how will that affect the ranks of federal employees. From my view point, those best and brightest federal employees will spen a few years employed as feds and then move on to more lucrative positions. Who stays? The truely dedicated and those that can't move on to greener pastures. That is a dumb move in my opinion.

There is more than one way to sink a boat....

[FundSurfer]

We must not forgot that the Gov't forced the banks into the lending practices that crashed the economy. Fannie, Freddie Dodd and Franks along with ACORN demonstrating in front of the Banks and harassing the Bank Administrators if they wouldn't make loans to unqualified people that could NOT afford to buy a home. The banks Had to comply or be put out of business, just another example of sharing the wealth gone wild. They knew where it was going and couldn't stop it. I could go on and on, Bill Clinton and George Bush all pushed this thing for Political reasons....

What the heck? What on earth have you been smoking? I've definitely got opinions on this too, but this forum ain't the place.

[burrocrat]

It's no haircut, Burro. With all due respect, it's an intentional decapitation. The right wants to destroy the middle class in this country, including anyone who is a government employee.

You are so adamant about chasing that political boogeyman, but you're good at it so carry on, gotta have a hobby, besides it makes for great entertainment, and it's free (that's about to become a big issue here right quick).

When you are sitting on the curb head in hands mumbling to yourself about what you used to have don't worry, I won't shun you or laugh at your predicament. Nor will I say I told you so (although I'm human so I'll probably be thinking it pretty loud), I'll just share my bread brother, so we can both stand on our feet.

[nnuut]

Yes as always they are using Federal Employees as a scapegoat because they can, they have done it before and will do it again. We all know that someone has to be doing the real work that many of us do, and are expected to do it perfectly, while our government continues to push us in the wrong direction. I'm talking about the workers not the bureaucrats that sit on their bunns all day and get over paid for it, many of them deserve what they are getting but not the rank and file. I could have made a lot more money working in private industry, but stuck it out for the Benefits, which at the time were a notch lower than the big companies on the outside were giving. At least we won the Cold War and we were part of that.:cool:

[alevin]

FERS was designed to be portable out of gov service-aka your TSP and SS. they designed purposefully with expectation people would want to move in-and out, and not make a life-career out of gov service. somehow they thought that portability would be an incentive to younger people to join up. maybe, maybe not. some jobs are less portable than others, some types of responsibilities bring out the dedication to longterm, others don't.

[James48843]

My problem Burro isn't the "haircut". I would be happy to make a SHARED SACRIFICE contribution to the issue.

So far, I've already made some of that shared sacrifice. I've given up two years of pay increases so far- that's about 5% of my pay. And they are asking for 5% more for retirement. Ok- fine. Are they happy yet? No? How about sick leave sacrifice. Only carry over half of what you earn. Is that enough? My retirement age is already boosted from 65 to 67 for social security purposes. Is that enough yet? Now Ryan wants to boost that to age 70. And medicare too. Is that enough yet?

But lord help us if those who make six figures or more have to make an itty bitty increase from 35% to 39%. Oh no- you can't do that!

[jkenjohnson]

I did it and I hope everyone else does. I am tired of being constantly bashed because I am a federal employee. Congress and the Senate are nothing but a bunch of self serving hipocritical jerks.

[alevin]

problem isn't so much the private sector people that are taxed at some level or nother, problem is all the people who aren't employed enough to pay taxes. way too many not employed or underemployed. business $ going either to overpay execs or being held overseas to avoid taxes here, or going to pay taxes instead of investing here now. none of that helps create private-sector taxpayer jobs here.

[burrocrat]

But lord help us if those who make six figures or more have to make an itty bitty increase from 35% to 39%. Oh no- you can't do that!

That sounds like what many advanced pay scale feds are saying right now... me, me, me, "I followed the potatoe plan so how dare you take my gravy".

I think the solution is more of a we, we, we deal. And if that don't work there's always "wheeee, wheeee, wheeeeeeeee".

Hell, let it burn it's a messed up and unsustainable obligation anyway, buckle up buttercup, wheeeeee are in for a ride.

[burrocrat]

problem is all the people who aren't employed enough to pay taxes.

oohhh, yum, more birch spam ;).

[FAB1]

Get rid of the SES overpaid bunch of incompetants. Note the cuts are directed at the general schedule. Those in high places are insulating themseleves. I would do any of their jobs for half the pay. Get rid of SES and save billion$.

[Mapper]

I'll say it again...How is this pay cut different from increasing taxes?

I'm just glad the people are being protected. When Grover Norquist posits that letting Bush era tax cuts expire is not really a tax increase but closing corporate loopholes is, you know he's watching out for the hardworking American people. ;)

[tsptalk]

A sensitive subject that never seems to end well. I will appreciate if we can keep it civil.

[nasa1974]

Folks these are good links to contact your congressman or senator. Let's take all the political talk over to the beltway before it gets ugly.





If you have not contacted your Senator or Congressman about the plan to reduce the federal deficit that hits federal employees pretty hard, then there is not time like the present.

Senator's contact information at:
http://www.senate.gov/general/contact_information/senators_cfm.cfm


(http://www.senate.gov/general/contact_information/senators_cfm.cfm)House of Representatives contact information at:
http://www.house.gov/representatives/


(http://www.house.gov/representatives/)Find your district if necessary:
https://writerep.house.gov/writerep/welcome.shtml


(https://writerep.house.gov/writerep/welcome.shtml)Tell them what you think of having a two year pay freeze and then a 5% after tax increase in what you pay for your pension. (5% after tax pay cut is what it amounts to)

[WorkFE]

98 here in KY, suppose to feel like 111. Dang that's hot

[alevin]

burro used a smilie, burro used a smilie! :laugh: Actually my point was that private-sector jobs aren't being created for many different reasons, and that the taxpayer burden is falling ever more heavily percentagewise on private sector middle and lower class who already do pay taxes. My neighbors-young married working couple-both work-lowpaid jobs, one-year old child, car borrowed from parents for reliable transportation to work and etc. responsible people, decent neighbors-still have to go to the foodbank once a month. underemployment-unlikely to be paying taxes.

whatever level of gov we have, needs to be supported broadbase-ie more private sector investment, employment needed, period. current debt and deficit draws from too-narrow base, takes from the $ available for job-creating private-sector investment, employment. The level of gov we can afford/willing to pay from that base is a whole nother questiion. I'm not going there at all.

[Aviator_Guy]

If you have not contacted your Senator or Congressman about the plan to reduce the federal deficit that hits federal employees pretty hard, then there is not time like the present.

Senator's contact information at:
http://www.senate.gov/general/contact_information/senators_cfm.cfm


(http://www.senate.gov/general/contact_information/senators_cfm.cfm)House of Representatives contact information at:
http://www.house.gov/representatives/


(http://www.house.gov/representatives/)Find your district if necessary:
https://writerep.house.gov/writerep/welcome.shtml


(https://writerep.house.gov/writerep/welcome.shtml)Tell them what you think of having a two year pay freeze and then a 5% after tax increase in what you pay for your pension. (5% after tax pay cut is what it amounts to)

Tell them what you think of changing the way that pension amounts or COLAs are calculated. They are planning to change the pension basis calculation from high-3 to high-5 annual salary. They also looking to change how COLAs are calculated which effectively reduces your benefit.

There are other things that you should have heard that they are considering which you can tell them about.

It takes just a few minutes to fill out the online form. Go do it now. Don't wait.

I know many in this group will have already done this. Educate your fellow federal employee.

Thanks for the excellent post and hotlink!!!

I recall the first time I sent a hand written letter to DC land was while stationed on the USS Enterprise (Carrier not the Spaceship… LOL)… As I recall, it was late 1979 or early 1980 when they told us our married Navy NCO’s were now eligible for food stamps due to our low pay!!! I was single at the time, but It really made me want to do something, so I drafted and sent a letter to my Senator, Congressman and also the President (Jimmy)…

I got a song and dance from my Illinois Senator / Congressman and I didn’t get one back from James, but I did get one from the Assistant Sec of Defense… LOL… Same song and dance, so I decided to find out how to register to vote via absentee…. I signed up all the guys in my F-14 Radar Shop… Then I moved to the rest of the AIMD Department… Word got out how easy it was to sign up and it spread to the other Departments on the ship… LOL… If you don’t vote, you can’t really complain, so I decided to get involved. Not really thinking about how fast something can take off… 1 voter becomes 2, 2-4 4-8, 8-16, 16 voters sign up 32 etc etc…

I see the same thing with Politics today. Last year I decided to check out this Tea Party thing here in Los Angeles… The TV media reported it was only a few hundred… I estimated it to be well over 2,000 and that’s a very conservative number… And the media was reporting they are basically nutty people who think that deficit government spending is the problem, not the solution… LOL

Just don’t ever doubt for a minute that your vote and ideas don’t count. Trust me they do!!! The last election was just a drop in the bucket… :)

[burrocrat]

I sent a hand written letter to DC land was while stationed on the USS Enterprise (Carrier not the Spaceship…

If you don’t vote, you can’t really complain, so I decided to get involved. Not really thinking about how fast something can take off… 1 voter becomes 2, 2-4 4-8, 8-16, 16 voters sign up 32 etc etc…

Duh, if it was the spaceship enterprise you could have just used your communicator. What ever happened to those old flip phones anyway?


http://www.youtube.com/watch?v=mcskckuosxQ

Is that Tommy Lee in the background?

[Boghie]

Folks...

Here is my deal toward balancing the Federal Gubmint budget:

TAKE everything you have in my pension lock box.
TAKE IT ALL. GIVE ME NOTHING NOW AND IN THE FUTURE.

Just DO NOT make me pay more into it.

Now, that's fair!!!

:)

[burrocrat]

Folks...

Here is my deal toward balancing the Federal Gubmint budget:

TAKE everything you have in my pension lock box.
TAKE IT ALL. GIVE ME NOTHING NOW AND IN THE FUTURE.

Just DO NOT make me pay more into it.

Now, that's fair!!!

:)

why so glum chum? don't worry, they're going to re-fund all the obligations just as soon as we can borrow more money.


http://www.youtube.com/watch?v=-_ZwvKoDTzo


We don't have to worry about the national debt, we can now borrow and spend all we want, and we don't have to pay for it, as long as we all die first.

[Boghie]

why so glum chum? don't worry, they're going to re-fund all the obligations just as soon as we can borrow more money.

Burrocrat,

I'm not being glum at all!!!

I'll gladly give up my 'Alpo Meal Deal Unfunded Pension backed with the Full Faith and Credit of Current Politicians' to attain more cash flow. The Federal Gubmint can have everything in my pension lock box. Everything. Leave me nothing. But DO NOT force me to pay ANYTHING into it.

Then, I'll pour those additional assets into my TSP (or Roth IRA) lock box. I'll gladly and voluntarily give up my pension benefit for cash flow. Right now!!! These idiots have been 'investing' the pension portion of our retirement into the 'G Fund'. In my case, we are talking about twenty years of 'investing' in the 'G Fund'. Yuk. Double Yuk. Imagine what I could have had in my TSP account had those bozos either provided that benefit to me (in increased salary) or invested it in the appropriate 'L Fund' rather than the 'G Fund'. And, now, because they blew their cash flow over that past three years they lock it up and talk about jiggering the formulas.

I have NO faith and NO confidence in the politicians that 'invest' the assets in our pension while controlling the formulas for benefits.

Never had, never will.

GenX.

[clester]

You have more faith in wall street than me. Their game is rigged. You can try to outsmart them but they are worse than the politicians.And do you realize how much you need in tsp to get a decent income for life? Which may run out.

[Boghie]

You have more faith in wall street than me. Their game is rigged. You can try to outsmart them but they are worse than the politicians.And do you realize how much you need in tsp to get a decent income for life? Which may run out.

Clester,

It is important to note that I am a GenXer. I believe you are covered under the CSRS retirement plan. I am under the FERS plan.

I just checked EBIS and my expected pre-tax FERS pension is $2,500/month. That is $30,000/year. To me, in Kalefornea, that is not a decent income. It would cover my mortgage - if I still have one - and food. Not much else. By the way, if you calculate the numbers there is NO way there are enough assets in the pension retirement fund 'lock box' to make the above promise via a working lifetime of 5% of salary contributions and a 4.25% annualized return. Smoke and mirrors - and, just another line item in Federal expenditures.

However, I have been investing in TSP for the last 15 years and will continue to do so (or in a corporate 401(k)) for the next 15 years. With a modest return (8%) and a modest contribution and the match I can expect a pre-tax TSP annual income of $64,000/year. That is ~$5,300/month. I can live on that.

Now, if instead of promising the pension, the gubmint gives me the 5% 'contribution' as a plus up in match to TSP I will end up with about $72,000/year ($6,000/month) in income. If they provide 2.5% more in the match I will be at $68,000/year ($5,650/month).

I am more than willing to give up my pension and all the assets currently in it for this deal. And I know I lose. Oh well.

But, I also know that kleptocratic politicians have NO control over my benefits.

I trust wall street far more than these goobers.

None, zip, nada.

[Boghie]

Clester,

I've reread my above post and it probably sounds way too harsh for my intended comment. It still has value for those of us on FERS, and I do not believe in striking out or deleting posts on the web so I will keep it in place.

My basic point is that we are comparing apples to oranges when we compare those under the CSRS plan with those under the FERS plan. CSRS is a very good - and very fair - plan for those on it. I believe that the Federal Government contributed far more than 5% of gross toward the plan out of each paycheck. It was, in fact, part of your salary. James could come up with the contribution ratio for CSRS employees. If politicians try to clawback benefits for those who signed a dotted line accepting less pay for greater benefits than expect me (and James!!!) to be in the picket line.

However, I am on FERS. Also, because if massive ignorance, I invested in FERS TSP as if there were NO other elements in the retirement plan. I also got a big tax kick in the head when Clinton jacked my taxes skyward literally the same pay period I jumped two pay grades - an experience that led to understanding the tax benefits, the investment benefits, and the retirement benefits of a 401(k) (TSP). I have been running between 10% and 15% contributions since then (not including the match). Investment life has been nice. Yes, Amoeba, life has been quite nice living in the land of the big plutocratic investment bankers.

Anyway, a TSP investor can easily beat the returns and risk of a FERS pensioner.

If my benefits remain, I should be getting about $1,000/month more than I am earning during my retirement.

However, I will give the guaranteed $30,000/year pension up if I get an additional 5% TSP match (for a total of 10%).

I will probably accept a lower match than that for the opportunity of investing the assets myself and avoiding the political clawback.


By the way Clester, if I am not mistaken, the market has been very good for you too.:)

I hate the risk of counting on politicians.

[nnuut]

National Active and Retired Federal EmployeesFlorida Federation of ChaptersFederal Retirement Benefits – CSRS and FERS

Civil Service Retirement System (CSRS) Highlights

The older of the two systems, CSRS, started in 1920 and the basic annuity is a “defined benefit program”; it provides an annuity that does not depend on other government benefit programs. Members of the Civil Service Retirement System have 7.00% of their pay deducted each pay period and placed in the CSRS Retirement Trust Fund as one contribution to their eventual CSRS basic annuity. The US Government matches this deduction with another 7.00% contribution into the CSRS Retirement Trust Fund. For the past two decades, CSRS employees have had the option to participate in the Thrift Savings Plan (TSP) and/or the Voluntary Contribution Program – ways to increase their retirement incomes.

Because the CSRS was phased out as of December 31, 1983, there are fewer personnel in the federal work force who are CSRS employees. Most members of the CSRS are eligible to retire at age 62 with 5 or more years service, at age 60 with 20 or more years service, or at age 55 with 30 or more years service. (Law Enforcement Officers, Firefighters and Air Traffic Controllers under CSRS are able to retire at age 50 with 20 or more years of service.) Of course, there are other types of CSRS retirements: “disability” or “involuntary” or “reduction-in-force”. Also, there are CSRS Survivor Benefits available if a CSRS member dies before retirement and retirees may elect to have funds deducted from their annuities to provide family members CSRS Retirement Survivor Annuity options.
http://www.narfefl.net/About/fed_retire.htm

[nnuut]

National Active and Retired Federal Employees
Florida Federation of Chapters
Federal Retirement Benefits – CSRS and FERS

Federal Employee Retirement System (FERS) Highlights

The newer of the two systems, FERS, started January 1, 1984 and, after a three year interim period, became operational January 1, 1987. FERS employees rely upon three benefits – Basic Annuity, Thrift Savings Plan and Social Security – for their retirement packages. Members of the Federal Employee Retirement System contribute 7.00% of their pay each pay period; 6.20% goes to Social Security and 0.80% goes to FERS. Also, FERS members may deposit up to 15% of their basic pay (limited by an IRS ceiling of $15,000.00 per year in 2006) into the Thrift Savings Plan, a defined contribution program. The agency that employs each FERS member contributes 1% on that employee’s behalf, whether a FERS member contributes any funds to TSP or not; and, up to 5% of the contribution made by each FERS member is matched by the government.

http://www.narfefl.net/About/fed_retire.htm

[Boghie]

National Active and Retired Federal EmployeesFlorida Federation of ChaptersFederal Retirement Benefits – CSRS and FERS

http://www.narfefl.net/About/fed_retire.htm

Thanks Nnuut.

I always mention James on this kinda stuff - but you have proven valuable on the hard numbers since I have started perusing this forum...

So, there is the answer Clester.

Those on CSRS contributed 14% of their gross salary to a pension. You should get full pension benefits. That ain't chump change.
Those on FERS contributed less than 1% toward the pension - with the remaining 4% coming from an employer 'match'.

FERS employees really haven't paid for the benefit and the benefit isn't nearly as valuable as the CSRS benefit.

But, personally, I much prefer it. It is actually in a lock box. It is in my name.

[nnuut]

CSRS pays 56.25% at 55 years of age and 30 years. I paid in $123,540 dollars over 36.8 years. No matching in TSP.

[burrocrat]

I have NO faith and NO confidence in the politicians that 'invest' the assets in our pension while controlling the formulas for benefits.

Never had, never will.

What? You don't go for the fiat money? It's the new religion. Don't you believe in God or something?

[burrocrat]

Never had, never will.


http://www.youtube.com/watch?v=AHMKyWgkChk

[nnuut]

CSRS pays 56.25% at 55 years of age and 30 years. I paid in $123,540 dollars over 36.8 years. No matching in TSP.
One other thing, many CSRS folks paid Social Security prior to working for the government. I earned 54 quarters and would have received about $760 a month, but the government thought that was a WINDFALL (WEP) and reduced my SSN by 60% even though I paid SSN for about 15 years. FWM don't you think you should recalculate your numbers?:)

[clester]

I am fers and retired under atc early retirement rules. As a percentage of my high 3, I get 41% from fers, about 11% from supplement and i take about 18% from tsp. Not bad for me.My point was that relying on beating the market for retirement is tricky. If you are lucky you may beat the market. I have had really good years and some bad years. It is easy to think you will get rich off the market and end up losing. In the good years, I would play with calculators and dream about what I could have making 20% in the market or whatever. I am so glad I have the pension or I would be working forever to get a decent income. Especially since atc has to retire at 56!The fers plan is actually a good one although not as good as csrs. You get the guaranteed part that is safe and the tsp part tsp play with. But those that get only 1% per year would have to work for 40 years to get what I have. So I understand that tsp is the main part of most folks retirement.The point I wanted to make was that relying totally on the market and wall street can bite you. Those guys in wall street want to take your money.They are as bad or worse than congress.Just mho.

[Boghie]

FWM, I value your posts - but I'm not certain you know the value of a 401(k).

Using the upper limit of your numbers – that is, an $80K average in final 3 years of salary…

A 30 year CSRS employee will attain an inflation adjusted pension of $48K/year (60%).
A 30 year FERS employee will attain an inflation adjusted pension of $35K/year (40%).
Thus, a FERS employee will require an inflation adjusted TSP distribution of $18K/year.

Now,

the average Annual Return for the past 30 years has been 12.93% (http://www.moneychimp.com/features/market_cagr.htm) and, the average CAGR for the past 30 years has been 11.39% (http://www.moneychimp.com/features/market_cagr.htm) but, let us use your Average Annual Return of 8%
and, factor in a 3.1% inflation rate.

Scenario 1: Me


Personally, to have 35 years (Age 65 through 100) of inflation adjusted distributions of $18K/year I would have to start pulling out $7,860/year (and increasing by inflation) RIGHT NOW. I am way over invested if all I want is $18K/year. I just turned 47 today. Makes the math real easy in Quicken!!!
If I want to match $80K I have to have enough to distribute $45K. To attain that using an 8% return and 3.1% inflation I need to contribute $10K per year to TSP – and that $10K incorporates the 5% match.
Thus, it is very probable that I will have to suffer on 100%+ of high salary.
Scenario 2: A newbie starting with a $24K salary


Now, assuming one starts their bucolic Federal GS career at age 24 with a starting salary of $24K one would have to contribute $2,800/year of which only $1,680/year is contributed by the employee – the other part is the 5% match. Additionally, that $1,680/year would only cost the employee $1,350/year because of the tax advantaged nature of our 401(k) plan. Thus, out of paycheck, the employee would contribute $52/pay period (going up with inflation). This nets the newbie $18K per year inflation adjusted for 35 years. Not very hard to do.
To get $45K/year out of TSP for 35 years our above newbie would have to contribute $6,800/year which is steep. But, the above chap never had his/her salary increased by more than inflation – no bonuses, no step increases, no promotions, no better paying jobs. Thus, this chap would still have a High-3 average salary of $24K/year. So, this example is a bit odd. He/she would end up with the equivalent of $54,600/year in an inflation adjusted retirement. Yowser.
These chaps will be chomping on caviar – not fighting the dog for Alpo.

I think one other corollary demonstrates itself: The pension is not paid for – especially for FERS employees, but probably not for CSRS either. Assuming 4.25 Average Return (pensions are ‘invested’ in the ‘G Fund’) and a 3.1% inflation rate:
24 year old CSRS employee:

14% of $24K = $3,360/year contribution
A benefit of 60% of $24K = $14,400/year inflation adjusted pension.
Requires a $8K+ contribution on year one and then adjusted for inflation. Thus, the CSRS pension looks to be significantly underfunded and thus potentially gameable by politicians. However, CSRS employees do not get Social Security and do not get a 401(k) match. To me, the pension looks fair. I will not be marching around the White House with a ‘Don’t Tread on Me’ sign.

24 year old FERS employee:

Not even worth doing the math. I mean, a 0.8% contribution resulting in a $9,600/year (to be adjusted for inflation) benefit. Yowser.


In the end, FWM, we FERS types have a tremendous retirement package. And, the critical part of it is TSP.

Question: is the FERS pension just part of Social Security – or is it added to Social Security and TSP?

Note: Please don't take these computations as gospel. They are hard to do, I am untrained, and I am a year older and slower:toung:

[Boghie]

I am fers and retired under atc early retirement rules. As a percentage of my high 3, I get 41% from fers, about 11% from supplement and i take about 18% from tsp. Not bad for me.My point was that relying on beating the market for retirement is tricky. If you are lucky you may beat the market. I have had really good years and some bad years. It is easy to think you will get rich off the market and end up losing. In the good years, I would play with calculators and dream about what I could have making 20% in the market or whatever. I am so glad I have the pension or I would be working forever to get a decent income. Especially since atc has to retire at 56!The fers plan is actually a good one although not as good as csrs. You get the guaranteed part that is safe and the tsp part tsp play with. But those that get only 1% per year would have to work for 40 years to get what I have. So I understand that tsp is the main part of most folks retirement.The point I wanted to make was that relying totally on the market and wall street can bite you. Those guys in wall street want to take your money.They are as bad or worse than congress.Just mho.

Clester, I hear you...

However, it is not hard to beat 'G Fund' returns in the equities funds. You can get an easy 6% return by mixing F with C/S/I. An 8% return can be considered normal for those with a number of years yet to invest.

All I was saying is that I consider it a gamble to demand our politicians provide a benefit I did not pay for. I would rather they be out of the game with no say in my benefits. I could invest the pension contribution (mine and theirs) in the 'G Fund' if I so desire. Then it would be my baseline. My rock. And NO politician could jigger pension obligation numbers.

When I get closer to retirement I will be migrating more assets for more time to the G/F. Till then, it is rather dumb to force me to pay into the 'G Fund' under the full faith and credit of some politicians twenty years in the future.

Yowser.


BTW, I never rely in Beating the Market. If I lose a bit less on the dumps or gain a point on the booms I consider it gravy. Like FWM, I count on an 8% return and a 3.1% inflation rate. Nice and smooth. Almost there now...

[clester]

Fers plus social security plus tsp.

[Boghie]

Fers plus social security plus tsp.

That's good news Clester.
Very good news.

Can I count on you to march around the White House with me if the politicians start jigging and jagging? Yuk, yuk.

BTW, reading your post tells me you are looking pretty good. Safe money at a huge percentage of high salary. Good to Go...

Also, FERS employees get a better benefit for years served over 20. More than the 1% thing. Adds up. Maybe too much. Eyes watching, eh.

[clester]

I agree it may not be paid for. Not sure about that. My brother has 401k only retirement and they match 15% I believe. He figures he will be working for a very long time to have enough to retire. He is a buy and holder that has many funds and diversified.He won't be rich off his 401k. Like most folks the last 10 years, his account is not even back to 2000 levels. A lost decade of throwing the max in and getting nothing.Just saying. Know the risks.

[Boghie]

I agree it may not be paid for. Not sure about that. My brother has 401k only retirement and they match 15% I believe. He figures he will be working for a very long time to have enough to retire. He is a buy and holder that has many funds and diversified.He won't be rich off his 401k. Like most folks the last 10 years, his account is not even back to 2000 levels. A lost decade of throwing the max in and getting nothing.Just saying. Know the risks.

There is much value in what BirchTree states.

DCA will treat your brother quite well. Just think of all those shares he purchased at half price for long periods of time in that 10 year span.

My guess is that your brother - if he invested in equity funds - is being modest. Or, maybe doesn't have the tools to calculate into the future. You two will problaby be sharing fine steak diners with the proper vino on his retirement. You guys will be helping the economy as you travel the nation in your jets and Winebegos (spelling???).

LateR.

[Birchtree]

Don't you have mucho compassion for all those blurry eyed college kids that voted for Obummer on a slogan of hope and change - sh*t not me. They can all move back home for all I care.

[Scout333]

Share-the-pain list out today Check out Mike Causey's Column today! Ouch!:mad:
September 19, 2011 - 2:02am
http://federalnewsradio.com/?nid=20&sid=2551342

[Frixxxx]

http://www.federalnewsradio.com/?nid=699&sid=2552215

(http://www.federalnewsradio.com/?nid=699&sid=2552215)Looks like about 2 million voters won't be re-electing next year.

[burrocrat]

Well I got some good news and some bad news.

The bad news is it looks like my take home will be considerably less in the future.

But the good news it's mostly only user fees and not taxes so the politicks are keeping their word.

Even better news is that it only applies to the wealthy, so I must be weathly now, woohoo! It's about time.

But the best part is that I get to keep riding this gravy train a bit longer at least, as it appears the red ink supplier is too busy over in Greece and hasn't started foreclosure proceedings here, yet.

[James48843]

Govexec has it's story on it too- FERS contribution details -
http://www.govexec.com/story_page.cfm?articleid=48829&dcn=todaysnews

That proposal,- 0.4% increase in employee contribution each year over three years, is considerably less than the republican proposal of doing away with FERS altogether. (http://www.tsptalk.com/mb/showthread.php?9333-GOP-attack-FERS)

[burrocrat]

Every cloud has a silver lining.

At least with the no FERS plan I would have a concrete number to base my retirement projections on and there wouldn't be any nasty surprises later.

Plus the red ink guys should really go for that one. Maybe they'll give us a discount on future orders.

[Boghie]

Take my pension, but release my 'investment' into the pension.
To be nice the employer could release all/some of their contributions to FERS.

I will invest those assets into TSP - and a 401(k)/IRA at a later date.

Please do not force me to invest ONLY in the 'G Fund'.

Under the full faith and confidence of todays politicians.

[burrocrat]

Take my pension, but release my 'investment' into the pension.
To be nice the employer could release all/some of their contributions to FERS.

I will invest those assets into TSP - and a 401(k)/IRA at a later date.

Please do not force me to invest ONLY in the 'G Fund'.

Under the full faith and confidence of todays politicians.

Great idea. Maybe could I interest you in one of these here Weimar Wheelbarrows? It's yours for only half the transfer balance, that should save you a bunch of trips while you carry all that paper over to your other paper dealer.

[Boghie]

Hey Burrocrat,
I'll take all the paper I can get...

There is one definite known. That known fact is that you cannot trust today's politicians to plan your future.

[burrocrat]

I really don't like mutton, but now I know how it feels to be the sacraficial lamb. Although it is a bit unnverving watching the two sides argue how to chop me up.

I don't know Boghie, I think I believe them this time.

If this is what a large class of new politicks can do, I wonder what happens when the whole lot of them get replaced?

Plus then I get to plan my own future? Sweet.

[jkenjohnson]

Take my pension, but release my 'investment' into the pension.
To be nice the employer could release all/some of their contributions to FERS.

I will invest those assets into TSP - and a 401(k)/IRA at a later date.

Please do not force me to invest ONLY in the 'G Fund'.

Under the full faith and confidence of todays politicians.

Is there a proposal to only allow us to invest in the G fund? I missed it if there is.

[James48843]

Is there a proposal to only allow us to invest in the G fund? I missed it if there is.

Don't worry. They won't let you miss anything.


Everyone will have to give something- some more than others.


15396

[Boghie]

Is there a proposal to only allow us to invest in the G fund? I missed it if there is.

The pension portion of our retirement (FERS) is invested in Social Security bonds. As is the 'G Fund'. As is, obviously, the Social Security 'Lock Box'.

[Viva_La_Migra]

The pension portion of our retirement (FERS) is invested in Social Security bonds. As is the 'G Fund'. As is, obviously, the Social Security 'Lock Box'.
Which means it has already been spent.:mad:

[jkenjohnson]

Everyone should go to FedSmith and look at all of the proposals that the super committee came up with. Increasing our potion of the basic annuity to7%, using high five for retirement calculations, eliminating locality pay....... goes on and on.

[Afishegg]

"HI ! , I'm Forest....Forest gump....(but chu can just call me forest!)"

[tsptalk]

Everyone should go to FedSmith and look at all of the proposals that the super committee came up with. Increasing our potion of the basic annuity to7%, using high five for retirement calculations, eliminating locality pay....... goes on and on.
From Fedsmith.com: Deficit Subcommittee Proposes Significant Cuts to Federal Employees' Retirement (http://www.fedsmith.com/headline/18540/)

[tsptalk]

From Fedsmith.com: Deficit Subcommittee Proposes Significant Cuts to Federal Employees' Retirement (http://www.fedsmith.com/headline/18540/)
Also, from FederalNewsRadio.com:

Obama proposes $42.5B in cuts to feds' benefits (http://www.tsptalk.com/?nid=699&sid=2552215):
President Barack Obama unveiled his plan to slash $4 trillion from the federal deficit over 10 years — including $42.5 billion in savings through reforms of federal employee benefit programs.

[jkenjohnson]

From Fedsmith.com: Deficit Subcommittee Proposes Significant Cuts to Federal Employees' Retirement (http://www.fedsmith.com/headline/18540/)

I should have done that. Thanks Tom.

[jkenjohnson]

"HI ! , I'm Forest....Forest gump....(but chu can just call me forest!)"

"I'm not a smart man", but the odds of having two Forrest Gumps on this site are astronomical. :)

[jkenjohnson]

Also, from FederalNewsRadio.com:

Obama proposes $42.5B in cuts to feds' benefits (http://www.tsptalk.com/?nid=699&sid=2552215):
President Barack Obama unveiled his plan to slash $4 trillion from the federal deficit over 10 years — including $42.5 billion in savings through reforms of federal employee benefit programs.

I saw another post the other day where someone said "Why don't we look at Congress' pay, benefits. etc". They pay less than we do into their retiremnt plan and are vested after two (I vaguely remember) terms.

[Boghie]

Everyone should go to FedSmith and look at all of the proposals that the super committee came up with. Increasing our potion of the basic annuity to7%, using high five for retirement calculations, eliminating locality pay....... goes on and on.

jkenjohnson,

It is that basic annuity (FERS) that is invested into the 'G Fund'. Right now, your contribution toward FERS is 0.8% It is not funded. If it were funded via a 7% employee contribution it would still be locked into the 'G Fund'. And, you have to understand that your employer (the Federal Gubmint) is CURRENTLY contributing 11.7% of your salary toward FERS (http://www.govexec.com/dailyfed/0611/060911kl1.htm) - and thus 12.5% of your salary is heading into the 'G Fund'.

Would it not be better to dump an unfunded promise that is jiggered by politicians and allow us to invest at least some of that 12.5% as we wish within TSP?

I have NO desire to reduce my take home pay by 6% and have the brain surgeons 'invest' it into the 'G Fund'. I still have at least 15 years of equity investing ahead of me.

I offer this deal.

Let the Maw of Congress and this Administration take everything I have in my FERS lock box. Leave me nothing. Nada.
Increase my match limit by 6% and allow me to invest it into TSP (obviously)

That allows the Gubmint a 6.5% annual reduction in liability and wipes out their pension liability.

Wouldn't it be nice to have a 11% match.

Yummy...

[jkenjohnson]

jkenjohnson,

It is that basic annuity (FERS) that is invested into the 'G Fund'. Right now, your contribution toward FERS is 0.8% It is not funded. If it were funded via a 7% employee contribution it would still be locked into the 'G Fund'. And, you have to understand that your employer (the Federal Gubmint) is CURRENTLY contributing 11.7% of your salary toward FERS (http://www.govexec.com/dailyfed/0611/060911kl1.htm) - and thus 12.5% of your salary is heading into the 'G Fund'.

Would it not be better to dump an unfunded promise that is jiggered by politicians and allow us to invest at least some of that 12.5% as we wish within TSP?

I have NO desire to reduce my take home pay by 6% and have the brain surgeons 'invest' it into the 'G Fund'. I still have at least 15 years of equity investing ahead of me.

I offer this deal.
Let the Maw of Congress and this Administration take everything I have in my FERS lock box. Leave me nothing. Nada.
Increase my match limit by 6% and allow me to invest it into TSP (obviously)
That allows the Gubmint a 6.5% annual reduction in liability and wipes out their pension liability.

Wouldn't it be nice to have a 11% match.

Yummy...

I agree. I just feel like we are being herded to the chopping block because everyone thinks we don't do anything, make to much money for it, and then retire wealthy.

[Viva_La_Migra]

I agree. I just feel like we are being herded to the chopping block because everyone thinks we don't do anything, make to much money for it, and then retire wealthy.

Yeah, we're bureaucrats, not politicians!;)

[burrocrat]

The pension portion of our retirement (FERS) is invested in Social Security bonds. As is the 'G Fund'. As is, obviously, the Social Security 'Lock Box'.

Do you mean that 66.67% of my future is invested in treasuries? Say it isn't so.

http://www.bloomberg.com/news/2011-09-13/the-risks-lurking-in-treasury-bonds.html


How's this for an investment opportunity: a guaranteed yield of 3.27 percent, with an enormous potential downside. As risky as that sounds, millions of investors are moving money into Treasury bonds as a "safe haven." In early September, the yield on the 30-year Treasury bond sank to a new low of 3.27 percent, while the 10-year note fell to 1.9 percent. If the inflation rate stays anywhere close to its current modest 3.6 percent pace, long-term investors will be guaranteed to lose money after factoring in inflation's toll.

So with 1/3 of my retirement in FERS entirely dependent on government investing in treasuries and making good on past promises, and another third in Social Security entirely dependent on government investing in treasuries and making good on past promises, then the best I can do with 1/3 of my three-legged stool is put it all in the market and hope I beat inflation? That f***in sucks.

Let's say I pull half of my TSP money (my contributions) out at regular intervals and invest fully in equity plays on the private side, then I've still got only 1/3, 1/3, 1/6, 1/6 for an allocation? But if I get frugal and creative maybe I can up my private witholdings too and just for optomistic fun say it equals 0.25 G FERS, 0.25 G SS, 0.25 TSP allin limited equity plays, and 0.25 private allin fun money. Then I'm still only fully invested halfway and chained to the G return anchor including the 'full faith and credit' guarantee?

Oh sh*t. This is bad.

Now I'm invested all the way in both TSP and outside accounts down to the tune about minus 6% but it's only half of my total future security portfolio so that's really only -3% overall, if my G fund passive investments break even. But they don't so add about, umm, some more negatives to that scenario and I come out losing about 5% overall. Not too bad for being way too reckless and mostly always wrong with my allocation decisions.

You mean I can be way f'd up, consistently, and still only lose 1 out of 20? cool. I'd just as soon be down 5 exercising my choices for a chance than down 1 below break even after inflation cowering in the negative safety of 'safety'.

Thank goodness I've got a hedge of sorts, all this while Mr. Long has been busy protecting myself. Besides, it's not like I'm going to hurt a whole bunch more being only able to buy 19/20 instead of 20/20 of below zero.

And I still plan on getting a free coffee mug in my future.

[burrocrat]

Don't worry. They won't let you miss anything.


Everyone will have to give something- some more than others.

15405

that girl has some long fingers, i bet they come in handy.

[alevin]

jkenjohnson,

It is that basic annuity (FERS) that is invested into the 'G Fund'. Right now, your contribution toward FERS is 0.8% It is not funded. If it were funded via a 7% employee contribution it would still be locked into the 'G Fund'. And, you have to understand that your employer (the Federal Gubmint) is CURRENTLY contributing 11.7% of your salary toward FERS (http://www.govexec.com/dailyfed/0611/060911kl1.htm) - and thus 12.5% of your salary is heading into the 'G Fund'.

Would it not be better to dump an unfunded promise that is jiggered by politicians and allow us to invest at least some of that 12.5% as we wish within TSP?

I have NO desire to reduce my take home pay by 6% and have the brain surgeons 'invest' it into the 'G Fund'. I still have at least 15 years of equity investing ahead of me.

I offer this deal.

Let the Maw of Congress and this Administration take everything I have in my FERS lock box. Leave me nothing. Nada.
Increase my match limit by 6% and allow me to invest it into TSP (obviously)

That allows the Gubmint a 6.5% annual reduction in liability and wipes out their pension liability.

Wouldn't it be nice to have a 11% match.

Yummy...

I'm just about right there with you Boghie. Don't know how long I have til I retire, may be sooner than later given budget outlooks. I'm gonna holler really long and loud at congresscritters both sides of the aisle if they really try to take the $ I'm currently putting into outside accounts (after tax), so they can stick it in G for me. they're just looking for an excuse to do that so they can borrow more. arg. think I can manage that 6% better than they, even if it does stay part cash til I find something goooood to put it down on in the casino. getting ready-starting to feel like Birch. lots of goodies waiting out there-give it a little more time. getting there. charts are working my way. got my buy list-finally spotted 2-3 ripe for picking last night in the longterm charts I've been waiting on, didn't have time this morning to set up buy orders before had to leave the house. bear market rules-I'm not throwing $ down the well, just waiting til I see the rock hit the water before I take a flyer.

[Atarrin]

Maybe it's just me; but considering the alternatives, I found the President's proposal fairly tame.

That said, I'd rather accept a deal Boghie offered, but I think the problem is that it would disproportionately help the sadly small number of government employees who contribute enough to get the full match. I bet even with an 11% match (like Boghie and I would prefer), most employees would still only give 2-3%.

[jkenjohnson]

Maybe it's just me; but considering the alternatives, I found the President's proposal fairly tame.

That said, I'd rather accept a deal Boghie offered, but I think the problem is that it would disproportionately help the sadly small number of government employees who contribute enough to get the full match. I bet even with an 11% match (like Boghie and I would prefer), most employees would still only give 2-3%.

The President's proposal was tame. On the other hand, the Super Committee is hunting for bear and we are open season, no bag limit.