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View Diary: Obama budget raises federal worker pension contributions but cuts pension payouts (82 comments)

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  •  There seems to be a lot of confusion here (1+ / 0-)
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    rodentrancher

    about the current federal retirement system and federal benefits in general.  While yes, I suppose it is more generous than many in the private sector receive, being a federal employee is not all unicorns and rainbows 24/7.  The benefits really aren't that great compared to other places I've worked and other private sector employers in my area.  

    The OLD federal retirement system-CSRS I believe it's called-is all pension and is similar to many state retirement programs.  If you became a federal employee prior to 1984, you had the option to stay with this retirement system and I know some Feds who chose that option who still haven't retired yet.  My understanding is that CSRS is quite generous, but you're still not going to be living high on the hog, so to speak, if you retire with CSRS.

    The vast majority of current federal employees, however, are on FERS, not CSRS.  FERS is a hybrid of a very small federal pension, a 401(k) (called the TSP, or Thrift Savings Plan), and social security.  My understanding is that most of a retiree's FERS benefit is funded by the TSP.  We already have mandatory contributions to the TSP of 3 to 4 percent (the mandatory contribution could be more; I don't pay much attention to it).  I personally can't afford to contribute more to my TSP (thank you, student loans).  

    As for health insurance, yes, it's great to have health insurance and it's far better than what many, many others have in this country, but it's about $300 a month to cover my husband and I and we're on the "cheap" plan.  The dental insurance is a joke.  It does not cover infertility treatments or abortions (thank you, Hyde Amendment).  We also still have lots of co-pays.  

    To clarify, I realize how lucky I am to 1) have a stable job; 2) have some sort of retirement plan and pension, however small, and 3) have health insurance.  The fact that these sorts of things are becoming more and more rare in this country is a national disgrace.  But federal employees are not some sort of privileged class who only work 4 hours a day and receive Cadillac, gold-plated benefits.  Most of us work pretty damn hard and we get a lot of sh*t in return.  We should all be working TOGETHER to improve benefits for EVERYONE in this country, not tearing away the last shreds of somewhat decent compensation from federal employees.  

    •  FERS and TSP -- two separate streams (0+ / 0-)

      TSP does not fund your FERS pension. Where you may be getting confused is that both you and your agency contribute to both items.

      When you retire, you will receive monthly pension payments from the Office of Personnel Management based on your three highest paid years -- this is your FERS pension.

      You will have to contact TSP separately from OPM and make arrangements as to how you wish to receive payments from your personal account. You may take a lump-sum, or monthly pay outs, roll it into an IRA, or leave it in TSP until you need it.

      You should look into attending a Federal retirement seminar, our agency sent us to them after we vested in FERS, then when we had been employed for about 15 to 20 years, and another about 3 to 5 years before we reached Minimum Retirement Age.

      •  I know that the TSP does not fund the FERS pension (0+ / 0-)

        sorry if I made it sound that way in my post.  I was using the term "FERS" to describe the federal retirement plan as a whole, i.e. the federal pension, TSP, and social security.  I would like to attend a Federal retirement seminar.  I just haven't seen the point recently since I'm not contributing much to my TSP.  

        •  Did you know... (0+ / 0-)

          ...that your contribution to TSP reduces your income tax? Which means more take home pay.

          Even if you're not contributing much NOW, at some point you will want to increase it. I was only able to contribute a full 15% of income for a few years, but it really made a difference.

          Good luck in your career. I really enjoyed helping people, which why the beatdown on public employees really depresses me.

          •  No I didn't know that. (0+ / 0-)

            Thanks for the tip!  :)  I am definitely planning on contributing more soon; I've just been waiting for hubby to finish school.  Anyway, yes, the whole "helping people" bit is getting completely lost in the hatefest towards public employees.  It is indeed depressing.  It's actually even getting the Republicans in my office down.  In fact, some of the most vociferous defenders of our agency amongst my co-workers happen to be Republican.  Too bad they can't seem to translate those feelings to others outside of themselves.  

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