Employee Benefits
A budget resolution approved by the House and Senate will allow for a reconciliation bill that many believe will be aimed at reducing benefits for federal employees. The resolution requires several committees to submit recommendations for budget cuts by May 9. The House Oversight and Reform Committee is seeking $50 billion in savings. With the federal workforce being by far the primary focus of their spending, it is also expected to be the primary focus of their cuts. A budget document that has been circulating proposes raising the FERS contribution to 4.4% for all employees, eliminating the Retirement Annuity Supplement, changing the annuity calculation to a “High 5,” and restructuring the premium sharing for FEHB.
TSP Losses
Stock market volatility took its toll on the TSP, reducing the number of TSP millionaires. Around 11,000 account holders dropped out of the TSP millionaires club, leaving the count just under 147,000. According to recent data, the TSP has roughly 7.25 million account holders and $972 billion on investment, with 67% allocated to the C, S, and I Funds. On average, TSP millionaires have had their accounts for 28.6 years. Wondering what the largest single TSP account balance is? As of March 31, $8.73 million.
Proposed Protection for Probationary Employees
House Representative Johnny Olszewski, D-MD, has proposed legislation to protect probationary employees. H.R. 2880 – the Protect Promoted Workers Act – aims to add protections for federal employees who have entered a probationary period due to promotion to a competitive service, excepted service, or senior executive service position. “Workers were fired for being good at their jobs. They were offered no notice, no severance, and no healthcare,” Olszewski said. “It’s not fair to them or the taxpayers who rely on the vital services they excelled at providing.”
Fewer Retirements in March
The number of federal employees who retired in March was a little over 7,800. This represents a decline of 2,000 from February. The claims backlog has dropped to around 16,500, and the processing time inched up to 50 days. More than 33,500 federal employees have retired in the first quarter of this year. That’s an increase of 3,800 over the first quarter of 2024.
Check in daily to keep track of the news and events affecting your federal employment and benefits. And if you have questions about your benefits or retirement plans, reach out to a Federal Retirement Consultant® who understands the complexity of federal benefits.
