"A government big enough to supply you with everything you need is a government big enough to take away everything you have."
--- Thomas Jefferson
There was a time in America, not so very long ago, when careers with the U.S. government seemed the safest route to go. For the individuals planning on or currently starting families, a guaranteed salary, solid pension, and government-secure TSP and all the perks sounded like heaven. Rather than pouring countless hours into climbing random corporate ladders, trudging through the process of entrepreneurship, or reconciling themselves to tenured positions with less-than-acceptable "benefits", sensible people signed up with Uncle Sam, via one organization or another. For awhile, it was clear they had made a solid decision.
Of late, however, even those positions which, ten years ago or less, seemed to be the epitome of job security are on shaky ground. As the federal government throws around phrases like "fiscal cliff," "sequestration," and "debt ceiling," the average American is simply trying to continue putting food on the table and hoping his ability to do so won't be thwarted by the very organization into which he has put his faith, sweat, and tears for years, often decades, on end. Unfortunately, with the current state of U.S. affairs, the low-ranking government agency employee has no control over this.
In February, an article from CNN warned that as many as 2 million federal employees would soon receive notices of impending furloughs that could last anywhere from days to weeks. In this and other news sources, assurances are made that these employees will be secure in their positions in general, though they may see changes in their income and benefits once the furloughs have ended. All of this is in an attempt by the government to curb spending and reduce the overall national deficit.
What does all this mean for the average federal worker? Well, certainly, it could, for some, mean a much-needed vacation; for others, however, it will mean tightening belts, perhaps significantly. For those employees whose livelihoods depend upon a particular income, certain sacrifices will have to be made. In general, if the federal government is unable to concoct a suitable scenario for reducing government spending and debt in the long run, they will not be the only American workers affected.
Rather, modern prognosticators in the form of internet journalists predict a scenario far grimmer: widespread budget cuts in both public and private sectors. Tax hikes and inflation greater than we've seen over the past 5 years. Loss of those benefits many government workers formerly held dear, such as tuition reimbursement for military members or relocation allowances for Customs workers (the latter of which has already been retracted). Ultimately, we as a nation, even those formerly "safe" federal workers, are being forced to accept what the media has coined, "The New Normal."
Currently, this "New Normal" consists of such things as those of retirement age being forced to work 5, 10, or even 15 years past the point at which they had previously intended to retire, whether due to job loss, underemployment, or myriad other factors which have arisen in conjunction with the recession. Whereas college graduates previously had realistic aspirations of working in the fields of their choice and earning a steady, sufficient income, this has become all but a pipe dream in today's volatile business world. Higher taxes and medical care reforms will, inevitably, pave an entirely new landscape for the American generations of the future... and not likely for the better.
Though the federal worker furloughs are foreboding, government officials have reassured those with fears, saying that this is a temporary setback and will not permanently affect those workers' livelihood. That said, the furloughs are hardly the only thing threatening the futures of federal employees; rather, such factors as stock market volatility and state funding limits may result in these workers having quite uncertain futures in retirement.
Even those American workers who previously thought that employment with any of a slough of government agencies was a solid investment and followed sensible steps to secure their financial futures might find themselves in trouble, should the economy take another hit. Many government-sponsored retirement funds, including the popular Thrift Savings Plan, are subject to market fluctuations, meaning that despite years of work paying into one or more of these accounts, many Americans may find themselves working with diminished funds due to something as unpredictable as a natural disaster. Additionally, news sources report that many states are now reaching their limits in paying worker pensions; all in all, the stability many once saw as unflinching is now terrifyingly tenuous.
What is the solution to all this uncertainty? For the individual, there is the option of having a financial planner well-skilled in federal benefits who can redistribute retirement money from volatile funds like the TSP into others with similar benefits but less or none of the same risks. Those federal employees early in their careers may benefit from such savings plans as Infinite Banking, which can aid them in avoiding the inherent downfalls of funds tied to the stock market. Clicking on the logo to the right of this post will take you to your first step in regaining the financial security for which you may formerly have believed you'd signed up. Without proper planning, the only inevitability is the ever-degenerating state of "The New Normal."
References (click to link to articles):
"Federal worker furloughs could start in April," CNN Money, 2/19/2013.
"Furlough Friday: 10 questions and answers," The Washington Post, 2/28/2013.
"6 realities of the 'New Normal' for seniors," U.S. News & World Report, 2/11/2013.
"10 states where pensions are running out of money," Yahoo Finance, 5/4/2011.
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