Working as a federal employee can provide you with a variety of benefits that may not be available to the average private sector employee. When it comes to your benefits, you want to be sure that you get what works best for you and your family. Some of the federal employee benefits offered may not cover all of your family’s needs, making it important to review your needs, coverages, and employee benefits comprehensively.
Working for the federal government has additional benefits that can help you with things such as retirement planning and health insurance. Having the right information about what benefits are available and how they actually work is the first step in choosing whether or not they are in fact the best fit for you.
Benefits And You
The most impactful benefits generally refer to the insurance coverages (and premium subsidies) and retirement income perks. Health insurance coverage can help you when you or a family member under the plan gets ill or requires hospitalization. It also helps you cover any prescriptions that you rely on to stay happy and healthy. FEGLI life insurance can help provide income replacement to your loved ones should you pass too soon and the Surviving Spouse Benefit can work similarly to help protect a spouse’s retirement lifestyle. There is also a long-term disability coverage included in your employment for disabilities lasting longer than 12-months.
Other benefits include a retirement pension and savings plan, allowing you to set aside money each month that your agency will match contributions on up to 5%. This can help you prepare for your future retirement and ensure that you have the funds you need to enjoy your time away from work.
Choosing what benefit coverages are right for you can be tricky, depending on your needs and plans, you may benefit from certain benefits more than others. Understanding your benefits can be tricky, and as a federal employee, you have even more options than the average worker.
What’s Included In Federal Benefits
In addition to the typical benefits such as health coverage, federal employees are eligible for additional benefits based on age, and years of service. Depending on the number of years you’ve worked as a federal employee, some benefits become portable, allowing you to keep them even after moving on to other job opportunities.
Portable benefits are benefits that an employee earns after a set amount of years working as a federal employee and attaining a specific age that allows them to continue after your employment ends. Some of your federal employee benefits will stay with you even if you retire, change federal agencies, or pursue a different career.
- Pension Plan (FERS): The federal employee retirement system, commonly known as FERS, provides a defined benefit pension after only 5 years of service as a federal employee. Depending on years of service and age, these benefits can help you when it comes to planning your future retirement. Many federal employees are eligible for retirement as early as 57 years of age (earlier for Special Provision Employees).
- Retirement Savings (TSP): The thrift savings plan (TSP), is the government’s version of a 401K for federal employees. It provides an automatic 1% automatic contribution to all federal employees who are covered by the FERS plan and will match up to 5%. Even if you only contribute 5% and all of that goes to the Roth TSP, they will still match 5% into the Traditional TSP.
- Social Security: Every federal employee covered by the FERS plan is automatically covered by social security. All FERS, FERS-RAE, and FERS-FRAE government earnings count towards your future social security benefits just as they would in a private sector. It was CSRS employees who did not contribute and thus were subject to the Windfall Elimination Provision (WEP) on any SS benefits they qualified for.
- Health Insurance: The health care insurance that federal employees receive is heavily subsidized (with Uncle Sam footing 72% of the monthly premiums) and for eligible employees it can be continued into retirement with the subsidy preserved.
Your Current Employee Benefits
Current employee benefits are benefits that you will receive while currently employed by the federal government. Many of these are standard across almost any federal position, however, keep in mind that in addition to these you’ll still be covered by the FERS benefits into retirement. The current employee benefits include things such as:
- Long term disability
- Short term disability in the form of sick leave
- Death benefits
- Health insurance with 72% premium subsidy
- Annual leave and holidays
- Life insurance (with subsidized FEGLI Basic coverage)
You can take advantage of enjoying things such as annual payouts for unused time off, and carryover time from annual leave while working as a federal employee.
Walker Capital, The Right Team With The Right Tools
When it comes to understanding federal employee benefits, we can help you get exactly what you need to secure your future. At Walker Capital, we’ll help you get the most out of your benefits, and help you understand exactly how to use them to meet your needs. We’re experts when it comes to financial planning, insurance planning, and more. Contact us today and see why we’re the right team, with the right tools.