There’s no denying that federal job security isn’t what it used to be. Budget cuts, agency restructuring, and shifting political priorities have placed many roles at increased risk. With a recent proposal calling for the elimination of over 100,000 positions by 2026, even long-tenured Feds are now starting to pay attention.
Many of our clients are taking a fresh look at their financial plans through the lens of federal employee job loss preparation. Taking a few simple steps now can give you a stronger sense of control if reductions reach your agency.
The first step is to understand exactly where you stand financially. Begin by reviewing your monthly cash flow (money coming in vs. money going out) and categorize all expenses as either necessary or discretionary. This can help identify where to make cuts if the need arises.
If able, make sure you have an emergency fund to cover a potential loss of income. Experts generally recommend having three to six months of living expenses on hand. However, a larger cushion can give you more stability if you’re impacted by job cuts. Considering the current environment, you may want to target nine months to a year’s worth of expenses, especially if you and your partner are both Feds.
Assessing your current benefits and using them strategically is a key part of financial planning for RIFs (reductions in force). Making the right moves now could help you save more, reduce costs, and strengthen your overall financial position. Here are a few things to consider:
The more clarity you have regarding your benefits, the easier it will be to make informed decisions if you find yourself facing cuts.
Federal employees are generally eligible for unemployment if separated through a RIF, although the rules vary by state. To avoid a delay in benefits, file as soon as possible after your separation. Many Feds in transition take on part-time work, consulting, or freelance opportunities to supplement their income.
You may also have the option to transfer to another federal agency or position, especially if you qualify for the Reemployment Priority List or have in-demand skills.
A CERTIFIED FINANCIAL PLANNER™ who understands federal benefits can test your plan against different scenarios, ranging from short-term job loss to early retirement. Revisiting your plan may help you find gaps to address and give you a clearer path forward. For personalized support, reach out to the team at Serving Those Who Serve at [email protected].
The Thrift Savings Plan (TSP) is a retirement savings and investment plan for Federal employees and members of the uniformed services, including the Ready Reserve. The TSP is a defined contribution plan, meaning that the retirement income you receive from your TSP account will depend on how much you (and your agency or service, if you’re eligible to receive agency or service contributions) put into your account during your working years and the earnings accumulated over that time. The Federal Retirement Thrift Investment Board (FRTIB) administers the TSP.
The information has been obtained from sources considered reliable but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of Serving Those Who Serve writers and not necessarily those of RJFS or Raymond James. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Investing involves risk and you may incur a profit or loss regardless of strategy suggested. Every investor’s situation is unique and you should consider your investment goals, risk tolerance, and time horizon before making any investment or financial decision. Prior to making an investment decision, please consult with your financial advisor about your individual situation. While we are familiar with the tax provisions of the issues presented herein, as Financial Advisors of RJFS, we are not qualified to render advice on tax or legal matters. You should discuss tax or legal matters with the appropriate professional. **
The FedLife Podcast is your in-depth, biweekly deep dive into the world of federal benefits and retirement planning. Hosted by federal benefits expert Ed Zurndorfer and Dan Sipe of Serving Those Who Serve, each 30-minute episode unpacks the complexities of FERS and CSRS retirement, FEHB and Medicare, survivor benefits, tax planning, and more. Designed for federal employees and retirees who want more than just the basics, FedLife goes beyond the headlines to explore the rules, nuances, and strategies that can make a meaningful difference in your retirement. Remember: it’s your Fed life, make it a great one.
The Fed15 Podcast is your weekly 15(ish)-minute briefing on federal benefits and financial planning, built specifically for federal employees and retirees. Hosted by Dan Sipe and Katelyn Murray of Serving Those Who Serve, each episode delivers clear, actionable guidance on topics like FERS and CSRS retirement, TSP strategies, FEHB, survivor benefits, tax planning, and more! Whether you’re five years from retirement or already there, The Fed15 helps you cut through the noise, avoid costly mistakes, and make confident decisions about your federal benefits.
