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someoldguy  
#1 Posted : Wednesday, February 12, 2020 3:37:10 PM(UTC)
someoldguy

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I've been a fed for a few years now, and pursuing fed jobs for a couple years before that, and over that time it seems like every year there is some new proposal to make the pension less valuable. This goes back to around 2013 when they upped the contribution rate to 3.1% and shortly thereafter to 4.4%. Recently the proposals have been more drastic.

Now I thought there was some law that you could not lose a pension benefit you had already earned? For example, I used to work at a private firm with a pension. In 2010 or so, they changed the calculation, but it would only affect benefits accrued after that date.

How might changes to FERS apply to feds? Take the high-three vs high-five. If someone is already retired, I doubt they would change the monthly amount that person is already receiving... but someone who has yet to retire would be more vulnerable. How about if somebody is already covered by FERS or FERS-RAE or FRAE or whatever? Would there be a new FERS-FFRAE with the new changes, and only new hires would be affected (like they did in 2013-14)? Or, as in one proposal, no pension at all, and a completely TSP-driven plan?

I doubt we will see any changes in the 2021 budget cycle. But there are no guarantees about the future.

I realize this is all in the realm of speculation, but any thoughts or comments are appreciated (within reason of course... be nice!)
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mallen  
#2 Posted : Thursday, February 13, 2020 10:21:12 PM(UTC)

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Such laws do not apply. Federal benefits are specified by laws enacted by congress. The only way to change those benefits is to pass a new law. So if a previous law says you get those benefits, or that you cannot change benefits already earned, a law that took those away, would just change that law as well. They can do that. All thats required is majority in the house and the senate, and the presidents signature. Keep that in mind come November.
SD Analyst  
#3 Posted : Friday, February 14, 2020 4:09:17 PM(UTC)
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You need 5 years to be vested in a retirement system, whether it's FERS,FERS-RAE,or whatever. Once you are vested, you will get benefits from that system. If you don't have 5 years in when some new version comes along, you will be moved to the new version.
someoldguy  
#4 Posted : Saturday, February 22, 2020 6:50:22 AM(UTC)
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Somebody from OPM has announced that any changes will only apply to new hires.

When they switched from CSRS to FERS, they gave current employees the option to switch but they could stay in the old plan if they liked. Same in the military "blended retirement system." So there is precedent for letting people stay in the plan they started with.

Not to say they can't do whatever they want.
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