April is Financial Literacy Month
April is National Financial Literacy Month, so it’s a good time to look over your financial situation and see if there’s anything that you could be doing better. Here are some tips designed specifically for federal employees.
Employee Benefits
Federal employees have access to many important employee benefits that can help with their personal finances.
- Student Loan Repayment Programs: For federal employees with student loan debt, the federal student loan repayment program should be of interest. Under this program, agencies can repay federally insured student loans as a recruitment or retention incentive. The agency may pay up to $10,000 toward an employee’s student loan in one year, for a maximum of $60,000.
- Employee Assistance Programs: Federal employees who are having personal or work-related problems should see if help is available through an Employee Assistance Program. These programs are voluntary and confidential, and they can provide help with financial issues and stress, as well as family problems, office conflicts, stress, legal issues and alcohol or substance use disorders.
- Paid Leave: Paid leave programs for federal employees may include annual leave and sick leave. Starting October 1, 2020, federal employees will also have access to up to 12 weeks of paid parental leave under new legislation signed into law in late 2019.
Retirement and Emergency Savings
All workers should try to set funds aside for their retirement as well as emergencies.
The Federal Employees Retirement System consists of three parts: Basic Benefit Plan, Social Security and the Thrift Savings Plan. Workers contribute to the Basic Benefit Plan and Social Security each pay period through payroll deductions. Upon retirement, these programs provide a payment each month.
As a federal employee, you can also make contributions to your Thrift Savings Plan. Your contributions to your Thrift Savings Plan are tax deferred, and your agency will make matching contributions, so it’s smart to set this up. You can learn more about setting up your contributions at the Thrift Savings Plan website.
In addition to saving for retirement, you should try to establish an emergency fund. This is important for all workers, but it is especially important for federal employees because a government shutdown can result in workers being furloughed without pay.
Insurance Needs
If something goes wrong, the right insurance coverage can help you get back on your feet.
Most federal employees have access to some insurance – including health insurance, dental insurance, vision insurance, life insurance and long-term care insurance – through their agency. However, federal workers will often need to purchase additional coverage through private insurance companies.
Common insurance coverage types for federal workers include the following:
- Umbrella Insurance: This policy type provides additional liability coverage beyond your auto and home policies.
- Life Insurance: Term life insurance provides important protection for your family. It’s possible to have more than one policy.
- Disability Insurance: If you become unable to work due to illness or injury, disability insurance will provide a payout to replace your lost income.
- Federal Employee Professional Liability Insurance (FEPLI): Federal workers are vulnerable to face civil, criminal and administrative claims. Federal Employee Professional Liability Insurance provides key coverage, and federal workers may qualify for a reimbursement of up to 50 percent of the premium cost. Talk to your employer to see if you qualify for reimbursement.
Article authored by and containing the opinions of Starr Wright USA. This article is offered solely for informational purposes.
Starr Wright USA is a marketing name for Starr Wright Insurance Agency, Inc. and its affiliate(s). Starr Wright USA is an insurance agency specializing in insurance solutions for federal employees and federal contractors. For more information, visit wrightusa.com. Starr Wright USA is a division of Starr Insurance Companies, which is a marketing name for the operating insurance and travel assistance companies and subsidiaries of Starr International Company, Inc. and for the investment business of C.V. Starr & Co., Inc.