SEQUESTRATION FACT SHEET #3
By Jeff Bratko, Steward AFGE Local 704
Sequestration Fact Sheets #1and 2 explained that sequestration will result in automatic, spending cuts in most discretionary spending by Federal Agencies. Sequestration Fact Sheet #2 discussed a few ways that employees can prepare for sequestration and avoid falling off their own fiscal cliff. This fact sheet contains additional tips and suggestions to help employees prepare for sequestration.
How you may be Impacted and Things you can do to Minimize the Damage
- The Thrift Savings Plan (TSP) – One possible impact of the sequestration is a furlough of 4 or 5 weeks between January 2, 2013 and the end of September 2013. It is not known if such furloughs will be done a day at a time, a week at a time, or multiple weeks at a time. TSP Bulletin OC 95-4 (5/2012) describes the impact of a furlough on your TSP contributions. If there is a furlough and you do nothing about your TSP contributions, you will end up contributing less than anticipated in 2013. Employees, who need to increase their net pay during a furlough so that they can meet essential living expenses, may have to reduce their TSP contributions. Employees who want to maximize their TSP contributions may need to adjust the biweekly TSP contribution amount to ensure they reach their goals (if possible). Keep in mind that the younger you are the more a furlough will impact your TSP savings in the long term unless you find a way to increase your TSP contribution in 2013 to make up for any reduction in contributions due to a furlough. Continue reading “SEQUESTRATION FACT SHEET #3”