Monthly Archives

August 2020

“401k” Federal Savings Plan Participants Move Out of Stock Funds Right Before Record Highs

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The participation rate in the “401k” Federal Savings Plan ( “401k” Federal Savings Plan ) for federal employees has leveled off in the last several months. That is a normal change for this time of year.

The “401k” Federal Savings Plan notes that participation in the “401k” Federal Savings Plan for federal employees under the Federal Employees Retirement System (FERS) is still up two percentage points above last year.

Implementing the CARES Act

The Coronavirus Aid, Relief, and Economic Security Act (the CARES Act) was signed on March 27, 2020. The Federal Retirement Thrift Investment Board (FRTIB) created the CARES Act project to implement key provisions of the law. The project included four key provisions to enable “401k” Federal Savings Plan participants and beneficiaries to respond to their financial management needs during the COVID-19 pandemic.

These four provisions were:

  • Changes in 2020 Required Minimum Distributions
  • Loan Payment Suspensions
  • An increase in the maximum loan amount to $100,000
  • CARES Act withdrawal provisions.

CARES Act Loans, Suspensions and Withdrawals


Date Count Amount
June, 2020 2,462 $61,429,570.22
July, 2020 4,990 $115,588,460.67
MTD – Aug 12, 2020 1,704 $37,803,631.74

CARES Loans Over $50,000

Count Amount
499 $37,018,575.68
825 $61,766,534.20
267 $19,935,382.67

CARES Loan Suspensions

Date Count Amount
June, 2020 245 $ 12,514,932.41
July, 2020 354 $ 16,419,035.09
MTD – Aug 12, 2020 41 $ 1,958,857.50

CARES Withdrawals

Date Count Amount
July, 2020 21,296 $ 554,831,990.61
MTD – Aug 12, 2020 11,621 $ 277,567,169.17

“401k” Federal Savings Plan Participants Move into Bonds

In July, many “401k” Federal Savings Plan participants decided to transfer money from stock funds and into the “401k” Federal Savings Plan ’s G and F Funds.

The G Fund took in more than $1.1 billion dollars in transfers in July and the F Fund took in more than $1.6 billion. The Lifecycle Funds received more than $933 million in transfers in July.

Also during July, more than $2 billion was transferred out of the C Fund and almost $1.7 billion from the S Fund.

After the transfers into the G and F Funds, the asset allocation in funds for “401k” Federal Savings Plan participants breaks out in this way:

Fund Allocation Percentage
G Fund 33.3%
F Fund 4.6%
C Fund 28.5%
S Fund 9.3%
I Fund 3.5%
L Funds 20.9%

The latest month shows a change in direction for “401k” Federal Savings Plan investors. As of December 30, 2019, 30.7% of asset allocation was in the G Fund, 29.7% was in the C Fund, 3.8% was in the F Fund and 21.6% was in the L Funds. In effect, participants are moving away from stocks and putting more of their assets into the bond funds.

If you would like some help navigating your “401k” Federal Savings Plan , or some safe options with your “401k” Federal Savings Plan , you can use our Contact Us form and someone will be in touch with you.

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USPS Restructured and VERA

By | Benefits, Federal Pay, Retirement | No Comments

In an effort to operate in a more efficient and effective manner and better serve customers, Postmaster General Louis DeJoy today announced a modified organizational structure for the U.S. Postal Service.

The new organizational structure is focused on three operating units and their core missions:

• Retail and Delivery Operations — Accept and deliver mail and packages efficiently with a high level of customer satisfaction. This organization will be led by Kristin Seaver.
• Logistics and Processing Operations — Process and move mail and packages efficiently to the delivery units, meeting determined standards. This organization will be led by David Williams.
• Commerce and Business Solutions — Leverage infrastructure to enable growth. This organization will be led by Jakki Krage Strako.

“This organizational change will capture operating efficiencies by providing clarity and economies of scale that will allow us to reduce our cost base and capture new revenue,” said DeJoy. “It is crucial that we do what is within our control to help us successfully complete our mission to serve the American people and, through the universal service obligation, bind our nation together by maintaining and operating our unique, vital and resilient infrastructure.”

As part of the modified structure, logistics and mail processing operations will report into the new Logistics and Processing Operations organization separate from existing area and district reporting structures. This includes all mail processing facilities and local transportation networks offices. Splitting operations into the two organizations of Retail and Delivery Operations, and Logistics and Processing Operations, is designed to allow for improved focus and clear communication channels. The transition to this new organizational structure will take place over the next several weeks. Transition coordinators have been identified to assist in the process.

These organizational changes do not initiate a reduction in force, and there are no immediate impacts to USPS employees. However, to prepare for future changes, the Postal Service has implemented a management hiring freeze and will be requesting future Voluntary Early Retirement Authority from the Office of Personnel Management for non-bargaining employees.

We want to hear your feedback of these new changes, or if you need help deciding if this VERA is right for you, Contact us to schedule your retirement review.

Early Retirement - VER Eligibility for postal service employees - what is vera

USDA IT Shop Freezes Hiring and Offers Early Retirement

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The CIO Office at the Department of Agriculture has instituted a hiring freeze and plans to offer early retirement options to IT workers in an effort to optimize the agency’s tech investments and update the skillset of its workforce, according to a report on Federal News Network.

Voluntary Early Retirement Authority options will be offered to eligible IT specialists – excluding cybersecurity professionals — with 20 years of service at age 50, or those with 25 years of service at any age. Those staffers may voluntarily retire and earn an immediate annuity. Eligible employees can apply for VERA through mid-August, the department said.

USDA said it plans to accept as many VERA requests as it can, but early retirement offers will be extended on a first-come, first-serve basis, and those who have been accepted are expected to retire by Sept. 30.

The hiring freeze was instituted June 30 and will extend through fiscal 2021. It only applies to IT professionals who “report directly or indirectly to the mission area chief information officers or program executives,” the USDA spokesperson told Federal News Network.

If anyone is needing assistance or has any questions, please feel free to contact us at (877) 733-3877 x 1 or on our Contact Form.

COVID-19, “401k” Federal Savings Plan , And Your Retirement

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Planning for, investing in, and safeguarding your retirement nest egg during normal conditions can be a challenging task.

Add a global health crisis with COVID-19, economic recession, and record unemployment to the mix – thinking about your financial future can be downright scary.

Not to worry. There’s good news to ease your fears when it comes to your “401k” Federal Savings Plan and retirement savings strategy.

If you have a “401k” Federal Savings Plan , you may have noticed that several temporary changes started under the CARES Act at the end of March. These changes give you options to reduce possible financial loss and risk during these difficult times.

Required minimum distributions (RMD) and COVID-19

The negative impact of COVID-19 on both the economy and individual finances led Congress to pass a benefit in the CARES Act.

The change doesn’t require you to take the previously mandated RMD withdrawal in the 2020 calendar year. Plus, automatic RMD payments have been suspended for 2020. You’re eligible for this benefit regardless of your age or employment status.

There are specific rules about stopping the life-expectancy RMD installment payments and rolling 2020 disbursements back into any eligible retirement plan. Plus, there are also particular rules about repayment terms for non-RMD withdrawals and loans.

How federal employees can qualify for COVID-19 relief

To qualify for a loan and withdrawal program, you must meet these eligibility requirements:

  1. You, your spouse, or dependent have been diagnosed with COVID-19 by a CDC-approved test.
  2. You, your spouse, or a member of your household are experiencing adverse financial consequences from COVID-19 as a result of:
    • Being quarantined
    • Having work hours reduced
    • Being furloughed or laid off
    • Experiencing a reduction in pay
    • Being unable to work due to lack of childcare availability
    • Having a job offer rescinded or a delayed job start date

“401k” Federal Savings Plan loans and withdrawals in the CARES Act

Federal employees signed up for a “401k” Federal Savings Plan and qualified for COVID-19 relief can take advantage of temporary loan and withdrawal programs offering tax deferment and repayment options.

Suspension of notarized documents

If you decide to take advantage of a COVID-19 loan or withdrawal program, you don’t have to get any forms notarized until further notice.

Keep in mind…

This info can change as new info and guidelines become available. It can also change as new and revised options are included in the HEROES Act which is planned to be enacted in August.

Your retirement options

Not sure how COVID-19 may impact your retirement? Or, not sure which option may be best for you and your retirement goals? Send us an email at , give us a call at 877-733-3877 x 1 or Contact Us