President Biden Announces Plan to Cancel Student Debt

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Ahead of another deadline on the restart of payments for America’s $1.7 trillion in federal student loans, President Joe Biden on Wednesday, 8/24/22 announced a plan to cancel debt for a subset of Americans and continue to keep a pandemic-era pause on the repayments — a sweeping move he has openly weighed in some form or another since his time as a candidate.

“In keeping with my campaign promise, my Administration is announcing a plan to give working and middle class families breathing room as they prepare to resume federal student loan payments in January 2023,” Biden wrote in a Twitter post.

Pell Grant recipients can qualify for up to $20,000 in debt forgiveness as part of Wednesday’s broader announcement on student loan forgiveness. Other student loan borrowers who don’t have Pell Grants will still have loans forgiven up to $10,000, as has been previously reported.

Both forgiveness options are for people who earn less than $125,000 per year, or $250,000 as a household. According to the White House, Biden will give remarks Wednesday at 2:15 p.m. in the Roosevelt Room.

Biden’s social media post also announced an extension of the pause on student loan payments through Dec. 31, 2022 — the final extension — a move that’s intended to give time for the transition back to repayment. Follow link to read more: Biden unveils plan to forgive student loan debt for a subset of Americans (msn.com)Follow link to read more.https://www.msn.com/en-us/news/politics/biden-unveils-plan-to-forgive-student-loan-debt-for-a-subset-of-americans/ar-AA111x5j

The Fed’s Inflation Nowcasting Tool

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Does waiting 30 days for a government report seem a bit unreasonable? After all, we live in a world of instant messages and real-time quotes. Why should we wait a whole month between updates on the Consumer Price Index to see what’s going on with inflation?

Well, you don’t. If you’re an economics geek like me, here’s a secret tool you may not know. If economics is not your thing, know that I’m keeping close tabs on this stuff.

The Cleveland Fed has a tool called Inflation Nowcasting, which provides daily updates on inflation. Much like the Atlanta Fed’s GDPNow forecasting model, it provides a real-time snapshot of gross domestic product.

For July, the Inflation Nowcasting forecasts that prices will rise 0.27% from a month earlier. That would be the smallest month-over-month gain since January 2021. For August, it’s showing an increase of 0.32%. How will the financial markets react if inflation starts to trend lower?

It’s important to point out that forecasting tools are based on assumptions and subject to revision without notice. In some instances, they may not materialize at all.

Real-time reports are nothing new, but it’s great to see that the Fed is starting to get more instant updates on the economy. And it’s information that’s available to all of us. You have to know where to look. Click HERE to learn more.

Your FERS Annuity Is Worth More Than You Think

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How much is your FERS annuity worth? More than you think it is! FERS is a defined benefit plan that is funded by mandatory contributions from both you and the government. You pay significantly less for this benefit than does Uncle Sam. Your FERS annuity is calculated by your length of service (in years and months) and your high-three annual salary. Those who retire under the age of 62 will receive an annuity based on 1% per year, while those who retire at or older than 62 and have at least 20 years of service will receive an annuity based on 1.1% per year. Those who are 62 or older but have less than 20 years get the 1% factor. Special category employees (e.g., law enforcement officers, firefighters, air traffic controllers, etc.) will receive a higher percentage.

How much would you have had to save on your own to get a benefit that is equal to what you have will receive in your FERS annuity? Quite a bit! Let’s say that you retire under the age of 62 and have a total of 30 years of federal service. Your high three salary is an even $100,000 a year. Your FERS annuity will be $30,000 per year and will (once you reach 62) have a cost of living adjustment. The COLA kicks in upon retirement for special category employees. How much would you have had to save in order to be able to generate an inflation indexed income of $30,000 per year? Click HERE to read more.

Phased Retirement

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Phased Retirement is a human resources tool that allows full-time employees to work part-time schedules while beginning to draw retirement benefits. This new tool will allow managers to better provide unique mentoring opportunities for employees while increasing access to the decades of institutional knowledge and experience that retirees can provide.

This is yet another forward-thinking policy that allows the Administration to continue its efforts to deliver a Government that is effective, efficient, and supportive of economic growth.

The final regulations are available on the Federal Register website and will take effect 90 days from August 8, 2014. This means that agencies can send their Phased Retirement applications to OPM for processing as early as November 6, 2014.

Guidance and other material about Phased Retirement will be posted here as it becomes available. Click HERE to read more.

Federal Government Has So Far Escaped Attrition Crisis, But Retirement Wave Looms

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Despite concerns that the ranks of the civil service could shrink during the COVID-19 pandemic, the federal government is hanging on to its workers — at least for now.

There was modest change in attrition across the federal government in fiscal 2021 despite turbulence caused by the nationwide health crisis and increased resignations in 2020. In fact, the civil service increased by more than 20,000 people last year and the total workforce is up more than 130,000 positions since 2014, according to a study from the Partnership for Public Service. Of those who did leave government posts in 2021, nearly half did so because they retired.

“While some attrition is natural and can help infuse the federal workforce with new talent and ideas, turnover can also cause a loss of institutional knowledge and cost hiring managers both time and resources,” the nonprofit said in issuing the report on Aug. 2. “Moreover, the federal government continued to grow in fiscal 2021, demonstrating the stability of the career workforce. That said, certain critical elements of the federal workforce are in a state of stress.”

By agency, the Department of Veterans Affairs had the highest attrition rate at 7.1% last year, a full percentage point greater than the government-wide average and an increase from the agency’s 6.4% attrition rate in 2020. CLICK HERE TO READ MORE: