Navigating Uncertainty: What Federal Employees Can and Can’t Count On

In any unstable environment, planning for the future feels nearly impossible. Agencies are reshuffling, buyouts are being offered, and legal rulings are constantly shifting employment statuses.

We at My Retirement Network always take a financially conservative approach in uncertain times – assume the worst in every scenario and budget accordingly. If things turn out better, great. But by preparing for instability, you ensure that you and your family are financially protected no matter what happens next.

What You Can and Can’t Count On

Employment Status: A Moving Target

• Paid Administrative Leave: If you’re still receiving a paycheck while on leave, you cannot file for unemployment. However, policies may shift, and there’s no guarantee this status will last.
• Voluntary Resignations & Buyouts: Accepting a buyout or resignation package may disqualify you from unemployment benefits, depending on your state. Never assume you’ll qualify -check your state’s specific rules first.
• Furloughs & Layoffs: If you are terminated involuntarily, you are more likely to qualify for unemployment. But again, eligibility varies by state.

Unemployment Benefits: Complicated and Unreliable

• You Can File But Don’t Count On It. While applying for unemployment is always an option, approval depends on state rules and whether you’ve been fully separated from service.
• State Laws Matter. Each state determines unemployment eligibility, wait times, and benefit amounts. Federal employees often have more paperwork to process, leading to delays.
• Buyouts and Severance Can Delay or Reduce Benefits. Some states require you to exhaust any severance package before receiving unemployment.

Budgeting for the Worst Case

Since your job situation could change overnight, build your budget assuming the least favorable outcome.

• Do not count on unemployment benefits in your budget. File for them, yes. But don’t plan your finances around money that may not come.
• Trim your expenses now. Reduce discretionary spending before a crisis forces you to.
• Stockpile cash. If you have extra funds, prioritize savings over investments right now. Liquidity is key in uncertain times.
•  Have a backup plan for health insurance. If you lose federal benefits, understand your options: COBRA, a spouse’s plan, or ACA marketplace coverage.

What You Can Do Right Now

Even if your agency hasn’t announced changes, assume turbulence ahead and start preparing:

• Check your unemployment eligibility in your state. Don’t assume you’ll qualify – research now.
• Review your agency’s buyout or severance options. If an offer is on the table, know the terms and the impact on benefits.
• Start networking and updating your resume. Even if you stay in government, having an exit strategy is smart.
• Get a clear financial picture. Know your monthly expenses, savings, and how long you could last without income.

You can’t control agency decisions, court rulings, or political shifts. But you can control your response. Preparing now gives you the flexibility to handle whatever happens next – with or without a safety net.