The Federal Employee Pay Freeze and Your Future Retirement Plans

How will the pay freeze impact the retirement decisions of federal employees? Will federal employees leave government service earlier than they planned? Here are the results of our recent survey.

How much of an impact will a two-year federal employee pay freeze have on your decision to retire (or not) from the federal government? The answers could be important to agencies that are concerned about a large exodus from the federal workforce due to retirements occurring quicker than expected.

So, we asked our readers this question: “How will the proposed two-year federal pay freeze impact your retirement plans?” We received over 2100 responses. Here are the results:


No impact

I will retire sooner than I had planned

I will retire later than I had planned


Since it would potentially impact the responses, we also asked about the length of time before those responding were eligible to retire. A few readers did not know (presumably, these folks have a number of years to go before they are eligible) and 44% were already eligible to retire. Here are the results:

Already eligible

1-2 years 17.2%

3-5 year 12.8%

5 years or more 21.2%

Already Retired 3.6%

Don’t Know 1.2%

Perhaps it is not surprising that those who are already eligible to retire will leave government service earlier than they had planned: Here are the responses from those who are already eligible to retire when answering the question: “How will the proposed two-year federal pay freeze impact your retirement plans?”


No impact 26.9%

I will retire sooner than I had planned 31.3%

I will retire later than I had planned 16.8%

Undecided 25.7%

Those who are within two years of retirement provided responses that were a little different:

No impact 24.2%

I will retire sooner than I had planned 24.2%

I will retire later than I had planned 21.8%

Undecided 29.8%

And, for those who were five years or more from retirement:

No impact 36.3%

I will retire sooner than I had planned 2.7%

I will retire later than I had planned 29.4%

Undecided 32.1%

Many readers had a strong opinion because of how the pay freeze impacts them on a personal level. On many subjects, there is a wide diversity of opinion. That is not the case in this instance as the 500 or so readers who sent in their written opinion often sounded similar. Here is a representative sample of the written response from our readers:

  • I was looking forward to boosting my high-3 – now I am flatlined for 2 years. So why stay? I am so far from being overpaid for what I am responsible for. AND i AM csrs – so I better retire before they make it your high-5. I have been a public servant since November 1975. 
  • My decision to retire (CSRS) was reached earlier in 2010. It’s not a decision one should make on a moment’s notice. There are too many variables in each person’s situation to base the decision to retire at a particular time on one event, though such changes may eventually tip the balance. The preparation needs to be already in place in such an instance.
  • I don’t mind helping, but, I don’t like being the centerpiece of Spending Reduction. If it were equal, across the board, and I mean to include our Armed Forces (100% of them are NOT in a foxhole shooting) then I could understand it. I will be keeping an eye out for any other signs like a change to “High-5”. I WILL be gone if that is in the cards.
  • It is unfair to single out the federal employees for pay freezes when nothing else from the budget has been cut.
  • We would not be addressing this problem if the U.S. would cease it’s useless and very costly police actions around the world.
  • I may have to work longer than planned
  • I am a GS-7, Step 10, so I can’t even get a step increase so my wages are completely frozen for 2 years. Why stick around for nothing? Especially since the cost for our health insurance is going up and the price of gas is going up which makes our commute cost more….I am sorry I voted for O’Bama and have decided to change to Republican.
  • I am an Internal Revenue Agent with 37+ years of service. I was going to work three more years but now I think I will retire in 2011….Seems like I have been sacrificing for 37+ years. This pay freeze just rubs me the wrong way. People on the outside say that Government employees are over paid. I personally don’t feel like I have been over paid. I am a college graduate who could have gone to work anywhere after college. I selected the IRS because of the promises that were made to me more than 37 years ago. I hope the Government will be able to maintain excellent employees in the future. I gave the Government my best from day one and will continue to do so until my last day of employment. I just wish I could have left on a high note!!!
  • I just pray that a high 5 is not enacted.
  • At the very least, it doesn’t make me want to stay, as my “high 3” will stagnate for at least 2 years without a COLA, perhaps longer. I wouldn’t mind the hiring freeze so much except that our so called “leaders” in Washington have stimulated and bailed out everyone but the middle class working person. Additionally, we flock to the aid of everyone else in the world while spending ourselves deeper and deeper into debt as a country. And, of course, let’s continue giving tax breaks to the richest in our country and approving the multitude of “earmarks” our senators blatantly and stupidly put into the budget.
  • I am over 69 years old. The pay freeze and other proposals Congress may be interested in only convince me that I will die at my desk. If they change from basing retirement on 5 instead of 3 years I will never afford to retire. I could lose everything I worked so hard to have in 45 years.
  • I’m sick and tired of the b/s these politicians are making us endure…To hell w/them, I’m out of here!!!!
  • I had already made the decision to retire at the end of 2010. Because of these potential changes, I think it was a good decision.
  • There are soooooo MANY program and spending abuses within the federal government that continue to be albatrosses for ALL taxpayers that should be addressed and cancelled LOOOOONG before individual employee salaries are targeted! Unfortunately, pay freezes and similar actions will have many more detrimental impacts on trying to recruit and retain the BEST qualified employees for the federal governement. Unfortunately, the best qualified will leave, and the remaining employees may not be the cream of the crop needed to manage and lead the critical work for ALL taxpayers in the years ahead!
  • I retire in 2 years, so my retirement will be calculated by what I make now, not what I would have made in 2 years.
    It will hurt me when I retire, I may have to work longer and that really isn’t fair. I’m not one of those “highly paid” government workers everyone hears about so much lately. I have a job so certainly I am blessed.

Our thanks to all readers who took the time to vote in this survey and a special thanks to those who sent in their written opinion.