Smart Money Moves for Feds

Federal employees work in many different fields and enjoy a variety of benefits as part of the work they do. The author presents several tips for federal workers to help strengthen their personal financial situations as they progress through their careers and work towards retirement.

When most people think of federal government employment, they think of Congress and the Senate, or perhaps the Secret Service. In reality, federal government jobs are available for people of almost any skill set, whether they’re interested in law enforcement, languages, science, or technology. Federal government jobs also have a reputation for high salaries, travel opportunities, and perks. Before you can enjoy your federal government job, however, you need to make sure you’re financially literate.

Financial literacy can be intimidating for everyone, including government workers. In fact, as a federal employee, you may feel more intimidated than most because you’re dealing with federal money. With the right knowledge, you can handle both federal and personal dollars expertly. This will ensure you succeed in the workplace and can manage your personal finances more efficiently.

Finance Tips for Federal Employees

Tip 1: Choose the Job You Love

Good personal finance often begins with passion. That is, if you have a job you enjoy, you’re more likely to take care of the money you earn in it. Remember that the federal government offers many job types, so think carefully about the agencies or departments where you’d fit best. If you excelled in foreign languages during school, you might be a good interpreter for any number of government departments, or you might consider working for the CIA or Department of Education. If you have law enforcement experience, consider working for the Department of Interior or the Department of Homeland Security.

Once you’ve narrowed down where you’d like to work, look for job openings on the right websites, and ensure your resume uses the terminology government supervisors are looking for. Do your homework when it comes to salary, as well. Learn what government workers in your desired field are paid and whether your unique experience might influence your salary. Be open and flexible in salary negotiations, but don’t settle for low numbers just because you’re a new employee. Ask to be paid competitively with other employees of your pay grade and experience.

Tip 2: Mind Your Monthly Spending

As stated, federal government jobs are known for high salaries. However, this doesn’t mean every employee begins with a high salary or has plenty of disposable income. In fact, most federal employees are middle- or upper middle-class people who need to watch their budgets just like everyone else. If you’re a federal employee, watch your personal budget with the same keen eye you would the federal budget or the specific monies in your department.

Most banking experts recommend separating monthly expenses by category – utilities, groceries, discretionary funds, and so on. Don’t spend more than you make, and be sure you have a full emergency fund for things like unexpected medical bills. If your budget has special considerations, such as the care of an elderly parent or a child with a disability, ask your bank or financial experts in your network for specialized help.

Tip 3: Watch Your Credit Score

Plenty of people, even those who work with finances, aren’t sure what a credit score is. That little three-digit number tells businesses, and often supervisors, how well you manage your personal finances. A low credit score can negatively influence your ability to get a government job and how you’re perceived in that job. For example, a budget analyst with a low credit score might find himself or herself audited more often or given fewer department funds for travel and discretionary spending.

Credit scores range from 500-850. The higher your score, the better your credit. Aim for a score between 700 and 850 or 750 and 850. Review your credit report often. Pay bills on time, and pay off debt as soon as possible to maintain a good credit score. Keep your credit card balances and other revolving credit balances low; 30 percent or less is the optimum.

Tip 4: Take Advantage of Deals and Special Programs

Federal government employees have many financial opportunities open to them. For example, federal government workers who want to go back to school can apply for Pell Grants and William D. Ford Direct Loans, which makes it easier to further their educations. Scholarships like the David and Marion Cook Memorial Scholarship can be worth as much as $3,000. While this may not sound like much, it can be a huge help to employees or employees’ children who need extra assistance with tuition.

The Federal Employee Education Fund (FEEA) Scholarship Program is another fantastic opportunity for federal employees, including active duty military and veterans. FEEA offers an annual scholarship competition, as well as a child care subsidy and assistance for people going to school while trying to fulfill everyday needs.

As a federal employee, don’t forget about deals and perks in businesses like airlines. Plenty of airlines offer discounts for active duty military members and other federal employees. During the 1995-1996 government shutdown, Delta Airlines reduced its rates by 60%. Retailers offering government discounts allow you to save substantially on everything from checks to storage Pods.

Tip 5: Prepare for Shutdowns

The federal government has experienced at least two shutdowns in the past few decades, one in 1995 and the latest in 2013. The government also narrowly averted a 2015 shutdown a few weeks ago. Furloughs may happen, so don’t panic if you hear one is coming. Instead, be sure you’re prepared. As noted, your emergency fund should be stocked. Go over your budget carefully and find small ways to cut spending, such as foregoing dinner out or buying less gasoline.

No one knows how long a shutdown will last, but resist the temptation to get a part-time job immediately. If you’re from a two-income family, your spouse’s income may help during the shutdown. Also remember that you’ll probably still get a paycheck from your current job; it may simply be delayed. If you do get a part-time job, try to keep your schedule flexible, and try to find a position you can leave quickly if your federal job opens up within several weeks or months.

Tip 6: Plan for Retirement

Even if you’re young, it’s never too early to think about retirement. After all, retirement is the time when elderly parents and relatives might need more care, grandchildren need to be provided for, or travel expenses may arise. Ask about your department or agency’s specific retirement plan, including whether or not you get rewards or extras for staying a certain number of years. For example, you may be eligible for retirement after 20 or 30 years but find you’ll be more comfortable financially if you retire after 35 years.

Make sure you know the meanings and details of basic plans that are available to you, such as the Thrift Savings Plan. Ask your financial adviser about developing the right plan for you, as well as the dollar amount you can save towards retirement each year.

Tip 7: Avoid High-Interest Loans and Debt

Some debt is “good debt.” It’s the debt you paid off on time and handled well. Good debt may come in the form of student loans, medical bills, or your home’s mortgage. However, for every example of good debt, there’s bad debt.

Bad debt is often what it sounds like – the debt you get into when you spend more than you should. As a government employee, it’s easy to let debt get out of control, buying expensive vehicles, clothing, or discretionary items. Avoid high-interest loans that involve writing post-dated checks; you may end up with overdue bills. Additionally, pay attention to principal and interest rates, not just the monthly payment for your credit card, vehicle, or utility bills.

About the Author

Jason Kay is a professional resume writer and regular contributor to, a professional federal resume service and repository of sample KSA statements.