Preparation for the loss of a paycheck when the funding lapse loomed revealed much about how our benefits are handled and prompted many of us to ponder our personal finances. One of the biggest surprises for me was the potential impact on vision and dental insurance premiums. I’m certainly glad no one in the Judiciary ever went without a paycheck, but the anxiety we all experienced should prompt some review of our personal finances. And while the funding lapse threatened us all, each of us may have sudden financial challenges. I offer the following, not as a financial expert, but based on my own life experiences and observations of the many employees I have supervised. Consider whether any of these points apply to your situation:
• Emergency Savings. The first part of our safety net is savings we can tap if we no longer get a paycheck. Many struggle to reach a savings account balance sufficient to cover three to six months of expenses – the recommended amount. Are we really at risk of being without a paycheck for six months? We may not need to plan for that long without pay. Set the goal of saving the equivalent of one pay check by the end of this fiscal year. Save the equivalent of another pay check in the following fiscal year, etc. You will have enough in a few years to get you through any extended crisis.
• Life Insurance. It was good to learn that our federal group life insurance would continue for a full year even if we aren’t getting paid. Other valid reasons exist for maintaining some life insurance separate and apart from FEGLI. First, coverage might be less expensive. Second, one might want to have a policy that will continue if we leave federal service before retirement. Ponder this scenario: a serious health problem impacts your ability to work and also makes the purchase of life insurance very expensive. It may be a good idea to have a non-FEGLI policy in place now, while it is affordable. One place you can explore life insurance options is at the Benefits section of NCBC’s website.
• Disability Insurance. We may not experience a threat to our paychecks in the near future, but each of us is at risk for an illness or injury that renders us unable to work for an extended period. Healthy leave balances may be your best disability insurance, and the voluntary leave transfer program is also some protection. Sometimes we can’t maintain a high leave balance – and do you really want to rely on the kindness of strangers to protect your financial well being? A short term disability insurance policy might be appropriate for your situation. Again, you can explore options at the Benefits section of NCBC’s website.
• Employee Assistance Program. Finally, one of the most overlooked benefits we enjoy as court employees is EAP. If you think you would benefit from some individual financial counseling, EAP is a great option. It’s free and confidential. The best time to obtain such counseling is NOW – don’t wait until the next financial crisis looms!
• Emergency Savings. The first part of our safety net is savings we can tap if we no longer get a paycheck. Many struggle to reach a savings account balance sufficient to cover three to six months of expenses – the recommended amount. Are we really at risk of being without a paycheck for six months? We may not need to plan for that long without pay. Set the goal of saving the equivalent of one pay check by the end of this fiscal year. Save the equivalent of another pay check in the following fiscal year, etc. You will have enough in a few years to get you through any extended crisis.
• Life Insurance. It was good to learn that our federal group life insurance would continue for a full year even if we aren’t getting paid. Other valid reasons exist for maintaining some life insurance separate and apart from FEGLI. First, coverage might be less expensive. Second, one might want to have a policy that will continue if we leave federal service before retirement. Ponder this scenario: a serious health problem impacts your ability to work and also makes the purchase of life insurance very expensive. It may be a good idea to have a non-FEGLI policy in place now, while it is affordable. One place you can explore life insurance options is at the Benefits section of NCBC’s website.
• Disability Insurance. We may not experience a threat to our paychecks in the near future, but each of us is at risk for an illness or injury that renders us unable to work for an extended period. Healthy leave balances may be your best disability insurance, and the voluntary leave transfer program is also some protection. Sometimes we can’t maintain a high leave balance – and do you really want to rely on the kindness of strangers to protect your financial well being? A short term disability insurance policy might be appropriate for your situation. Again, you can explore options at the Benefits section of NCBC’s website.
• Employee Assistance Program. Finally, one of the most overlooked benefits we enjoy as court employees is EAP. If you think you would benefit from some individual financial counseling, EAP is a great option. It’s free and confidential. The best time to obtain such counseling is NOW – don’t wait until the next financial crisis looms!