March 16, 2012
One decade from now, federal retirement will carry a much larger price tag.
According to multiple reports released this month by the Congressional Budget Office and analyzed Friday by The Washington Post, the number of federal retirees is likely to grow by 10 percent during the next decade and total spending on federal retirement will increase by about 30 percent during the same time.
In a series of documents setting baselines for federal benefit programs, CBO predicted that by 2022, the number of federal employees and survivors in the Civil Service Retirement System will decrease from 2 million to 1.5 million. But during the same period, the number of beneficiaries of the newer Federal Employees Retirement System will balloon from 506,000 to 1.2 million. The combined average monthly benefits for both groups will increase; CSRS beneficiaries will receive an average of $3,781 per month in 2022 compared to $2,677 monthly in 2012, and FERS beneficiaries will see their monthly benefits rise from $1,088 to $1,584.
While CBO expects total federal retirement spending to grow from $73.9 billion to $95.7 billion during the next decade, it predicts even bigger increases in Social Security spending, with combined annual outlays expected to jump from $660 billion to $1.3 trillion. The number of beneficiaries under the main program, known as old-age and survivors insurance, will grow from 42.8 million to 61.8 million, and participation in the disability program will increase from 9.7 million to 12.3 million.
Meanwhile, CBO predicts the cost of military retirement benefits to rise from $49 billion to $75.1 billion, even though the number of military retirees will remain around the 2 million mark.
(Image via Jill Battaglia/Shutterstock.com)
March 16, 2012