The government is once again staring down a funding deadline, and the possibility of a partial shutdown looms. While Congress may still reach a deal, the uncertainty is real.
In the past, many Feds received back pay once the shutdown ended — but that outcome is never guaranteed. The safest move is to plan as if your next paycheck could be delayed.
What a Partial Shutdown Could Mean for You
During a shutdown, federal employees fall into two broad categories: furloughed (sent home without pay) and excepted or “essential” (required to keep working, but still unpaid until the shutdown ends). Either way, your cash flow may take a hit.
Some programs keep running because their funding is guaranteed. Others slow down or stop. That means you could see delayed pay, changes to your schedule, or reduced access to services you need.
Your Immediate Money Moves (Next 30 Days)
Start with a clear picture of your cash on hand versus your essential expenses. Rent or mortgage, utilities, food, and transportation take priority. Trim non-essential spending and consider pausing extra debt payments for now.
If you anticipate trouble making payments, reach out to lenders or servicers before you fall behind. Many offer hardship programs or short-term forbearance options. Building a bare-bones budget for the next one or two pay cycles gives you a roadmap while things remain uncertain. These practical steps are at the heart of effective federal shutdown financial tips, keeping your focus on essentials first.
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Benefits Check: Health Care, TSP, and Leave
Health benefits under the Federal Employees Health Benefits (FEHB) program or Tricare generally continue, but confirm how premiums are handled if your paycheck is interrupted.
When it comes to retirement, think twice before tapping into your Thrift Savings Plan (TSP). It may be tempting to pull cash through a loan or hardship withdrawal, but those choices carry lasting costs that can weaken your future savings. Take time to look over your TSP options during the government shutdown and treat them as a last resort, not a first move.
If you expect to be placed on leave without pay, keep good records. Track your status, save your paperwork, and review your agency’s rules on leave accrual and carryover so you know exactly where you stand.
If You’re Working Without Pay (Excepted Employees)
If you’re still reporting to work, track your hours meticulously. Keep receipts for any required travel or commuting costs. Stay current on minimum debt payments, but avoid high-interest options like payday loans if possible. If cash gets tight, prioritize essentials — housing, food, transportation — and be proactive with creditors before you miss payments.
Building Resilience if Disruptions Continue
When pay resumes, consider rebuilding your financial cushion immediately. Aim for one to three months of expenses in an emergency fund. If you receive back pay, consider automating a portion straight into savings before resuming discretionary spending.
Take time to review your insurance coverage, flexible spending accounts, and beneficiary designations. Update your contingency budget so you’re not starting from scratch if the cycle of shutdown threats repeats. These steps turn short-term recovery into long-term resilience.
When to Get Professional Help
If you’re weighing a TSP loan, a hardship withdrawal, or struggling to keep up with bills, talk with a fiduciary advisor before making a decision. A CERTIFIED FINANCIAL PLANNER™ (CFP®) can help you balance short-term needs with long-term goals and structure a plan that is designed to mitigate damage to your retirement outlook.
Stay Focused on What You Can Control
Shutdown news is stressful. The best thing you can do is keep it simple — know your numbers, talk to lenders before there’s a problem, and make careful choices with your benefits. That’s how you stay grounded, even if pay is delayed.
If you’d like help evaluating your TSP options during the government shutdown, reach out to the team at Serving Those Who Serve at [email protected].
The information has been obtained from sources considered reliable but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of Serving Those Who Serve writers and not necessarily those of RJFS or Raymond James. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Investing involves risk and you may incur a profit or loss regardless of strategy suggested. Every investor’s situation is unique and you should consider your investment goals, risk tolerance, and time horizon before making any investment or financial decision. Prior to making an investment decision, please consult with your financial advisor about your individual situation. While we are familiar with the tax provisions of the issues presented herein, as Financial Advisors of RJFS, we are not qualified to render advice on tax or legal matters. You should discuss tax or legal matters with the appropriate professional. **
