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Furloughed workers face threat of no back pay

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10 months ago

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Commuters cross the street near the Federal Aviation Administration (FAA) headquarters on October 1, 2025 in Washington, DC.

Al Drago | Getty Images News | Getty Images

Government shutdowns have historically been an precarious time for federal workers, both for those required to remain on the job without pay and those furloughed. This shutdown comes with added financial uncertainty.

A draft memo from the White House, first reported by Axios and confirmed to NBC News by the White House, suggests not all federal workers on furlough are entitled to receive back pay once the government reopens. Asked about back pay, President Donald Trump said on Tuesday, “I would say it depends on who we’re talking about.”

“It really depends on who you’re talking about,” Trump said. “But for the most part, we’re going to take care of our people. There are some people that really don’t deserve to be taken care of, and we’ll take care of them in a different way.”

Trump has also threatened mass firings, if Democrats won’t agree to the GOP funding proposal.

Back pay guaranteed by law

The memo runs counter to a federal law that requires back pay for federal workers after a shutdown ends, and to recent guidance from the Trump administration.

Congress passed the Government Employee Fair Treatment Act of 2019, and Trump signed it, after the last government shutdown, which lasted for a record 35 days.

“Each employee of the United States Government or of a District of Columbia public employer furloughed as a result of a covered lapse in appropriations shall be paid for the period of the lapse in appropriations,” according to the law.

In prior shutdowns, Congress would pass a bill to provide federal workers with back pay.

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The American Federation of Government Employees, the largest union of federal workers, called the administration’s argument “frivolous” and “an obvious misinterpretation of the law.”

“It is also inconsistent with the Trump administration’s own guidance from mere days ago, which clearly and correctly states that furloughed employees will receive retroactive pay for the time they were out of work as quickly as possible once the shutdown is over,” Everett Kelley, the national president of AFGE, said in a statement.

The Office of Personnel Management, the government’s equivalent of a human resources department, issued guidance dated September 2025 stating that retroactive pay will be available for federal employees affected by a lapse in appropriations “as soon as possible after the lapse in appropriations ends.”

Federal workers may have other legal options

“The federal government’s threat not to pay furloughed federal employees is both alarming and legally questionable,” said Tom Spiggle, a labor and employment attorney and founder of the Spiggle Law Firm in Washington, D.C.

If the administration does not provide back pay, workers may have other legal options, he said, including bringing a case under the Fair Labor Standards Act. They could also appeal through the Merit Systems Protection Board, an independent agency charged with protecting federal employees. A class action lawsuit may also be an option.

“Federal employees should document their losses and preserve records of any communications or threats related to pay,” Spiggle said. Those legal avenues for recourse can take months, if not years, to resolve.

If you’re missing paychecks, here are some strategies to cope with delayed or lost income. 

Focus on cash flow

Start with a vigorous accounting of expenses: “Three things you really need to focus on … cash flow, cash flow and cash flow,” said Mary Clements Evans, a certified financial planner and owner of Evans Wealth Strategies in Emmaus, Pennsylvania.

Many people don’t have an understanding of their monthly expenses beyond the large essentials such as rent or mortgage and car payments, she said. Automatic payments and debit or credit card swipes can also make it harder to gauge discretionary spending. 

“We’re in a world where we’re disconnected from our spending habits,” Evans said.

Here's how to manage your finances during a government shutdown

Once you have a handle on expenses, plan for reduced income. This may mean determining which savings to tap and adjusting your budget.

“It sounds like that’s a financial equation, but it’s not. It’s often emotional and psychological, because they feel they’re losing their identity and their status,” said Evans, who is also the author of “Emotionally Invested.”

Reach out to your lenders. Financial institutions may offer payment deferrals, loan modifications and other forms of hardship assistance. For example, Navy Federal Credit Union is offering a Paycheck Assistance Program with zero-interest loans for eligible members affected by the shutdown.

Prepare for possible unemployment

Andreypopov | Istock | Getty Images

The Trump administration’s plan for a “reduction in force,” or RIF, is unique to this shutdown.

“It’s obviously a changing time in terms of the willingness of this administration to take novel views of what has previously been considered, and is from a plain reading, considered clear law,” said John Hatton, staff vice president for policy and programs at the National Active and Retired Federal Employees Association.

During a shutdown, a majority of employees at government agencies funded through the annual appropriations process are typically put on furlough, or unpaid leave, if the agency hasn’t received funding. Those whose work is necessary to protect life or property, or to deliver mandated benefits, are considered essential and required to work, according to the Office of Personnel Management. 

“This is always a difficult situation for federal employees,” Hatton said, “whether they’re working or furloughed or now, adding this new option of receiving a RIF notice, for possible permanent loss of their employment.”

Two federal employee unions, AFGE and the American Federation of State, County and Municipal Employees, have filed a lawsuit to keep the Trump administration from moving forward with RIFs during the shutdown, calling the threat of RIFs unlawful.

There are legal requirements for an RIF: Agencies must provide justification for the layoffs, give written notice to employees 60 days before a layoff and offer an appeals process. During a shutdown, only “essential” functions are supposed to be carried out, and experts say it’s uncertain if carrying out mass layoffs would fit that definition.

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To prepare for a possible layoff, federal employees should research unemployment benefits and determine when their health coverage might end.

Research health insurance costs, too. Workers may be able to extend their federal workplace plan for up to 18 months through the Temporary Continuation of Coverage option — but they still must shoulder the full cost of premiums.

For now, a more affordable option could be marketplace coverage under the Affordable Care Act.

“You can go and you can get insurance through them, and that is based on your income,” Evans said.

However, the enhanced subsidies that have kept premiums low are set to expire at the end of the year, unless Congress acts.

The subsidies are a key sticking point in the current government funding debate. Democrats say they want to extend them as part of the current budget negotiations, while Republicans say they want to debate the policy only after averting a shutdown.

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$20,000 Caution Bond Requirement for US Visa Applications imposed on 50 Countries

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6 days ago

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August 8, 2026

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The United States Department of State has officially implemented a revised visa policy introducing a mandatory posting requirement for caution payments of up to $20,000 on select foreign travel applications. Under the updated regulatory framework, consular officials are authorized to require temporary nonimmigrant visa applicants from targeted foreign countries to post a refundable financial bond of $20,000 as a condition for visa issuance. The policy mechanism is designed to address diplomatic concerns regarding high overstay rates among temporary visitor, business, and educational visa categories.

The caution bond pilot program applies selectively to foreign nationals from designated countries whose diplomatic entities record historical visa overstay rates exceeding established federal thresholds. Under administrative guidelines published by the State Department, the full financial deposit is posted directly to a dedicated federal escrow account prior to final visa issuance. The entire caution payment is automatically refunded to the applicant upon verified proof of timely departure from the United States in strict compliance with the authorized duration of stay. Conversely, failure to depart within the legal timeframe results in full forfeiture of the posted financial bond to the United States government.

Diplomatic representatives and travel policy experts have expressed varying perspectives regarding the operational implementation of the caution bond system. Administration officials emphasize that the measure serves as an effective, market-based incentive to enforce international travel compliance and preserve domestic immigration security standards. However, international trade organizations and foreign diplomatic missions have raised concerns regarding the financial burden imposed on legitimate business travelers, foreign students, and commercial partners from developing nations.

The United States finalized the rule to make the temporary visa bond program permanent, taking effect on August 3, 2026. The updated permanent regulation replaces the prior 12-month pilot, eliminates the lowest $5,000 tier, and raises the maximum required bond amount to $20,000 for specific B-1/B-2 business and tourist visa applicants.

Here is the list of the 50 countries on the list as o August 3, 2026

African Nations (31 Countries)

  • Algeria
  • Angola
  • Benin
  • Botswana
  • Burundi
  • Cabo Verde (Cape Verde)
  • Central African Republic
  • Côte d’Ivoire (Ivory Coast)
  • Djibouti
  • Ethiopia
  • Gabon
  • The Gambia
  • Ghana
  • Guinea
  • Guinea-Bissau
  • Lesotho
  • Malawi
  • Mauritania
  • Mauritius
  • Mozambique
  • Namibia
  • Nigeria
  • São Tomé and Príncipe
  • Senegal
  • Seychelles
  • Tanzania
  • Togo
  • Tunisia
  • Uganda
  • Zambia
  • Zimbabwe

Asian & Eastern European Nations (11 Countries)

  • Bangladesh
  • Bhutan
  • Cambodia
  • Georgia
  • Kyrgyzstan
  • Mongolia
  • Nepal
  • Papua New Guinea
  • Tajikistan
  • Turkmenistan
  • Uzbekistan

Caribbean & Latin American Nations (5 Countries)

  • Antigua and Barbuda
  • Cuba
  • Dominica
  • Grenada
  • Venezuela

Oceanian Nations (3 Countries)

  • Fiji
  • Tonga
  • Vanuatu

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Personal Finance

Next-Generation Retirement Planning: Managing Longevity Risk and Variable Income Streams

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1 week ago

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August 7, 2026

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Retirement planning strategies are evolving in 2026 to address increased life expectancies, shifting dynamic market conditions, and the transition away from traditional defined-benefit pensions. Individual investors and financial advisors are abandoning rigid retirement models in favor of flexible, multi-asset strategies designed to mitigate longevity risk and preserve purchasing power over multi-decade retirement horizons.

Mitigating Longevity Risk with Dynamic Asset Allocation
As average life expectancies extend past eighty-five years, one of the primary financial risks facing retirees is outliving their accumulated wealth. Traditional fixed income allocations—such as the standard 60/40 equity-to-bond portfolio—are being reevaluated to ensure portfolios generate sufficient capital growth alongside reliable income.

Financial planners recommend maintaining a meaningful equity allocation throughout retirement to offset long-term inflation erosion. High-dividend equity funds, global real estate investment trusts (REITs), and inflation-indexed Treasuries are combined to create diversified portfolios that deliver both growth and income stability.

The Transition to Dynamic Withdrawal Strategies
The classic “4% safe withdrawal rule” is increasingly replaced by dynamic withdrawal strategies that adapt annually based on market performance. Under a dynamic withdrawal framework, retirees adjust their annual distribution rates within pre-set caps and floors:
– Market Upside: During strong market returns, retirees can increase discretionary spending or fund family legacy gifts.
– Market Downturns: During market pullbacks, spending distributions are temporarily reduced to prevent sequence-of-returns risk and preserve core investment principal.

Guaranteed Lifetime Income Options and Deferred Annuities
To establish a guaranteed baseline for essential living expenses, individuals are incorporating modern fixed-indexed and deferred longevity annuities into their broader retirement architectures. Modern annuity structures offer competitive return caps, transparent fee schedules, and inflation-adjustment options.

By funding essential expenses—such as housing, healthcare, and insurance—with guaranteed income streams from Social Security, pensions, and annuities, retirees can manage discretionary investment portfolios with greater flexibility and lower emotional stress during market volatility.

Actionable Steps for Future Retirees
1. Calculate Baseline Retirement Expenses: Determine fixed living costs and map guaranteed income sources to cover essential expenditures.
2. Adopt Flexible Withdrawal Rules: Implement dynamic spending rules to protect investment principal against market downturns.
3. Incorporate Inflation-Protected Assets: Maintain exposure to dividend-growing equities and inflation-indexed bonds to safeguard long-term purchasing power.

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Personal Finance

Building Generational Wealth: Family Governance, Estate Tax Optimization, and Asset Protection

Published

2 weeks ago

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August 1, 2026

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As the largest intergenerational transfer of wealth in history accelerates, high-net-worth families, entrepreneurs, and individual investors are placing heightened emphasis on comprehensive estate planning, family governance, and asset protection. Preserving capital across generations requires a balanced approach combining tax-efficient legal structures with open family communication and financial literacy education.

Optimizing Estate Tax Exemptions and Trust Structures
With potential modifications to federal estate tax exemption thresholds on the horizon, proactive estate planning is essential for high-net-worth households. Estate planning attorneys and wealth advisors are establishing multi-generational trust structures to transfer wealth efficiently while minimizing estate and gift tax exposure.

Popular structural strategies include:
– Irrevocable Life Insurance Trusts (ILITs): Utilizing life insurance proceeds to provide liquidity for estate tax obligations without expanding the taxable estate.
– Grantor Retained Annuity Trusts (GRATs): Transferring rapidly appreciating assets to beneficiaries with minimal gift tax consequences.
– Dynasty Trusts: Preserving wealth across multiple generations while providing long-term asset protection from creditor claims and legal liabilities.

Establishing Family Governance and Financial Education
Legal and financial structures alone cannot guarantee long-term wealth preservation without effective family governance. Financial advisors report that a significant percentage of multi-generational wealth dissipation stems from lack of communication and inadequate financial preparation among heir generations.

Families are establishing formal family governance frameworks, including periodic family meetings, written mission statements, and structured philanthropic foundations. Involving younger family members in charitable grant-making and investment discussions fosters financial stewardship and prepares heirs to manage family assets responsibly.

Digital Asset Custody and Legacy Planning
In today’s modern economy, estate planning must extend beyond physical real estate and traditional brokerage accounts to encompass digital assets. Comprehensive estate plans now include detailed inventories and legal access protocols for corporate domain names, intellectual property, digital media rights, and cryptocurrency holdings.

Fiduciaries and estate executors should be provided with secure, encrypted access mechanisms and clear legal authority to manage and transfer digital holdings in accordance with the owner’s estate directions.

Practical Steps for Legacy Planning
1. Review and Update Estate Documents: Ensure wills, revocable trusts, and power-of-attorney designations accurately reflect current family structures.
2. Establish Structured Trusts: Utilize irrevocable trusts to protect assets from creditors and minimize future estate tax liabilities.
3. Create a Digital Estate Inventory: Document access protocols and legal permissions for all online accounts, intellectual property, and digital assets.

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