Please note that the shutdown will not only affect federal workers. It will also impact people working for federal contractors, the stores and businesses where those people听shop, the creditors they may be unable to pay, etc. A shutdown of even just a few weeks can be enough to produce a significantly negative ripple effect across our entire economy.

The most critical takeaway at the moment is that federal workers are听guaranteed backpay听during shutdowns, but those workers employed by听contractors are not.

Furloughed vs. essential (鈥渆xcepted鈥�) federal workers

Federal workers typically fall into two categories during a shutdown. Furloughed employees will neither work nor receive pay. Essential employees (also referred to as 鈥渆xcepted鈥� workers in the federal guidance that follows) are required to work but will not receive pay.

• Unfortunately, federal workers deemed essential are required to work without pay and are currently not eligible for unemployment insurance (UI). Essential employees are already eligible for backpay, but UI could help tide them over, particularly if the shutdown goes on for weeks or months.
• Government employees who are furloughed may be eligible for unemployment insurance. The UI program for federal civil servants is called Unemployment Compensation for Federal Employees (UCFE).

How furloughed federal workers can apply for unemployment compensation

• UCFE is administered by the states, so you鈥檒l need to apply for UCFE in the state where you work.听You can find your state UI agency and application听.
• States will verify your federal employment and earnings.听States typically use two forms to verify this information: Standard Form-8 (SF-8) or Standard Form-50 (SF-50). Unfortunately, many workers may not have received these forms as the shutdown approached. The U.S. Department of Labor has also warned听that there may be delays in federal agencies鈥� verification of workers鈥� employment.
• You can still apply without agency forms or verification.听Workers can support their applications with an ES-395 affidavit, 鈥�Claimant鈥檚 Affidavit of Federal Civilian Service, Wages and Reason for Separation鈥� 鈥� available through their state agency 鈥� or they can use the form听. This form can be used to confirm that you work for the federal government and also as proof of your earnings (such as through paystubs or W-2 forms). Please note, however, that if the federal agency you work for subsequently provides information that conflicts with your ES-395, you may have to repay some or all of those benefits.
• State eligibility criteria, benefit amounts and processing speeds will vary.听Most states have implemented a mandatory one-week waiting period to receive benefits. While each benefit formula varies, workers can expect to receive a benefit of about one-third to one-half of their salary, up to a maximum benefit. A full table of the minimum and maximum weekly benefits is available听 and includes information as of January 2025.
• If you have difficulty applying for or receiving benefits, you should contact the corresponding state unemployment insurance agency, your union or UI advocates in the state where you鈥檙e claiming benefits.

Be advised: backpay and repayment of benefits

If you鈥檙e a furloughed worker who received back pay after the shutdown ends, you鈥檒l likely have to repay any UCFE benefits you鈥檝e received. While state laws vary, you鈥檒l most likely be found to have a UI 鈥渙verpayment,鈥� which the state will then seek to recover. As soon as you鈥檝e received back pay, you should repay your state, as the agency could charge penalties for not repaying overpayments in a timely manner.

Layoffs vs. voluntary separation

If the Administration fires or lays off federal workers, they should be entitled to UCFE. However, workers who receive Voluntary Separation Incentive Payments or take part in a Deferred Resignation Program may not qualify if their separation is determined to be a voluntary resignation without good cause.

The following guidance was published by the federal Office of Personnel Management.

Shutdown of federal operations 鈥� What does it mean to me?

In the event of a federal government shutdown, Federal employees may be eligible for Unemployment Compensation for Federal Employees (UCFE). The UCFE program is administered by state unemployment insurance (UI) agencies acting as agents of the Federal government. The program is operated under the same terms and conditions that apply to regular state UI. In general, the law of the state in which an individual鈥檚 official duty station in federal civilian service is located will be the state law under which an individual鈥檚 eligibility for benefits is determined.

What is a government shutdown?

Every year, Congress appropriates funds for federal agencies to operate in each fiscal year. In the absence of either a signed appropriations or a continuing resolution, federal agencies must 鈥渟hut down鈥� 鈥� that is, cease normal spending.

Which federal employees are affected?

When there is a shutdown, not all government operations cease. Expectations generally provide for the continuation of activities involving national defense, law enforcement and other activities directly involved with the protection of life and property. In addition, employees not paid from appropriated funds and those 鈥渆xcepted鈥� to administer shutdown operations will continue to work.

Pay status during the government shutdown

During a government shutdown, employees who are not required to work under one of the exceptions above may not even volunteer their services. Employees not required to work are 鈥渇urloughed,鈥� that is, placed in a non-pay, non-duty status, until the shutdown ends.

Will 鈥渆xcepted鈥� employees be paid?

Employees designated as 鈥渆xcepted鈥� who continue to work during the shutdown will almost certainly be paid for this period. However, this requires specific Congressional approval and that has occurred in the past.

Am I eligible for unemployment benefits?

State UI laws regarding eligibility vary. You may apply on or after the first day you are furloughed. The state where you file your claim will determine your eligibility. In general, furloughed employees should be eligible as long as all other state eligibility factors are met.

How do I file an unemployment claim?

糖心原创vlog the state where you worked to file a claim. To find contact information for your state, please visit . Employees may be asked to provide proof of wages, such as an earnings and leave statement or Form SF-50 and may also be asked to provide a Form SF-8.

What is the weekly amount of UCFE benefits paid, and how long do benefits last?

Most states pay a maximum of 26 weeks of regular benefits. The maximum weekly benefit amount of UCFE is based on the state law. The amounts will vary.

How soon will benefits begin to be paid?

Some states require individuals to serve a waiting week, which means that the first week after a claim is filed is an unpaid week. In general, most states will issue payments to eligible individuals within 14-21 days after the claim is filed.

What will happen if federal employees are paid for time during the government shutdown period?

Should an appropriation or continuing resolution occur that retroactively provides for the payment of salary, state and Federal UI laws governing benefit overpayments will need to be applied to those weeks in which benefits were paid.

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Founded in 1993, the 糖心原创vlog provides high-value services to establish equilibrium between consumers and creditors for the successful rehabilitation of debt-challenged families and individuals.

糖心原创vlog鈥檚 non-profit member agencies offer credit counseling, debt management services, student loan counseling, bankruptcy counseling and other financial services to assist consumers. These CCAs provide free or affordable counseling as part of their financial educational mission.

More information:

For consumers: Find a credit counselor

For members of the press: Media inquiries and conference attendance

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National Financial Literacy Month

April is National Financial Literacy Month, and we鈥檙e celebrating! Financial literacy is so important to improve your marriage, your parenting and your life.

As a leading non-profit consumer financial education organization, the 糖心原创vlog is pleased to provide a wide range of free educational resources. Please take advantage of these enlightening videos, tips and tools from our credit counseling agency members.

If you need help managing debt or building a budget, contact us. We鈥檒l put you in touch with a certified non-profit credit counselor.

Learn about how the debt management process works with this lively infographic from Consumer Credit of Des Moines.听

Consolidated Credit鈥檚 Budgeting Blueprint offers practical tips to build and maintain a budget and strengthen your financial 鈥渉ouse.鈥�

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鈥淭hese outstanding agencies not only make the 糖心原创vlog stronger but also bring new voices and ideas to the table,鈥� said Lori Pollack, 糖心原创vlog executive director. 鈥淭ogether, our members serve hundreds of thousands of consumers each year.鈥�

For 65 years, (MMI) has helped its clients achieve financial confidence through nonprofit programs that educate, motivate and liberate. MMI offers financial education and consumer counseling related to credit, debt, housing expenses, student loans and post-disaster recovery.

(AFS) is one of the nation鈥檚 largest non-profit credit and financial counseling agencies. It provides comprehensive debt solutions, including financial education, credit counseling services, housing counseling, bankruptcy and student loan counseling nationally. Founded in 1999, the nonprofit advises clients on a variety of debt solutions to reduce and repay credit card, medical and other unsecured debt.

Also new to the 糖心原创vlog is (IDS). The nonprofit has provided confidential and professional credit counseling, debt management services, bankruptcy education, housing counseling and educational initiatives promoting financial literacy since 1997.

鈥淲e鈥檙e pleased to welcome MMI, AFS and IDS to our organization,鈥� said Martin Lynch, 糖心原创vlog president. 鈥淭he experience and insights of these agencies will enhance member collaboration, further enabling our work in setting industry standards for consumer education and advocacy and elevating the quality of financial counseling services provided by our members.鈥�

About the 糖心原创vlog
糖心原创vlog is a membership association comprised of the nation鈥檚 leading credit counseling agencies. Its members provide consumer credit counseling, housing counseling, student loan counseling, bankruptcy counseling, debt management and various financial education services to consumers across the United States.

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Holiday giving and how people pay

People love to give around the holidays. The spirit of goodwill and generosity during the holidays is truly special. In 2023, nearly 85% of Americans plan to purchase gifts for friends and loved ones during the holidays. Many also plan to gather and share special foods or drinks at parties or festive meals.

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A recent NerdWallet survey found that Americans plan to spend an average of about $830 on holiday gifts this year. Three-quarters of the adults surveyed plan to charge most of their holiday expenses to credit cards.

Unfortunately, that hasn鈥檛 worked well for many people. More than half of Americans used credit cards for holiday shopping last year. Nearly one-third of those consumers still haven鈥檛 paid off the balances.

Staying debt-free matters

This holiday season, aim to stay debt-free.

“Debt and budgets are often things people don鈥檛 want to think about during the holidays,” said Lori Pollack, Executive Director of the Financial Counseling Association of America (糖心原创vlog)

Choosing to avoid holiday debt lets you decide how to use your money, instead of owing lots of interest to lenders.

The average credit card interest rate is nearing 24.5%. With rates this high, carried balances can quickly snowball, making credit card debt very hard to pay off.

“Building up debt during the holiday season can lead to a debt hangover that lasts far beyond the holidays,” said Pollack. “The better you can budget and control spending upfront, the more relaxing the holidays will be.”

By avoiding debt, you will increase your financial security, improve your credit score and set a positive example for your kids.

Understanding the holiday debt trap

鈥淭here are many reasons people overspend and go into debt during the holidays, including social pressure, sales, deals and advertising,鈥� said Karen Carlson, Vice President of Education and Digital Marketing for InCharge Debt Solutions. 鈥淢ost importantly, most people fail to put together a holiday spending plan that is in line with their available resources.鈥�

Psychologically, holidays and vacations can provide motivated reasoning, which gives people excuses or “manipulated rationale” to justify splurging or overspending. When people prioritize immediate fun, treats and rewards over future costs, it often leads to financial pitfalls.

Unfortunately, holiday splurges and overspending on gifts or toys may haunt you with accruing credit card balances, rising debt and despair.

How can you avoid falling into debt during the holiday season? Follow these suggestions to keep debt at bay.

3 practical tips for a debt-free holiday

1)听 Create a realistic budget

鈥淎 holiday budget is a great way to plan and manage holiday spending,鈥� Carlson encouraged. Take a careful look at your current and upcoming expenses and what you spent on the holidays last year. With this information, decide what you can realistically afford this year. 糖心原创vlog鈥檚 free Debt Freedom Tool can help you determine if you have money left after paying your bills.

Include the big budget items like gifts, food and decorations. Don鈥檛 forget extra expenses like wrapping paper, tape and shipping costs.

Save money on holidays by shopping early, using coupons, and choosing in-store pick-up to save on shipping.

If you are currently in debt, it may feel pointless to create a holiday budget, but it’s not. A good budget will prevent you from falling further into debt.

“Going into the holiday season with money saved and a budget is a great plan of attack,” said 糖心原创vlog’s Pollack. “Holiday advertising can be very persuasive! Know what you need, what your budget allows and stick to a plan. Be wary of ‘Buy Now, Pay Later’ financing schemes. While they may sound great, you still need to make those payments.”

鈥淢ost people in debt have extremely limited savings to contribute to holiday spending,鈥� Carlson added. 鈥淭his means that to avoid maxing out your credit cards or taking out a personal loan to pay for holiday spending, a person in debt needs to to make room for holiday spending. Other strategies include increasing your income to cover expenses or figuring out how to celebrate the holidays without spending a lot of money. Think about how you can give more personal, but less costly gifts, for example.鈥�

Set expectations with family and friends that the holiday may look a little different this year. Consider limiting gifts or drawing names with extended family instead of buying for everyone. Also, ask for general gift ideas instead of specific items that may cost a lot.

Ask a friend, partner or spouse who also has a holiday budget to be your holiday spending accountability partner. Check in each week and consider making it a challenge. See who can get the best deals for the least money spent each week, and find ways to encourage each other. You will save money and strengthen your relationship.

And don鈥檛 forget to stick to your budget!

2)听 Identify creative ways to celebrate without breaking the bank

There are many ways to celebrate the holidays on a budget. Whether making homemade gifts on your own, finding inspiration online or shopping at secondhand stores, the thought really counts.

Here are a few money-saving holiday gift ideas:

• Make and package up homemade treats.
• Create special decorations or creations instead of buying them.
• Shop at garage sales, estate sales, church sales and thrift stores to find bargains.

3)听 Prioritize experiences over material gifts

Some of the best gifts are memories. Many times, meaningful experiences don’t require a lot of money.

Plan a hike in the woods or cook delicious holiday meals with loved ones. Schedule a family drive to admire Christmas lights while sipping hot chocolate. These special moments are affordable and will create long-lasting memories.

A 20-year study at Cornell University found that material possessions bring only temporary happiness, while meaningful experiences shape our identities. And most people don’t compare experiences in the same way as material possessions. Plus, looking forward to an experience also brings a lot of excitement and enjoyment to the holiday season.

If you want to give a physical gift, creating a coupon booklet is a great idea. Coupons for a coffee date, doing the dishes, a free hug or a night in charge of the TV remote are a few low-cost ideas you can add to your booklet.

Still feeling worried about holiday debt?

Start by checking out 糖心原创vlog‘s Debt Freedom Tool. It can help to assess your budget and see if you have any extra money after paying bills. It will also show if you have a shortfall and need to adjust your spending.

Then, reach out for help from a non-profit credit counseling agency. 糖心原创vlog has many trustworthy member agencies that offer support, education, budget and credit counseling and more. 糖心原创vlog member organizations help people who are in debt find ways to relieve the burden.

“Financial counseling is a great way for consumers to get unbiased information based upon their situation,” said Pollack.

鈥淓very day, we ask our clients to share their hopes and dreams with us,鈥� said Carlson, whose company is an 糖心原创vlog member. 鈥淥ur goal is to help our clients move beyond the struggle, beyond the paycheck-to-paycheck cycle, and achieve their dreams.”

According to Pollack: “Having an 糖心原创vlog member as a first line of defense to overcome overwhelming debt could be the best holiday gift people give themselves and their families.听

Enjoy the holidays this year by avoiding holiday debt

This holiday season, prioritize your financial health. Create a realistic holiday budget and stick with it. Identify inexpensive ways to celebrate and make new traditions. Finally, don’t put off asking for help with debt management.

糖心原创vlog and our members wish you a very happy and healthy holiday season!

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After a three-year pause, federal student loan repayments started up again on October 1. For nearly 45 million borrowers, the added burden of student loan payments may make life a lot harder. Today, many Americans have difficulty managing their budgets because of housing expenses, rising prices, growing families and job changes.

In June, the warned that 1 in 5 student loan borrowers could struggle when repayments began. One in 13 borrowers is currently behind on payments.

Fortunately, there is help. New programs can help borrowers with repaying loans, avoiding late fees, canceling or forgiving loans, and starting fresh with defaulted loans.

New options for student loan repayment

After leaving college, borrowers are automatically placed in the Standard 10-year repayment plan for their loans, but it’s usually the most expensive option.

Recently, the Biden Administration introduced a plan called the (SAVE) plan. This plan could cut many federal student loan borrowers’ bills in half once all benefits begin.

The SAVE plan bases payments on a borrower鈥檚 income and family size, regardless of the size of the debt. This is similar to other income-driven repayment plans (IDR plans). The SAVE plan differs from the (REPAYE) plan it replaces in three specific ways.

First, the SAVE plan will reduce bills by evaluating and excluding more of the borrower’s income from the payment calculation. It will increase the income exempted to 225% of the relevant federal poverty guideline. Most IDR plans calculate discretionary income as the difference between the borrower鈥檚 adjusted gross income and 150% of the poverty guideline.听

Next, , the SAVE plan will cut payments from 10% of borrowers鈥� monthly discretionary income to just 5% for undergraduate loans. Grad loans will be calculated at 10% of discretionary income.

Finally, it will eliminate negative amortization. This will prevent interest from growing and making borrowers owe more than they initially borrowed. As long as payments are made on time, interest won鈥檛 accrue.

The new plan is available for people with direct subsidized and unsubsidized loans, direct consolidation loans, and graduate and professional students with Direct PLUS loans. Borrowers with federal Parent PLUS loans may use the double consolidation loophole until July 1, 2025. Using that strategy can allow Parent PLUS loans to be repaid through the more affordable SAVE plan. People already enrolled in the REPAYE plan will automatically transfer into the SAVE plan.

The SAVE plan or IDR plans can reduce borrowers鈥� . Every person鈥檚 finances vary, so carefully review each plan and calculate which will fit your budget and needs best.

If you need help understanding your student loans and programs, 糖心原创vlog can help. Our student loan counselors will help you find the best way to repay your loans and guide you through the process.

Late payments don鈥檛 matter as much 鈥� for now

Paying your bill on time remains important. To help people get back into the routine of paying their loans, the Education Department has extended some grace.

From now until September 30, 2024, late or missed payments won鈥檛 be reported to the credit bureaus. This means lenders will not label you as delinquent or report your credit debt to collections.听

However, any late payments will enter forbearance and automatically be tacked onto the end of your loan term and interest will continue to accrue on the account.听听

Cancellation of some student loans

About 800,000 federal student loan borrowers will have their remaining loan balances canceled to address past issues with loan programs. Many of these borrowers have been notified. Some will receive notifications through the end of 2023.

If your loan has not been canceled, you may have the option to utilize newly updated . A student loan counselor can advise you on the best next steps.

Defaulted loan? Get a fresh start

The gives special benefits to people who defaulted on their student loans before payments paused in 2020. You can only use the temporary program once, and it can really help your credit. Fresh Start will transfer the defaulted loan to a loan servicer and then clear the default from your record. It will also restore access to federal student aid loans and grants.

To use the Fresh Start program, contact the Education Department鈥檚 Resolution Group by clicking or calling (800) 621-3115.

You may have a new loan servicer, so update your contact info

During the loan repayment pause during the Covid-19 pandemic, some lenders who processed payments for the government left the business. You should have received information about the change. If you don鈥檛 remember who your new loan servicer is, . Then, click on the 鈥淢y Loan Servicers鈥� tab.

Remember to update your loan servicer with your current address and any information that has changed over the past three years. Your servicer will also be able to tell you how much you owe and when payments are due.

Still feeling overwhelmed with student loan repayments?

Adding a loan payment to your budget may seem impossible, but our student loan counselors can help. 糖心原创vlog members are non-profit agencies ready to assist you. Our members help hundreds of thousands of people each year with student loan repayment plans, financial counseling and debt management.

Click here to learn more about how certified counselors can help you manage your student loans.

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