By Scott Kupor, Director, U.S. Office of Personnel Management

November 7, 2025

Human beings are creatures of habit. Mostly that’s a good thing – habits are a good heuristic to enhance our safety, predictability and, sometimes, economy. We don’t need to rethink from first principles everything we do on a daily basis – life would grind to a halt if we did.

But, when habit supplants critical thinking and our ability to change with the times when circumstances merit it, it can lead to organizational stasis. We forget the reason why we developed the habit and keep doing things the same way because – well – that’s the way we’ve always done it.

This can happen in any organization and, not surprisingly, it happens in the federal government.  Some processes are rooted more in tradition – or even urban legend. For example, maybe we were sued sometime many moons ago over some past practice, so we developed a new one in its place. And now years later that practice persists independent of whether the original problem for which it was proposed is still relevant. Simply put, we are often fighting the last battle.

It’s not that people don’t care—quite the opposite. Most of the time, those systems were built to prevent something bad from happening – it’s generally good not to get sued. But in trying to eliminate all risk or by refusing to periodically ask whether the risk that we perceived is still valid, we sometimes make it harder to do what’s right for the people we serve.

A great example in my organization is how we handle interim pay for new retirees. Interim pay is the first check you receive after leaving federal service, essentially a bridge while OPM finishes processing your full retirement package. Basically, our team is doing a rough calculation of what we think you will be owed and then we pay out 80% of that amount to the annuitant. For years, we had a bunch of “stopper codes” that automatically prevented interim pay from being issued in certain situations where we felt as though the estimates might be too complicated because of, for example, a federal law enforcement officer who may have had a period of part time service. The goal was a good one – to avoid the possibility of overpayment.

But that “do not take any risk of overpayment” mindset came with a cost: retirees waiting too long for their first check. And this would be exacerbated further in 2025 because of the heavier than normal volume of retirements owing to the voluntary retirement and deferred resignation programs we made available to federal employees earlier in the year.

So, we took a step back and asked, “What’s the real risk here?” What has been our actual track record of overpayment? In cases of overpayment, what has been our actual track record of being able to timely recoup those payments in the future? And what is the range of possible actual financial losses if we do in fact slightly overpay someone and can’t recoup?

And then we needed to weigh that modicum of risk against the risk of delaying retirees’ payments for weeks or months. After all, these are individuals who are used to getting bi-weekly paychecks and likely have planned their cash flow needs around that. What is the real hardship a delay in cash flow may create in terms of paying their rent, groceries, car payments, etc.? After all, these individuals have spent decades serving their country.

For you quant folks, here’s the quick math. The average annuitant receives about $3,400 per month in retirement benefits. Typically, about 100,000 people retire each year. So, if we automatically paid out $2,720 (80% of $3,400) in interim pay to get people money within 15-30 days vs the normal 45-60 days, the government would pay out about $272 million in incremental interim pay.

So, what is the “cost” of that? Well, we earn about 2.5% annually on our $1.1 trillion retirement trust fund, so the “cost” of paying people earlier is the foregone interest payments that would otherwise accrue to the trust fund. That turns out to be $567,000, or a 0.00005% impact to the trust fund. [OPM’s track record on over-payments is pretty much zero and we’ve almost never not recovered fully any over-payments, so we don’t have any real potential loss of additional dollars.]

Now, I don’t like giving up any money – if you ask any of my friends, you may sometimes hear the adjective “cheap” used to describe me. I prefer “frugal,” but oh well! But, to have a financially negligible impact on the trust fund for the benefit of ensuring our retirees don’t experience financial difficulties on their path to retirement seems like a great ROI from my perspective.

That’s where the idea of “measured risk” comes in. I’m not talking about taking reckless chances but being smart about tradeoffs. Our Retirement Services team dug into the data, reviewed every “stopper” we had in place, and found ways to streamline the process without sacrificing accountability. The result? More retirees getting their interim pay faster, with fewer unnecessary holds.

About 75% of retiree applicants are currently receiving automatic interim pay. This is up from 30-40% under our old process, and our goal is for 100% of retiring federal workers to receive that interim payment within 30 days as they wait for their application to be processed. We do that by taking this measured risk. Questioning old habits, comparing downside risk to upside opportunity is a mindset we are developing at OPM. It’s part of how we modernize: not just with new technology, but with new thinking.

We recently published a new FAQ for retirees that explains what we’re doing to improve the retirement process as we prepare for a surge in applications. And as of last month, retirees can now track their retirement via the Retirement Processing Times page on the OPM website. It’s one more way we’re putting transparency and service at the center of everything we do.

Sometimes progress means changing how we think about risk. And if that means moving a little faster to get people what they’ve earned, then that’s a risk worth taking. No more fighting the last battle.