My best friend and I are retiring together; how is this fair? (grandfather, benefits)

[Minervah]

I repped Curmudgeon. If life were fair, we would all be the "fairest of them all."

[fumbling]

I think the public pensions with the SS component and separate retirement annuity and 401K-equivalent should be the model for private sector instead of the source of envy...

[TuborgP]

Originally Posted by fumbling

I think the public pensions with the SS component and separate retirement annuity and 401K-equivalent should be the model for private sector instead of the source of envy...

The crux of the issue is the defined benefit v defined contribution debate.

[Curmudgeon]

Originally Posted by TuborgP

The crux of the issue is the defined benefit v defined contribution debate.

I think the crux of the issue is the fact that many employers offer neither.

[TuborgP]

There are many ways to look at this question including what will the nature of offered workplace savings plans be when offered.
PLANADVISER.com - Employers Shift to Employee Controlled Benefits

More employers offer defined contribution (DC) retirement savings plans (92%) than defined benefit (DB) pension plans (21%) this year, putting the impetus on employees to manage their own retirement savings instead of relying on employer-provided pensions.

[fumbling]

Originally Posted by TuborgP

The crux of the issue is the defined benefit v defined contribution debate.

I agree the "older" public pensions that are 100% defined benefit are probably outdated and are going away. What I'm thinking of are the "newer" public pensions that have are a mix of DB and DC; for example, a SS component that all employees have to pay into, the 401K component that all employees should pay into, and a small defined benefit benefit that is paid primarily by the employer, that should be the model.

[TuborgP]

Originally Posted by fumbling

I agree the "older" public pensions that are 100% defined benefit are probably outdated and are going away. What I'm thinking of are the "newer" public pensions that have are a mix of DB and DC; for example, a SS component that all employees have to pay into, the 401K component that all employees should pay into, and a small defined benefit benefit that is paid primarily by the employer, that should be the model.

Do you have any links or can you tell me some government pensions that are going that way. I would love to read up on.

[fumbling]

Originally Posted by TuborgP

Do you have any links or can you tell me some government pensions that are going that way. I would love to read up on.

For the federal government, FERS is the newer pension model with the TSP (defined contribution), SS and small annuity (defined benefits), while the CSRS is the older pension model that is purely defined benefit that is being phased out.

[akck]

Originally Posted by TuborgP

Do you have any links or can you tell me some government pensions that are going that way. I would love to read up on.

Here's the evolution of my state's pension plan:

http://doa.alaska.gov/drb/pdf/pers/p...ri-ivchart.pdf

Main points are going from DB to DC and revised medical benefits.

[TuborgP]

Originally Posted by akck

Here's the evolution of my state's pension plan:

http://doa.alaska.gov/drb/pdf/pers/p...ri-ivchart.pdf

Main points are going from DB to DC and revised medical benefits.

Thank you, very informative. How do you like it? I can understand differences in employee groups for vesting and time served etc but why the difference in contribution rates and why are school district employees higher? Also they have highest five years and others fewer years.