Potential Risk for Public Pensions (tax, place, difference, Illinois)

[Escort Rider]

Originally Posted by Beach Sportsfan

Florida is 1.6 and you must reach 62 That's why I said I would have gladly contributed your % to get that 2.4.
So right now we are putting 3% which is not helping the pension as originally stipulated and after 30 years I will get 48% for pension

Originally Posted by tom1944

NJ is 1.8 and the employee contributes 7.5%

I completely understand where you folks are coming from. Those percentages are really quite low, and indeed I am grateful and thankful for my 2.4%. In Louisiana it's 2.5%, unless they have lowered it in recent years. Again, there is considerable variation among the states. By the way, for a long time the California maximum percent for teachers was 2.0%, then about 15 years ago (give or take, as that's a guess on my part) the legislature raised it to 2.4%.

[tom1944]

Escort I am not critical that was part of your compensation packet. NJ now has a formula of 1.67 and contribute 7.5% for the new tier employees.

[Beach Sportsfan]

In Florida I'm worried because some legislators have been pushing for all new hires to go into the 401k route and not the pension but of course if all the new hires goes into those individual plans how will the state continue to pay those still in the pension fund. I think it's a way for them to eventually cry they are bankrupt and not pay it at the assigned rate.

[tom1944]

In the devastating Detroit bankruptcy the pensions were cut 4.5%.

[Escort Rider]

Originally Posted by tom1944

In the devastating Detroit bankruptcy the pensions were cut 4.5%.

Good point. While that must be tough on Detroit retirees, I was surprised the cut was not even greater.

[TuborgP]

Originally Posted by Escort Rider

Good point. While that must be tough on Detroit retirees, I was surprised the cut was not even greater.

That's the cut for now. It makes assumptions about future solvency that may or may not pan out.

[NewToCA]

Originally Posted by TuborgP

That's the cut for now. It makes assumptions about future solvency that may or may not pan out.

A really important point that the Stockton retirees must be concerned about right now.

[mlb]

20 Best & Worst States for Pension Funding

[Escort Rider]

Originally Posted by mlb

20 Best & Worst States for Pension Funding

Thanks for the link, mlb. I found it interesting. Not only are the 10 best funded pension states and the 10 worst funded pension states given, but the percent of funding is listed, which ranges from 99.9% (Wisconsin, the best state) to 43.4% (Illinois, the worst state). In a sense, Illinois is even worse off than its last place ranking would indicate, because the second worst state (Kentucky) is funded at 53.4%, ten whole percentage points better than Illinois! Illinois is in a league of its own!

[mlb]

Adjusted Pension Liability Medians for U.S. States:

http://www.ncsl.org/documents/summit...ty-Medians.pdf