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Old 07-05-2019, 10:37 AM
 
Location: Pittsford, NY
517 posts, read 624,141 times
Reputation: 578

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I did 10 years in federal government, then some big companies, then my own company for 20 years till I could not do it anymore. I would take the government over all them. But of course realize if for your government work you have to live in DC/MD-Bethesda/NoVa or something you need a million dollars for a house. Being ones own small business is better when it works, and it can work many times, but being really specialized makes that hard when most money goes to big business these days even when you can outbid them you won't get the work. So government wins.
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Old 07-05-2019, 10:53 AM
 
5,332 posts, read 5,295,429 times
Reputation: 12489
Good info already from people like Fishbrains and Sheerbliss. 401k's, 403B's, etc. are nothing to fear.

There are many things to consider, your age, lifestyle, what you want for your future, etc.

Speaking strictly in terms of money, you should calculate the total package and take all factors (or as many as you can) into account - 401k match rate, pension rate, other benefits, etc. I was offered what looked to be a fat raise for jumping to another org. After I calculated the insurance contribution and other factors, it ended up being just under a 10% raise. I still jumped but more for professional development than salary. So I got tons more work and responsibility for not a big difference in money. But that was what I wanted. So in addition to money, you need to decide what you want in a career as well as how to best stay employed.

Best of luck.
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Old 07-05-2019, 10:56 AM
 
25,964 posts, read 32,962,923 times
Reputation: 32143
Quote:
Originally Posted by HolyGuacomole View Post
I know this question has been asked a 1,000 times, but I am just curious. I am in my early 30 and have worked for the gov. for about 7 years. I guess I have gotten a bit spoiled with benefits pension etc. although I don't really make that much money. My question is if you were capable, would you rather have a gov. job making the above amount or a 50k job in the private sector. I am a bit scared because I have no clue how to manage 401ks etc and have not heard anything positive about them. Maybe someone else can shed some light on how they work.
I lost THREE jobs in the private sector to bankrupty or being bought out. I took my last (current) job with a 12K pay cut, in public sector. I have never regretted if for one second. I'd never have been looking at retirement with the comfort level that I have now.
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Old 07-05-2019, 11:40 AM
 
10,058 posts, read 4,648,803 times
Reputation: 15275
Quote:
Originally Posted by ChessieMom View Post
I lost THREE jobs in the private sector to bankrupty or being bought out. I took my last (current) job with a 12K pay cut, in public sector. I have never regretted if for one second. I'd never have been looking at retirement with the comfort level that I have now.
Stop referring to it as a pay cut by default, a pension is a pay deferral. No different than a 401k deferred taxes until retirement.

It could be a pay cut but you won't know until you calculate the value of the pension and what you would need to match it without an equivalent 401k

At the pay rate for op, he would do better taking the higher paying job for 5 years, then going back to a govt job if he still wants in but this time at a higher pay band.

Number wise, the two jobs are fairly equal in compensation. But if he is thinking about a pension, it means he is looking 30 years down the road but using today's salary as a base. A pension on $35k isn't going to be much (~$1500/month)... not worth 30 years when you can build your own portfolio of investments with a higher paying job to get that amount

One thing people don't bring up is social security, the higher salary would have a higher social security too. So that will chip away at what the pension is worth. If SS is higher by $500 a month that is $500 less you need to you match on investments
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Old 07-05-2019, 11:51 AM
 
25,964 posts, read 32,962,923 times
Reputation: 32143
Quote:
Originally Posted by MLSFan View Post
Stop referring to it as a pay cut by default, a pension is a pay deferral. No different than a 401k deferred taxes until retirement.

It could be a pay cut but you won't know until you calculate the value of the pension and what you would need to match it without an equivalent 401k
Stop trying to assign it something other than a retirement plan. It IS. It is absolutely different from a 401k. THAT is a finite amount. The pension is NOT.

I have a pension, AND a 457b retirement account, AND 401k funds. I'm good with the built-in retirement plan - it works.
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Old 07-05-2019, 11:55 AM
 
Location: East of Seattle since 1992, originally from SF Bay Area
29,738 posts, read 54,373,866 times
Reputation: 31023
Look for a public agency that is not dependent on tax dollars, which can go up and down. Those with other revenue sources like airports and public utilities make money from their services, so are more secure, and can offer better benefits. Where I work for example, we have a fixed pension, plus 401K and 457 both with employer matching. In the case of utilities, if they need more money, they simply raise the rates. Airports can raise the rent for new tenants.
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Old 07-05-2019, 11:58 AM
 
10,058 posts, read 4,648,803 times
Reputation: 15275
Quote:
Originally Posted by RamenAddict View Post
You have to look at the overall picture. I know some people who switched and they were happy to make the switch. They were able to see wage growth and actually put more into a 401K.
They don't have to see wage growth... For his comparison, he can max out a 401k AND still have the same living standards as he has with the $35k job. With no changes, does 30 years of maxing out a 401k beat a ~$1500/month pension? That's what the basic math question is right now.

$50k minus $15k into 401k would leave him at $35k. That's his starting line for the comparison. Him " living" better with the higher paying job is lifestyle inflation. He can control that if he wants to retire well. Most seem like they can't so they rather have a pension that forces them
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Old 07-05-2019, 12:02 PM
 
Location: Herndon, VA
2,086 posts, read 2,101,980 times
Reputation: 7371
Quote:
Originally Posted by TestEngr View Post
I did 10 years in federal government, then some big companies, then my own company for 20 years till I could not do it anymore. I would take the government over all them. But of course realize if for your government work you have to live in DC/MD-Bethesda/NoVa or something you need a million dollars for a house. Being ones own small business is better when it works, and it can work many times, but being really specialized makes that hard when most money goes to big business these days even when you can outbid them you won't get the work. So government wins.
Meh, my house was less than $500k and is only a 45 minute commute to my job in Old Town Alexandria and 10 minutes from a Metro station. People that pay a million for a house in the area on a government salary are trying to play big shot.
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Old 07-05-2019, 12:12 PM
 
935 posts, read 1,055,637 times
Reputation: 1777
Our financial advisor told me I’d be crazy to switch jobs and give up my NYS teacher’s retirement plan. With our age and career opportunities- it’s our best plan for solid retirement income. My husband has a 401 but he didn’t start it until he was 40 and we cannot afford to throw much into it.

I’ve seen how the private sector chews people up and spits them out. I’d hate to be 45-50 and be out of work at an age too late to hope for a pension. I’d say go with unlicensed if there’s stability and room to grow.
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Old 07-05-2019, 12:27 PM
 
1,663 posts, read 547,450 times
Reputation: 3555
Why would I choose a job that pays that much less just because it's a government job?
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