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And what about those of us who have no employer-based pension, public or private, so only have a 2 legged stool with SS and personal savings ? And due to the effect that IRA RMDs have on the taxation of SS benefits, have to "give back" some of that SS benefit ? IOW being penalized for having saved on our own ?
My SS benefit is about 39% of my last working salary. And the RMD driven give back is running about 4.5% a year of SS benefit.
I am a widow/single and at the time I retire I will have worked 1/2 of my 45 year nursing career in the private sector and the 2nd 1/2 for the Federal Government. My employment with the Feds began in 2000 which puts me in the 3 legged stool FERS retirement pension plan. With a little over 23 years of service at retirement the annuity part of my pension will be about 26% of my average high 3 salaries. Unlike the former CSRS retirement plan Social Security is part of the FERS plan along with the 5% match TSP/401K. If I were to take my Social Security at FRA which is when I am retiring that would equal another 26% of my average high 3 salaries, and what I could for the long haul withdraw from my TSP/401K annually would replace another 23% of my income = a total of 75% income replacement. That 25% loss of working to retirement income for me comes out to $28K. Even with a $28K lower income with having to file taxes as single along with 23% of my retire income coming from pre-tax TSP $$, not only will I be paying just about the same Federal and State taxes I do now, my retirement income will bump me up to the next Medicare Part B premium bracket.
You think you are being penalized by having to "give back" some of your SS benefit for having saved on your own, well for me, Uncle Sam gives me a pension but takes back 1/2 if it for taxes and a higher Medicare Part B premium.
As time goes on, the working classes are being required to pay heavy taxes to support government retirees pensions. It is not politically sustainable, and it is not financially sustainable.
I do think many systems recognize that. For example, newer employees in the NYS system cannot retire with full benefits at 55 even if they have 30 years, as we could, nor will they get their health insurance paid for in retirement. Now full benefits are only possible at 62, and they have to contribute if they opt to keep the health insurance. Plus they have optional deferred compensation plans in which to participate.
Some states are in much better shape than other states. Which points to a different problem. If a state sees a significant drop in its pension contributors (for example, a state which is losing population), should the pensions be adjusted accordingly? Otherwise, the remaining taxpayers must support a higher and higher tax burden.
Mine is 78% of high 3 years. CSRS. Feds changed to FERS in 1984, they tried to convince CSRS employees to switch to FERS, some did, many didn't. I didn't.
First 20 years at 2.5% per year = 50%
Final 14 years at 2% per year = 28%
34 years
Fed govt employees under CSRS were capped at 80%, the only way they could go above 80% was credit given for excess sick leave
Truth be told, at retirement I no longer had to pay 8% into my retirement, no longer had to pay into FICA, no longer could max out my contribution into the Thrift Savings Plan (Govt 401k plan) subtract all of that and my monthly retirement pension check is $1000 more than my monthly paycheck while working.
Although CSRS is history, the remuneration described above is really OTT -- public pensioneers receiving a mid-six-figure pension, and the poster admits the pension EXCEEDS his top and final salary.
These extreme cases are what drives the negative narrative about public pensions.
Although CSRS is history, the remuneration described above is really OTT -- public pensioneers receiving a mid-six-figure pension, and the poster admits the pension EXCEEDS his top and final salary.
These extreme cases are what drives the negative narrative about public pensions.
they stopped those pensions in 1983. Anyone hired in 1994 or later are under a different system.
Should tax paying citizens who do not have a pension plan going for them be required to fund the pensions of others?
Few private sector employees have a pension plan in this day and age. However, most public sector employees (municipal, state and Federal) have pension plans that are funded in whole or in part from taxes imposed on all people in their respective tax base.
In my mind, it doesn't make any sense whatsoever to require people who don't have a pension to fund the pensions of people in the public sector. If it were up to me, I would provide for a tax credit for people without a pension plan or, better yet, pass a law that required all public sector employees to fund their own pensions.
What makes sense to you?
It depends when you say "tax paying citizen" well there are many forms of tax (Income, Sales, Property, etc..). Now you're conflating your rights as a "tax paying citizen" and dictating compensation for public/government employees. Well the only way you can express your right/opinion is to socialize your policy ideals then vote for those willing to support them. I do not blame the public employees for the mismanagement of government as typically the employees have very little influence over policy and departmental waste. There also is typically a tradeoff that those going to work for government take a lower paying salary than in the private marketplace in exchange for more job security and better benefits.
Although CSRS is history, the remuneration described above is really OTT -- public pensioneers receiving a mid-six-figure pension, and the poster admits the pension EXCEEDS his top and final salary.
These extreme cases are what drives the negative narrative about public pensions.
Recognize this is not normal CSRS - also the member paid something like 8.5% of salary to pay for this, much more than SS payments and they get no SS or reduced by WEP if had 40 quarters of SS before.
Normally, CSRS is 1.5% for year 1-5, 1.75% for year 6-10, and 2% after that. Normally someone on CSRS would get 64.25% of high 3 for 34 years service, not 78%.
Under FERB, with 34 years would get 1.1% per year once over 20 years so would get 37.4% of high 3 plus SS.
You are part of the public. Public employees are paid by their employer. One part of their pay is a pension partially funded by their employer. Public employees tend to be paid considerably less salary than their counterparts in private industry.
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some of that SS benefit ? IOW being penalized for having saved on our own ?
