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I have read many discussions about public education pensions similar to this one. Let us say that you are approached to apply for a position as superintendent of a large city's schools. As an incentive (since you are such a desirable candidate) the head hunting committee outlines that the city has authorized them to offer top candidates a salary of $200,000/yr plus benefits worth an additional $50,000/yr plus a retirement that after 20 years would give you $125,000/yr plus paid health care to 65. You accept the job and 20 years later everyone is all mad at you about your benefits.
You argue that the benefits were in the package offered and not something you stole from the taxpayers. The taxpayers say "we don't have a pension so why should you since we pay you". You respond that "we the people" of the district should have considered that before they enticed you to leave your prior position which also had good benefit on retirement. The taxpayers respond "we weren't there; we didn't cause you to leave your prior employment".
Well, the taxpayers did cause you to leave for the better offer since they elected the government that gave you the offer. By electing that government they empowered that government to act on behalf of "we the taxpayers" of that district.
Think of hiring a lawyer. You (or most people) pay him/her more than you make (thus funding a bigger 401k than you have) because you need to purchase his skills at the going price. That is what you also do when you hire a school teacher or administrator at the competitive price. It has nothing to do with whether their skills cost more in salary or benefits than you have.
Now I may not have followed most hiring steps right but I think my last point about representative government would hold for most hiring of top officials in education.
There are so many different public pension plans with so many different formulas, contribution rates and whether health care is included or not that most of these posts started to complain are based on ignorance.
IMHO if you are going to complain at least know the basic formula of the plan you are complaining about.
Exactly. People read an article. The article is designed to be outrageous, otherwise it wouldn't have been written in the first place. (There are exceptions, of course, in the high quality media such as the New York Times). Then the people think that's how public pensions are, because they read an article about them.
My California teachers' pension benefits include not one dime towards health care or health insurance. Indidvidual school districts can provide that on top of the state pension if they wish, but most do not for understandable cost reasons.
Another frequently ignored or unknown fact: I had 8% deducted from my salary to support the pension system for the entire 34 years of my career. This employee contribution rate varies quite a bit, as Tom1944 points out, across the many states and many different pension systems within a state, but it is normally greater than zero.
Plus the formula that the benefit is calculated on varies from plan to plan. In addition some plans have a COLA and some do not.
I get a kick out of the anti- public pension pro-privatization of social security people I listen to on shows like Kudlow. They argue that we would all do better with private social security and in the same breath argue that public pensions are too generous.
In NJ I contribute more to my pension than I do to social security. According to these experts if I was allowed to invest my ss contributions my monthly benefit at retirement would be 3 to 5 times what I would get from the current social security program. They then go on to claim my public pension is overly generous. Problem is my public pension in which more was contributed than was contributed to social security is not 3 to 5 times more than my social security benefit. So they clearly are wrong on at least one of their arguments. Either my public pension is not overly generous or their claim that I could invest my ss contributions and receive significantly more is wrong.
Patrick Godwin WAS NOT A TEACHER, he was an ADMINISTRATOR, that is above a Principal. He was Management an EXECUTIVE. Plus it was California where in some areas base salaries start well over $50,000 to offset the cost of living.
I don't see you complaining about 6 WALTONS being as rich as 100,000,000 Americans, that's 100,000,000 more than the popuation of the midwest
Those are called "Educrats" who serve no useful purpose but to bloat the system
My sister has a $60,000 a year pension. With medical that she pays $300 for a ultra Cadillac plan. She has a masters and she worked special ed most of her career. She took an early buy out at 58. Retired but working a $10 a hour job now as an adjunct professor for an online college course. This is what she tells me.
She thinks she doesn't have enough money to live on. Has no children no husband.
My sister has a $60,000 a year pension. With medical that she pays $300 for a ultra Cadillac plan. She has a masters and she worked special ed most of her career. She took an early buy out at 58. Retired but working a $10 a hour job now as an adjunct professor for an online college course. This is what she tells me.
She thinks she doesn't have enough money to live on. Has no children no husband.
In debt $100,000.
Go figure.
Where does she live and what is the cost of living there. That can be a major driver of how much a given income will get you. If she worked and is living in a high income area that 60k could be well below the average household income.
Who cares if "it's below the average household income"? $60,000 per year is a gigantic sum of money to be living on in retirement. Especially with paid medical, but even without paid medical.
(no need for people living in New York City and San Francisco to pipe up)
And also in retirement, one should not automatically expect to have an amount similar to what their job salary was.
Last edited by matisse12; 03-26-2017 at 07:37 PM..
Who cares if "it's below the average household income"? $60,000 per year is a gigantic sum of money to be living on in retirement. Especially with paid medical, but even without paid medical.
(no need for people living in New York City and San Francisco to pipe up)
And also in retirement, one should not automatically expect to have an amount similar to what their job salary was.
Why shouldn't they plan to have an amount similar to what their job salary was? If they start early on and contribute the needed amounts to their 401/403/Roth/after tax savings plan to make up the difference between their pension/SS benefits and working salary?
Many people base their retirement income needs based on their thinking and not what someone else thinks is enough. That is probably why the person person being talked about is working to supplement her pension because she knows what she wants and is willing to make the effort to try to achieve it. One persons gigantic is another persons minimial. What we need to live on is for many not all,
is determined by their retirement vision and I know it is for us.
My sister has a $60,000 a year pension. With medical that she pays $300 for a ultra Cadillac plan. She has a masters and she worked special ed most of her career. She took an early buy out at 58. Retired but working a $10 a hour job now as an adjunct professor for an online college course. This is what she tells me.
She thinks she doesn't have enough money to live on. Has no children no husband.
In debt $100,000.
Go figure.
She also could have stopped with just getting enough credits beyond her bachelors to meet certification requirements but she wanted more and that the full masters. She is also willing to work still towards making more than 60k in retirement. If she will be able to draw SS eventually in addition to her pension she may be working as a bridge til SS time. Sounds like she has a plan and is willing to work to get there. That extra income will give her a greater safety margin and enable her to enhance her retirement beyond what the 60k would buy her.
Who cares if "it's below the average household income"? $60,000 per year is a gigantic sum of money to be living on in retirement. Especially with paid medical, but even without paid medical.
(no need for people living in New York City and San Francisco to pipe up)
And also in retirement, one should not automatically expect to have an amount similar to what their job salary was.
Did you mean $60,000 gross or $60,000 net is a gigantic sum to live on?
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