In reading through the following link: https://www.google.com/amp/s/www.br...-students-now-and-its-going-to-get-worse/amp/ it seems that CA public schoolteachers are in for a rude awakening in the coming years. The state teacher pension system is underfunded by $97.2 billion and many think tanks say that the actuarial formula that CalSTRS uses is too optimistic. Teachers will have to contribute more, year to year, to CalSTRS (10.2%), the district will have to pay anywhere from 15% to 20% (over the next few years, they will have to pay 10.3%), and the state will pay the rest (about 10%). This is not good for several reasons and, according to the article, is the reason why teachers can’t have the raises they want, is the primary reason why building projects and maintenance are being deferred, and class sizes have ballooned. Personally, I think the state and districts need to cut back on benefits to ensure the pension program continues to thrive and teachers get fair wages and small class sizes. It looks like pension reform is on the horizon because rising costs are becoming untenable. In fact, they are barely sustainable right now. Going forward, I worry about the total amount of underfunded liabilities and am greatly concerned for its future. CA Governor Gavin Newsom has taken proactive steps to reduce the debts owed and added additional billions to the teacher pension system beyond what his original budget called for (by tapping into the $20 billion state surplus), which is excellent news. However, it barely made a dent. https://www.ai-cio.com/news/new-california-governor-aims-cut-calpers-calstrs-debt/ What are all of your thoughts?
We have to pay 11% of our salary into our pensions in MA. I'm concerned that we will probably have to pay more eventually.
I totally thought about this. What was your reaction when Governor Chris Christie did pension reform? How did your colleagues handle it? How did you cope?
We pay 14.5% in Missouri, and the district matches it. Nothing comes from the state. It seems like a lot, but I don’t mind it. We have one of the best pension systems in the country. Totally worth it.
VA altered their system about 10 years ago into tiers. Tier 1 is the best for teachers, less out of our pocket. Each of the following Tiers is more out-of-pocket from the teachers but I think the payout is the same. Not sure what my percentage is, but I'm in Tier 1, so it's the smallest. Ours isnt' bad, we get the average of our three highest years salaries, so for most teachers, that'll be 60,000 or so every year.
Um, that’s not how it works, unfortunately... “As public employees in the state of Virginia, teachers must enroll in the Virginia Retirement System (VRS). The VRS provides a defined benefit plan that will ensure you have monthly pension benefits the rest of your life. In order to keep the system strong, participating employees must contribute a portion of the salaries to the pension fund. VRS members currently contribute 5% of their monthly salaries to the fund on a pre-tax salary reduction basis. Your account will accrue 4% interest, which is compounded annually on June 30. When you retire, there are four options you can choose from to receive your benefits. These options include: Basic Benefit The Basic Benefit option is calculated based on your age, total years of service credit, and average final compensation. The formula is: 1.7 percent of your average final compensation multiplied by Total years of service credit divided by 12 For example, if you worked 30 years with an average final compensation of $65,000, your monthly benefit would be $2,762.50.” https://www.teaching-certification..../virginia-teaching-salaries-and-benefits.html In the above example, if your average final compensation is $65,000, then you would only make $33,150/year and that is before taxes. I really hope you are not just going to rely on that for retirement because that is not very much at all. You are going to receive a lot less in retirement than $60,000...
CalSTRS doesn’t seem to know what it is doing. Please see the attached link for more information. The numbers just don’t add up. http://laschoolreport.com/antonucci...ias-teacher-retirement-system-by-the-numbers/
Not fully, but it is quite stable with assets at an all-time high, and it serves as a model to other systems apparently. The next annual report will be due out soon, now that we are at the end of June. As of last June, we were 84% pre-funded. See this link for a comparison to other states, including California: https://www.psrs-peers.org/About-Us/The-Missouri-Model. You'll notice our neighboring state, Illinois, is the worst, which played a big role in my decision to teach there for only one year before returning to Missouri.
Holy cow! Missouri is doing great and I hope they can get to 100% funding. The CA retirement system sucks, to be honest.
Which is why once I get vested, I'm looking out of state for a public sector job. I need multiple pensions plus my ROTH and any other funding I acquire the next 25 years.
So, if you final compensation average is $60,000 and you work for, say 30 years, then you will receive $2,500/month before taxes in retirement. If you work for, say 20 years in a VA district, then you would make only $1,700/month in retirement. Oof!
How many years have you been teaching in VA, presumably? And I totally agree. I don’t think other teachers realize how little they will make with just their teacher pension, which is sometimes roughly half of what they made at the peak of their career. I just started investing heavily this year and already have $30,000 ($28,000 in index funds and $2,000 in mutual funds in a Roth IRA that I started this month). I’m on track to have multiple millions in retirement and fully expect to generate $150,000/year after I quit working! And here’s the kicker: I plan to retirement between 50-52 years of age.
Oh, I should have highlighted the part I was responding to. I don't work in VA. I was responding to the part about the total years and final income one would make and the pension from that which is mind blowing to me, which is why I'll need more than one pension.
Hell if I could generate $3,500-$4,000 a month in retirement that would be plenty for me. I'm not living in a big city or living it up. Just pay bills, take a few vacations and relax.
My problem is, I never made tenure. I worked for several districts, and was laid off each time. I finally pulled my Illinois TRS funds. Since I'm 60, I know I don't plan to work 10 years at any district. I also pulled my teacher assistant funds, IMRF. (Illinois Municipal Retirement Fund) I keep hearing you shouldn't take Social Security at 62, but I have serious reservations if I should wait until 66. I think it will all depend on how my health holds up, and if I still want or need to work. I just hate to think I'll be trying to sit on a rug and singing, "The Wheels On The Bus" at 65.
I'm confused... I had funds in TRS, IMRF, and CTPF, and I also pulled them. But I pulled them because I moved back to Missouri, which is where I grew up and my family lives. I decided that I'm staying here for the life of my career, unless there are significant unforeseen circumstances requiring a move. I felt confident that I would no longer need to have the very small amounts of money that existed in my Illinois accounts. Back to why I'm confused... I didn't think that you had to be tenured or work in the same district to draw funds from TRS or IMRF. As long as you had the total years of experience in ANY district, I though that you could draw funds. Is this not correct?
I’m seriously worried about your retirement. When you pulled those funds, you usually only have 60 days before you are penalized (at 10%) to put those funds in another retirement vehicle. Did you do so? If you mostly are relying on Social Security, then you are going to be struggling for the rest of your life...
I am a New York State teacher retiree. I get a COLA each year. Between my pension and SS I bring in over $6,000 a month. NYSTRS is solid and I had no qualms being a union member during my teaching career.
Nice! You did it right and I’m elated to hear that you draw in over $6,000/month. Do you have any recommendations for fun stuff that you do in retirement? I would like suggestions even though I only 27, lol!
My first year of retirement I took things slow and did’t do too much. Second year I really branched out. Joined the Lions Club and one most noteworthy event is the yearly eye screening for over 600 preschool - K students. (Approx 10% are found to have some sort of visual problem), became more active at my church, mainly running the food pantry, taking classes at the Community Center, tutor adults who wish to improve upon their English, joined Friends of the Library. I travel to Boston every 5 - 6 weeks to visit my grandsons and plan activities with them, lunch once a month with former teachers (catch up on the last news) and with college roommates. I learned to sew! Also day trips because of where I live there are so many places to visit.
I’ m not necessarily living it up but I am enjoying my retirement. I taught for 32 years and loved it. I taught in 2 different districts, both small, where everyone cared for everyone. I was very, very fortunate to have had such a rewarding teaching experience.
