<p>I am shocked how I think compared to 10 years ago so yeah, you may think differently in your 60’s. I have friends that want to work until they die andI have friends that don’t want to work at all. </p>
<p>Tom1944, looks like a good plan. Were colas taken away from those already retired?</p>
<p>BC- I will work as long as I can but it may not be in my government job. With a defined benefit pension between my hc contribution, pension contribution and social security contribution there is a point it makes sense to retire. I will do something else at that point.</p>
<p>dstark- yes those already retired lost cola until the pension is back to 80% funded. It can be granted at that point but does not have to be.</p>
<p>dad- I agree the estimated return should be regulated so they do not play games.</p>
<p>If any of you know: I have a defined benefit pension. If I retire this year and begin collecting the pension, what happens if my company were to go out of business or get acquired? Is my pension locked in once I pull the trigger, or is it subject to the financial stability of the company?</p>
<p>Also, Tom1944, you seem to know a lot about the financial situation in NJ. Without saying too much, could you share what type of job you have? HR? Finance? I’m just curious.</p>
<p>hayden- I work in the tax department. In the collection area. I pay attention to NJ politics and the financial situation because I find it interesting but also because it impacts me directly. I also like to discuss issues of all kind but really like the discussions to be fact based. For example dstark once challenged my pension figures by pointing out how much better the pension formula was than the social security formula. He was correct. I never have a problem when people point out those things but when people say pension based on overtime, free this, sick leave payout that as if that applies to everyone when it really does not I like to correct them. I guess it would be like me thinking every private sector worker gets free tickets to every professional sports team and flies private jets.</p>
<p>If your company goes under the Pension Benefit Guarantee Corporation takes over the assets and liabilities of the pension. I think that the maximum payout per year is about $45,000 which means a haircut if you are getting more.</p>
<p>Tom1944, I appreciate that you like fact based arguments. There is a reason based part of the brain and emotional part of the brain. It is amazing how many people use their emotional part of the brain when trying to figure something out.</p>
<p>This bugs me.
We should not be cutting pensions while giving away tax cuts.</p>
<p>Are there more wealthy people than public pensioners in NJ? </p>
<p>“The average annual pension for government workers is roughly $19,500 a year, according to the American Federation of State, County and Municipal Employees, one of the nation’s largest labor unions. That would mean $500,000 could provide about 25 years worth of payouts to a retired public servant. The $9 million bonus Goldman Sachs chief executive Lloyd Blankfein received for 2009 could have provided two decades of pension pay for 23 such public workers.”</p>
<p>[An</a> Overblown ‘Crisis’ For State Pension Funds](<a href=“HuffPost - Breaking News, U.S. and World News | HuffPost”>HuffPost - Breaking News, U.S. and World News | HuffPost)</p>
<p>Tom, thanks so much. As a taxpayer, I really have no problem paying taxes to people as dedicated as you seem to be.</p>
<p>BCEagle, thanks. That’s quite a haircut. I guess I have to keep my fingers crossed, more for other retirees and employees than for us.</p>
<p>
Another thing that bugs me about public jobs.</p>
<p>Why on earth should you get cash for your sick time if you weren’t sick?</p>
<p>Being able to stack up a year or two of vacation, and cash it out at current pay levels when most of it was earned at much lower levels is also ridiculous (which also applies to accrued sick time). </p>
<p>My current company lets me carry over 1 week. My last company was 6 weeks. Use it or lose it, IMO.</p>
<p>I SO wish I had considered a career in gov’t when I was in my 20’s. In my profession, the pay wouldn’t be that much less. 40 hrs/week, days off on those “banker” holidays I’ve never ever seen.</p>
<p>S1 and S2 will get to retire at approx 52 with 80% of last year’s salary…for life. I don’t see how someone with a 401(k) and the little to no company match can accumulate enough to yield that kind of payout. Plus, I’m a frugal person. Without knowing one’s actual lifespan, I’ll be chicken to spend too much and outlive my savings. Having a set payout per year would make my decisions in retirement much different.</p>
<p>Most people of my parents’ generations had pensions. Most people my age in private sector do not. I think it’s going to have an interesting (and not good) effect on the economy as we all start to retire.</p>
<p>“When news of Goldmanesque bonuses first sparked public outrage, both Wall Street and the White House combated the criticism with a persistent argument: Yes, it might be deeply frustrating to see taxpayer dollars used to further enrich already wealthy bankers, but these bonus deals were were contractual obligations and America is a nation of laws. You just can’t tear up contracts, the argument went. So, with few exceptions, the bonuses stayed.
Yet now, with state leaders planning pay cuts for teachers, firefighters and other public workers, contracts aren’t described as so sacrosanct anymore.”</p>
<p>From the prior link…</p>
<p>Sryrstress, I think you are right.</p>
<p>"S1 and S2 will get to retire at approx 52 with 80% of last year’s salary…for life. I don’t see how someone with a 401(k) and the little to no company match can accumulate enough to yield that kind of payout. Plus, I’m a frugal person. Without knowing one’s actual lifespan, I’ll be chicken to spend too much and outlive my savings. Having a set payout per year would make my decisions in retirement much different.</p>
<p>Most people of my parents’ generations had pensions. Most people my age in private sector do not. I think it’s going to have an interesting (and not good) effect on the economy as we all start to retire."</p>
<p>People seem to like 401ks here…</p>
<p>Pensions can add a lot more security than 401ks…especially if there are colas…</p>
<p>There are a lot of people comfortable with managing investments here. My impressions of the general populace is that the vast majority are not comfortable managing investments.</p>
<p>BCEagle91, I agree with that. </p>
<p>For those not comfortable, the vast majority, pensions are probably better. Life expectancy
Is a factor and there are other factors so it is hard to make a blanket statement.</p>
<p>But out living your money is going to be a big problem in the United States with the decline in pensions.</p>
<p>syrstress and dstark, not all public employees retire with a pension of 80% of their salary. I can assure you that is not the case, by a long shot.</p>
<p>I see in the future people with assets of 2 million who are going to outlive their money, and there aren’t that many people with assets over 2 million.</p>
<p>Hayden, I know that. Read my last link…</p>
<p>In Illinois they were recently calling for pension reform for all state employees… except the judges.</p>
<p>Even if you are fortunate enough to still be promised a pension, you have no idea how long it will be there. Pension funds are going bust all the time. I trust my 401K far more than my pension. Even if the pension supposedly guarantees a far larger payout than the 401K, it seems like the only one who can screw up my 401K is me, as opposed to the company underfunding the pensions, or declaring bankruptcy and folding the pensions up into nothing. No pensions are guaranteed.</p>
<p>The biggest “structural” problem I have with 401/403s is that it is not an efficient system. If you have a million people with similar savings with various actual lifespans, if the group as a whole is funded for the average lifespan, some will die with money in the bank and some will outlive their investments. So the individuals in this group would have to save more money than they should have to if the priority is that people don’t run out of money, or go for annuities with their own problems. Institutions like defined benefit pension plans and social security can potentially do a better job because the pool of money gains from those who die young and the money can be used to fund those who die older. </p>
<p>However in real life, this consideration is over-ridden by the more significant factor which has to do with the financial integrity of the systems. Since it’s so easy to run it with wildly optimistic numbers or, worse, with Bernie-like models we’ve lost the advantage of pooling to the point we’re better off not having these at all.</p>