Retirement......pensions?

[Colleen27]

No pension and probably no social security for us, so we fund everything on our own. Right now about 15% of our income goes into retirement savings and that's not quite enough to get us to where we'd like to be savings-wise but is what we feel we can afford right now without putting ourselves in the position of living entirely for "someday".

 

[tinker&belle]

DH has a pension that should generate about 50% of his income at time of retirement if he stays with the company until retirement. We currently contribute 5% with a 4% partial match as well to his 401k.

 

[dvcgirl]

Umm...I didn't attack any individual in my post.



And you don't know what I am involved with in my private life. Let's just say that I don't just kvetch on an internet message board.

No, you didn't. You were on topic and didn't get personal.

 

[Karlzmom]

Wow! I didn't know there were states where the employee didn't contribute. I will get a state pension also, but I have always contributed 5% of my salary to it. I know there are risks with a state retirement, but there are risks with any type of retirement plans. I should collect approx. 50 - 60% of my average income of my "high five" which is basically my last 5 years of employment. I will be eligible for full retirement with health insurance for myself after 27 years of service, which will be in about 9 more years. I will be 52 years old.

My DH has nada! Not very good planning on our part.

Generally "non- contributing" employees waived some kind of benefit in exchange to not have to make an ongoing contribution on paper. Our union waived raises a number times, but are now finding that we should have demanded the raise, then had a pre-tax deduction taken to "pay" the contribuion on paper as the average Joe can't wrap their head around the notion that we DID pay [and continue to pay] for the pension, we just didn't do a paperwork shuffle. No paper evidence *today* = we got a *freebie* and then the whole envy thing starts and we are going to find ourselves with no $ in hand from the raises, no pension and likely a pay cut for good measure! The public got the benefit of the labor at a reduced rate *yesterday* based on a promise to pay *tomorrow* but now doesn't like that the bill is coming due.

I've compared it to SS. People were made a promise, realistic or not, that the contribuitions they made would ensure a financial benefit later. Those people made plans based on that promise and if the good citizens of the country now said *too bad* we can't afford it, there'd be outrage....The other easy illustration relates to a person's mortgage. Did you buy your house for cash? No? You have an unfunded liability...you expect to meet next month's/next year's obligation with money yet to be earned. Public pensions work the same way. We hear so much about *unfunded liability* as though the entire amount is due today, which is not true! Its also amazing how many municipalities raided pension funds to make life nice *today* or didn't make the regular contributions and instead expected the market to fix the problem. Does anyone throw out the politicians who made the bad choices? Nope...much easier to saber rattle about pampered public employees.

Oh, and yes I am a government employed TAXPAYER, who pays a significant portion of my health insurance premiums and paid outright cash to my pension in addition to the *payment* in kind through reduced wages. I don't have any option but to belong to a collective bargaining unit. I do not have any option for negotiating advancement, benefits or other outside of the mandatory steps based on time in grade. In the future, I'll vote for straight cash. Once its in my hands then I am responsible and it can not be taken back again - ever. Funny how community producers are fair game for bashing, but the people who sit and do nothing but take from the system are someone to treated with kid gloves when discussing budget priorities.....

 

[Julia M]

Dh is under a pension plan at work, but the newer employees (maybe last 5 years) are not. We were incredibly fortunate, because dh worked there, left and returned almost 5 years later. Because it was within the 5 years (by about a month), they bridged his service, which will get him a better pension, becuase he now has continous service.

I also have a pension, but it's an automatic deduction, I think 8%, with my emploer putting in 2% or 3%.

We are extremely rare among our friends, to have two pensions.

We also contribute to dh's 401K plan as well, and he gets a match up to 6%.

We haven't done great, by any means, but by virtue of having two edfined benefit pensions, we feel we are in pertty good shape.

Julia

 

[taaren]

DH has a pension plan, will be vested next year and when he gets vested will probably take it and run since we'd rather live in another state. He also has a 403(b), which we do a set amount for rather than a percentage. I've just been max-ing out my Roth instead since I've been on Emergency Hire status with the State for the last 3 years (thanks to the perpetual "hiring freeze") Probably won't be enough but since I just hit 30 and DH hasn't yet, we've got some time to beef it up + my income will be increasing when I finish my Master's next semester and am hoping to get hired out of state someplace with a decent 403(b)/401(k).

 

[njmom47]

I contribute 7% and my company contributes 3% ot my 401k, and I will have a small pension from my previous job (unless, as a pp stated, something "happens" to the funding...grrr!).

 

[momx2]

Generally "non- contributing" employees waived some kind of benefit in exchange to not have to make an ongoing contribution on paper. Our union waived raises a number times, but are now finding that we should have demanded the raise, then had a pre-tax deduction taken to "pay" the contribuion on paper as the average Joe can't wrap their head around the notion that we DID pay [and continue to pay] for the pension, we just didn't do a paperwork shuffle. No paper evidence *today* = we got a *freebie* and then the whole envy thing starts and we are going to find ourselves with no $ in hand from the raises, no pension and likely a pay cut for good measure! The public got the benefit of the labor at a reduced rate *yesterday* based on a promise to pay *tomorrow* but now doesn't like that the bill is coming due.

I've compared it to SS. People were made a promise, realistic or not, that the contribuitions they made would ensure a financial benefit later. Those people made plans based on that promise and if the good citizens of the country now said *too bad* we can't afford it, there'd be outrage....The other easy illustration relates to a person's mortgage. Did you buy your house for cash? No? You have an unfunded liability...you expect to meet next month's/next year's obligation with money yet to be earned. Public pensions work the same way. We hear so much about *unfunded liability* as though the entire amount is due today, which is not true! Its also amazing how many municipalities raided pension funds to make life nice *today* or didn't make the regular contributions and instead expected the market to fix the problem. Does anyone throw out the politicians who made the bad choices? Nope...much easier to saber rattle about pampered public employees.

Oh, and yes I am a government employed TAXPAYER, who pays a significant portion of my health insurance premiums and paid outright cash to my pension in addition to the *payment* in kind through reduced wages. I don't have any option but to belong to a collective bargaining unit. I do not have any option for negotiating advancement, benefits or other outside of the mandatory steps based on time in grade. In the future, I'll vote for straight cash. Once its in my hands then I am responsible and it can not be taken back again - ever. Funny how community producers are fair game for bashing, but the people who sit and do nothing but take from the system are someone to treated with kid gloves when discussing budget priorities.....

The Commonwealth of Kentucky, my employer, has banned unions for state employees. We are "merit" employees and have many protections that unionized employees have, but no union. I guess this why things in my state employment are so different than other states.

BTW, I too pay a hefty portion of my insurance premiums. I pay $600+ per month for my family coverage and our coverage co-pays go up, along with the premiums, every year.

I am an attorney and I am also a supervisor so I make a decent wage, but the attorneys I supervise basically only stay for the retirement due to their low salaries, rising health insurance costs and furloughs. We don't recieve raises any longer and we make less than we did 3 years ago. If not for the "promise" of the retirement packages, we could not find attorneys to work for us much past a few years.

 

[crisi]

Generally "non- contributing" employees waived some kind of benefit in exchange to not have to make an ongoing contribution on paper. Our union waived raises a number times, but are now finding that we should have demanded the raise, then had a pre-tax deduction taken to "pay" the contribuion on paper as the average Joe can't wrap their head around the notion that we DID pay [and continue to pay] for the pension, we just didn't do a paperwork shuffle. No paper evidence *today* = we got a *freebie* and then the whole envy thing starts and we are going to find ourselves with no $ in hand from the raises, no pension and likely a pay cut for good measure! The public got the benefit of the labor at a reduced rate *yesterday* based on a promise to pay *tomorrow* but now doesn't like that the bill is coming due.

Its one of the things that makes me angriest about unions - they gave away money in their members pockets today for the promise of something tomorrow. That is almost always a bad bet - and its a really bad bet over 30 years or longer.

 

[aprilgail2]

Teachers aren't federal, though, which is where the big gap exists and besides, those stats fail to control for level of education. Teachers generally earn less than private sector employees with the same level of education (bachelors or masters), and for many the reason they signed on for the lower pay was specifically because of the better fringe benefits. How many other professions expect a masters degree for $40K/year?

Well you are really talking about different regions because no way does a teacher make 40K around here, not even as a starting salary!--many are well over $100,000.

 

[nowellsl]

Well you are really talking about different regions because no way does a teacher make 40K around here, not even as a starting salary!--many are well over $100,000.

Wow! In the school system I work for starting salary for a teacher is less than $34,000 (minus 3% now, which will go into their retirement)

 

[Colleen27]

Wow! In the school system I work for starting salary for a teacher is less than $34,000 (minus 3% now, which will go into their retirement)

Yeah, that's about how it is around here too. Starting pay is in the low to mid 30s depending on the district, so I can totally understand why teachers get upset over cuts in benefits and retirement. I made more at 19yo with an associates than a teacher in our district makes with 10 years' experience and a masters.

 

[lisaross]

my husband should be getting a decent pension - hoping it will still be there in 15 years...he also contributes 6% to a 401k - company matches 6% and then we contribute ab out 4% to a Roth.

I also have a rollover 401 from my previous job...i will also get a very small pension from that job..

 

[JaymeC]

No pensions for us... but to be truthful I'm kind of glad about that. Pensions scare me just because it seems so easy for them to change their benefits in recent years. DH and I have socked money into either a 401(k) or Roth IRA depending our situation at the time. Right now he's out of work and going back to school and I'm working a job that puts me as one of the underemployed as it's not even really in the field my bachelors is in. But it's an income. We're only putting about 7-8% of our income into retirement now, but I'm comfortable with that since in years past we put significantly more and I'm only 28 and dh only 32. We'd been putting money back every year since we got married, almost 8 years ago and have about twice my normal income now socked away already. On top of all this, our entire married life we've been living on only one income as one of us was always home with the kids (including now!) Dh should finish school just as our kids are headed into middle school and won't require me to be at home nearly as much. I'm sure as teens they'll take a chunk of our income, but I expect we'll be able to put away at minimum half of one of our paychecks by then.

 

[DawnM]

I have a pension from when I did work. Hopefully it will be around when I retire.

DH has a 401K. His company will match a certain amount and that amount seems to change every time we turn around.

Dawn

 

[QVCshopper]

For those with private pensions, I would also make backup plans. When I worked for a mutual fund company, large corporations were changing their DC plans to DB plans a lot. I'm a writer and wrote all about the changes, which were as fair as possible. Pensions as they used to be are too expensive to maintain in years to come. I expect government plans to change eventually as well, but there are tax payers and politicians and states involved. Just MHO.

That said, DH gets a 4% match into his 401k on the first 4%, as well as a 10% company contribution every quarter (very generous). I get a 6% match on the first 6% (still pretty good for part-time).

 

[aprilgail2]

The company I work for has a few of us left there with company paid pensions- the group after me has to contribute a percentage into their pension and then the group after that was totally in a 401K type system with no gaurenteed pension. As soon as I can I am taking the money and running-they did a round of buy outs last year but it was for people that had the age but not the years- I am the opposite, I have 27 years there (you need 20) but I dont have the age- my group has to be 50 to go. The group after me has to be 55 and the ones hired after that have to be 57--can't wait to see how old it goes to for next contract!

 

[nunzia]

I love it too, but not in the same sense that you do. There is nothing wrong with being upset when the people that you employ (public servants) earn more and receive more in benefits than their private sector counterparts.

And to answer the OP's question. We own our own business. We pay 100% of our own social security (12.4%) and 6.2% for our employees. We also pay into medicare for them. We have no pension. No 401k matching funds. Our retirement is completely on us.

and to avoid road again..

We have no pensions..we put over 20% of our income in various places..work, 401K, Roth, savings, etc. It will not be enough. We will need that Social Security in some form (which, although unsustainable does need to factor in that people who paid into it are not an 'entitlement' program, but are rather entitled to at least what they put in plus a decent interest since the gov't managed to not protect it and squander the heck out of it..I digress..). My DH is above that 'magic' 55 age and I will be this year. My retirement choice at work is truly pathetic as it is a high load connected to business admin son..which is probably not totally kosher since that's our only choice..and with Primerica. DH's is better but I'm increasingly worried about retirement being too closely tied to the market so am doing more with cash. Both of our employers match 3%..at my main job I contribute just that, at my small part time job I contribute 30%, my DH does well above 3%. If SS is maintained for us, we'll do ok living frugally with that plus our retirement savings..depending on health care of course...

 

[nunzia]

Yeah, that's about how it is around here too. Starting pay is in the low to mid 30s depending on the district, so I can totally understand why teachers get upset over cuts in benefits and retirement. I made more at 19yo with an associates than a teacher in our district makes with 10 years' experience and a masters.

wow..I wish I would have gotten your associates. I had a Bachelors and started at $26K..my teacher friends retired at about 60K, but did enjoy shorter work years for their careers and also retired at betwen 52-56 years old so can now look forward to about 30 years of that pension check.

 

[averysmom]

Wow! In the school system I work for starting salary for a teacher is less than $34,000 (minus 3% now, which will go into their retirement)

Keep in mind as well too, that teachers overall have a lower life expectancy than other professions - we're in the top ten - we fluctuate around 7-8 usually. We outlive cops and firefighters, but die earlier than dentists and air traffic controllers. So less years for us to collect that pension. Think of the savings tax payers