Wisconsin Beth
Distinguished Associate
No, we don't walk away. But when we're holding on to something precious, we run.
Joined: Dec 20, 2010 11:59:36 GMT -5
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Post by Wisconsin Beth on Jan 25, 2011 9:58:29 GMT -5
If states could declare bankruptcy, does that mean that the bankruptcy gets to decide on their budget obligations, isn't that how chapter 13 works, more or less?
As for pensions and the funding of the pension funds, it's also part of the unions job to be watchdogs and to challenge the town/city/state, in court if necessary, when someone tries to play fast and loose with the rules. I'm local gov't, about 15 years ago our then Mayor decided to change 5 things in how the pension funding was dealt with. The unions (mainly Fire and Police) took it to court. The City lost all 5 cases because the Mayor's actions were either against the City Charter, the ordinances involving the Pension Fund or the contracts with the employees.
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Deleted
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Post by Deleted on Jan 25, 2011 10:16:27 GMT -5
Rahm Emmanuel during his Chicago Mayoral campaign said that City pensions will be reformed and they will get back everything they put in. That's ok for them at first glance, but the problem has never been not getting what you put in. It's getting what the city/state said THEY were going to put in.
But having said all that, in order to keep the pension fully funded, the state is required to put in 1-3x towards the pension. That alone is insane when you think about. In IL, they contribute 9% of their salaries towards the pension. So in the private sector, you're lucky to get ANY match. State employees potentially get a 3x match.
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973beachbum
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Post by 973beachbum on Jan 25, 2011 10:22:33 GMT -5
This is from Gov Christie in Camden county NJ. I just wanted to show how crazy this is at the moment here. I have lots of friends who are teachers and I love them but these number just don't add up. And therre is just no way as they are done now to make them add up. I have a friend who just retired from teaching after 30 years at 55 years of age. His contract allowed him to retire with full pay after 25 years and 55 years of age. Just to make it easy numbers I am lowering his final salary that he is gettin his pension on and pretending he paid in to his pension the entire 30 years at that amount. The numbers are, $100,000 salary $5,000 paid in pension per year $5,000 state match $300,000 paid in by both for all 30 years. And yet he is going to recieve his full salary for the rest of his life. And I know I didn't include interest but seriously what interest rate would you have to have to allow this to fund $100K a year till he is 70?
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Deleted
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Post by Deleted on Jan 25, 2011 10:27:36 GMT -5
This is from Gov Christie in Camden county NJ. I just wanted to show how crazy this is at the moment here. I have lots of friends who are teachers and I love them but these number just don't add up. And therre is just no way as they are done now to make them add up. I have a friend who just retired from teaching after 30 years at 55 years of age. His contract allowed him to retire with full pay after 25 years and 55 years of age. Just to make it easy numbers I am lowering his final salary that he is gettin his pension on and pretending he paid in to his pension the entire 30 years at that amount. The numbers are, $100,000 salary $5,000 paid in pension per year $5,000 state match $300,000 paid in by both for all 30 years. And yet he is going to recieve his full salary for the rest of his life. And I know I didn't include interest but seriously what interest rate would you have to have to allow this to fund $100K a year till he is 70? You explain that to 90% of teachers and they do get the problem. They didn't really ask for the pension they received, but they'll gladly take it. There are 10% of teachers that don't care if that seems like a lot. They will justify it by talking about their dedication to kids, their education, and how they don't get social security, etc. In other words, they're totally delusional. It has nothing to do with how hard they work...it has to do with the math not adding up.
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973beachbum
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Post by 973beachbum on Jan 25, 2011 10:43:38 GMT -5
Where does this happen? Every state or local employee or school district employee that I have ever heard about gets SS and medicaire. They don't get it till 65 like everyone else but since they also don't have to ever pay for their health ins either it is hard to feel sorry for them about it.
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zibazinski
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Post by zibazinski on Jan 25, 2011 10:51:17 GMT -5
Florida gives you $5 for every year you taught toward your insurance but trust me, that insurance is so high that the amount is pitiful.
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Deleted
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Post by Deleted on Jan 25, 2011 16:18:16 GMT -5
Where does this happen? Every state or local employee or school district employee that I have ever heard about gets SS and medicaire. They don't get it till 65 like everyone else but since they also don't have to ever pay for their health ins either it is hard to feel sorry for them about it. I don't know which states do or don't, but in IL they DEFINITELY don't pay into SS or receive SS. My wife is a teacher and I never really realized this until just a few years ago. They look at it as a negative, but it's actually a positive. Because at least their 9% is actually going into a pension fund that holds marketable securities.. Whereas the rest of us are contributing 6.5% to a social security fund that just goes to pay current gov't expenditures.
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Deleted
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Post by Deleted on Jan 25, 2011 18:55:01 GMT -5
Are you SURE that NJ teachers get 100% of their pensions about 25 years? I plugged the numbers in to their calculator for "early retirement" if I was a member before 2007. This is what I got:
Retirement Type: Early Retirement
Based on the information you provided, your Maximum Option is estimated at $45,454.55 per year, or $3,787.88 per month.
That is much more in line with the 2% per year that Alabama teachers get paid. We also have 25 year retirement at any age, which I have no problem eliminating.
I'm not saying that your friend was lying to you, but I don't think the pension in NJ is quite as generous as you describe.
P.S. I pay SS and into a 403b as well as toward my pension. In good years, I also help fund my Roth.
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The J
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Post by The J on Jan 26, 2011 10:32:50 GMT -5
Are you SURE that NJ teachers get 100% of their pensions about 25 years? I plugged the numbers in to their calculator for "early retirement" if I was a member before 2007. This is what I got: Retirement Type: Early Retirement Based on the information you provided, your Maximum Option is estimated at $45,454.55 per year, or $3,787.88 per month. That is much more in line with the 2% per year that Alabama teachers get paid. We also have 25 year retirement at any age, which I have no problem eliminating. I'm not saying that your friend was lying to you, but I don't think the pension in NJ is quite as generous as you describe. P.S. I pay SS and into a 403b as well as toward my pension. In good years, I also help fund my Roth. I'm guess the person said a 100% pension, which is not the same thing. A 100% pension would mean that, because you worked X number of years, there's no reduction in benefit for taking it early. For example, if I have 29 years at my job, I get a pension equal to 58% of my salary. If I retire before 62, that pension would be reduced by a percentage based on how many years before 62. If I work 30 years, it's a pension equal to 60% of my salary. That pension would not be reduced for retiring early, because I have 30 years of service, so it would be a 100% pension at 55.
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Deleted
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Post by Deleted on Jan 26, 2011 11:13:45 GMT -5
Illinois has extremely generous gov't pensions. The "richest" i know is someone that has probably put about 30+ years and she is collecting 90% of her salary.
My wife entered teaching 10 years ago and will get 70% of her salary.
Not sure about new teachers.
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973beachbum
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Post by 973beachbum on Jan 26, 2011 11:22:22 GMT -5
I tried to be very specific (clearly not ) and say HIS CONTRACT meaning the one he was hired under, that was negotiated for him 30 years ago. It did give him a pension of 100% of his salary as a benefit. It was also negotiated when starting salaries were like 16K a year and after 30 years maybe $35K. He also taught in an inner city school so some of it was combat pay. I am sure no one ever envisioned a point that those same teachers would be making 6 figures. Brand new starting out teachers would get what you are saying from the pension calculator. And some new teachers that I know are pretty pissed about it. They will pay in MUCH more over their teaching career into their pension and get much less as a benefit. But even then it is still a pretty generous program. The people retiring right now are getting benefits more like my friends and not what is offered today. That is why it is so imperative that we get his system fixed. There is no place to go with taxes in NJ at this point and we simply can't afford to pay these promises that were made 30 years ago. Not that I have a clue what to do with a contract that was legally made by a state. I had always thought that states can't declare bankruptcy since they have the power to tax. But clearly having an obligation of 4 times our entire state budget and that is assuming it stops right now, isn't possible to do either.
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Deleted
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Post by Deleted on Jan 26, 2011 13:53:16 GMT -5
No, brand new starting out teachers do not get what I was saying. You had to be hired before 2007.
It's not worth arguing about, but your friend is the exception even in his/her state these days.
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Deleted
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Post by Deleted on Jan 30, 2011 12:25:11 GMT -5
Sad facts from todays SF Chronicle: $0 Amount the California Public Employees' Retirement System estimated a big increase in pension benefits would cost the state general fund when legislators and Gov. Gray Davis approved them in 1999. 25,000 The level the Dow Jones industrial average would need to be at today to meet that CalPERS projection. $6 billion The amount of state general fund required this year to support the pension system. $2.5 billion General fund support for the University of California in Gov. Jerry Brown's 2011-12 budget. Read more: www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/01/29/IN6C1HE931.DTL&ao=2#ixzz1CXZF4XHy
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