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hopefully, depends on my pension
Old 12-02-2017, 07:46 AM   #1
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hopefully, depends on my pension

I am 45 year old firefighter with a normal retirement age of 55, but may take a early ret at 50. Our pension is reportedly in trouble as most city or state pensions these days are. Because of the city being overly generous to people who have already retired for the past 20 years the new and current firefighters have to take a reduction in our future pension to get our pension fund back in the black. I am currently selling off stuff that I currently own and don't use or need to reinvest those funds to help with the shortage of my future pension. I have read this website as well as others to get tips and tricks to get me to my goal. So in short I just wanted to say hi and give a little info on my current situation.
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Old 12-02-2017, 07:52 AM   #2
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I am 45 year old firefighter with a normal retirement age of 55, but may take a early ret at 50. Our pension is reportedly in trouble as most city or state pensions these days are. Because of the city being overly generous to people who have already retired for the past 20 years the new and current firefighters have to take a reduction in our future pension to get our pension fund back in the black. I am currently selling off stuff that I currently own and don't use or need to reinvest those funds to help with the shortage of my future pension. I have read this website as well as others to get tips and tricks to get me to my goal. So in short I just wanted to say hi and give a little info on my current situation.
Thanks
Greg
Hi! I think you are taking a smart approach. Unfortunately, a lot of State/City pensioners are going to suffer over the coming years, I think even those already retired. Your approach to awareness on this will help you significantly in the future! Good Luck!
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Old 12-02-2017, 08:14 AM   #3
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Old 12-02-2017, 08:26 AM   #4
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Sounds brutal to me. I think firefighter and police pensions should be valued above all other city and state pensions. People who put their lives on the line shouldn't be getting screwed in retirement. Hope it all works out for you.
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Old 12-02-2017, 09:04 AM   #5
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Thank you for the welcomes. According to people on the pension board that I know they said that they heard from the chamber of commerce members that no one without a hi degree of education should ever retire with 100% of their working wages. So they have come up with a new formula to say that the pension will be exhausted within the next 25 years. Which in turn makes us current employees take a cut. So I am not sure what to believe as far as why we are in the red currently.
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Old 12-02-2017, 09:24 AM   #6
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Thank you for the welcomes. According to people on the pension board that I know they said that they heard from the chamber of commerce members that no one without a hi degree of education should ever retire with 100% of their working wages. So they have come up with a new formula to say that the pension will be exhausted within the next 25 years. Which in turn makes us current employees take a cut. So I am not sure what to believe as far as why we are in the red currently.
Whut Not sure about this post now.
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Old 12-02-2017, 09:29 AM   #7
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Whut Not sure about this post now.
as in?
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Old 12-02-2017, 09:35 AM   #8
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Thank you for the welcomes. According to people on the pension board that I know they said that they heard from the chamber of commerce members that no one without a hi degree of education should ever retire with 100% of their working wages. So they have come up with a new formula to say that the pension will be exhausted within the next 25 years. Which in turn makes us current employees take a cut. So I am not sure what to believe as far as why we are in the red currently.


Like with most ponzi schemes it’s probably deeper into the red than what they’re reporting, this is why I firmly believe your retirement funds should not be tied into a retirement type fund or account, the only person I want handling my money is myself
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Old 12-02-2017, 09:46 AM   #9
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I'd love to understand what "hi degree of education" has to do with pension benefits, and why anyone would say something of that nature? Something just smells...
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Old 12-02-2017, 10:37 AM   #10
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Like with most ponzi schemes it’s probably deeper into the red than what they’re reporting, this is why I firmly believe your retirement funds should not be tied into a retirement type fund or account, the only person I want handling my money is myself
I agree with you on that as I cant trust anyone to do what they say. I just watched a 1.5hr video of the last ret board meeting and the management team handling the fund reported a 8.75 return. I, just this April opened up a 457b and have a ytd return of 11.5 and I am no expert.
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Old 12-02-2017, 10:43 AM   #11
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I'd love to understand what "hi degree of education" has to do with pension benefits, and why anyone would say something of that nature? Something just smells...
From what I am told the chamber has a chip on their shoulder towards anyone getting more benefits than them.

It seems to be a political issue. What is bad is that our union has no power. We cant strike or demand anything. We can only accept what the city is doing to us.
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Old 12-02-2017, 10:46 AM   #12
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Our pension also is not protected under any contract, the city can change it at any time.
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Old 12-02-2017, 11:06 AM   #13
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I worked in the US auto industry and though I was promised a pension, I figured it was quite likely I'd never see it, or at least not all of it. I saved and invested like crazy to ensure I could still retire early. As luck would have it, the pension has been honored, with health care insurance, but I don't regret having a back stop. You really can't depend on anyone but yourself.
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Old 12-02-2017, 11:38 AM   #14
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I worked the US auto industry and though I was promised a pension, I figured it was quite likely I'd never see it, or at least all of it. I saved and invested like crazy to ensure I could still retire early. As luck would have it, the pension has been honored, with health care insurance, but I don't regret having a back stop. You really can't depend on anyone but yourself.
I agree but I have gotten a late start, but will finish strong.
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Old 12-02-2017, 12:27 PM   #15
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I agree but I have gotten a late start, but will finish strong.
Good attitude. You have to start from today and look forward.

Incidentally, my nephew is a firefighter and I asked him to be sure he fully understood all the fees attached to his retirement investment account managed by his union. He and I were shocked at the fees stacked on top of fees. As I recall, over 3% - someone had really sold out the firefighters to pickpocket "financial advisors".
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Old 12-02-2017, 12:39 PM   #16
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Good attitude. You have to start from today and look forward.

Incidentally, my nephew is a firefighter and I asked him to be sure he fully understood all the fees attached to his retirement investment account managed by his union. He and I were shocked at the fees stacked on top of fees. As I recall, over 3% - someone had really sold out the firefighters to pickpocket "financial advisors".
ours is managed by the city who hires for all the studies to be done which I am sure comes out of the fund and a expense.
I am now maxxing out my 457 per year along with either a trad or roth ira and a HSA account as well. Plus working all the overtime I can to get debt free.
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Old 12-02-2017, 01:31 PM   #17
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ours is managed by the city who hires for all the studies to be done which I am sure comes out of the fund and a expense.
I am now maxxing out my 457 per year along with either a trad or roth ira and a HSA account as well. Plus working all the overtime I can to get debt free.
I was referring to the 457 plan - be sure to understand fees.
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Old 12-02-2017, 01:33 PM   #18
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I was referring to the 457 plan - be sure to understand fees.
mine is with TIAA
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Old 12-02-2017, 03:55 PM   #19
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Thank you for the welcomes. According to people on the pension board that I know they said that they heard from the chamber of commerce members that no one without a hi degree of education should ever retire with 100% of their working wages. So they have come up with a new formula to say that the pension will be exhausted within the next 25 years. Which in turn makes us current employees take a cut. So I am not sure what to believe as far as why we are in the red currently.
I suspect what the Chamber may have been reacting to was a benefit formula that was much more rich/liberal than typical. Even for long term employees, pensions generally do not totally (100%) replace earnings... in part because of social security.... remember the 3-legged stool (pension, SS and personal savings) If your plan pays 100% of pay then that is a red flag that the plan is too rich... and may be why the plan is struggling financially. IIRC for long-term employees 2/3rds was the previous gold standard.

Also, there should be no need for anyone to retire with 100% of working wages since social security and medicare taxes take 7.65% out and you don't pay that on retirement income... the point being that if someone retired and their pension was 92.35% of their working gross then their take-home pay would be no different from working and they would get SS on top of that. Pensions are usually designed to replace pay... not provide a raise.

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I agree with you on that as I cant trust anyone to do what they say. I just watched a 1.5hr video of the last ret board meeting and the management team handling the fund reported a 8.75 return. I, just this April opened up a 457b and have a ytd return of 11.5 and I am no expert.
One thing that you need to consider before judging them is what their asset allocation is compared to yours.... I'd bet that it is likely that your 457b has a higher allocation to stock than your pension fund does.
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Old 12-02-2017, 04:31 PM   #20
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I suspect what the Chamber may have been reacting to was a benefit formula that was much more rich/liberal than typical. Even for long term employees, pensions generally do not totally (100%) replace earnings... in part because of social security.... remember the 3-legged stool (pension, SS and personal savings) If your plan pays 100% of pay then that is a red flag that the plan is too rich... and may be why the plan is struggling financially.
This may very well be the case. I'm a retired police officer and I went out a bit over 70% (I think 72%) and the max that one could get to was I think 73% or thereabouts. Anyway, when I retired my net monthly income actually went up a few dollars. We're talking single digits here so it wasn't significant. But the reason was as you said, I wasn't paying into SS, Medicare, union dues, the pension plan, and I was maxed out on the 457 contributions.

I've heard of pension plans that promise to pay amounts like 100% and agree that's just crazy.

BTW, not all pension plans are in trouble. As of a few months ago the one I'm in was 94% funded.
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