Originally Posted by 79protons
I don't know if you are pulling our leg or what, but that kind of deal after only 5 years of service is ridiculous. If it is true, it is no wonder that California is one of the states with bad financial problems.
I just hope the federal government doesn't step in and bail out the states. I can vote with my feet and move out of my state when it goes belly up due to these pension problems and other spending issues and move to Alaska where oil pays for everything and money grows on the trees, but I can't easily escape the fed if they decide to bail out every bankrupt state.
CalPERS has a bunch of different plans, but in general a 58 year old state employee with 5 years of service would be eligible for a pension between 8-12% of their final salary. So Xynny example sounds exactly correct. Xynny was she able to collect the pension immediately or does she have to wait until 60 or 62?
Believe it or not in California employees pension are pretty average. Most of the pension ratings put CalPERS right in the middle of all the state in terms of financial health, albeit still significantly underfunded. A five year vesting retire is not too unusual, nor is the option to buy 5 years of service.
The 100K and 200K pensions get the headlines, but if you think about the millions of folks in their 50s who join local government for the pension and medical benefits are really the drain on the system. Most of the folks on the list of NY pensioner getting more than 100K had 35-45 years in service. Their contributions (and the states when made
) would have a had time to grow to a pretty large sum. In contrast in Xynny family members case, her contribution would have included 2008, when she retires CalPERS will be lucky to break even on her contribution. FYI, under most CalPERS plans the combined employee and employer plans is between 12-20%. So the deal is even better than you thought.