Rhode Island Public Pension System Reform

[ripper1]

Are there any public employees out there going to give me a hand with this? I'll admit I get a decent pension but it is not way over the top like some of you might suggest

 

[Chuckanut]

Ripper1. I certainly can't retire after 20 years for anywhere near $44,000 a year. It would be more like 20,000. Keep in mind that includes some of my own money since I have been paying 6% of my earnings into the pension for 20 Years.
That's a lot of my money and its earnings. It's not all taxpayer money. Also I would like to know if the individual involved bought retirement credits to enhance his pension. They work like an annuity. Give the government a big pile of cash and collect a few hundred dollars more a month. Live long enough and it is a good deal. Die to early and your heirs will not be happy with your decision.

Yes, I would get SS but why not? I have paid into it like everybody else. Surely, I am not to be denied SS because I worked 1/2 my life for a public institution?!?!?!?!?

 

[Mulligan]

Seriously? $11k a year for a 9 month position works out to about a quarter an hour more than minimum wage. If that is a 10 month position they are making less than the federal min wage. That stat is a little shocking.

Our TA's locally get over $11/hr with zero experience, increasing to $13/$15 for mid career and 30 yr veterans, respectively. After checking, our assistant lunch ladies are the least paid school staff at over $10/hr (and they get benefits).

This is in a non-unionized area that isn't particularly high cost of living.

Yes, its under $10 an hour. They have 7 hour work days and work 175 school days a year. The ones that have been around awhile make a little more, but not much. The health insurance is the main draw, and most are not the primary income for the family. Oddly enough, there isnt that much turnover in those jobs. Some even have college degrees, but are content and enjoy what they do.

 

[ripper1]

Ripper1. I certainly can't retire after 20 years for anywhere near $44,000 a year. It would be more like 20,000. Keep in mind that includes some of my own money since I have been paying 6% of my earnings into the pension for 20 Years.
That's a lot of my money and its earnings. It's not all taxpayer money. Also I would like to know if the individual involved bought retirement credits to enhance his pension. They work like an annuity. Give the government a big pile of cash and collect a few hundred dollars more a month. Live long enough and it is a good deal. Die to early and your heirs will not be happy with your decision.

Yes, I would get SS but why not? I have paid into it like everybody else. Surely, I am not to be denied SS because I worked 1/2 my life for a public institution?!?!?!?!?

I paid 8.5% of my earnings for 30 years into pension. No SS

 

[friar1610]

I don't know that the military is really a place where it could work well, especially not those who are deployed in combat-ready roles around the world.

I think we have to question the continued use of 20 as the "magic number", though, as well as the ability to start collecting at age 38. Many places start offering at least some pension vesting at 10 years and occasionally less, and as long as these are actuarially sound I have no problem with that. Maybe there should be more of a sliding scale, from (say) 10 to 40 years -- not just all or nothing at 20 (nothing for 19 years, full pension and lifetime health insurance at 20?). And most pensions don't allow starting the pension until age 55 or so -- maybe as early as 50, some as late at 60, but few allow being a pensioner at 38.

Also, depending what happens with health care reform in the future, that could make less military spending specifically on health care for military retirees which is necessary under the current (largely broken) health insurance model here.

In terms of any future cutbacks for military retirement, I'd hope at the very least decent people would agree that nothing should be taken from combat-disabled veterans, especially those too disabled to find work elsewhere. We certainly owe a lot to our veterans, and especially the vets and families who suffered casualties in combat or combat training. And nothing should change for those already in the service.

There are definitely plans beginning to be floated to do much as you outline above. The Administration wants to go to a more corporate type plan. There is one study floating around (done by the Defense Business Board - a group of industry high rollers who advise DoD) that essentially recommends a defined contribution plan with matches by the Government which vary by military speciality and current job. (An infantry soldier on combat duty gets a larger match than an admin clerk on shore duty in Hawaii.) The JCS and the various military organizations (MOAA, for example) are against any big changes. The major argument against a drastic change is that it will hurt retention and create a "hollow force" much as what happened in the late 70's when the retirement system was changed (i.e., made much less valuable) and retention dropped significantly.

As a military retiree myself I foresee, at a minimum, a reduction in COLA adjustments.

This is a very tough issue because, generally speaking, a military career is more arduous than a corporate one. There have always been deployments (6 -12 month carrier deployments for Navy, for example), unaccompanied tours (a year on Okinawa for Marines or a year in Korea for the Army, for example), unusual working conditions (time in the silo for AF missile folks, for example) and crazy, disruptive working hours (trying to keep drunken yachtsmen from killing themselves during summer weekends for the Coast Guard, for example.) The last 10 years has only exacerbated all of that for many military folks (multiple deployments to Iraq and Afghanistan, constant stress, disrupted family life, etc). Historically, the 20 - 30 retirement has been the pot of gold at the end of the career and many people, myself included, made decisions to stay for careers based partly on the retirement promise.

On the other hand, personnel costs (which include retiree pensions and health care costs) are eating DoD alive. Not sure how this will all play out but it will be very interesting to watch.

 

[Chuckanut]

I paid 8.5% of my earnings for 30 years into pension. No SS

I have always paid SS (and now medicare) whether in the private or public sector. I never made enough to get to the no-pay amount. So, yes, I do think I am justified in getting SS benefits.

 

[ripper1]

I have always paid SS (and now medicare) whether in the private or public sector. I never made enough to get to the no-pay amount. So, yes, I do think I am justified in getting SS benefits.

Who said you weren't. Employees that started after 1984 with City of Chicago started paying into Medicare. I started in 1981 so I am not eligible for Medicare or SS.

 

[youbet]

I can't wait for them to align public sector IT job salaries with private sector! I will get a nice raise for sure! Throw in Boston area market pricing and that is icing on the cake!

Just curious Bimmerbill, what is it about your public sector job that keeps you there despite the fact that you could earn more in the private sector? Benefit package? Working conditions? Also, in your hard-to-recruit IT field, is your employer finding it difficult to attract and retain good people with the salary and benefit packages they're offering today?

BTW, by "align public sector jobs with market prices" I meant pay what it takes to attract and recruit qualified employees, no more, no less. I didn't mean do a study comparing salaries and make adjustments up and down to existing employees' salaries.

 

[Chuckanut]

Who said you weren't. Employees that started after 1984 with City of Chicago started paying into Medicare. I started in 1981 so I am not eligible for Medicare or SS.

Ripper, There are people who still believe that public employees do not pay into SS, then retire, work a few years at a private sector job that requires paying into SS, and then collect a HUGE SS payout based upon just a few years of work. I was pointing out that as a public sector worker I have always paid into SS. So I have earned my SS just like any other person.

 

[ERD50]

Ripper, There are people who still believe that public employees do not pay into SS, then retire, work a few years at a private sector job that requires paying into SS, and then collect a HUGE SS payout based upon just a few years of work. I was pointing out that as a public sector worker I have always paid into SS. So I have earned my SS just like any other person.

Well, it is true that some public employees do not pay into SS, and some then retire and work a few years at a private sector job that requires paying into SS (or work those years before the public job), and then collect a HUGE SS payout (HUGE in relative terms - SS pays relatively higher for those first years/$s).

In some cases there are adjustments for this effect.

-ERD50

 

[Mulligan]

Well, it is true that some public employees do not pay into SS, and some then retire and work a few years at a private sector job that requires paying into SS (or work those years before the public job), and then collect a HUGE SS payout (HUGE in relative terms - SS pays relatively higher for those first years/$s).

In some cases there are adjustments for this effect.

-ERD50

I guess unfortunately for me, your last sentence pertains to me. I have substantially more than 40 quarters in but WEP is whacking me to under $100 when I become eligible. I amused myself with the SS WEP calculator, projecting what I would get if I put 10 solid years of full time working to boost it up. The results werent worth the time I put in to figure out the benefit! Im probably the oddball on this, but I wish I had the opportunity to pay into SS during my working career. It would have been another leg for the old retirement stool.

 

[haha]

I can't wait for them to align public sector IT job salaries with private sector! I will get a nice raise for sure!

True, but be prepared to work 12 days during the count down to ship. And weekends? Private sector programmers are like ERs- "What are weekends?"

Ha

 

[ripper1]

Well, it is true that some public employees do not pay into SS, and some then retire and work a few years at a private sector job that requires paying into SS (or work those years before the public job), and then collect a HUGE SS payout (HUGE in relative terms - SS pays relatively higher for those first years/$s).

In some cases there are adjustments for this effect.

-ERD50

Most public employees do not pay into SS. They make contributions for their public pensions and if they somehow acquire 40 quarters outside their employment with a government job their is a couple things that knock down that SS to practically nothing. One is called GPO (Government Pension Offset) and WEP (Windfall Elimination Program). Look it up.

 

[ripper1]

I guess unfortunately for me, your last sentence pertains to me. I have substantially more than 40 quarters in but WEP is whacking me to under $100 when I become eligible. I amused myself with the SS WEP calculator, projecting what I would get if I put 10 solid years of full time working to boost it up. The results werent worth the time I put in to figure out the benefit! Im probably the oddball on this, but I wish I had the opportunity to pay into SS during my working career. It would have been another leg for the old retirement stool.

Well, if anything your SS benefit will pay for Medicare. Otherwise if your wife has 40 quarters of private employment you will go on her benefit.

 

[Mulligan]

Well, if anything your SS benefit will pay for Medicare. Otherwise if your wife has 40 quarters of private employment you will go on her benefit.

Not currently married, but isnt that where the GPO kicks in on that scenerio?

 

[Mulligan]

Well, if anything your SS benefit will pay for Medicare. Otherwise if your wife has 40 quarters of private employment you will go on her benefit.

I reread your post, I misunderstood. Even though I didnt pay into SS, I did pay into Medicare, so Im good there.

 

[ripper1]

I reread your post, I misunderstood. Even though I didnt pay into SS, I did pay into Medicare, so Im good there.

Don't take this for gospel but if you paid into Medicare as a public employee than you should be good for it. Look into at socialsecurity.gov.

 

[clifp]

Most public employees do not pay into SS. They make contributions for their public pensions and if they somehow acquire 40 quarters outside their employment with a government job their is a couple things that knock down that SS to practically nothing. One is called GPO (Government Pension Offset) and WEP (Windfall Elimination Program). Look it up.

Actually this isn't true. This GAO study from 2005 found that 75% of public employees are covered by SS and that number is decreasing fairly rapidly as older workers retire, and more states modify their pension plan. 7 state include CA, IL, and TX account for 71% of employees who aren't covered by SS. Among the 25% not covered I imagine a reasonable number are eligible for SS benefits due other worker or spousal benefits. In all 94% of all workers are covered by SS.

 

[ripper1]

Actually this isn't true. This GAO study from 2005 found that 75% of public employees are covered by SS and that number is decreasing fairly rapidly as older workers retire, and more states modify their pension plan. 7 state include CA, IL, and TX account for 71% of employees who aren't covered by SS. Among the 25% not covered I imagine a reasonable number are eligible for SS benefits due other worker or spousal benefits. In all 94% of all workers are covered by SS.

I think they are covered by Medicare but not SS. Employees that started after 1984 in Chicago started paying into Medicare but not SS. That being said if they had a government pension and somehow found outside work to be eligible for SS their benefit would be greatly reduced by GPO/WEP.

 

[52andout]

Well, if anything your SS benefit will pay for Medicare. Otherwise if your wife has 40 quarters of private employment you will go on her benefit.

not always true. In the postal service you don't pay into SS but you also cannot claim on a spouse.

If a non working spouse reaches age 65 can they also get medicare for the low premium, or do they have to pay more if they didn't pay in? Does the spousal benefit work for medicare?

 

[ripper1]

not always true. In the postal service you don't pay into SS but you also cannot claim on a spouse.

If a non working spouse reaches age 65 can they also get medicare for the low premium, or do they have to pay more if they didn't pay in? Does the spousal benefit work for medicare?

My understanding is you can qualify on your spouse's benefit. The website at socialsecurity.gov is pretty informative.

 

[clifp]

I think they are covered by Medicare but not SS. Employees that started after 1984 in Chicago started paying into Medicare but not SS. That being said if they had a government pension and somehow found outside work to be eligible for SS their benefit would be greatly reduced by GPO/WEP.

Would you care to provide some evidence to back up your thinking or are you just spouting off stuff? Hint I read links from 3rd party sources.

As the GAO reports says it is 25% of public employee who don't pay SS taxes, but many of them receive SS benefits for other reasons. It doesn't make any discussion of Medicare. I get that in IL many worker aren't covered by SS, like many things regarding government IL is the exception not the rule. For instance the number of former governors serving prison sentences.

 

[ripper1]

Would you care to provide some evidence to back up your thinking or are you just spouting off stuff? Hint I read links from 3rd party sources.

As the GAO reports says it is 25% of public employee who don't pay SS taxes, but many of them receive SS benefits for other reasons. It doesn't make any discussion of Medicare. I get that in IL many worker aren't covered by SS, like many things regarding government IL is the exception not the rule. For instance the number of former governors serving prison sentences.

I stand corrected. It is in Illinois where 80% are not covered by SS. I can't speak to the rest of the country. But again if a public employee is eligible for SS, his or her benefit will be reduced by GPO (Government Pension Offset). Go to the social security website and look it up. Also being a retiree of the City of Chicago they started paying into Medicare after 1984 so those employees when they retire will be eligible for a Medicare benefit only at 65. Anyone that started before 1984 was not eligible to participate.

 

[ripper1]

By the way, clifp, I'm just stating the facts as I know them here in Illinois and not spouting off. By the way, how is the weather in Hawaii?

 

[nun]

Well, it is true that some public employees do not pay into SS, and some then retire and work a few years at a private sector job that requires paying into SS (or work those years before the public job), and then collect a HUGE SS payout (HUGE in relative terms - SS pays relatively higher for those first years/$s).

In some cases there are adjustments for this effect.

-ERD50

I don't agree. You need to pay into SS for 10 years to qualify. Additionally if you have a retirement benefit from a job where you didn't pay into SS any SS payments you might get from a job where you did pay into SS is reduced using the Windfall Elimination Provision.