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View Poll Results: Do you have a pension?
Government Pension 166 29.23%
Corporate Pension 195 34.33%
No pension, just SS & savings 207 36.44%
Voters: 568. You may not vote on this poll

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Old 05-14-2021, 12:28 AM   #141
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Corp pension w/severe diet COLA, (almost 26 years), no contribution, 35% of final years gross salary, but better than 50% of take home after FICA, MED, health, life, 401k etc. ER @61, with subsidized HC until 65 of $300/mo. DW gets 2 small teachers pensions, diet COLAs, and started SS @62, for total of about $2k/m. If I start SS at 68 in less than 5 years, SI will be about $9500/mo. If we can’t live comfortably on that, then we have a spending problem.

I, too, am surprised at both the percentage of pensions and some of the amounts. $200k/yr in pensions? Yowsa. Some high salary people here!
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Old 05-14-2021, 06:35 AM   #142
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My DW and I have defined contribution pensions totaling about $1.1m, all yet to be started, 6 years into my retirement.

Next year I become eligible for a social security pension, but I am undecided whether to take it at 62 or to wait, as it increases 8% a year.
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Old 05-14-2021, 09:02 AM   #143
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Originally Posted by JohnnyBGoode View Post
I think it is quite telling that (according to this poll at least) almost 2/3 of the participants on this board have a corp or govt pension. This is a far higher percentage than the typical American. https://www.cnbc.com/2020/01/17/here...nt-income.html

Just goes to show that FI is remarkably difficult without a pension.
Agree, we could have retired at 62-63 without a pension using ACA and early Social Security, but our living standard would have been very modest.
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Old 05-14-2021, 09:30 AM   #144
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Originally Posted by JohnnyBGoode View Post
I think it is quite telling that (according to this poll at least) almost 2/3 of the participants on this board have a corp or govt pension. This is a far higher percentage than the typical American. https://www.cnbc.com/2020/01/17/here...nt-income.html

Just goes to show that FI is remarkably difficult without a pension.
Many in this self-selected group tended to have jobs with skill requirements that are not easy to find. Thus those tended to offer (at least in the past) pensions to compete in the labor market. Also many here also worked with an employer long enough to qualify for a pension.

But given the size of most of the pensions that have been mentioned, I do not know if I would say "remarkably" different. It would be harder, but still possible, though one might need to spend at a "comfortable/survival" level instead of a "Blow That Dough" level. Other factors such as one's debt level and having to care for parents or children would also come into play.

Though my pension is over $6k a month, without it I could still be FI on just our investments and SS. One reason I delayed my retirement to that level of pension was to ensure that as long as I had 2 out of 3 income sources (pension, investments, SS) we would be comfortable and only have to cut back on "extravagant" expenditures.
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Old 05-14-2021, 09:44 AM   #145
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Though my pension is over $6k a month, without it I could still be FI on just our investments and SS. One reason I delayed my retirement to that level of pension was to ensure that as long as I had 2 out of 3 income sources (pension, investments, SS) we would be comfortable and only have to cut back on "extravagant" expenditures.
Though my pension is a fraction of that, my logic was the same. I am cautious enough that I waited to ER until my savings would be enough to support my family without pension or SS. This means the pension serves as a comfortable buffer rather than primary support.

An interesting element that few have mentioned in this thread is that those of us with non-COLA'd pensions basically need two strategies: one for early ER when the pension is significant and one for later retirement when inflation has rendered the pension less so. This is why I am particularly cautious about large expenditures from savings during the first 10-15 years of retirement. During this phase, growth of savings is still an important aspect of my ER strategy. After that point, savings (hopefully with an assist from SS) will be by far the largest contributor to available spending and the pension won't matter much at all. That will more truly be the decumulation phase of my retirement and I'll worry less about growth and more about capital preservation.
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Old 05-14-2021, 09:46 AM   #146
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One difference between pensions is the amount the employee contributes.

I did not have to fund my DB pension. My sister had to fund hers at 8 percent. There is a huge difference between these DB pension benefits and percentage payouts. Combined with the SS like Government pension her total pension contributions were 12 percent of salary.

The average person will have something like five to seven employers in their working life. For many, DB pensions are not ideal because they lack the longevity with an employer to build up the credits.

Since retiring nine years ago inflation has been very low. This may change over the next few years. I assumed early on that we would need to supplement my DB pension because of higher living expenses and the effects of inflation over time.
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Old 05-14-2021, 09:47 AM   #147
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Dh has a 75k per year, non Cola pension from a company that does a lot of government contracts (aerospace)

I am either retiring in June 2022 or June 2023 from public education. I work in a district that has good funding so salaries are good. My pension will either be about 86K or 96k depending on which year I retire. No cola, but a 2% increase each year but itís based on your original pension amount, not cumulative.
I always find pension amounts like this amazing.
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Old 05-14-2021, 10:37 AM   #148
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I always find pension amounts like this amazing.
It really does show the variability of incomes on a forum like this. Still, MOST here would be considered "solidly" middle class and not "rich" - and I don't mean to start another discussion of what is "rich."

I'm just pointing out that our spread of incomes can be quite significant. I do think a lot of times, "total compensation" may be weighted toward "now vs later." IOW some folks accepted somewhat lower salaries at the time because they were promised very good pensions later on.

In my case, I had a more modest pension but a relatively generous participation by Megacorp in our DB plan AND a salary that typically was in the top 10% for the industry. My Megacorp WANTED us to stay for an entire c*reer so sweetened the pension the longer we stayed. So "early retirement" was "relatively" costly to my Megacorp's empl*yees.

Our empl*yee compensation package also included a very generous health insurance program during empl*yment. It also included on-sight clinic with 24 hour nurse and access to a Doctor by appointment. Megacorp encouraged us to have our "own" doc, but I knew many folks who ONLY used the clinic - saving quite a bit of money on personal health insurance costs.

Finally, we received very good supplementation of health insurance after retirement. I will say, THAT part was not guaranteed and Megacorp reneged (somewhat) after I retired. They still supplemented our health insurance but not nearly as favorably. As far as I was concerned, before MC the mere PROMISE of health insurance - even if relatively more expensive - was an excellent benefit before ACA became a reality.

Very much a YMMV situation within our members here.
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Old 05-14-2021, 10:37 AM   #149
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A very small pension, about 5% of planned budget, when we turn 65.
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Old 05-14-2021, 11:47 AM   #150
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An interesting element that few have mentioned in this thread is that those of us with non-COLA'd pensions basically need two strategies: one for early ER when the pension is significant and one for later retirement when inflation has rendered the pension less so.

This is a very good point. The best I could come up with for my "early" plan was to accumulate enough in cash savings, adjusted for expected inflation, to cover the difference between my pension and our planned "extravagant" spending level before I take SS. I am fortunate to have hit the 35 year maximum SS tax payments to get the maximum SS benefit, and that will help as inflation more impacts the pension.
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Old 05-14-2021, 12:05 PM   #151
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We've found that spending on "stuff" has gone way down as has travel as we reach our mid 70s. On THAT basis, a non-cola'd pension doesn't feel quite as bad. As jollystomper points out, you PLAN around whatever you're "blessed" with. You can plan your own "COLA" replacement during FIRE preparation. YMMV
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Old 05-14-2021, 02:20 PM   #152
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COLA County Pension. SSA just approved right on time. Screenshot_20210514-130117_Chrome.jpeg
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Old 05-14-2021, 04:59 PM   #153
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An interesting element that few have mentioned in this thread is that those of us with non-COLA'd pensions basically need two strategies: one for early ER when the pension is significant and one for later retirement when inflation has rendered the pension less so.
A strategy I'm using for my non-COLA pension is to defer. The terms of my pension increase the benefit for deferral based partly on mortality credits and partly on prevailing interest rates. The interest rate applied is the greater of 5% or the 30 year treasury, so for quite a few years the 5% floor has been the rate applied. My pension is more-or-less inflation protected while deferred by virtue of variable interest rate credits. Once started, the payout is fixed with no COLA. To blunt inflation concerns I elect to defer my pension as long as possible.

Corporate pensions are all individual in their terms. I went through the boiler plate of 4 different plans I was in and they all were different. Don't depend on HR people to guide you, they generally don't know the small details and their default answer of "No" is often wrong.
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Old 05-14-2021, 05:25 PM   #154
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Military.
Corporate.

Tried never to let this future fact affect my saving and investing since I was 21.

Oh, yeah - did make a lot of mistakes along the way - but ALWAYS tried to save and invest.
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Old 05-15-2021, 04:27 PM   #155
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I'm age 65.5. I have a state public retirement pension and a city retirement pension (COLA). Combined pensions total $70,653.00 annually. I also have an untouched 401(k) with $187K. I plan on applying for SS at either FRA (in 9 mths) or in 3 years as Open Social Security says optimization is age 68.5. SS at FRA: $24,6K. DW, age 56, is a state university professor with a tax-deferred 403b, and 401(k), combined total currently:$906K. DW plans to retire in 2-3 years and delay her SS until age 70.
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Old 05-15-2021, 05:45 PM   #156
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Had to choose between Pension with low salary vs. no pension with higher salary. Chose latter and invested extra $ myself. So far so good.
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Old 05-16-2021, 07:31 AM   #157
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Corporate pension. Not taking it yet, and it will be relatively small as it is a DC plan converted to an annuity within our company's administration. I think it will be around $1,200/mo. This represents a fairly small portion of our overall FIRE financial plan.
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Old 05-16-2021, 07:41 AM   #158
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Corporate pension around $3,500 per month. No Cola but I was happy I was around when the company still had a pension and got grandfathered in.
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Old 05-16-2021, 08:09 AM   #159
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I get a federal pension and a federal widower's pension (both nearly fully indexed) and social security (taken at age 70); my DW gets a federal pension (nearly fully indexed) and a pension from an international financial institution (fully indexed with 3% annual increase guarantee) and qualifies for reduced social security...together substantially more than our annual expenses without drawing on retirement funds....
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Old 05-16-2021, 08:13 AM   #160
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Had to choose between Pension with low salary vs. no pension with higher salary. Chose latter and invested extra $ myself. So far so good.
If i had to do it all over again i would have done the same as you. Some people get upset with people who have pensions thinking it is not fair that they get a check every month. Some pensions like mine are not what they seam to be when viewed by others. Mine for example i have to contribute 14% into my pension. My formula at time of being hired was 3 x how many years worked equals the percentage of my high 3 years with overtime. But has since been changed to 2.5 x years worked equals percentage of my high 5 years with no overtime. The city can change the formula at anytime not just when contract are negotiated. The city is also in charged of managing the fund and invest how they see fit. Last 3 yrs the fund return has averaged 8% per year. I am no financial expert by any means but my last 3 years average in my 457b that i choose the investments has averaged 28%. I have friends that have 401k's that get more in retirement than me at the 4% rule. They also qualify for SS which i do not.

So having a pension is not all its cracked up to be.
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