Government Pensions and FIRE

[bbuzzard]

It appears to me that a disporportionate number of successful FIREs on this board have worked in government jobs with generous pensions that allow for early retirement. Does anyone else have this impression?

I am not criticising these pensions (I am sure someone else will be happy to do that), but merely pointing out that one person's sucessful FIRE at age 50 with the help of a government pension paying 60% of their retirement salary is meaningless to most people who are working toward FIRE and will have to save every penny out of their own pocket.

Simply put, If you have FIREd with a pension, you need to point this out when discussing your retirement (in all fairness, I think most do this). To simply state, "I did it, so can you" without pointing out that a pension is funding 80% of the retirement is useless information to most.

I guess that my second point, if I am correct, is that working for the government is not all bad.

[soupcxan]

Full disclosure is a nice goal, but I doubt it will ever happen here. What's next, is our resident troll going to be required to explain that his "ER" story is really a "mooch of the working wife & collect SS" story?

[grumpy]

bbuzzard,

Just to be clear, as one who retired at 55 with a gov't pension, there are offsets that go along with the pension. During my NASA career I was the financial manager for a number of major spaceflight projects. In each case my counterpart at the prime contractor was earning a salary nearly double mine. If I had worked on the other side of the table (in private industry) I could have saved a WHOLE LOT more over the years and still could have retired at 55 without a gov't pension. It would still have required that we LBYM. The gov't sponsored health insurance that goes along with the pension is certainly an important benefit but I have no doubt that the higher pay in industry (at least for my occupation) would have allowed me to accomplish the same comfortable ER I now have.

Your point is well taken; posters should make clear what career path allowed them to FIRE. However, I don't think it is necessarily true that a gov't pension makes it easier to retire early.

Grumpy

[Martha]

As a person without a pension, I am comforted by our "seniors" Jarhead and HaHa who early retired years ago without pensions.

When Jarhead and HaHa speak, I listen. (Unless it is about sports or T & A)

[REWahoo]

Quote:

Originally Posted by Martha (Unless it is about sports or T & A)

Taxes and Assets?

[azanon]

Give me a break bbuzzard.* *Goverment workers such as myself make mediocre salaries at best in most cases.* *The private worker, especially the small business owner, has far more salary potential and thus more source of funding to grow retirement assets.

Even if i stay a full 30 years to qualify for my pension, which would only amount to ~ 28K/year, that really isnt that much and one could argue staying in long enough to qualify for that isnt exactly FIRE anyway.* Several of the folks here talk about retiring in their 30s and 40s, and that just isnt going to happen as a Federal employee unless you're military or you take an early out, which means your pension wont be much anyway.

IMO, being a federal employee with possible pension is offset by the mediocre, at best, salary.* *My dad, for example,* (a small business owner) makes my GS-12 salary look like play money.* If i wanted to give him a good laugh, I could brag about my eventual pension to him.

Azanon

[Martha]

You guys are being too hard on bbuzzard. He gently suggested that a pension is highly relevant information when talking about the road to FIRE. It is. Just like having a working spouse is relevant.

Also, the wage gap between public and private employment may not be as big as many think. Some interesting comparisons between state/local government employees and private sector employees from a thread I started last summer:

Government Private

34.72 23.76 Average compensation per hour
2.23 .85 Average retirement per hour
98% 60% Workers with some kind of retirement plan
86% 66% Workers with health insurance

Service jobs pull down the private sector's earnings per hour figure. However, state and local managers and professional staff earned $42.87 an hour in 2004, while their private sector counterparts earned $41.52. So even the white collar workers do a bit better.


http://early-retirement.org/forums/i...p?topic=3086.0

[Sheryl]

I think Buzzard made a very polite and qualified comment/question.

The interesting thing about this forum is that many people have arrived at FIRE in many different ways. You've got -

Government or military pensions
Working spouses
Dot-com millionaires
LBYM savers
Those with inheritances
Those that were lucky/smart in real estate

etc. etc. Some of us are combining two or more of these methods to make FIRE happen... but we all at least share a common goal.

[MasterBlaster]

It is to everyones benefit that government employees have the best pensions and the best healthcare. By giving them these things the corruption of government is kept to a minimum lower level.

[azanon]

I don't see what's polite about someone telling me I need to do something, especially in the event that I don't.* * I explained why in the previous post.

Martha, i highly doubt the average government worker pulls in close to $35 an hour.* I'd double check your source on that.* I'm a GS 12, step 4 and i dont make that.* I know for sure at my agency there are plenty more that make less, than make more. And i'm a Fed. State government workers make even less here.

Azanon

[HFWR]

The OP makes a legit point, but most posters here have disclosed an amazing amount of financial/personal info. It's there if you look...

[Martha]

Quote:

Originally Posted by azanon I d Martha, i highly doubt the average government worker pulls in close to $35 an hour. I'd double check your source on that. I'm a GS 12, step 4 and i dont make that. I know for sure at my agency there are plenty more that make less, than make more. And i'm a Fed. State government workers make even less here. Azanon

Az, I quoted myself from a post last summer that discussed a Business Week article. I cannot find the article now to recheck the figures. I agree the number seems high. But then again it is a nationwide average and isn't Arkansas below average? (sooory Az, I couldn't resist)

[Nords]

Quote:

Originally Posted by bbuzzard I guess that my second point, if I am correct, is that working for the government is not all bad.

For the survivors, anyway.

[haha]

Quote:

Originally Posted by Martha As a person without a pension, I am comforted by our "seniors"* Jarhead and HaHa who early retired years ago without pensions.* When Jarhead and HaHa speak, I listen.* (Unless it is about sports or T & A)

Come on Martha, I am a certified T&A-ologist. Mark my thoughts on that expansive topic.

Ha

[Jarhead*]

Quote:

Originally Posted by Martha As a person without a pension, I am comforted by our "seniors"* Jarhead and HaHa who early retired years ago without pensions.* When Jarhead and HaHa speak, I listen.* (Unless it is about sports or T & A)

Martha: You've effectively put my donation to this board "out of business", excluding the above.

However, you didn't say anything about jokes, so here's a Judge joke especially for you:

It was just a misunderstanding, Your Honor,"
testified the man charged with indecent exposure.
"Explain that statement," the judge demanded.
"Well, you see, this girl and I were drinking in a bar, and she asked me what I wanted most in a women--so I showed her."

Jarhead (Martha's hero)

[azanon]

Quote:

But then again it is a nationwide average and isn't Arkansas below average?* * (sooory Az, I couldn't resist)

Below average in salary, and WAY below average in cost of living.* That was a compliment right?* *

I presume the statistic was a national average though and commented based on that understanding.* $35/hr still seems high to me even in that case.* * At step 1, that's GS-13+ regardless of where you live. Also, the COLAs for locality aren't near as much as you might think.* Everyone gets like an 8% base COLA in the federal government, and the % above that for locality doesnt get much over an extra 5-6%, if that.* In short, its a really bad deal to work for the feds in a high cost of living area.

............

Anyway, my point wasn't that being a government employee is a bad deal (with the pensions and all).* But by no means are we necessarily better off than the private sector either.* So for that reason, I dont think i should have to qualify any claims of ER just because I may have a pension.* *The potential to make the most money clearly lies in the private world, especially the small businessman; potential to easily make up for not having a pension.* *

[virginia]

$35 seems high, but when you start factoring in things (especially if military - and just think how many goverment workers are made up of military) - like housing, food allowance, cost of living allowance, special pays, medical benefits, etc, it could very well be possible that the figure is accurate.

With that said - I basically don't trust in a word I read in just about any magazine or news article. For all we know, the writer called his brother, and said "Hey Joe, whadda you figure a gov't worker makes these days?" His brother replies, "Hell, I don't know, I bet $35" and thus, the birth of our article with reliable souces.

I also have to agree with the statement about contractors. They do make tons more and I hear people complain about it all the time. We have guys getting out of the military left and right because the lure of contractor pay is so great. But - contracts can expire, and you do have to do the saving on your own - which most people don't do of course.

[TomSimpsonAZ]

My friend is married to a Fireman in Iraq......he makes about 120k + room/board a year and is hardly ever in harms way. Hooray contractors.

[MasterBlaster]

Quote:

My friend is married to a Fireman in Iraq......he makes about 120k + room/board a year and is hardly ever in harms way. Hooray contractors.

Is your point that he is ripping someone (eg. US government) off ?

Would many people likely take that job ?

What exactly is your point ?

[unclemick]

I don't think there is a point.

My little niece's hubby (knot head Marine lifer) will be going in next month for his third tour.

I haven't seen my doughnut shop bubby since Katrina - power plant control systems - 400k in a safe job - two Iragies died saving their contractor butt's and he'll have a bad back the rest of his life. The telephone guy and the retired Army motor pool sarge turned down their offers.

Then again I could get creamed driving.

Bon Temps Rolliere - there are no guarantee's. A trip down history lane on French/British pensions - would probably not give someone expecting 40 years of bliss a warm feeling.

Remember the Bear! Final round and Superbowl yet to come.