Retired at 54, pensionless at 74

[DayDreaming]

...Still, isn't $37,500 below the limits of what PBGC will cover? I'd think he's safe unless the government goes under completely.

The amount PBGC covers is reduced for early retirees. If his GM pension goes under after he turns 61 he should be covered for up to $38,880. If it goes under before that, his pension will probably be reduced: Maximum monthly guarantee tables (Although those numbers are revised every year).

 

[TiredOfDoingDiddly]

Spiking was a major "game" strategy in my private sector pension.
Basic pension = 1.75% x years of service x high 3.
High 3 was any, ANY, money paid to you by the company.
I spiked my salary to double.

Gimmicks used, all legal:
1. Cash out up to 240 hours of vacation per year.
2. Work (charge regardless) 15 hours OT per week.
3. File several patent applications at $500 per application.
4. Get eyes/teeth bullet-proofed then take the benefit as cash over last 3 years, $4000 per year
5. Profit sharing 2-3% of base salary in good years.
6. Hiring bonus of $10,000 for referring "cleared" persons, 1-2 per year.

The process is a pandemic of fraud, but if it's there, it will be done.

 

[shoe]

My FIL retired as a salaried GM employee in 1979 and his pension (non-COLA) was $1160 a month plus $960 SS. He and my MIL lived a very modest life, with a 860sq foot house, 1 car and one vacation in 38 years of marriage. They were the typical family of the 50's with 4 kids and a SAHM. Their clothes came from garage sales and my FIl drank generic beer. When she died the had $3000 to their names. No three-legged stool there.

 

[FinanceDude]

Come to Wisconsin, home of the "amazing pensions" for teachers. 30 years service gets you a monthly payment equal to 85% of an average of your LAST 5 years of employment, plus health insurance is $50 a month until Medicare kicks in.

Plenty of early to mid 50's retired teachers living in my neighborhood.......

There is talk that the pension fund may have to lower the pension payment to 75% of your last 5 year average, since times are tough........

 

[ziggy29]

Come to Wisconsin, home of the "amazing pensions" for teachers. 30 years service gets you a monthly payment equal to 85% of an average of your LAST 5 years of employment, plus health insurance is $50 a month until Medicare kicks in.

Plenty of early to mid 50's retired teachers living in my neighborhood.......

There is talk that the pension fund may have to lower the pension payment to 75% of your last 5 year average, since times are tough........

My wife's going to be under TRS (the Texas Teachers' Retirement System) in her new j*b, and here the formula is 2.3% per year of service based on last five years. Thirty years of service (for newer hires; as usual, people who have been there a long time get a better deal) will get you 69% of pay.

If she likes the gig, hopefully she can stick it out for 20 years until age 60, retire with her 80 points at 46% of last five years of pay. Making sure, of course, to become a full teacher and not just an aide for the last five years (based on pay scales that would nearly double her pension amount). Yeah, it's gaming the system in a way that feels unclean, but we'd be leaving a lot of money on the table by being true to our principles.

 

[FinanceDude]

My wife's going to be under TRS (the Texas Teachers' Retirement System) in her new j*b, and here the formula is 2.3% per year of service based on last five years. Thirty years of service (for newer hires; as usual, people who have been there a long time get a better deal) will get you 69% of pay.

If she likes the gig, hopefully she can stick it out for 20 years until age 60, retire with her 80 points at 46% of last five years of pay. Making sure, of course, to become a full teacher and not just an aide for the last five years (based on pay scales that would nearly double her pension amount). Yeah, it's gaming the system in a way that feels unclean, but we'd be leaving a lot of money on the table by being true to our principles.

'My advice is that if you can "work the system" in a legal manner, then work it, because the system may change.........

 

[youbet]

My wife's going to be under TRS (the Texas Teachers' Retirement System) in her new j*b, and here the formula is 2.3% per year of service based on last five years. Thirty years of service (for newer hires; as usual, people who have been there a long time get a better deal) will get you 69% of pay.

If she likes the gig, hopefully she can stick it out for 20 years until age 60, retire with her 80 points at 46% of last five years of pay. Making sure, of course, to become a full teacher and not just an aide for the last five years (based on pay scales that would nearly double her pension amount). Yeah, it's gaming the system in a way that feels unclean, but we'd be leaving a lot of money on the table by being true to our principles.

Why would she wait to do whatever it takes to become a certified teacher instead of a lower paid teacher's aide? There is no upside to waiting but lots of downside.........

 

[ziggy29]

Why would she wait to do whatever it takes to become a certified teacher instead of a lower paid teacher's aide? There is no upside to waiting but lots of downside.........

She may do it sooner than that if she likes the job and such. She already has a degree and would just need to go through alternative certification, provided there was an opening and they would take her on through that route. She could conceivably pursue certification on her own if she wants, but that might conflict with working schedules and there aren't any conventional institutions for doing that within reasonable distance.

I'm just saying that for pension purposes, for at least the last five years it would be better to be higher on the "food chain" in terms of jobs with the district. It's not like I'm going to push her into something she's not ready for or decides she doesn't want to do.

 

[beowulf]

Most of the problems with increased overtime and spiking during the last few years of work are problems more related to state/local systems and maybe some private firms and not the federal government. In NYC (and I'm sure elsewhere) the police and fire departments have had that situation for many years - at one time I believe the retirement amount was based on the last full year of salary prior to retirement. Now it may be another time period, but the result is the same - during that final period the employees will put in as much OT as physically possible and many can double thair salaries used in the retirement calculation.

For the average fed, whether under CSRS or FERS, this is pretty much impossible. The only way it can really be done is to move from a low cost area to a high cost one for a 3 year period prior to retirement. Not too many folks are willing to do that. You can also get promoted and remain in the new position for at least 3 years.

 

[youbet]

Most of the problems with increased overtime and spiking during the last few years of work are problems more related to state/local systems and maybe some private firms and not the federal government. In NYC (and I'm sure elsewhere) the police and fire departments have had that situation for many years - at one time I believe the retirement amount was based on the last full year of salary prior to retirement. Now it may be another time period, but the result is the same - during that final period the employees will put in as much OT as physically possible and many can double thair salaries used in the retirement calculation.

For the average fed, whether under CSRS or FERS, this is pretty much impossible. The only way it can really be done is to move from a low cost area to a high cost one for a 3 year period prior to retirement. Not too many folks are willing to do that. You can also get promoted and remain in the new position for at least 3 years.

Sounds like the federal employee unions need to get on the stick! Although it may be too late....... Some states, Illinois for example, now discourage spiking provisions in union contracts by not recognizing annual raises greater than 6% during the last five years of employment unless the employer (school district, municipality, etc) pays a lump sum into the pension fund to offset the increased pension costs.

 

[youbet]

She may do it sooner than that if she likes the job and such. She already has a degree and would just need to go through alternative certification, provided there was an opening and they would take her on through that route. She could conceivably pursue certification on her own if she wants, but that might conflict with working schedules and there aren't any conventional institutions for doing that within reasonable distance.

I'm just saying that for pension purposes, for at least the last five years it would be better to be higher on the "food chain" in terms of jobs with the district. It's not like I'm going to push her into something she's not ready for or decides she doesn't want to do.

OK, gotcha....... I assumed she was going to be taking the normal academic route to certification and therefore thought if she's going to invest the time and money in classes, why not do so right away and harvest the maximum benefit? I had forgotten about alternative certification as it is rarely used here in the Chicago area. In fact, it's the other way around here. Many certified teachers are working as aide's and at daycare providers, etc. because they can't find an opening in the public school system.

BTW, my oldest grandson is a special needs child due to cerebral palsy. He is assigned an aide who is with him in his third grade classroom (working under the direction of his special ed teacher). She is one very wonderful lady for whom we are thankful and have the highest regard!

 

[ziggy29]

OK, gotcha....... I assumed she was going to be taking the normal academic route to certification and therefore thought if you're going to invest the time and money in classes, why not do so right away and harvest the maximum benefit? I had forgotten about alternative certification as it is rarely used here in the Chicago area. In fact, it's the other way around here. Many certified teachers are working as aide's and at daycare providers, etc. because they can't find an opening in the public school system.

The state of Texas is fairly aggressive with respect to helping aides become teachers. There's a program here which (within income guidelines) allows aides in Texas to attend public colleges and universities tuition-free in order to gain teacher certification.

Plus out here in the boonies, there is a relatively low percentage of people with bachelor's degrees or higher -- making the "barrier to entry" a bit lower for someone who has a degree but no teaching certificate. Having said that, my wife got the job over a candidate who was a certified teacher already. Perhaps she was rejected as being overqualified and ready to "jump ship" as soon as a suitable teaching position opened somewhere.

 

[dm]

My wife is in the Missouri teachers pension plan. In her plan it is the 3 highest years salary. The part of her health care benifits that are paid are also considered part of her salary. The plan also offered an early out with slightly lower payout for 25 years of service.

We have to pay for the medical insurance, but we are on the teachers plan and pay the same group rate.

With 27 years in she gets about 70% of her final salary. And its COLA?

But she also paid in something like 12% of her salary and the district matched that amount. She never paid into SS.

 

[lets-retire]

Some of these teacher retirements sound extremely lucrative, until you figure that the teachers must have a degree and normally don't make top dollar. I guess it's payback for not leaving for a much better paying job.

 

[youbet]

Some of these teacher retirements sound extremely lucrative, until you figure that the teachers must have a degree and normally don't make top dollar. I guess it's payback for not leaving for a much better paying job.

In many cases it's also the result of the work of the country's most powerful unions............

 

[jimukr194]

Actually you do not have the pension thing correct for NYC. I am NYPD with 9 1/2 years left.Not only are NYC cops one of lowest paid in country,especially for the crap we put up with. Yes we have 20 and out,but you know what?we would love to stay longer but city and top brass treats us bad uses us as canon fodder and "blue canaries" for counter terrorism activities.NYS has corrupt politicians that pocket the money ,but its not going to the unions as the papers will have you believe. NYS unions are big and the amount going to pensions seems enormous but remeber nys has large amount of taxpayers and public servants but pensions paid individually are small. For example,many states give police 66%-70% pensions indexed for inflation. NYC only a measely 50% ,i say measely because its not indexed for inflation,so i retire at 46 yr ,i have to wait to 62 get social security(based only on 20 yrs work).my pension can lose half purchasing power by then. You see,NYS has the most smallest cola in existence,might as well be none. At 62 i am entitled to a cola based on half the inflation rate on only 18000 dollars of my pension to a max of 3%.that means nys retirees getting only 180-450 a year increase and thats after being retired 16 yrs.So where is this great padding of pensions?Overtime? al precincts have caps.35 hrs a month,transit 45 hrs. nobody can double their salary. Kingston law also makes sure pensionable income cant be more han 20% of previous yr.
The truth is ofcourse most cops try to get as much ot as possible ,but you know what? 75% cops try to get as much ot as possible all there career to make enough to survive in NYC.The brass and bosses actually mess with cops and will try to screw them by actually taking ot away when they know cops need it most(last year). I think I DESERVE THE MOST POSSIBLE BY MAKING THE MOST FOR PUTTING UP WITH 20 YEARS OF BEING IN A WAR ZONE ,both inside and outside(Some cops who are reservists volunteer multiple times in Iraq to get away on a rest break from the job).
Its good to know that people think its corrupt to make an extra $7000 a yr in the pension from ot doing ot that is mandatory. Most NYPD ot isnt collars for dollars its forced ot on details or fixed posts.Which means someone has to do it,so a soon to be retired cop has right to request it just like anyone else.please post this to any taxpayer whiners you know.

 

[Leonidas]

Well, that certainly ought to spur some conversation!

I will say that jimukr194's statement about the low state of wages at NYPD is pretty accurate. I w*rked with a lot of people in NYC and I was amazed at how low the wages were given the cost of living in that city. An NYPD Sgt. and I compared paychecks one night while having a few beers and I was stunned to find that I made more than he did - and I w*rked in a city with one of the lowest costs of living as opposed to NYC.

Jim, explain something to me that I never learned the details about: Most NYPD guys always told me that it made no economic sense to stay on past 25 years, and most guys I know retired around that time of service. Why is that?

 

[ziggy29]

I know a lot of high-cost cities have trouble with paying cops, teachers and firefighters enough to compensate for the cost of living. It's not an easy thing to deal with, because many of these cities have high overall tax burdens already. Not sure there's an easy answer.

 

[jimukr194]

Yes,Alot of high cost cities do have trouble paying cops. But I dear you go to recruitment sites of some cities and you will see they are much better compensated then others. San Francisco starts rookies at $75,000,Boston pays more than NYC,even pays $5000 more for B.A. degrees.If you look at total compensation places like Arizona pay more(take home cars,etc). NYC is the hardest beat in the country,then add the NYPD itself actually tries to jam up there own cops. We have the only IAB that cant catch corrupt cops,but goes after cops cars ilegally parked(perk most cops get in any city)and jams up cops for not vouchering unmarked claim t shirts that they set up as a sting to catch cops,instead the cops gave the clothing to the poor and homeless.
Everyone will say teachers are underpaid but its funny NYC pays teachers among highest in country but cops among the lowest,strange.
LEONIDAS, as for your question about cops getting out at 25yrs ,my answer is it must have been an old timer from the old days or a house mouse(inside desk job). Truth is 80% leave at 20 yrs,, because at 20 you get 50% final 12 months salary,after 20 you only get 1.66 percent so at 25 yrs you would have 58% and max at 30 yrs 66%.most depts pay higher % after 20 NYC actually is telling you , you are worth less. Is it really worth staying another 5 years for 8% ? Mind you working holidays,nights and knowing any on duty or off duty accident or action can get leaked to press ,you get in trouble and fired you lose pension.Its A MYTH that a cop in trouble gets to retire,in NYPD administrative misconduct(in other words sloppy paper work,lol)can get you fired(rare ofcourse but NYS law says so).I know a guy,did something stupid ,but not criminal got fired with 1 yr left to retirement,he loses pension,everything.City looks at it as money saved to pad there own projects.
Fortunately smart cops retire at 20 yrs get 50% plus we get fixed $12000 pension supplement every december and dont stay longer risking their pension,then they either move to florida and retire ,or get another job. You will find retired NYPD cops working in towns across the usa ,seems NYPD cops are well respected in every other community but NYC,I know patrol cops retired became chiefs in small towns.But for the mentally challenged like myself , I WILL WORK IN MC DONALDS,but added to pension comes out the same as working. I did the calculation if i retire with $66,000 pension its the same as making $90,000(my salary)because only pay Federal tax on pensions,so I can stay home and have same spending money.Since pension not Cola'd the secret is to have half a million saved to help keep pension up with iniflation until social security. I always tell rookies,invest in 457k and then in 401k and put extra money in pension fund earning 8 1/2 %.There is no reason not to walk off this thankless job with $500,000 in your 40's.On the plus side retirees get free medical for whole family for life and union welfare fund pays most dental costs,prescription,and vision.

 

[lets-retire]

I attended my last academy with a guy who retired from NYPD. He was 40. I can't say if he was rounding or turned 41 while at the academy, but he said he was actually still employed with the NYPD. He was on vacation until his actual retirement date. He didn't detail any of the bad stuff your talking about, but overall he seemed like a rather positive guy, and expressed gratitude about finally being retired.

I was looking into NYPD a while back and noticed first year rooks made 50k including o/t. It seemed very low to me considering the cost of living and the amount of crap they had to deal with.

 

[jimukr194]

Hey lets-retire,as you said he was a rather positive guy, positive guys make the job work for them. Maybe he even had a good inside out of the way detail,heck idont know. You will find complainers in even the best depts. BUT the difference is morale is very low in the NYPD ,its not the job he came on in anymore and if it was soo great he would have stayed longer,but as i said NYPD is looked as a sinking ship by majority of members of the service. i met a retiree who told me he ritired asap because you dont run 27 miles in a 26 mile marathon,words I will always remember.Every retiree I know is quite positive and happy also,because the headache is over.
As for 50k thats great for a rookie a year earlier they made $25,000 base ,so with everything lucky to clear $35,000.They start out now with 10 days vacation , while previos rookies for as long as I can remember got 20 to start with.It was a give back for getting a raise.
Do you mind telling me what dept academy you were in,always interested in depts that don't have max age caps.

 

[Texas Proud]

Kind of went to a police retirement instead of auto...

I decided to take a look at my locations info.... and I got to tell you it looks pretty nice for someone WITHOUT an college degree.. but then again, they don't pay much more for the college degree..



Here is Houston's pay...
Police Cadet / Probationary Police Officer *$29,164
Police Officer$ 38,602 - 53,622
Sr. Police Officer *$ 54,774 - 59,191
Police Sergeant **$ 66,208 - 72,186
Police Lieutenant **$ 74,321 - 81,021
Police Captain **$ 85,109 - 92,815
Assistant Police Chief$119,431 - 125,434
Executive Assistant Police Chief$137,977 - 144,963


It also says you get in the $10K for overtime... and I used to know cops and they got a LOT of money on their side job...

You START with 7 WEEKS time off... and get to 12 weeks plus 2 more counting holidays... I never knew it was THIS good...

GENEROUS BENEFIT PACKAGE
*During first year of employment officers will accrue 35 paid days off and increase to 60 paid days off per year plus 11 paid holidays.
*Excellent, affordable health insurance subsidized by City of Houston. Also includes vision screening and optional dental insurance.
*Defined Benefit Pension Plan with early retirement options
*Multiple Supplemental Retirement Plans
*Various Deferred Compensation plans available​

Not sure if it is 20 and out... and can not find it on the site, but not looking hard....

 

[Leonidas]

I decided to take a look at my locations info.... and I got to tell you it looks pretty nice for someone WITHOUT an college degree.. but then again, they don't pay much more for the college degree..

2 years college is required except for prior military and law enforcement. A bachelors becomes a requirement for Captains and a masters is required for Asst Chief's. Education pay is $3640 for bachelors, $6240 for masters and $8840 for doctorate. A law degree is more than $10K, but they only pay that to cop/lawyers who are assigned to legal affairs. (kind of ridiculous because the cop/lawyers I know are all making ten times that in their private practices).

The good this is they reimburse tuition and mandatory fees for anyone attending an accredited college/university (at Texas school rates).

It also says you get in the $10K for overtime

Overtime cometh and overtime goeth. I wouldn't figure a budget on that. It's not unusual to walk in one morning and be told "there is no more overtime - work for comp time or go home".

and I used to know cops and they got a LOT of money on their side job...

who slept a few hours here and a few there and their spouse had to show the kids his/her photo so they knew what their daddy/mommy looked like.

You START with 7 WEEKS time off... and get to 12 weeks plus 2 more counting holidays... I never knew it was THIS good...

Okay, this is the city selling BS. Four of those Seven weeks are PFT - Physical Fitness & Training Hours. The city used to just pay everyone to go to training, or qualify with their weapons, etc. Now they give officers 20 days a year (supervisors 10 days) and make them go to training, annual firearms practice and qualification, annual physical agility testing, annual physical fitness testing, and police memorial duty all using PFT. And yes, you accrue those 20 days, but the accrual only lasts for one year, the time has no cash value unless the Department's staffing needs prevented you from taking it off, and every September any unused time is wiped off the books without compensation.

The other three weeks is not vacation time - but a combination of the old vacation time and sick leave called PTO (Paid Time Off). Lots of rules about scheduling vs unscheduled, abuse of time, accumulation, etc.

Not sure if it is 20 and out... and can not find it on the site, but not looking hard....

Totally different website, and you need a password.

For everyone hired after October 2004:

Normal retirement age is 55 with at least 10 years of service.

Benefit is 2.25% of final average pay for each year of service for up to 20 years, and 2% for each year over 20 (20 years is 45%, 30 years is 65%).

Final average pay is regular wages and extra pays that are considered wages (language, college, education/training, shift/weekend differential payments, hazardous duty pay), and not things like clothing and motorcycle allowances, overtime, exempt pay (supervisor 'overtime'), and strategic staffing pay. Final average pay is computed as the average of the 78 pay periods prior to retirement (last 3 years).

 

[jimukr194]

I bet if you add everything ,a senior officer is making aobut 80k with a b.s. degree. But then again you dont pay local taxes in texas so that brings pay similar to NY.But you can buy homes and stuff much cheaper in Texas.I am surprised ot not calculated in pension.The fact they pay almost 3000 more for masters,I think it a no brainer to get one with tuition being paid by city.

 

[lets-retire]

Hey lets-retire,as you said he was a rather positive guy, positive guys make the job work for them. Maybe he even had a good inside out of the way detail,heck idont know. You will find complainers in even the best depts. BUT the difference is morale is very low in the NYPD ,its not the job he came on in anymore and if it was soo great he would have stayed longer,but as i said NYPD is looked as a sinking ship by majority of members of the service. i met a retiree who told me he ritired asap because you dont run 27 miles in a 26 mile marathon,words I will always remember.Every retiree I know is quite positive and happy also,because the headache is over.
As for 50k thats great for a rookie a year earlier they made $25,000 base ,so with everything lucky to clear $35,000.They start out now with 10 days vacation , while previos rookies for as long as I can remember got 20 to start with.It was a give back for getting a raise.
Do you mind telling me what dept academy you were in,always interested in depts that don't have max age caps.

He could have just been happy to get his retired tin and be done with it. We never really got into the telling of war stories or stories about our last agencies. I know he said he didn't want to deal with the BS that came with promotions. I was attending a federal academy, that at the time didn't have an age limit. Now the age limit is under 37 years old, although that does not apply to preference eligible Vets.