martyb
Thinks s/he gets paid by the post
My federal govt. CSRS pension (36 yrs) will be/is/has been contributory (7%) and my military (33 yrs) (mostly reserves) was not.
Sadly, most Americans are in the dark on just about anything financially-related. If I had a nickel for every time I talked to someone spending $500-1000/mo on health insurance that had no clue what they were spending or what the policy covered, I'd ER tomorrow.
Not looking to take this thread off it's target (as this did), but it's not only the people buying health insurance that don't "completely" understand what they purchased - the health insurance companies don't always get it right either. It's only when you need them that the "Big Book of Rules" comes out. Several times in the past - I had to point out that the claim they denied (out of network), should have been covered under my corporate policy (and they paid them). Now that we are ER'd and on our own individual policies - can't even get BCBS to send us a paper copy of the expensive poor coverage policies we've purchased - only available in PDF on line...
I was more referring to the fact that people have no clue how deductibles, copayments, coinsurance, and OOP maximums work, along with not even knowing how much they pay for the insurance in the first place.
There is no clear standardization between health insurance companies - let alone their own policies (find this somewhat deliberate). Don't envy you selling them, and really don't fault people for not completely understanding them.
martyb said:I'm 17 months away from my DB retirement commencement. But...I guarantee I've been reading and studying everything I could find about how it works for years, how much I can expect to receive, making estimates about the things that will be coming out before I get the net ie. med ins, life ins, survivor's benefit, fed taxes (not planning to pay any state income taxes) etc. While I don't know the exact bottom line just yet, I have a pretty good idea. I also know exactly how it all works. That's just my personality...no way I could just leave it all to chance. But then...I don't have the huge nest eggs many on this forum have either. I'm heavily depending on that CSRS pension for my (our) primary retirement income, along with a few other lesser sources.
Sure, if you're deciding how much spare cash to invest. But some people don't have spare cash in the run-up to retirement. I didn't. There's no point in discovering that you need to save more for retirement if you don't have anything to save. It would just make you sad.I'm not understanding how those who did (or will get) a pension didn't see the point in calculating the payout until close to retirement. ... I want to know the full financial picture when determining how large our investments have to be to retire with a 95% success rate.
Most Americans do not have pensions, .........
I agree. For most folks (those in non-governmental j*bs, it's a mute point) the word pension means nothing at all.Most Americans do not have pensions, and in addition, if the check comes every month, (retired)the pensioner doesn't really care about all that other stuff.........
Sure, if you're deciding how much spare cash to invest. But some people don't have spare cash in the run-up to retirement. I didn't. There's no point in discovering that you need to save more for retirement if you don't have anything to save. It would just make you sad.
Alan said:Is this true if you include all government workers, military etc?
Waiting until relatively close to retirement to calculate a pension payout really doesn't surprise me much. A person early in their career may not even stay with the same employer until retirement, and even if they do, how good an idea do they have of what their top salary will be (or top two years or five years or whatever), so many years in advance? If you have only a very rough idea of the top salary, you don't really know how much the pension is going to be. Even though I am within two years of my target retirement date and expect to stay in the same pay grade for the rest of my time with the City, both the "official" pension estimates I got from our retirement system just last year, and the ones I did myself using the website calculator at about the same time, are now invalid, because they used assumptions based on the COLA provisions of our old contract, which are no longer in effect. I am thinking about taking one of the "lump sum + reduced benefit" options, and even the official estimates use my accumulated contributions at the time I requested the estimate, not a projection of what they'll be when I retire. In the meantime, the COLA provision has changed, and so has the employee contribution rate, both of which will affect my accumulated contributions at the time I retire—and when the total accumulated contributions change, so does the amount the monthly benefit is reduced by, if I take the lump sum.I'm not understanding how those who did (or will get) a pension didn't see the point in calculating the payout until close to retirement.
While my pension will be relatively small at age 55 (about $1300/month + COLA) I calculate it yearly and plug the number into FireCalc. I want to know the full financial picture when determining how large our investments have to be to retire with a 95% success rate.
But then I'm a planner...always have been, always will be.
Alan, in another thread recently a poster had a research article showing a little under 20% of Americans have a pension, with 7% of private workforce having one, down from around 70% about 30 years ago. As far as percent of people who ARE currently retired AND have a pension, I don't know if I have ever seen such a survey.
Last year, only 36 per cent of those aged between 16 and 64 were actively contributing to a private pension, the report states. Over the past 10 years, the proportion of men saving into a pension has fallen from 49 per cent to 38 per cent, while for women it has dropped from 36 per cent to 33 per cent. Lord McFall warned that although millions of workers would be enrolled automatically into workplace pension schemes from next year, up to nine million “may still fall through the cracks” by opting out.
Alan, in another thread recently a poster had a research article showing a little under 20% of Americans have a pension, ....
Pretty bleak prospects for many.
I retired from a company that had a union (I was white-collar) and the union folks knew exactly what their pension would be. That's because they voted on a new contract every 2-3 years (depending on economic cycle) and everybody got the same monthly amount in retirement, per the contract.