From the same Money Magazine article as the last post. Sound familiar, Massachusetts muni workers?
"There is no justification, ever, under any circumstances for pension spiking," says Sylvester Schieber, director of research at Wyatt Co., a national benefits consulting firm in Washington, D.C. "It is a form of theft." Here's how spiking works: Traditional corporate pension plans typically base retirement benefits on your average earnings during your final three or five years of employment. These private plans usually exclude overtime and performance bonuses, restricting pension benefits to your base pay. By contrast, state and local pension plans are typically based on the final three years' compensation, and sometimes on the last year's alone, creating an incentive for public employees to boost their pre-retirement pay by such tactics as volunteering to delay their vacations and work overtime, thereby inflating lifelong pensions. Says Joseph Serota, a Fort Lauderdale attorney who defends cities against pension abuses: "It's often the senior managers who initiate such things, working hand in hand to help the rank and file -- and themselves."
Showing posts with label National News. Show all posts
Showing posts with label National News. Show all posts
Sunday, May 17, 2009
How government pensions are robbing you
Amazing: this is from 1994
Amazing: this is from Money magazine / CNN
HOW GOVERNMENT PENSIONS ARE ROBBING YOU Federal, state and local employees' pensions are so lavish, shrinking them to what private employers provide could cut your tax bill by 8%.
By DAVID JOHNSTON Reporter associate: Judy Feldman
October 1, 1994
(MONEY Magazine) – The gaps between the princely pensions that public employees often collect and what the rest of us get are so astounding that they seem to have been exaggerated by a task force of bureaucrat-bashing Limbaughites. Read these numbers and -- unless you're a public servant yourself -- seethe: -- A state or local government worker earning $35,000 a year with 30 years on the job who retires at age 65 can expect an annual pension of about $18,000, according to the Employee Benefit Research Institute of Washington, D.C. For comparable federal employees, the pension figure runs as high as $19,700. But a similar private-sector worker would get only about $10,000 a year, or as much as 49% less. --
Amazing: this is from Money magazine / CNN
HOW GOVERNMENT PENSIONS ARE ROBBING YOU Federal, state and local employees' pensions are so lavish, shrinking them to what private employers provide could cut your tax bill by 8%.
By DAVID JOHNSTON Reporter associate: Judy Feldman
October 1, 1994
(MONEY Magazine) – The gaps between the princely pensions that public employees often collect and what the rest of us get are so astounding that they seem to have been exaggerated by a task force of bureaucrat-bashing Limbaughites. Read these numbers and -- unless you're a public servant yourself -- seethe: -- A state or local government worker earning $35,000 a year with 30 years on the job who retires at age 65 can expect an annual pension of about $18,000, according to the Employee Benefit Research Institute of Washington, D.C. For comparable federal employees, the pension figure runs as high as $19,700. But a similar private-sector worker would get only about $10,000 a year, or as much as 49% less. --
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