Survival & Freedom #4: Retirement

[tom mac]

Retirement started MANY years before it came with the 457 plan...
I max'ed out every year, over the years it came to a pretty good penny.
I was able to take the pay out over ten years after retirement... it served me well and has been moved out/used up.
Also, in there was blood money ( a day of pay for every blood donation; 5x a yr ), saved vac, sick days ( they paid out 50% of 570 days ), and unused comp pay... so walking money was good too.... sad day was the first yr at tax time!!

But for those young, start now even if a little bit at a time. Over the years it adds up.

Good things we don't talk about pension amounts... pensions in NY are very good even to point of keeping health ins for free, but then the property taxes a 13k a yr for 1/2 ac
But as mentioned NY doesn't tax the pension , nor SS payments even tho the Fed Gov't gets their part.

[Bob]

agreed. If things don't change, I will be fine.

Famous last words

[Bob]

Same here, wife is covered by my pension. Which is very comforting.

There are a lot of people whose Pensions went away when the .Gov that was paying it went broke.

"But that's my pension! They HAVE to pay me!"
Can't get blood from a rock. When the money is gone it is gone. Many Govs know when that day will happen long before you do. Its pretty easy to figure out.

Pay out per year + pay in per year over time. When the number goes negative, your pension goes down. eventually it is gone as Pay in is only a small fraction of the needed pay out.

How secure is yours?

[David]

FRS is the most secure in the nation. It's been as much as 80 billion in the black. If it goes under you may as well move out of Florida because it no longer exists.

[Bob]

Did you work for the State, or the County?

[David]

I worked for the county which is covered under the State i.e. FRS.

[Bmyers]

Illinois will most likely be the test bed for what happens to State, County, and Municipal pensions. Our State has been mismanaged for so long, that they are even unable to tax their way out of the problem. The only solution is to cut-services, benefits, etc. The unions are counting on the Illinois Constitution that states benefits can't be cut (summary of the law).

Yet, as it has been pointed out, we are approaching the point that there is no money. Illinois is typically 2 years or more on paying bills. Companies have stopped doing business with the State. Our own company will only do business with the State if they pay up front. It is sad when the State has to go outside the State boundaries to find a company that is willing to come in and complete mechanical work for them because all the locals know they won't pay anytime soon.

The latest attempt by the State is to combine all the State, County, Municipal retirement accounts into one to try to extending out the date before they collapse. When 60% of your State budget has to go to meeting the retirement pension fund, your State is doomed.

There has been serious discussion about letting Counties and Municipalities file for bankruptcy and eliminating the debt.

Sadly, it isn't fair to those who worked and were promised pensions. The politicians have failed to make changes and everyone in the State is going to pay the price. Illinois is losing a medium size city each year by residents moving out (roughly 70,000 people a year are leaving).

Illinois will be the State to watch to see how the courts deal with the pensions crisis.

https://www.thestreet.com/mishtalk/econ ... the-budget

[Bmyers]

One more article that explains some of Illinois issues

https://www.forbes.com/sites/adamandrze ... 41f5467ee9

[Mac66]

Both my wife and I are part of the Michigan education retirement system. She was a teacher, I was a state college administrator. The state government is always trying to whittle away at that system. Trying to rob Peter to pay Paul.

Fortunately both of us are grandfathered under the old system. People retiring today don't get the same benefits as we did. So as long as the state stays solvent we're good to go. If the pensions went away we still have investment interest and social security to fall back on. If SS went away we'd live on our investments. If those went away, we'd live on savings for awhile. I figure we have maybe 25 years if we're lucky, to worry about.

[tom mac]

In NY, NYSLRS the pension system is well rated with plenty to go a long time.... Only reason is yrs ago the State wanted to tap into the systems monies but a big court case ruled against it... since then no issues.

Also new members have lower tier levels and the pension pay out now has limits of padding by new rules....