Are you receiving the aveage pay in private industries

[shadows]

Please list these perks.

Please provide a list of the 'flood of unattainable perks".  Many of us would be curious.

If you are unaware of the perks attached to public servants that are not offered in the private sector I suggest you read the conditions of employment in applying for a job in the private sector.  In the years spent in the labor movement asking the employer for a weeks paid vacation for employees brought an instant reaction that would not be allowed to be printed on this forum.   Then the second trip asking for 7 paid holidays #@%^&.   Accumulating sick time, vacation time, insurance HAHAHA

[Red Arrow]

Police officers contribute to the pension system at an 8% rate, slightly higher then the social security rate.  Their employers pay into the pension system at a rate slightly higher then social security as well, but I'm not positive of the rate.

Retirement pay is based on years of service, with the minimum amount of service being 20 years and the maximum being 30 (for determining benefits - you can stay longer, but your benefits do not increase).

No, I do not pay into social security, nor, will I draw any benefits.  I guess those contributions I made as a teenager are just that, free contributions.  Everyone is welcome!

Because I am a pension employee, my wife, who does pay into social security, is penalized and will only be allowed to draw up to a maximum of 50% of HER benefits (could be as low as zero), even though she has been paying at the same rate as everyone else.  Because her spouse is a pension employee, she is penalized.  Go figure that one out.

A police officer's average life expectancy is 58-years.  The average police officer lives 5-years after retirement.  Not sure how that other 20-year job plays into those figures.  That's probably a good reason most police pension systems are always so fiscally sound.

I find it a little strange you say it's okay for someone in the military to retire and go work someplace else, but other government employees (working for the same 'employer') can't.  Many military people make more then other government employees.  Their housing and many other essentials are paid for, yet....  Weird.

And, what prevents a fiscally sound person to retire early from their private sector job, draw from their own retirement funds and going out and starting a new job?  Not a darn thing.  But that is okay?

You and your employer pay at a slightly higher rate than SS and can retire (min service 20 yrs) and draw benefits at age mid 40s as compared to min age 62 for SS.   At age 62, I will be entitled to reduced benefits.  Full benefits at age 66 for me, later for those younger.  If I were to die at 58, I would get zero benefit from nearly 40 years of contributions.

As you present it,  I agree that the 50% on your wife's SS appears unfair.  When my dad died, my mom gave up all of her SS benefits to get my dad's SS benefits.  Mom was a stay at home mom so dad's benefits were better.  Mom's benefits from dad's private sector retirement were also reduced after dad died from the level my dad got while he was still alive.  

I just checked my SS benefits statement and saw:

Benefits:
"To qualify for benefits you earn "credits" through your work - up to four each year.  This year for example, you earn one credit for each $1,090 of wages or self-employment income. When you've earned $4360, you've earned your four credits for the year. Most people need 40 credits, earned over their working lifetime, to receive retirement benefits. For disability and survivors benefits, young people need fewer credits to be eligible."    So, most workers will be eligible for benefits after 10 years of working (but have to wait until age 62 to get them).  Since most SS beneficiaries work more like 40 years, the fine folks in Congress (another story) have determined that your benefits will most likely be reduced for contributing for only a few years instead of your entire career.

"Windfall Elimination Provision (WEP)".   "If you receive a pension from employment in which you did not pay Social Security taxes and you also qualify for your own Social Security retirement or disability benefit, your Social Security benefit may be reduced, but not eliminated, by WEP. The amount of the reduction, if any, depends on your earnings and the number of years in jobs in which you paid Social Security taxes, and the year you are age 62 or are disabled."

"Government Pension Offset (GPO)"  "If you receive a pension based on federal, state or local government work in which you did not pay Social Security taxes and you qualify, now or in the future, for Social Security benefits as a current or former spouse, widow or widower, you are likely to be affected by GPO. If GPO applies, your Social Security benefit will be reduced by an amount equal to two-thirds of your government pension, and could be reduced to zero. Even if your benefit is reduced to zero, you will be eligible for Medicare at age 65 on your spouse's record.

It sounds as though if you are still alive, your wife should be eligible for her SS benefits.  When/if you die before her and she elects to take your TPD retirement, her SS benefits would be reduced then.

I was not aware that retired police officers lived an average of nearly 20 years less than the general populace. I guess my friend who is retired from the TPD is due to die soon. He appears to be in good health.  I'll miss him. I got the 20 yr figure based on graduating from college at 21 or 22, another year or so to become an officer. Add 20 and you get 40 something.  Retire from the force and get a "good paying job" in the private sector, pay into SS and if you live long enough you get SS too or your wife should be able to collect if she outlives you.

I don't understand your statement that you cannot work somewhere after retirement.  My (retired from TPD) friend is working in the private sector and I respect his integrity enough to believe he is not violating any provisions of his retirement.  I haven't kept up with military allowances or pay but when I was in (1972-76) the allowance for living off base wouldn't cover living off base without a roomie or two.  Married living quarters were provided in base housing.  OK but nothing special. I don't know if the allowance for married personnel would cover living off base.  I got drafted and was enlisted.  I believe Officer (O-1 through maybe O-3) pay at the time was still on the order of about 1/2 of what I could have earned as a beginning engineer (4 year degree).  My cousin works for the US Post Office.  He has indicated that he will retire after 20 yrs of Civil Service (not all at the USPS) and get another job. If the retired military can get a civil service job, then that's a benefit I am willing to pay a career military person.  FWIW, I paid into SS when I was in the Navy.  I don't know if that has changed.  

The "thing" that prevents a fiscally sound person in the private sector from drawing from their "retirement funds" is minimum age requirements.  I cannot draw on my 401K or IRA funds without penalties until age 59-1/2.  Even though I have contributed 12% or more of my salary to a 401K Plan for close to 20 yrs, the present return on that would not put me above the poverty level.  The only place I've worked with a legacy retirement program terminated the program after a few years when IRAs became available.  I will get about $100/mo from that program but have to wait until 60+ to collect anything.  A couple of employers did not match any of my 401 contributions.  My present employer matches up to about 4%.  If I had enough money in my savings independent of official "retirement accounts", you are correct.  I could draw on them just like I could from my checking account.  I am not that fortunate.

[Wilbur]

Social security was NEVER proposed to be someone's total retirement...  it is a retirement supplement.  Unfortunately, many people have come to rely on SS for total retirement and now wonder why they struggle living off of SS.

When social security was put in place in 1935, you couldn't draw benefits until 65, but the average life expectancy was 61.7.  Sounds like a typical federal plan well thought out.

Those who contribute to SS would have made more money by putting that same amount of money into a simple savings account.  Yes, a simply savings account, with its poor interest rate, makes a better return then SS.  Yet, people fight any change to social security.  Plus, the federal government wouldn't be able to rob your savings account to pay for some other silly ....

You mention your 401k and IRA you can't draw from until a certain age.  I agree, but you can certainly contribute to any savings plan you wish that does not have this restriction.  My employer, while they offer 457b plans (same as 401k), they match zero.  I would love a match similar to that in the private sector, or any match for that matter.

Look, I'm certainly not complaining about my pension.  I'll be glad to collect it and PRAY TO GOD I'll get to enjoy it more then the average officer does.  My wife wants me to live past 58 (I think).

[Conan71]

Those who contribute to SS would have made more money by putting that same amount of money into a simple savings account.  Yes, a simply savings account, with its poor interest rate, makes a better return then SS.  Yet, people fight any change to social security.  Plus, the federal government wouldn't be able to rob your savings account to pay for some other silly ....

I've never really worked the numbers to see if that's accurate, but a savings account is going to have a finite amount of money in it when you start drawing on it, Social Security is variable in nature.  Let's say I saved money at a rate which assumed I'd live 20 years beyond retirement.  I'd be out of money in 20 years if I took 240 equal draws even accounting for the nominal interest accrual at that point.  If I wound up living another 10 years, I'd have nothing left to live on, whereas SS would continue to pay me benefits.  I have no idea how long the gov't model says I'll be collecting SSI retirement (if it still exists).

I realize we are talking about retirement benefits here, but that contribution to SS also would become a survivor's benefit to your spouse and minor children should you die before retirement age, and become a disablilty benefit should you become partially or fully disabled.

I'm no big fan of social security, but the statement that a savings account is a better investment should have some qualifiers attached.

[Red Arrow]

Social security was NEVER proposed to be someone's total retirement...  it is a retirement supplement.  Unfortunately, many people have come to rely on SS for total retirement and now wonder why they struggle living off of SS.

I agree.

When social security was put in place in 1935, you couldn't draw benefits until 65, but the average life expectancy was 61.7.  Sounds like a typical federal plan well thought out.

Until folks started living longer.  That's probably why they are increasing the age for full benefits and give even greater if you wait longer.  Playing the odds.

Those who contribute to SS would have made more money by putting that same amount of money into a simple savings account.  Yes, a simply savings account, with its poor interest rate, makes a better return then SS.  Yet, people fight any change to social security.  Plus, the federal government wouldn't be able to rob your savings account to pay for some other silly ....

I quit putting money in a passbook savings account when the interest rate went below 1%.  The rates were better than that when I was a kid in the 50s and 60s.  I got about 3% from a commercial bank and 4% from the savings and loan.  Right now I'd like to get that on a CD.  See Conan's reply about finite quantities of funds.

You mention your 401k and IRA you can't draw from until a certain age.  I agree, but you can certainly contribute to any savings plan you wish that does not have this restriction.  My employer, while they offer 457b plans (same as 401k), they match zero.  I would love a match similar to that in the private sector, or any match for that matter.

Being single, the tax advantages of the 401K are too much to turn down.  As I noted before, not all my employers matched any of my contributions.  I'm glad my current one does.  Putting as much as I do in the 401K doesn't leave a whole lot more to put in another retirement specific savings.

Look, I'm certainly not complaining about my pension.  I'll be glad to collect it and PRAY TO GOD I'll get to enjoy it more then the average officer does.  My wife wants me to live past 58 (I think).

And I am certainly not going to deny you the right to it.  You and your employer have paid for it.  Perhaps SS should be universal, even for Civil Service.  That way your pension would be a lot like the legacy pensions like my dad's.  He contributed significantly (I don't remember the percentage.) so he and mom could have a comfortable retirement above SS.  Then the SS supplement for your wife would not be subject to any GAO or other cuts and you would get a few extra bucks too.  Of course, nothing is free. One thing that concerns me now is the thought of "means based benefits" for SS.  I have paid for a lot of years.  My benefits should be based on my contributions, not any other income I may have. 

[shadows]

Social security was NEVER proposed to be someone's total retirement...  it is a retirement supplement.  Unfortunately, many people have come to rely on SS for total retirement and now wonder why they struggle living off of it.

This is one of those stories where I was there.  When Roosevelt installed the SS system in 1935the teachers were signing contract for $75.00 per month.  In the starting the goal was after retirement at 65 the max I could draw was $160 dollars per month.  Now in simple arithmetic that would be over twice the salary the teachers were paid.  I am sure if that promise was kept then I could live comfortable on twice what the teachers are paid today don't you think?  As it is I have drawn benefits in excess of a quarter of a million of dollars since retirement off SS.  I saw the people line up at the doors of the closed banks wanting their savings they never got.  We are on the brink of that again.  SS can pay a family of a retired worker the maximum of $2,324.40 a month.  What Bank can you start a saving account in that will produce such dividends after 65?

[Red Arrow]

Shadows,

Was that max of $160/mo what you could get from a $75/mo salary or was that for the payers who maxed out their contribution?  Not everyone gets the max payout.

[Wilbur]

My point about social security is.... you shouldn't rely on it for your total retirement. 

Plenty of people in this country retire before the age of 65 who work in the private sector and do not rely on some government run program to get them through retirement.  They have had the discipline and goal to save and invest, making it possible for them to retire way before the age of 65.

[cannon_fodder]

Ha, the heck with you old folks and your social security!  I'll be paying for it at the full rate and have no illusions about ever getting a dime from that system.  That's why I am against it:  it is a back loaded system.  Benefits were paid out to people who never paid in.  Thus, we started behind and continue to be behind. Though I fully intend to retire off my own savings, I still have to pay into the damn system.  So in my eyes, I'm being taxed to subsidize someone else's retirement while at the same time I'm working to fund my own.

- - -

Shadows:  while I do not work for a wage I can pretty well assure you that my salary minus my student loan payments that are automatically deducted puts me well into your beloved "working poor" category.  So what do I get?  Do I get some special Shadows prize?

Maybe you should clarify.  How much can I make and be counted as "working poor"? 

I worked my butt off in high school to get into college.  I then worked hard in college to get into law school.  I then graduated in the top 15% in law school.  I worked jobs, often 2nd shift, to pay as much of my way as I could, but still graduated with what amounts to a second mortgage payment.  So lets take what I make and pro-rate it against 8 years of labor at the national average for high school graduates and add to that an estimated student loan payment on 100,000.

8 years as a high school graduate earns on average:  $25,000 x 8 = $200,000
Student Loan Debt: $100,000

So I spent $300,000 going to college to avoid being a member of the "working poor."  Do you have any idea how long it will take me to earn that money back to even BREAK EVEN?

And while I'm rambling - my neighbor to the East makes about $100,000 a year as a single man, drives a BMW, and lives alone.  My neighbor to the West makes probably $28,000 a year and has a nest full of kids.  What does this tell you, me, or anyone about how much we should value their opinion on any given topic?  NOTHING.  (for the record, the $28K guy is a lot more fun than the $100K guy)

/ramble

[Red Arrow]

SS can pay a family of a retired worker the maximum of $2,324.40 a month.  What Bank can you start a saving account in that will produce such dividends after 65?

I ran a few quick calculations using the financial formulas in Excel (MicroSoft Spreadsheet).

Assumptions:
5% APR on savings
Taxes deferred until cash is withdrawn as income
Allow for 30 years of retirement payments, I hope to live past 85.

$2500/mo for 30 years requires approximately a $465,700 nest egg

To get that nest egg Save:
     $559/mo for 30 years
or  $409/mo for 35 yrs
or  $305/mo for 40 yrs
or  $229/mo for 45 yrs

Years of saving are in your favor.  All you young guys that expect to receive no SS benefits should be saving now.  Of course, in another 20 or 30 years, $2500/mo will probably not be enough.

[Red Arrow]

  So in my eyes, I'm being taxed to subsidize someone else's retirement while at the same time I'm working to fund my own.

Yep, bad deal in that respect.  It worked well enough when the Baby Boomers (me) entered the work force. I paid for my grandparents and parents (mom is still living).  Not so many folks (you guys) to pay for me.  Other bad deals such as "borrowing" from the SS funds for the general fund etc didn't help any either. 

In any case, my employers and I have paid a bunch in,  I expect some back.

[Conan71]

I hope to live past 85.

Not me.  I should have been more gentle on my body when I was younger 

Your assumptions are correct, only problem is even the best CD rates are between 2 & 3% at this point.  Passbook savings??? Under 2, I believe.

[shadows]

CF: Don't be alarmed. Its all in the grand plan of retirement.

So it be that the working poor appreciate greatly all the contributions that are paid by elitist who can deposit $25,000 in a retirement savings accounts monthly, drawing less than 1% per year in interest.  Or buy stocks that can delete your  equity at any given moment or loose the market value of the stock in minutes.   The SS can borrow from the nation debt if its funds are depleted and only in the shortage of paper-ink would the fund be in  jeopardy as we expect our unborn great grandchildren to pay it off the public debit

Look up at what year the right to take the Oklahoma Bar examination required 80 college before it could be taken was installed.  Look up when the schools downtown taught the fundamentals to be able to pass the bar.  When one had to spends a $100,000 to qualify to be given the bar examination this created a class of their own that do not pay SS.  (of course if one is on a athletic scholarship offtimes receives the hours.) Isn't that Lincoln spent 6 years as a Illinois legislator before he studied by the light of the fire place interesting and now this class is not subject to SS.    Protect the turf . 
.     

[Red Arrow]

Your assumptions are correct, only problem is even the best CD rates are between 2 & 3% at this point.  Passbook savings??? Under 2, I believe.

Last time I looked, passbook savings were about 1/2% (.005).  CDs ranged from the low of 0.25% at BOK to a little over 2% at the Credit Union with most commercial banks between 1% and 2%.  As of about a month ago.

I have had CDs as much as 15% in the early 80s.  Of course inflation ate most of that up.

[shadows]

Shadows,

Was that max of $160/mo what you could get from a $75/mo salary or was that for the payers who maxed out their contribution?  Not everyone gets the max payout.

The purpose of the SS was the thousands of homeless, gov soup kitchens, the buying  of cattle by gov for 20 dollars a head and pigs for 25 cents which were canned in gov canaries and passed out as welfare.  Unemployment rose to an unofficial 20% and the minimum wage was established at .25cents per hour.  A good job paid $1.00 dollar a day.  WPA allow one to work until they earned $14.00 each week.  Camps were set up for the youth that paid $14 dollars plus board and room per month.  A state legislature had to recommend you for admittance.   This was the foundation for the Grapes of Wrath .  And the HI BAB BO PEEP was not a part of the program.

Then the program of social security was introduced at a very low percentage on labors earned income liken the mills on sales taxes for old age assistance on the sale of commodities that has become a cash cow for the exploding bureaucracies that are our masters.
We were promised the total of $160.oo monthly after retirement at 65.  When you were 18 years old it sould be a dream of a secure retirement when you were earning a dollar a day.