Author Topic: Railroad Retirement Board - Worth it for an early retiree?  (Read 1700 times)

Field123

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Railroad Retirement Board - Worth it for an early retiree?
« on: October 23, 2014, 08:55:21 AM »
Does anyone have any experience or know anything about Railroad Retirement?

What I do know is that if you work for a railroad company, you pay into the RRB rather than Social Security; which results in a much higher benefit at retirement age. My specific question is, would this be worthwhile consideration in choosing to accept a job at a railroad if the goal is FIRE in ~ 10 years?

My research on the subject is fairly limited so far, but from what I can tell, you vest in RRB after 5 years of employment. Does this mean after 5 years SS is totally replaced by RRB, or would you receive a smaller payout from both? Any information would be appreciated.

The reason I ask is an opportunity has presented itself for me to leave my current job at a midsize law firm to join a large railroad. Compensation would probably be equal, maybe even a little less. The highlights are the benefits - railroad offers a 401k program ($18,000 contribution max + 3.5% match), while the law firm only offers SIMPLE IRA ($12,000 yr max), and the big wildcard is railroad retirement board and pension. Everyone I talk to says that these railroad benefits cannot be beat, but I wonder how this logic is affected when the goal is to retire at 40, not 60?

All input is appreciated!