Author Topic: I can't really be the only one, can I? And now I've been called a unicorn...  (Read 11620 times)

Secretly Saving

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Part 1:    "I can't really be the only one ---- Can I?"

So yesterday I felt like I was banging my head against a wall while simultaneously wondering if I could REALLY be "the only one..."   It's taken me a night of tossing and turning while contemplating this to even be able post. 

Background:
- I have been a stay at home parent for the past several years in a major metropolitan area.
- I WANT to go back to work (teaching) because I believe in what I was doing and enjoyed it (yes, despite all the craziness). 
- We do not NEED the money from me working.  It would be because I want to be a contributing member of society.  I like making a difference!

What happened:
I called one of the local schools that has a few open positions to find out about salary details, benefits, and retirement.  The answer about salary was reasonable.  Ok, ok, it IS poor pay all things considered, but reasonable for what teachers are paid for the area.   I really don't care what the pay is exactly.  I mean, I want to get paid for my time, but the exact numbers aren't going to make it or break it for me because I'd be taking the job because I want to be teaching.   So I move on to other questions for HR -- about benefits and retirement and that's when it happened.  The deal breaker...


What is the deal breaker?


That they do not offer ANY type of retirement vehicle besides the normal state retirement. 

No 403b, no 457.  NOTHING. ZILCH. NADA.  ZE-ROOOOOH!

It was like time stopped and it took me probably 20-30 seconds to recover.  (Whhhhattt?)  Let's just say it was probably good that I was on the phone and not actually sitting in front of the HR person.  I think they could probably hear a bit of the shock, but my face would have left no question about how crazy I thought they sounded.   So I tried again, I mean, maybe if I tried inquiring in a different way... Maybe they weren't getting what I was asking, right?   There has to be someone who wants to be able to save for retirement and has asked this of the employer.  (Insert wall / head knocking relationship repeatedly here)

Thought process over the past 24 hours:
So, looking at it objectively.  Yes, I get that teachers have small salaries, but I can't imagine that I would be the ONLY ONE (can I really be the only one??) in the school system who would want to save money via a 403b or a 457.  What about administrators and other people with larger salaries who might be able to stash some more away for retirement?  None of them want to utilize a 403b or a 457?  (Not to mention actually being able to save in both -- now there's a thought).  There HAS to be someone else, right?   Am I seriously the only one??     

And here I was thinking that I was going to be able to put away a grand total of 36k (18k in a 403b and 18k in a 457) and then have the 11% put aside for state retirement.   Nope.  Not even an option.  Sigh.


Part 2:  And now I've been called a unicorn...

Before getting off the phone with HR I did get the name of a contact that has helped others within the schools with retirement planning.  I thought good, I'll just ask the 403b and 457 question one more time with them. It has to be some misunderstanding!

So today I got on the phone with the financial planner.  I was told, well yes, there was an option... an IRA.  (Insert head/wall relationship here again)  "Yes, but there is a significant difference between deferring $5,500 versus deferring $18,000 to $36,000 a year," I thought.  I politely explained that I was hoping to save the max in the two accounts and that's when I was told "Oh, you're the unicorn that we've been waiting for." 

So not only am I really truly "the only one," but now I have unicorn status as well.  Doh!


GrowingTheGreen

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This blows my mind. How can something like a school--where we are supposed to be teaching kids good habits--not have a retirement savings plan?!

Wear your unicorn badge with pride.

bobechs

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I think you have encountered the conditions for a lot of public employees throughout the country, not just teachers.  Especially at the municipal, county and special tax district levels.

Add in the empirical realization for schools in particular that most of the new hires will be gone from the profession in three to five years and that there are usually plenty more where they came from.

That's not all of the districts, and not all of the teachers.  But whether you are an extreme outlier or not, those policies definitely are not.

charis

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Yep, as a public employee - not a teacher, I don't have access to any such accounts either.  My husband is a teacher and has one, a 403b, not a 457 as well.

Did they say that you were the only teacher in the district to ever ask about a 403b (other otherwise)?  Because I find that extremely hard to believe unless they are tracking every call to HR, which is unlikely.

Heckler

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In Ontario, I've always believed teachers to get a big fat teachers pension.  My F-I-L retired at 55 as a math teacher.

154 billion in assets...

https://en.m.wikipedia.org/wiki/Ontario_Teachers%27_Pension_Plan

abhe8

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Teacher retirement varies by state. In my state it is a pension. And, they get the pension instead of social security. Ya. It's true. They pay in something like 11% of their income and get a pension with a lump sum option, but no other retirement options.

abhe8

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This blows my mind. How can something like a school--where we are supposed to be teaching kids good habits--not have a retirement savings plan?!

Wear your unicorn badge with pride.
Because they give a pension. It's forced, controlled savings. No thought required.

nobodyspecial

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Ironically the big fat government pension can be a disadvantage.
It's great if you spend 40years in the job and are promoted. But if you only work there for a few years, especially at the start of your career you would probably be better off having the money in a regular tax back retirement fund.

I know I would much rather have been able to contribute 18% of my lowest associate junior lecturer to a retirement account than know that when I'm 65 I'll get 1/40th of whatever that salary was back then.

Manguy888

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Just a quick suggestion to make sure to dig a little bit deeper. Usually public teachers have access to the 457 of that state, but it's not always well known by the administration.

My wife teaches in MA, when she started she got a long list of 403b providers, along with salesmen who would come in and try to pitch products. She never heard a thing about a  457, but when she looked into it she found out that she qualified. The HR person at her school stated that she was the first person EVER to ask about the 457 plan.

abhe8

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Ironically the big fat government pension can be a disadvantage.
It's great if you spend 40years in the job and are promoted. But if you only work there for a few years, especially at the start of your career you would probably be better off having the money in a regular tax back retirement fund.

I know I would much rather have been able to contribute 18% of my lowest associate junior lecturer to a retirement account than know that when I'm 65 I'll get 1/40th of whatever that salary was back then.
I don't disagree. But it is very different to say that the job offers nothing towards retirement.

bobechs

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Ironically the big fat government pension can be a disadvantage.
It's great if you spend 40years in the job and are promoted. But if you only work there for a few years, especially at the start of your career you would probably be better off having the money in a regular tax back retirement fund.

I know I would much rather have been able to contribute 18% of my lowest associate junior lecturer to a retirement account than know that when I'm 65 I'll get 1/40th of whatever that salary was back then.
I don't disagree. But it is very different to say that the job offers nothing towards retirement.

But not different to say that the job offers nothing towards retirement unless you stay for the full ride.

Which many workers will not, or cannot (in a single human lifespan.)  So it matters.  Not just a semantic game.

beltim

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Ironically the big fat government pension can be a disadvantage.
It's great if you spend 40years in the job and are promoted. But if you only work there for a few years, especially at the start of your career you would probably be better off having the money in a regular tax back retirement fund.

I know I would much rather have been able to contribute 18% of my lowest associate junior lecturer to a retirement account than know that when I'm 65 I'll get 1/40th of whatever that salary was back then.
I don't disagree. But it is very different to say that the job offers nothing towards retirement.

But not different to say that the job offers nothing towards retirement unless you stay for the full ride.

Which many workers will not, or cannot (in a single human lifespan.)  So it matters.  Not just a semantic game.

Very, very few professions have the model that you're saying they do, where you must work a full career there.  The military is one, but even the the full career is 20 years.  Most workplaces have vesting times of 5 to 10 years, and if you don't vest, you get back your contributions, with interest. 

bobechs

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Nope, there are a lot of non-federal governments where if you don't cross the vesting threshold, which as you say is in the ten-year ballpark, you get nothing-point-nothing back.

Between vesting and full pension eligibility (which is way less than full pay, and often not payable until 65, and not inflation-adjusted) you approach, year by year, the maximum benefit allowable in that system.  Thirty years service (for that government) is not uncommon as the end point of the ladder.

It's non-portable to an extreme, and that's not a design bug.  It's a feature to the system's creators.

beltim

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Nope, there are a lot of non-federal governments where if you don't cross the vesting threshold, which as you say is in the ten-year ballpark, you get nothing-point-nothing back.

Please link to one. 

Quote
Between vesting and full pension eligibility (which is way less than full pay, and often not payable until 65, and not inflation-adjusted) you approach, year by year, the maximum benefit allowable in that system.  Thirty years service (for that government) is not uncommon as the end point of the ladder.

It's non-portable to an extreme, and that's not a design bug.  It's a feature to the system's creators.

I certainly agree that pensions pretty much never pay out before traditional retirement age (again, excepting the military), but that's hardly a flaw considering that pensions require that timeline in order for investments to fund the retirement.  And yes, pensions increase based on years of service, just like every other benefit offered by employment.

Cassie

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As someone else suggested I would suggest that you check on the 457 plan for state employees. In our state everyone is eligible (teachers and state /county/city workers). In our state if you don't stay long enough to vest then they pay you the $. Also when you leave you can choose between leaving your pension sit or taking the $ and no pension.

mrpercentage

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News flash.. most do not save for retirement, even if the company does a match,  but it doesn't stop there. Most do not budget. They pay their bills and spend what is left over.

I talked 3 people at work into a 457 and to let it ride in VINIX. I have a passion for investing. I could probably talk them into buying individual stocks but that would be totally irresponsible of me. I had some say they would give me their money (can't do that either-- or won't).

This forum is a very special breed of smart people. They are very cautious and save. That is one of the main reasons I like to hang out in here. They are a really good influence.

randymarsh

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What state are you in?

CO's state/teacher pension plan has the side benefit of a 401k in additional to the trad pension. So while my specific employer did offer their own 403b, I could have used the 401k instead.

Heckler

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This forum is a very special breed of smart people. They are very cautious and save. That is one of the main reasons I like to hang out in here. They are a really good influence.

I just got a rare cash bonus and raise and my boss tells me to take the wife on a weeklong trip and not worry about the bill.  Instead, the wife tells me she'd rather not go to work for three months in ten years and to put it in my RSP.  Payroll doesn't even have a method of depositing a bonus to my work RSP plan!   My raise will be going to help max both our TFSA this year.

We wouldn't be doing this pre-MMM
« Last Edit: March 02, 2016, 11:33:08 PM by Heckler »

MustacheAndaHalf

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Look at the bright side: you can work around the lack of retirement plan options.  Federal taxes on stock funds are low.  If you're married (filing jointly) you get $74,900 taxed at the 15% tax bracket.  But that's ordinary income - when you sell stock held over a year, you pay 0%.  To quote IRS publication 17:
"0% on any amount that otherwise would be taxed at a 10% or 15% rate."

In other words, you can invest in a Total Stock Market fund, with no retirement plan.  When it issues dividends, if your income (after deductions) falls under $74,900 you pay $0 on the dividends.  If you only sell funds / stocks after 1 year of holding them, that also falls into the 0% tax rate for long-term capital gains.  So there's some very efficient ways to save for retirement even if you have no retirement plan options.
« Last Edit: March 03, 2016, 01:33:47 AM by MustacheAndaHalf »

charis

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Our state has deferred comp, but it has to offered by the school district/employer, so regardless of whether one is eligible, if your employer doesn't offer it, you are out of luck.

Look at the bright side: you can work around the lack of retirement plan options.  Federal taxes on stock funds are low.  If you're married (filing jointly) you get $74,900 taxed at the 15% tax bracket.  But that's ordinary income - when you sell stock held over a year, you pay 0%.  To quote IRS publication 17:
"0% on any amount that otherwise would be taxed at a 10% or 15% rate."

In other words, you can invest in a Total Stock Market fund, with no retirement plan.  When it issues dividends, if your income (after deductions) falls under $74,900 you pay $0 on the dividends.  If you only sell funds / stocks after 1 year of holding them, that also falls into the 0% tax rate for long-term capital gains.  So there's some very efficient ways to save for retirement even if you have no retirement plan options.

As someone with no retirement, this is of interest to me.  In other words, I start a regular taxable total stock market fund at Vanguard and if our AGI is less than 74900, we pay no taxes on dividends and nothing for long term capital gains? The rub is that the AGI will be hard to hit for us without another tax advantaged account in the mix.

themagicman

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Part 1:    "I can't really be the only one ---- Can I?"

So yesterday I felt like I was banging my head against a wall while simultaneously wondering if I could REALLY be "the only one..."   It's taken me a night of tossing and turning while contemplating this to even be able post. 

Background:
- I have been a stay at home parent for the past several years in a major metropolitan area.
- I WANT to go back to work (teaching) because I believe in what I was doing and enjoyed it (yes, despite all the craziness). 
- We do not NEED the money from me working.  It would be because I want to be a contributing member of society.  I like making a difference!

What happened:
I called one of the local schools that has a few open positions to find out about salary details, benefits, and retirement.  The answer about salary was reasonable.  Ok, ok, it IS poor pay all things considered, but reasonable for what teachers are paid for the area.   I really don't care what the pay is exactly.  I mean, I want to get paid for my time, but the exact numbers aren't going to make it or break it for me because I'd be taking the job because I want to be teaching.   So I move on to other questions for HR -- about benefits and retirement and that's when it happened.  The deal breaker...


What is the deal breaker?


That they do not offer ANY type of retirement vehicle besides the normal state retirement. 

No 403b, no 457.  NOTHING. ZILCH. NADA.  ZE-ROOOOOH!

It was like time stopped and it took me probably 20-30 seconds to recover.  (Whhhhattt?)  Let's just say it was probably good that I was on the phone and not actually sitting in front of the HR person.  I think they could probably hear a bit of the shock, but my face would have left no question about how crazy I thought they sounded.   So I tried again, I mean, maybe if I tried inquiring in a different way... Maybe they weren't getting what I was asking, right?   There has to be someone who wants to be able to save for retirement and has asked this of the employer.  (Insert wall / head knocking relationship repeatedly here)

Thought process over the past 24 hours:
So, looking at it objectively.  Yes, I get that teachers have small salaries, but I can't imagine that I would be the ONLY ONE (can I really be the only one??) in the school system who would want to save money via a 403b or a 457.  What about administrators and other people with larger salaries who might be able to stash some more away for retirement?  None of them want to utilize a 403b or a 457?  (Not to mention actually being able to save in both -- now there's a thought).  There HAS to be someone else, right?   Am I seriously the only one??     

And here I was thinking that I was going to be able to put away a grand total of 36k (18k in a 403b and 18k in a 457) and then have the 11% put aside for state retirement.   Nope.  Not even an option.  Sigh.


Part 2:  And now I've been called a unicorn...

Before getting off the phone with HR I did get the name of a contact that has helped others within the schools with retirement planning.  I thought good, I'll just ask the 403b and 457 question one more time with them. It has to be some misunderstanding!

So today I got on the phone with the financial planner.  I was told, well yes, there was an option... an IRA.  (Insert head/wall relationship here again)  "Yes, but there is a significant difference between deferring $5,500 versus deferring $18,000 to $36,000 a year," I thought.  I politely explained that I was hoping to save the max in the two accounts and that's when I was told "Oh, you're the unicorn that we've been waiting for." 

So not only am I really truly "the only one," but now I have unicorn status as well.  Doh!

You might be one of the few. My wife is a teacher and we have 100% of her salary going into 403/457. We get calls and emails every week checking to make sure we really want to do that and asking why? They always think it is a mistake and they we need to change it. They say in their history the most someone has contributed is 15% and that the majority of people do not do anything.
« Last Edit: March 03, 2016, 07:12:33 AM by themagicman »

I'm a red panda

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That they do not offer ANY type of retirement vehicle besides the normal state retirement. 

No 403b, no 457.  NOTHING. ZILCH. NADA.  ZE-ROOOOOH!


I don't understand this.  They offer the normal state retirement.  Why would they offer something else?

When I've worked for education institutions, the "normal state retirement" IS the retirement plan.

Cassie

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When I worked for the state most of the people I knew were putting $ into deferred compensation offered by the state in addition to the retirement plan that was mandatory to contribute too. I also knew people using the catch-up revision which allowed you to put in 15k/year if you were a certain age. I am surprised that so many of you report people putting nothing into it.

MrFrugalChicago

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In Ontario, I've always believed teachers to get a big fat teachers pension.  My F-I-L retired at 55 as a math teacher.

154 billion in assets...

https://en.m.wikipedia.org/wiki/Ontario_Teachers%27_Pension_Plan

Pensions are falling 1 by 1. Chicago teacher pension is many millions in the hole and no end in sight. Only option is to cut pension for new teachers and keep putting in money for 30 years to bail it out.

beltim

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In Ontario, I've always believed teachers to get a big fat teachers pension.  My F-I-L retired at 55 as a math teacher.

154 billion in assets...

https://en.m.wikipedia.org/wiki/Ontario_Teachers%27_Pension_Plan

Pensions are falling 1 by 1. Chicago teacher pension is many millions in the hole and no end in sight. Only option is to cut pension for new teachers and keep putting in money for 30 years to bail it out.

No, that's not the only option.  It's just the cheapest option.

The fairest option would be for the city and state to actually contribute the amount that they are legally obligated to, instead of skipping their payments for a decade: http://www.marketwatch.com/story/whos-responsible-for-the-chicago-teachers-pension-fund-2015-06-10

randymarsh

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That they do not offer ANY type of retirement vehicle besides the normal state retirement. 

No 403b, no 457.  NOTHING. ZILCH. NADA.  ZE-ROOOOOH!


I don't understand this.  They offer the normal state retirement.  Why would they offer something else?

When I've worked for education institutions, the "normal state retirement" IS the retirement plan.

Because employers want to attract talent and retirement plans are a way to do that.

Both states I've lived in offer teachers (and other public employees) a myriad of retirement options. In many states teachers won't collect SS, so being able to contribute to an additional plan is pretty important.

charis

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Again, people, the state offerings are only as good as the districts that do.  It means nothing to employees that there are state programs if their districts don't offer them.

BFGirl

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My county offers a pension.  You must contribute 7% (no more, no less) and they match at 200%.  Vesting is a 8 years when you are entitled to the match. They pay 7% interest on your contributions.

They also offer deferred comp.

If I quit before being eligible to take the pension, then I have to wait 60.  I will be eligible at 53.

I expect to get a little more than 1/3 of my salary in the form of a monthly payment for life (it would have been more, but I got divorced - but I got part of the ex's IRA so it probably works out just fine).  It is not inflation adjusted.  If I work longer, it goes up.

The good news is that the entity that manages the retirement plan requires each county to pay 100% of its contributions every year, so there shouldn't be any worries about the government going bankrupt.

Just posted this to give an example of another type of government pension.

cawiau

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My wife works for the state of Massachusetts. She can either contribute to the state retirement plan or ORP (other retirement plan) where we select the funds. We picked ORP.

She also has access to a 403b and 457. Currently we are doing the require ~9% to the ORP and working towards maxing her 403b (I max my 401k).


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randommadness

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Federal we have access to a 401k (TSP) on top of our pension.  We are vested after 5 years, but you can't typically collect until 57, 60, or 62 depending on your circumstances.

abhe8

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What teachers are federal employees?

randymarsh

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Again, people, the state offerings are only as good as the districts that do.  It means nothing to employees that there are state programs if their districts don't offer them.

In at least 3 states I know of, the employer options are completely independent of the state options, so it has nothing to do with the districts.

randommadness

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What teachers are federal employees?

I just meant in general. Sorry :P

Though for certain professions that require certifications, like acquisitions, there are some "professors," such as for the DAU. (Defense Acquisition University)

charis

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Again, people, the state offerings are only as good as the districts that do.  It means nothing to employees that there are state programs if their districts don't offer them.

In at least 3 states I know of, the employer options are completely independent of the state options, so it has nothing to do with the districts.

That's awesome for the 3 states that you are aware of. I wish we lived in such a location.  In our state, you get what the employer offers.  And I have no idea how one has access to a deferred compensation plan outside of an employer, the party deferring compensation.

MustacheAndaHalf

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If you're married (filing jointly) you get $74,900 taxed at the 15% tax bracket.  But that's ordinary income - when you sell stock held over a year, you pay 0%.
...
As someone with no retirement, this is of interest to me.  In other words, I start a regular taxable total stock market fund at Vanguard and if our AGI is less than 74900, we pay no taxes on dividends and nothing for long term capital gains? The rub is that the AGI will be hard to hit for us without another tax advantaged account in the mix.
The IRS provides a standard deduction ($12,600 married/joint) and one personal exemption each ($4,000 x 2) for a total of about $20,600 in deductions.  So if you make $95,500 you would deduct things that bring you to $74,900 and again pay 0% on long-term capital gains and dividends.

If your AGI puts you between 15% and 39.6%, you still benefit:
"15% on any amount that otherwise would be taxed at rates greater than 15% but less than 39.6%."
Even if you fall in the 28% or 33% tax bracket, you're only paying 15% on qualified dividends.  So let's say you bought $10,000 of Vanguard Total Stock Market (currently yielding 2%).  You would expect about 2% in dividends, or $200.  The IRS would tax that $200 at the qualified dividends rate of 15%, and you'd pay $30.  That assumes a lot, but experiment with it in your tax software or ask a tax expert about it.  (I'm not a tax expert)

Nickels Dimes Quarters

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Any chance you can read the current union contract that the teachers have with the school district? Some are posted on union websites or the district will have a copy. You may also look into other districts or look at teaching posts with the state or federal government. I work for a state government and we employ teachers for kids in state facilities and adults studying for the GED. Our state teachers have their own contract and they do get retirement options that the rest of state employees aren't offered.

NDQ

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Nope, there are a lot of non-federal governments where if you don't cross the vesting threshold, which as you say is in the ten-year ballpark, you get nothing-point-nothing back.

Look up vesting schedules. What you are describing is illegal. A qualified defined benefit pension plan can have a vesting schedule. The worst vesting schedule possible is a 5 year cliff. You have to wait 5 years to get anything, but you get 100% vested at 5 years. The second worst is a 3-7 year vesting schedule where you get 20% at yr 3, and it increases to 100% at year 7. Most private companies actually use a more lenient vesting schedule because the whole point is to attract talent. Defined contribution plans(401ks/403bs/etc.) in particular are normally legally required to stick to a 3 year cliff or 2-6 year vesting schedule.



Teacher's plans can vary a lot by state.  I was reviewing one for a friend where they had the pension by default, but they could switch to a metlife 403b. That sounded terrible at first until I looked at the investment options... all Vanguard institutional funds :D.  Metlife added their own fee on top, but total costs were still under 0.2%.

ImCheap

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Just a quick suggestion to make sure to dig a little bit deeper. Usually public teachers have access to the 457 of that state, but it's not always well known by the administration.

My wife teaches in MA, when she started she got a long list of 403b providers, along with salesmen who would come in and try to pitch products. She never heard a thing about a  457, but when she looked into it she found out that she qualified. The HR person at her school stated that she was the first person EVER to ask about the 457 plan.

Same thing here, the school does not talk much about if at all about the 457 state plan, all paper work is done thru the state.

They do offer a 403b, they set it up a 3-4 years ago, they give a little match so that's good, but.......they set up 4 plan providers to chose from, all of them are piss poor plans riddled with high fees. One would have thought a pile of teachers, admin and school board members filled with people who have a bunch of letters before and after their names could get one decent plan to use would not be that tough. They would not have had to look to far, the state 457 plan is top notch. Kind of makes me second guess the school system that I do truly think highly of.

wenchsenior

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What teachers are federal employees?

I just meant in general. Sorry :P

Though for certain professions that require certifications, like acquisitions, there are some "professors," such as for the DAU. (Defense Acquisition University)

A fair number of Feds teach at the university level. My husband is a biologist, employed by USGS, but with status of adjunct professor at a university and a duty station on campus. His main job is research, but he teaches a few classes a year as well.  He functions in most ways as a regular full professor...including as major adviser to a bunch of grad students. That might not really be pertinent to this particular question, though.

VAR

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What teachers are federal employees?

I just meant in general. Sorry :P

Though for certain professions that require certifications, like acquisitions, there are some "professors," such as for the DAU. (Defense Acquisition University)

I believe teachers in DOD schools would also be federal employees.

A fair number of Feds teach at the university level. My husband is a biologist, employed by USGS, but with status of adjunct professor at a university and a duty station on campus. His main job is research, but he teaches a few classes a year as well.  He functions in most ways as a regular full professor...including as major adviser to a bunch of grad students. That might not really be pertinent to this particular question, though.

mrpercentage

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Just got another to sign up tonight, and put it in VINIX. Vanguard really needs to start paying me.

Hey It's Me

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I work in the private sector, but recently had one co-worker tell me she doesn't invest in the company 401K because her father told her it was a crappy match system. We match 25% of all contributions up to the max...

I had another co-worker tell me she dropped her contribution from 4% to 3% because "4% is a LOT of money. I didn't even realize."

Both smart women who I otherwise like. Common ladies!

rugorak

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This sort of thing isn't unusual from what I have seen. I live in NY state and a few public sector jobs I looked at part of the reason I turned the jobs down is because they had the insane requirements for the state pension system. They had just kicked things up for new people. So you weren't vested at all until 10 years and fully vested until 30 years. And you were required to pay into it. Add to that poor pay and they had just reduced a number of other benefits for newbies.

I get that for the average American that could be a good deal. They won't save otherwise. But for someone like me it was horrid. I mean I am hoping to retire in 10-15 years (not super early but late 40's early 50's). If I had taken that I would have waited until I was in my late 60's to get my money out. And I would have to leave it in the hands of politicians.

Honestly I think they do a disservice. A lot of smart people who might be willing to work there like those on this forum will turn away as soon as they see that. I think they would potentially do better with a 403b with no match option. Sure most people would do the pension, but you could get some of us in that way.

As for the person asking for a link I don't know of any. I tried to research that stuff before applying but they didn't have it on any publicly available site.

beltim

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This sort of thing isn't unusual from what I have seen. I live in NY state and a few public sector jobs I looked at part of the reason I turned the jobs down is because they had the insane requirements for the state pension system. They had just kicked things up for new people. So you weren't vested at all until 10 years and fully vested until 30 years. And you were required to pay into it. Add to that poor pay and they had just reduced a number of other benefits for newbies.

I get that for the average American that could be a good deal. They won't save otherwise. But for someone like me it was horrid. I mean I am hoping to retire in 10-15 years (not super early but late 40's early 50's). If I had taken that I would have waited until I was in my late 60's to get my money out. And I would have to leave it in the hands of politicians.

Honestly I think they do a disservice. A lot of smart people who might be willing to work there like those on this forum will turn away as soon as they see that. I think they would potentially do better with a 403b with no match option. Sure most people would do the pension, but you could get some of us in that way.

As for the person asking for a link I don't know of any. I tried to research that stuff before applying but they didn't have it on any publicly available site.

Try Google:
http://lmgtfy.com/?q=new+york+state+retirement+vesting
Gives you this site which states:
Quote
If you are not vested, you may end your membership and request a refund of your contributions by filing a Withdrawal Application (RS5014) Adobe pdf, available on our website or from our Call Center. You must be off the payroll at least 15 days before submitting the application. You can receive the refund directly or roll your contributions over to an Individual Retirement Account (IRA) or other qualified retirement plan.

If you do not withdraw your contributions, they will continue to earn 5 percent interest for seven years.

Thus, like I said, if you don't vest, you get your contributions back, in this case with decent risk-free interest.

rugorak

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Good to know but still not the best deal. I was looking at those jobs 3+ years ago and could not find it at the time. Google improves as do the state websites. Maybe the same held true then but when I specifically asked the hiring manager they stated if you are not vested you get nothing. In which case they better educate their hiring staff.

I'd still rather have what I have now. I got a much better deal at my current job. I get an additional 10% of my base salary put into a 401(a). Not to mention a number of other better benefits. Overall I have a higher base pay even before factoring retirement, the same holidays, same working hours, better benefits in a number of other areas, and my retirement stuff will grow much better than it would have.