Gentle readers, I am one of the reviled of this country, for I must confess, I am the recipient of a public sector pension, albeit a small one. I waited to collect until I was 55, and just this morning, I got a big smile on my face when I saw that direct deposit amount in my checking account.
The day I actually went in and signed up for it, I felt a bit sad. I was now retired, I was old, that was it. To make it worse, the woman who worked with me said, "Well, that's not very much." Knowing that former coworkers collect something like $132k a year, I can see what she meant. However, my "not very much" is sufficient for me since my husband and I worked to build other retirement funds. We have a plan!
The thing no one seems to know is that many public sector employees put their own money into those accounts. (I say "many" because some public entities make the employee contributions for them as part of their compensation package.) Like Social Security, PERS contributions are mandatory. I had no choice, and in fact, at some places I paid both PERS and Social Security.
Unlike Social Security, though, PERS accrues as a cash balance; that is, I could have taken a lump sum but chose instead to annuitize those funds, which will be inflation-indexed, also like Social Security. When I finally do collect Social Security one day, that will also be impacted and coordinated with my pension.
If you read my earlier post about buying American products, then you will also understand that I think about the taxpayers of my beautiful state when I think about where to retire. It's expensive here. Do I take my pension and head to a state-income-tax-free state? (And pay higher property taxes and higher utility bills for summertime air conditioning?)
Or do I stick it out here, hope our new governor will get things sorted out, and spend my pension funds to support the state that helped me earn them while enjoying our amazing weather?
This rat's staying on board.
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