Most state and local workers in the United States receive retirement benefits, usually in the form of a pension. However, the quality of those benefits vary widely. Depending on your goals for retirement, your lifestyle, and health care needs, those benefits may or may not be enough.
That’s why it’s important for public workers like teachers, firefighters, and municipal employees to understand how retirement benefits work, what to expect when you enter retirement, and how you may be impacted by different laws and regulations.
To that end, we’ve put together a list of some of our best educational resources for public employees and retirees. We’ve crafted these tools to provide easy-to-understand information so you can retire with confidence.
Equable Institute’s Pension Basics Series
Understanding how pensions work is complicated. Rules and formulas vary state to state, so figuring out what to expect is confusing. Since many public workers in the U.S. don’t get any education about their retirement benefits, we created this series to help.
Explore our Pension Basics Series today to demystify your retirement.
How to Calculate Your Pension
The pension formula is based on your working years — both how long you serve and what you earn. In this article, we explain how you can calculate or estimate the value of your future pension. We also have a calculator that you can use to estimate your future pension if you are in a pension plan currently accepting new members.
Estimate your future benefits now using our Retirement Benefit Calculator.
Retirement Security Report
We analyzed public retirement plans across the U.S. to determine which plans provide a path to a secure retirement for all public workers. These customizable scorecards can help you determine how well your retirement plan is working well for you.
Check your plan’s score with our Retirement Security Report.
Retirement Security Report: Teacher Edition
The Retirement Security Report: Teacher Edition analyzes the state of teacher retirement benefits in the U.S. Importantly, this four-part report details the best and worst teacher retirement plans across the county. It also highlights the most important elements of quality teacher retirement plan design and trends in the value of retirement benefits.
Read the Retirement Security Report: Teacher Edition to see how your plan ranks.
Are Public Pensions Protected from Inflation?
Retirees with a pension from state or local governments were made a promise: guaranteed income for the rest of their lives. However, in a number of states, that doesn’t necessarily mean a financially secure retirement. If pension income doesn’t keep up with inflation, then it may not offer the security many workers need. Unfortunately, there isn’t universal cost-of-living-adjustment coverage for retired teachers, firefighters, city workers, and other public workers with pensions. This article details which states offer cost-of-living adjustments and how they are determined.
Find out if your state offers cost-of-living adjustments in our full article.
How Does Social Security Work with Public Pensions for State and Local Workers?
There are 12 states that have totally opted out of allowing state workers to collect both Social Security and a pension. And another 5 states have allowed local employers to choose whether or not they participate.
Read this article to see where state and local workers are allowed to join Social Security.
We also have an article on Social Security coverage for teachers here.
What is a Guaranteed Return Retirement Plan?
Not all public employees are offered a pension. A guaranteed return plan is an alternative type of retirement benefit. It builds retirement income for participants by creating personal accounts for each employee and centrally managing investments through a retirement system. The retirement system invests the money and guarantees that employees will earn a minimum return.
Click here to learn the ins and outs of guaranteed return plans.
What is a Hybrid Retirement Plan?
In a hybrid retirement plan, your employer provides access to two compatible benefit structures at the same time. A typical hybrid plan combines a small guaranteed income plan (like a pension) with a defined contribution plan. However, there are a range of ways in which these plans can be designed.
Explore the different types of Hybrid Retirement Plans in our breakdown.
What is a Defined Contribution Plan?
In a defined contribution plan, you and your employer each contribute a specified amount to your individual account. That money is then invested in one of several professionally designed and managed funds. Your retirement income depends on the value of your investments upon retirement. The IRS typically refers to defined contribution plans as 401(a), 403(b), or 457 plans.
Learn the basics of defined contribution plans to maximize your retirement.
What is a 403(b) Plan for Teachers?
A 403(b) plan is the most common form of supplemental savings offered to teachers.
Check out this article to understand how they work and how to determine if you should invest.
Take charge of your financial health and wellbeing today by educating yourself with Equable’s financial education tools. Share these tools or this article with your public employee community and spread the financial literacy around.
