Welcome to the latest edition of This Week in Pensions! As we do most weeks, we have gathered the best stories about pensions and retirement security from the previous week. This is the news you need to know in the fight for a secure retirement.
Here are this week’s top stories:
- The Downside of Choice by Bailey Childers: NPPC’s Executive Director argues that recent moves by states to give public employees a choice between defined benefit pensions and 401(k)s are the wrong move. When given a choice, public employees overwhelmingly choose pensions. Still, states should be focusing on other priorities, such as fully funding their pensions, rather than giving workers an unnecessary choice.
- On pensions, Kentucky should heed W. Virginia’s hard-learned lessons by David Haney: the Executive Director of the West Virginia Education Association warns Kentucky against making the same mistake as West Virginia and switching teachers from a pension to a 401(k)-style plan. After making the switch, costs skyrocketed for the state and retirement security plummeted for teachers. Eventually West Virginia reopened the pension plan and funding levels have improved dramatically.
- Don’t blame retirees for pension woes by Robert Dalton: a retired state employee in Kentucky points out that public employees have paid their fair share of pension costs over the years and that it is the state government that skipped payments to the pension fund. Why should hard-working public employees lose their retirement security over the state’s failure to act responsibly?
- States Hand Out Corporate Subsidies As Their Pensions Suffer by Lydia O’Neal: the International Business Times covers the release of a series of reports by Good Jobs First that compares the costs of corporate subsidies and tax loopholes to the costs of funding public pensions. As we discussed on this blog previously, in most states, the cost of corporate giveaways far exceeds the annual cost of funding pensions.
- Bad news: Your 401(k) won’t give you a decent retirement by Michael Hiltzik: LA Times columnist Hiltzik discusses the latest research on retirement savings from the Center for Retirement Research. Unfortunately, the research reveals what we already know: 401(k)s will provide an inadequate retirement for many working families, who will fall behind their standard of living in retirement or not be able to retire at all.
Be sure to check back in the weeks ahead for the latest news in the fight for a secure retirement!