Welcome to the latest edition of This Week in Pensions! 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 the top stories from this week:
Pension leaders: Oklahoma’s pension systems can withstand retiree COLA by Carmen Forman. Last Friday, the Oklahoma House of Representatives held an interim study committee meeting on a much-needed cost-of-living adjustment (COLA) for the state’s retirees. In her article for the Oklahoman, Forman quoted Ginger Sliger, the executive director of the Oklahoma Police and Pension Retirement system: “Our retirees have suffered from this and I think it’s time to give a COLA. We need to be prudent about it, but I think it’s time.” Forman also wrote about retired Oklahoma City teacher Debbie Hogue-Downing. “A widow, Hogue-Downing has grown more concerned about her finances in the five years since her husband’s death. Home repair costs have started adding up as everything else in Hogue-Downing’s life has started to cost more. ‘We need to let legislators know that it’s important for us and we’re serious about this,’ she said.”
Why millennials should care about government pensions – even if they don’t have one by Jen Sidorova. In her article for Market Watch, Sidorova peddles the false narrative of a public pension crisis to claim that millennials should care about states’ unfunded pension liabilities. Sidorova argues that millennials will have to foot the bill for unfunded pension liabilities through higher taxes. As we covered on our blog last month, however, pension opponents peddle the unfunded liability to claim pension systems aren’t healthy. An unfunded liability simply means that “at a specific point in time, the pension plan does not have the full amount of money it will need to pay out ALL of the retirement benefits it will owe in the future to ALL of its current and former employees,” which has never happened before. Furthermore, according to the National Institute on Retirement Security, nearly all millennials (97 percent) have a positive view of public pensions. Finally, Sidorova works for the Reason Foundation, a Koch-backed libertarian think tank that advocates for privatizing many public services, including eliminating defined benefit plans for public employees. Check out our video on the untrustworthy Reason Foundation here.
America isn’t ready for longer lifespans by Ethan Wolff-Mann. In this article for Yahoo! Finance, Wolff-Mann writes about the issues America’s workforce faces as average U.S. life expectancy increases to 78 years, the highest ever measured. One issue Wolff-Mann highlights is “longevity risk,” which is the idea that workers can run out of money in retirement before they run out of years to live. The employer shift from defined benefit to defined contribution plans like 401(k)s also makes preparing for retirement all the more difficult for workers. As defined benefit plans for public employees come increasingly under threat, all of us have a role to play to ensure that every American has the resources they need in retirement.
Be sure to check back in two weeks for the latest news in the fight for a secure retirement!