Welcome to this week’s edition of This Week in Pensions! We have gathered 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.
Before we dive into our top stories from this week, check out some stories of public employees helping their communities during the coronavirus pandemic:
- Even amid coronavirus closures, Emerald Elementary, other BVSD schools growing vegetables for food banks
- A 10-year-old girl has sent more than 1,500 art kits to kids in foster care and homeless shelters during the coronavirus pandemic
- Clinton police officer and his wife donate plasma after COVID-19 recovery
- Tucson’s creative community, teachers join forces to enhance learning during coronavirus
- Thanks to runner’s initiative, Keene grocery employees score brand new sneakers
Here are stories from this week:
Retirement crisis for women is even worse than you think by Brett Arends. In this article for Market Watch, Arends analyzes this month’s new report from the National Institute on Retirement Security (NIRS) on the gender pay gap in retirement. The report points out that there is a 20 percent gap between men and women’s average income in retirement, which is due to a variety of reasons. For example: women, on average, earn less than men during their working lives, take more time off from work than men for caregiving duties, and are more likely than men to work part-time. This means they aren’t eligible for a workplace retirement plan. To learn more about NIRS’ findings, check out our blog from earlier this month.
Colorado lawmakers return to tackle $3.3 billion budget hole by the Associated Press. On Tuesday, the Colorado state legislature returned to the legislative session for the first time since March 14, where they will take up a state budget that is facing a $3.3 billion deficit. Suspending a $225 million payment to the Colorado Public Employees Retirement Association (PERA) is one of the options lawmakers are considering to bridge the budget gap. As we wrote last week, this action “would add an estimated $990 million to the pension’s long-term debt if it’s approved by the full legislature” and “would also threaten the state’s credit rating.”
For Two Decades, North Dakota Has Failed to Properly Fund Its Public Pensions by Raheem Williams. In this op-ed for the Grand Forks Herald, Williams (a policy analyst for the anti-pension Reason Foundation) argues that North Dakota’s public pension systems “should consider implementing serious pension reforms” because they “never fully recovered from the last financial crisis, making them particularly vulnerable now.” However, changes to plan design are actually more costly in the long run for states. For example, in West Virginia, teachers were enrolled in a 401(k)-style defined contribution plan for 17 years before the state legislature voted to reopen the closed defined benefit pension plan, which came on the heels of a study which “showed that the pension plan offered equivalent benefits at half the cost of the defined contribution plan.”
Be sure to check back next week for the latest news in the fight for a secure retirement!