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.
10 Jobs That Still Offer Traditional Pensions by WTOP News. Most jobs nowadays have eliminated traditional pensions from their list of benefits. However, government and union employees are among the few still provided pensions by their employers. According to the Bureau of Labor Statistics, only 17 percent of the private sector industries offer pensions to their employees, putting employees working in these industries at a considerable disadvantage regarding retirement security. Public employees like teachers, nurses, police, firefighters, and those working for the state and local government are more likely to receive pension payments in retirement. Eighty-nine percent of teachers working in primary, secondary, and special education have access to a pension, while 59% of college and university employees also have access to pensions. Melinda Morrill, associate professor of economics at North Carolina State University said, “teachers are still predominantly covered by defined-benefit pensions. Although public employers are making some movement away from these plans, the vast majority of public sector workers are still covered by defined-benefit pension plans.” Other workers receiving pensions include those working in utilities, insurance, pharmaceuticals, transportation, unions, and the military.
Social Security Not Enough For Full Retirement by Terri Russell. Contrary to popular belief, Social Security alone will not provide a secure retirement, and it was never created to. Instead, it was designed to “fill in the gaps.” Most jobs today offer defined-contribution plans like 401(k)s, “a plan that allows your employer to take money out of your paycheck pre-tax, and then put it into an account in your name and it grows tax-deferred,” says Richard Jay, a Wells Fargo Investment Officer. “And then at some point in time you have that source to add to your social security,” he says. Some employers match what their employees put into their retirement accounts capped at a percentage. The problem is people don’t know when to start saving to cover the gap between their 401(k) and Social Security. Jay says, “The 20-year-old says I’m too young. The 30- year-old says I’m starting a family. The 40- year- old; kids are getting into high school. The 50-year-old says the kids are in college, I have to pay for that. The 60-year-old says. “oh no I didn’t save for retirement. What am I going to do now?” His advice? Start saving now.
Be sure to check back next Friday for the latest news in the fight for a secure retirement!