Friday Top Five Nov 30 2012

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The Friday Top Five: A collection of the top five news articles, blog posts, or other retirement related information from the past week.

From the Schwartz Center for Economic Policy Analysis at The New School: NYS Comptroller: The Promise of Public Pensions

[Note: This video clip is about an hour and a half in length, with DiNapoli's comments running just over 30 minutes, starting at the 10 minute mark. Highly recommended.]

New York State Comptroller Thomas DiNapoli presents his perspective on the future of retirement and on public pension funds. [Public pensions is an] "issue that continues to provoke impassioned discussion and debate in state capitols, union halls, corporate board rooms and living rooms across the country. From coast to coast we are experiencing coordinated, sustained attacks on public employee pensions. If you only read the news accounts and editorials, you would come to the conclusion that all Defined Benefit public pensions are costly, unsustainable give-aways, that are bankrupting states and localities. Anti-pension advocates have skillfully commandeered the debate, and co-opted the media to such a degree, that many in the public now accept this faulty premise."

From the State of Illinois, Gov. Pat Quinn Introduces Squeezy the Pension Python

Reaction to Gov. Quinn's video has varied, but the new online campaign to get Illinoisans excited about pension reform at least has people talking. Whether this approach will lead to action is still anyone's guess.

From Governing Magazine: The Real Story of Public Pensions

An excellent review of Alicia Munnell's book "State and Local Pensions: What Now?" by Mark Funkhouser, and former Kansas City mayor and auditor, and current director of the Governing Institute. Says Funkhouser, "The book not only is a comprehensive consideration of the relevant literature but also provides empirical analysis of an exhaustive Public Plans Database that she and her colleagues at the center have put together. It is this database that makes the book unique and is its great strength. The story of how we got to where we are with public pensions is told in prose that is lively and direct.

From the Center for Retirement Research at Boston College: The Impact of Long Vesting Periods on State and Local Workers

"The brief’s key findings are:

  • Public sector defined benefit plans provide short-tenure workers with little or no pension benefits.

  • One reason is that these plans have long vesting periods – the years of service needed to qualify for any benefit.

  • The longer the vesting period, the less likely an employee will remain long enough to vest.

  • This effect helps explain why nearly half of workers depart without any promise of future benefits."

From the St. Louis Post-Dispatch: Editorial, Public Pensions Are A Promise to be Kept

This editorial is about the public pension issues faced by the state of Illinois and the fight between the Civic Committee of the Commercial Club of Chicago and the Illinois office of AFSCME.

The views expressed by the writers of these pieces are entirely their own and do not necessarily reflect the views of MOSERS. Print Friendly and PDF

What's In It For Me? Total Compensation Package Survey

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In early October of this year, MOSERS conducted an online survey to assess the views held by agency human resources staff on the various elements of the State of Missouri's total compensation package. Total compensation includes the benefits that are provided for benefit-eligible state employees in addition to their salaries, including paid time off (annual leave, sick leave and paid holidays), health insurance, basic and optimal life insurance, long-term disability insurance, a deferred compensation plan, retirement (MOSERS and Social Security), a cafeteria plan, workers' compensation, and unemployment insurance.

We wanted to get the opinions of people in these important positions - HR - because they are the ones who have the most contact with all levels of employees throughout state government. We thought their assessment of their employees' views about the various elements of total compensation would be useful and that they are be well-positioned to rank them and provide us feedback.

Respondents ranked the benefits offered by the state in the following order, from 1 being most important to 10 being least important:

1 - Cash Pay (salary and/or wages)

2 - Health Insurance

3 - Paid Time Off (including annual leave, sick leave and paid holidays)

4 - Retirement (MOSERS and Social Security)

5 - Basic and Optional Life Insurance

6 - Deferred Compensation Plan

7 - Cafeteria Plan

8 - LTD Insurance

9 - Workers' Compensation Program

10 - Unemployment Insurance

We heard from people in nearly every agency in Missouri State Government. Many survey respondents suggested that while they are extremely important benefits to have available, long-term disability insurance, workers' compensation, unemployment insurance are low on the minds of state employees.

That is likely correct. But, these are benefits employees can count on if they need them. As a member of the plan administered by MOSERS, the state provides long-term disability insurance at no cost to the employee. If an employee is determined by the insurance carrier to be disabled, the monthly LTD benefit will replace up to 60% of a pre-disability salary. Unemployment insurance provides an employee with partial compensation in the event of a lay off or termination from work for reasons other than misconduct. And workers' compensation may be provided for injuries and illnesses arising out of and in the course of state employment.

The state-offered cafeteria plan is a program in which those who are eligible for health, dental and vision insurance can have their premiums automatically deducted from their paychecks before taxes. And did you know that employees can save $25 or more in taxes for each $100 paid through the cafeteria plan on qualifying expenses?

Most respondents said employees know the value of the State of Missouri Deferred Compensation Plan, even though the state match has been suspended. The Plan provides state employees a convenient way to save money for retirement through payroll deduction.

Benefits are a significant part of state employees' total compensation package and MOSERS is proud to play a large part in it, as well as serve as a major component in the retirement security of the state's retirees. Print Friendly and PDF

Friday Top Five Nov 23 2012

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The Friday Top Five: A collection of the top five news articles, blog posts, or other retirement related information from the past week.

From CNN Money: 4 Crusaders Fighting for Seniors' Financial Rights

A great article focusing on four people who are fighting for the financial rights of seniors, including Karen Ferguson, director of the Pension Rights Center, Jackie Wiley-Sistruck, who works to educate seniors about investment fraud, Art Koff, a retired advertising executive who founded, and Tammy Flanagan, a senior benefits director at the National Institute of Transition Planning.

From MarketWatch (WSJ): The 4 Retirement Problems Obama Must Solve

In this letter to President Obama, MarketWatch's Robert Powell implores the president to begin to tackle the retirement-related issues facing the nation, including Social Security, Medicare, retirement security, and caring for a nation of elders.

From (St. Joseph, MO): Important Decisions For Retirees and Near-Retirees

This article is about some important decisions individuals and couples must make, both immediately preceding retirement, and the first few years after retirement.

From the Best Life Blog: Fiscal Cliff Shouldn't Change Your Financial Plans

It's times like these when folks should have a plan for retirement and stick to it. As far as the "fiscal cliff" goes, this blog post opines about what might happen if congress does nothing before the end of the year. If you have a plan, stick with it over the long-term. If you don't have a plan, get one.

From the Stanford Center on Longevity: A Long Bright Future (Book Review)

"In A Long Bright Future, longevity and aging expert Laura Carstensen guides [readers] into the new possibilities offered by a longer life."

The views expressed by the writers of these pieces are entirely their own and do not necessarily reflect the views of MOSERS. Print Friendly and PDF
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This is a nice summary blog post of the recently released results of the Public Fund Survey Summary of Findings for FY2011 from our friends at Pension Dialog. Print Friendly and PDF

Happy Thanksgiving to You and Yours

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Happy ThanksgivingTo all MOSERS Members and Associates,

Thanksgiving is a good time for a time-out – not in the parenting sense when a child misbehaves but in the sense of a time-out from the day-in and day-out things that may keep us from thinking about those things that are the most important – things like family, friends, loved-ones, freedom, health, opportunities, and peace – things which tend to be taken for granted but which we should cherish and for which we should be grateful.

Have a wonderful time-out.

We are thankful for our opportunity to serve.  We are here for your benefit.

Gary Findlay
Executive Director Print Friendly and PDF

Friday Top Five Nov 16 2012

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The Friday Top Five: A collection of the top five news articles, blog posts, or other retirement related information from the past week.

From the Squared Away Blog: Dicey Retirement: The Long Ride Down

"No one really needs confirmation of how tough the Great Recession was.  But the Center for Retirement Research at Boston College has quantified the decline – and it’s brutal. Investment losses and falling home prices placed 53 percent of U.S. households in danger of a decline in their standard of living once they quit working and retire, reports the Center, which funds [the Squared Away] blog.  That’s up sharply from 45 percent in 2004, prior to the financial boom, which created a strong – albeit fleeting – increase in Americans’ wealth."

From the Center for Retirement Research (CRR) at Boston College: The National Retirement Risk Index

This is what the Squared Away blog post above is referring to - CRR's National Retirement Risk Index (NRRI).

"NRRI measures the percentage of working-age households that are at risk of being unable to maintain their pre-retirement standard of living in retirement. It addresses one of the most compelling challenges facing the nation today: ensuring retirement security for an aging population."

From AARP: AARP Official YouTube Channel

AARP has a YouTube channel with a section called "Work and Retirement."

From aiCIO: Report Slams Illinois Pension System as ‘Unfixable’

The influential Illinois business group, the Civic Committee of the Commercial Club of Chicago, says "there’s almost no solution for the nation’s worst-funded pension system."

From the New York Times: Pushing 80, and Still Punching the Clock

"With fewer companies offering pensions, contributions to 401(k) plans patchy because of volatile investment markets and even Social Security’s future uncertain, many Americans are facing the prospect of working well into what used to be thought of as “'the golden years.'”

The views expressed by the writers of these pieces are entirely their own and do not necessarily reflect the views of MOSERS. Print Friendly and PDF


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Heard a rumor that there is a bill being proposed to end the BackDROP. Anything to this rumor?
Rumors abound, especially as the start of the legislative session approaches. Thanks for your email. The 2013 legislative session begins in January. We know of no proposals to change the rules the apply to the BackDROP.  We encourage you to monitor legislation as it is introduced and moves through the legislative process by visiting the Missouri House of Representatives and Missouri Senate websites.

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BackDROP and Sick Leave

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I have one year of BackDROP completed. I also have 2080 (1 year) of sick time on the books. If I were to retire at this time, could I count the 1 year of sick time and have 2 years of required BackDROP to receive the full 2 years of money?
You will receive one month of credited service for every 168 hours of unused sick leave reported to MOSERS by your employer at the time you leave your position. Your sick leave is used in calculating the amount of your retirement, but cannot be used to determine eligibility for retirement or BackDROP.

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Long-Term Disability (LTD) and Shared Leave

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If you apply for shared leave and you have papers for Long Term Disability (LTD), which comes first, using the shared leave or is the shared leave used after the LTD?
Your LTD benefit payments will begin at the end of the benefit waiting period - 90 consecutive days after your last day on the job or when your sick leave benefits expire, whichever is later. LTD benefits will be paid to you at the end of each month you qualify for them. Once you begin receiving benefits, your employer may terminate your employer with the state. You will need to contact your human resources department with any questions you may have regarding share leave and how it would work in conjunction with a LTD claim.
If you believe you have a claim for LTD benefits, you must complete the "Standard LTD Claim form" located on our website.

For more information regarding LTD benefits, please review our "Long-Term Disability Handbook.

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Friday Top Five Nov 9 2012

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The Friday Top Five: A collection of the top five news articles, blog posts, or other retirement related information from the past week.

From the Squared Away Blog: Women’s Pay Gap Explained

"To understand why women earn 77 cents for every dollar earned by men, Squared Away interviewed Francine Blau of Cornell University, one of the nation’s top authorities on the matter.  A new collection of her academic work, “Gender, Inequality, and Wages,” was published in September."

From Pension Dialog: Instant Long-Term Public Pensions

This blog post explains the importance of the investment return assumption for a public retirement system and why it remains important to focus not on instant, or short-term results, but rather recognize that public pension systems are in it for the long haul and there is "nothing instant about a long-term horizon." [Video clip: "85 years in 40 seconds"]

From the AARP Blog: Obama Challenges: Medicare, Social Security, Health Care Law

A thoughtful post from the AARP blog about big issues and challenges facing congress and the president as he begins his second term.

From The Washington Post: Young Workers’ Retirement Hopes Grow Bleaker Amid Economic Downturn

“We have a looming retirement-income crisis in this country,” said Diane Oakley, executive director of the National Institute on Retirement Security. “The problem is we won’t see the ultimate brunt of it until 30 years down the road when it is too late to do something about it.”

From the NYT Booming Blog: Questions Answered About Pension Plans

"Readers recently submitted questions about pension plans to Mary Williams Walsh, a business reporter for The New York Times who has written about how companies manage their pension plans; what happens when companies go bankrupt; public workers’ pensions and how they may affect state and local finances; and Chapter 9 municipal bankruptcy."

The views expressed by the writers of these pieces are entirely their own and do not necessarily reflect the views of MOSERS. Print Friendly and PDF

The Pension Factor Web Series - Part 4

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Older households fare better with Defined Benefit income. Between 2006-2010, including the 2008 financial collapse, hardships in older households increased significantly, but there was a smaller increase in public assistance in the same years.

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Friday Top Five Nov 2 2012

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The Friday Top Five: A collection of the top five news articles, blog posts, or other retirement related information from the past week.

From the WISER blog (Women's Institute For A Secure Retirement): A Series of Blog Posts for National Save for Retirement Week

During National Save for Retirement Week (Oct 22-26, 2012), the folks at WISER offered a new blog post each day, each dealing with a different topic. How cool is that? I know it's five posts, but I'm counting it as one!

From Pension Dialog: Women, Retirement, and Savings

There's no doubt that women face higher hurdles in saving for retirement. This blog post discusses the reasons why. Having a traditional, defined benefit (DB) pension income can help to mitigate those hurdles by providing a benefit that cannot be outlived.

From Pew Social and Demographic Trends: More Americans Worry about Financing Retirement - Adults in Their Late 30s Most Concerned

According to a recent Pew Center report, "...Americans today are more worried about their retirement finances than they were at the end of the Great Recession in 2009...."

The report was picked up by several news outlets. From - "[t]he group with the greatest, grounded fear of poverty at retirement, and the one that experienced the greatest wealth decline over the last decade, is Generation X: young moms and dads, up-to-their-eyeballs-in-inflated-mortgages homeowners, professionals or blue-collar workers in their 30s and 40s, going nowhere at lightning speed."

And from - "A survey released [Oct. 22, 2012] shows that Americans aged 35 to 44 are now the most worried about financing their retirement, a stark turnaround from 2009, when people in that age group were among the least worried about money for retirement."

From the Retirement Town Hall blog: Funding Study Finds Public Pension Plans are Not Systematically Underreporting Liabilities

This blog post addresses a recent Public Pension Funding study done by Milliman, an actuarial and related products and services firm with offices throughout the world, showing that "although much negative attention has been given to the state of pension plans in the United States, the findings...indicate that on the whole the plans are aware of their funding shortfalls, and are using reasonable investment return assumptions to perform measurements of their liabilities."

From PlanSponsor: Barry's Pickings:The Next Four Years

This post focuses on what the Obama Administration has done with respect to "strengthening retirement savings" and how Washington has fared on those issues.

The views expressed by the writers of these pieces are entirely their own and do not necessarily reflect the views of MOSERS. Print Friendly and PDF