West Virginia has allowed thousands of teachers and school staffers to switch to a traditional pension program this year, after they voted to abandon 401(k)-style accounts amid complaints of inadequate returns and poor oversight.
A number of these transferring educators had said that insufficient earnings from their individual investment accounts had forced them to postpone planned retirements. But the executive director of the Consolidated Public Retirement Board reports no mass retirements in the wake of the pension switch.
Anne Lambright told MetroNews that "those who are planning to retire on September first, October first or November first had to notify their county leaders of those intentions by July first," but "at this point, those numbers are in the dozens. It's fewer, she says, than she anticipated."
The MetroNews item said that "Lambright estimates 1,500 additional teachers and school service workers are eligible, based on years of service and age, to retire."
31 July 2008
Teacher Pension Fix Prompting Some Retirements
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Many of the teachers that wanted out of the defined contribution plan invested in a vehicle about as effective as putting your money under the mattress - an annuity through Valic. I say "shame on you Valic and CPRB" for misleading people into selecting an annuity. In fact, an annuity should never have been an option in the first place.
And then how ridiculous is it for WV to move people INTO a defined benefit plan which is grossly underfunded and the type of plan businesses are moving AWAY from.
As a member of the defined contribution plan, my retirement benefits are always 100% funded. I also control the draw I take each month after I retire and can increase it or decrease it as I desire. When I die, the ENTIRE BALANCE of my account will go to my children. You don't get that with the defined benefit plan.
If you are close to retirement age, you don't have the time to accumulate the funds like a defined contribution plan depends upon to build adequate wealth. And if you are one of those people and you transferred back into the TRS, you better retire before the next administration realizes what all this is costing the state and reduces your benefits. It's just a matter of time before they eliminate the ability to convert unused sick leave to PEIA/retirement benefits. They are offering a buy-back plan right now that wouldn't yield enough for a tank of gas in exchange for a sick day.
I don't trust any administration to look after my retirement - it's up to me. I have many years before I retire and I doubt the same benefits will be in place at that time. I figured I better stick with the TDC so I know that money is mine and I can count on it.
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