The pension system in New York, and most other school systems, heavily backloads retirement compensation. Teachers accrue very little wealth during their first two decades of service, then suddenly become eligible for much larger payouts if they remain in the classroom for 30 years or more.Translation: If you are a young educator, run away from New York as fast as possible.
Perhaps this model made sense once upon a time. But it has many negative consequences, especially in the modern economy.
Take, for example, a 25-year-old entering a Gotham classroom for the first time this year. Were she to leave the system 20 years later — perhaps her spouse took a job in the Midwest or she decided two decades in the classroom was enough — she would take with her the equivalent of only about $60,000 in employer-provided retirement savings. If she were to remain in the school system until age 63, on the other hand, she would have earned the equivalent of about $610,000, a more than 10-fold increase in just 18 years.
And did the Gubinator decide that theft is fine and dandy:
In 2010, Gov. Schwarzenegger insisted the FY 2011 budget pare pension benefits for newly hired state workers to pre-1999 levels as part of any budget agreement.[61] The governor was successful, as the FY2011 state budget created a two-tier system that scaled back pensions for newly hired workers.[2] In addition, the budget included new reporting requirements that CalPERS must justify the need to the governor, state treasurer and Legislature when it needs more money from taxpayers.[2]BallotpediaIn business, the idea of a two tiered benefit system has been proved a failure time and again. In the case of politics, it is a method for liberals to skate by on their responsibility for some fiasco
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