Why you should care about the pension issue
Published 8:54 am Monday, October 16, 2017
Kentucky’s current pension program is $33 billion in debt. However, that figure reflects the combined underfunding of all eight pension plans. The TeachersRetirementSystem (TRS) is currently funded at 54.6 percent.
Since the 1930s, Kentucky teachers do not pay into or draw from Social Security.
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Teachers contribute 13 percent of their pay into TRS, which is the only source of retirement income for teachers.
Per TRS statistics, the average teacher retires at age 59 and works more than 30 years.
Fewer than 5 percent of certified school employees retire before age 50. Four times as many retire at age 65 or older than at 50 or younger.
Nearly 60 percent of retired teachers earned $40,000 or less in 2017 — remember, no Social Security!
Why should you care?
First, the most important factor in a student’s success in the classroom — and in life — is the influence of a great teacher. Our community is blessed with teachers who love kids and who have dedicated their lives to education. That’s why they do what they do! But we already face a shortage of teachers in Kentucky and across the country. Taking away the promise of a stable retirement would dramatically reduce the number of young people entering the teaching profession.
Second, public employee pensions are partially funded by taxpayers. There are only two ways to balance any budget — whether at your household level or at the state level or beyond. The first is to bring in more money; that means higher taxes. The second is to cut expenses; that means services. That includes reducing staff numbers, lowering the quality of services, or reducing or eliminating programs. These cuts would result in a negative classroom impact for your child or grandchild and for future generations that follow.
What are the options being proposed, and what are the potential consequences?One suggestion is to move teachers from the current plan to a Social Security/401(k) plan. West Virginia made this mistake a few years ago; the results were catastrophic, and we project the same or worse for Kentucky.
Social Security already has an unfunded liability of $12.5 trillion ($38,000 per household in America) — even worse than our current TRS pension plan.
What can you do? Call and/or write your representatives and let them know you support complete funding of the TRS.