Secure Your Future
Our members have retirement security — not insecurity
Feb 5, 2009 3:43 PM
Pension ClinicsThe UFT’s popular pension clinics — a mini-course in pensions and related retirement matters — have been scheduled for the school year in all the boroughs. We urge all members to participate in these clinics two or three years before retirement. The clinics are only one part of the UFT’s many services devoted to helping members prepare for a financially secure retirement. Following clinics this fall in Brooklyn and Staten Island, the Pension Department has scheduled winter and spring clinics in Manhattan, Queens and the Bronx. To be fully informed, Tier I/II members should attend all of the three-part series and Tiers III/IV the two-part series. 4-6 p.m.
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When Frank Sinatra sang “It Was a Very Good Year,” he was not crooning about the fiscal situation of 2008.
2008 was a financial year that we all would like to forget, but will probably remember for a very long time. It was however a year that highlighted the difference between the retirement security that the UFT has secured for us and the retirement insecurity of many others.
We would like to remind you of the “Four Pillars of Retirement Security” that we enjoy.
- We are covered by SOCIAL SECURITY, a program that provides us with disability and life insurance benefits while we are working and retirement income and health insurance (Medicare) after retirement. The UFT and its allies fought against Social Security privatization. Imagine if Social Security recipients had to rely on a benefit that depends on the performance of investments in stocks.
- We are covered by a wonderful DEFINED BENEFIT (DB) pension plan based on our final average salary (FAS) and the number of years worked covered by the plan. How TRS invests the money to provide our benefits does not determine the size of our pension. Work 25 years and collect at least 50 percent of FAS, 30 years – 60 percent, 35 years – 67.5 percent, etc., no matter what is going on in the financial world.
- We are covered by a wonderful HEALTH INSURANCE program in retirement, both pre age 65 and at age 65 and older.
- Finally, the cherry on the charlotte russe (if you do not know what a charlotte russe is, you have plenty of time to make up any losses you incurred in your portfolio in 2008) is the TAX-DEFERRED ANNUITY (TDA). The TDA, as you know, is a supplemental retirement savings program which has as an incentive tax-deferred treatment of your contributions. (By the way, a charlotte russe is a delicacy made up of a piece of shortcake inside a round cardboard holder, with a mound of whipped cream with a maraschino cherry on top.)
Career education employees in New York City are among the few people in America who have such a complete retirement security package.
The National Institute on Retirement Security (NIRS) on Jan. 14 issued a report which stated that there is widespread retirement insecurity among American working people. For instance:
- 83 percent of Americans are concerned about current economic conditions affecting their retirement;
- Seven in 10 Americans believe it is harder to retire today than in the past;
- 51 percent of Americans believe today’s retirement system is worse than the previous system where workers were more likely to have pensions;
- 65 percent of workers with a pension are confident it will be there at retirement; and
- Only about half of Americans with 401(k)-type accounts believe they will have enough money to retire;
- 55 percent of those without a pension say having a pension would ease their anxiety; and
- 87 percent believe all workers should have a pension so they can be self-reliant in retirement.
The report further stated that:
- 85 percent of Americans view retirement as a shared responsibility between individuals, employers and government;
- Strengthening Social Security is viewed as the most important step the new Congress and administration can take to improve retirement security; and
- 84 percent of Americans think government should make it easier for employers to offer pensions.
The complete report is available on NIRS’ Web site: www.nirsonline.org.
Lack of pensions for most Americans, sometimes referred to as “pension envy,” is one of the driving forces for the governor and mayor to call for a reduced pension for future city employees. They know that the immediate savings produced by a new plan is none to minimal, but they are using the current economic crisis as an excuse for reducing pensions. Pensions for new employees were first reduced in 1973, and it wasn’t until 2008 that one of the worst of those reductions was finally eliminated by the passage of the 55/25, 55/27 plans. We will call on you to help us fight any attempt to reduce the retirement security of your future colleagues. We further urge you to contribute to COPE in order to help us in our battle to “Secure Your Future.”
Investment results for the TRS’ Investment Programs for 2008
As you know, TRS offers members six investment programs. We will have a more detailed look at the 2008 investment results in a future issue of the New York Teacher. Below is a report on the three programs that are at least 1 year old; investment returns of the three new investment programs since inception will be included in the more detailed report.
Results for periods greater than one year are annualized. Current results are not guaranteed for the future.
Next issue will include an article on the folly of not having on file at TRS proof of date of birth and designation of beneficiary forms.
“Secure your future” is compiled and written by Mel Aaronson, Sandra March and Mona Romain, teacher-members of the NYC Teachers’ Retirement Board. For further information on items discussed, call your UFT borough office or the TRS. BRONX: 1-718-379-6200; BROOKLYN: 1-718-852-4900; MANHATTAN: 1-212-598-6800; QUEENS: 1-718-275-4400; STATEN ISLAND: 1-718-605-1400; Teachers’ Retirement System: 1-888-8NYC-TRS (692-877), www.trs.nyc.ny.us.
Investment returns |
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One year |
Five Year |
TenYear |
Twenty Year |
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1/1/08 – 12/31/08 |
1/1/04 –12/31/08 |
1/1/99 –12/31/08 |
1/1/89 – 12/31/08 |
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| Fixed | 8.25 | 8.25 | 8.25 | 8.25 |
| Diversified Equity (Variable A) | -38.15 | -1.58 | -0.29 | 7.78 |
| Stable-Value (Variable B) | 4.01 | 3.88 | 4.45 | 5.77 |
