I'm a teacher in MD, do I need disability insurance too?
Total Comments: 14
Posted: Tue Jul 13, 2010 02:42 am Post Subject:
a public employee is covered by a defined benefit plan that requires contributions by both the employee and the employer in equal amounts totaling at least 15.3% of pay, such as California's PERS and STRS programs, the pension plan may have filed for an exemption from Social Security, and employees then do not make the 6.2% FICA contribution, unless they voluntarily agree to "opt in". All employees pay the 1.45% Medicare contribution.
In such pension plans, there is an integration of benefits provision that reduces the pension plan's obligation to the retiree $ for $ for every dollar of benefit received in Social Security retirement income. Retirees either get the pension benefit, the Social Security benefit, or a combination, as stated in the pension plan documents.
This doesn't make sense to me. The only two ways to receive a social security benefit is to either pay FICA tax or be entitled to a benefit by being a widow/widower (we'll ignore children for a minute since they are not likely to receive pension benefits). Why would anyone voluntarily pay a tax that will reduce their pension benefit?
Posted: Tue Jul 13, 2010 03:00 pm Post Subject:
Why would anyone voluntarily pay a tax that will reduce their pension benefit?
Because there have been persistent rumors circulated to members of the CAL PERS and STRS retirement plans over the past 10 years that the Legislature will eventually permit them to collect both their state pension AND Social Security Retirement, if qualified. Currently, most PERS and STRS participants do not pay FICA.
The "possibility" has been used as an attractant to persons who are fully insured for Social Security to switch careers to teaching. Earn money, get a pension (only need to teach for 5 years to qualify for a lifetime benefit), and keep your Social Security, too, is pretty powerful. Just hasn't happened in California yet.
Those who do receive a reduction in their PERS benefit when they start collecting Social Security Retirement benefits. But both programs allow a participant to retire at age 55 with a lifetime benefit. Assuming delaying the start of SSR to age 70, this means 15 years of collecting the maximum pension entitlement (based on age, years of service, and salary), followed by collecting the maximum SSR benefit.
Only the current financial "crisis" in California prevents the full double-dip from happening. But it's come very close to passage several times.
Posted: Sat Apr 09, 2011 01:42 am Post Subject: ymkJBdqTMzRp
Insurance teachers.. Retweeted it :)
Posted: Sat Apr 09, 2011 06:31 am Post Subject:
I do agree on one point - the chances are more that we may get injured off the job than our chances of getting injured at work. Only those of us who're in a risky profession may have more risk of getting injured at work.
Posted: Tue Jul 13, 2010 02:42 am Post Subject:
a public employee is covered by a defined benefit plan that requires contributions by both the employee and the employer in equal amounts totaling at least 15.3% of pay, such as California's PERS and STRS programs, the pension plan may have filed for an exemption from Social Security, and employees then do not make the 6.2% FICA contribution, unless they voluntarily agree to "opt in". All employees pay the 1.45% Medicare contribution.
In such pension plans, there is an integration of benefits provision that reduces the pension plan's obligation to the retiree $ for $ for every dollar of benefit received in Social Security retirement income. Retirees either get the pension benefit, the Social Security benefit, or a combination, as stated in the pension plan documents.
This doesn't make sense to me. The only two ways to receive a social security benefit is to either pay FICA tax or be entitled to a benefit by being a widow/widower (we'll ignore children for a minute since they are not likely to receive pension benefits). Why would anyone voluntarily pay a tax that will reduce their pension benefit?
Posted: Tue Jul 13, 2010 03:00 pm Post Subject:
Why would anyone voluntarily pay a tax that will reduce their pension benefit?
Because there have been persistent rumors circulated to members of the CAL PERS and STRS retirement plans over the past 10 years that the Legislature will eventually permit them to collect both their state pension AND Social Security Retirement, if qualified. Currently, most PERS and STRS participants do not pay FICA.
The "possibility" has been used as an attractant to persons who are fully insured for Social Security to switch careers to teaching. Earn money, get a pension (only need to teach for 5 years to qualify for a lifetime benefit), and keep your Social Security, too, is pretty powerful. Just hasn't happened in California yet.
Those who do receive a reduction in their PERS benefit when they start collecting Social Security Retirement benefits. But both programs allow a participant to retire at age 55 with a lifetime benefit. Assuming delaying the start of SSR to age 70, this means 15 years of collecting the maximum pension entitlement (based on age, years of service, and salary), followed by collecting the maximum SSR benefit.
Only the current financial "crisis" in California prevents the full double-dip from happening. But it's come very close to passage several times.
Posted: Sat Apr 09, 2011 01:42 am Post Subject: ymkJBdqTMzRp
Insurance teachers.. Retweeted it :)
Posted: Sat Apr 09, 2011 06:31 am Post Subject:
I do agree on one point - the chances are more that we may get injured off the job than our chances of getting injured at work. Only those of us who're in a risky profession may have more risk of getting injured at work.
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