Oregon Retirement Plan Runs Rich
A new Portland State University study suggests that Oregon public employees get better retirement benefits and have to pay much less for them than what their competition would in surrounding states. The study, which is provided by the school’s Center for Public Service, is supposed to account for the variations in retirement plans in Oregon, Idaho, and Washington. It compares three representative public employees, an accountant, a police officer, and a teacher. In order to get benefits in retirement that would be worth around $1 million right now, the Oregon workers would have to pay around $160,000 instead. In comparison, workers in Washington and Idaho would have to pay from $370,000 to $560,000.
One exception in Oregon is said to be found in the 30 percent of public employees which make a 6 percent contribution. They would have to pay around $320,000 instead. However, the employers pay the rest of the contribution for the remaining 70 percent in question. In Salem, there has been a summary of the study which is being spread around because the legislature is thinking about proposals that may allow individual lawmakers to cut the increasing costs of the Public Employee Retirement System.
In a recent letter to The Oregonian, a union leader has said that it would be unfair because employees have traded their pay for pension benefits during the negotiations of the contracts. The issue is whether or not the proposals amount to the breaking of the contract and if they would be rejected by the state supreme court. Many employees are also concerned about whether or not the entire thing is even fair or ethical. There are many who already feel that it is unfair because Oregon workers are paying far less in comparison to what they would have to pay if the were performing the same tasks in the states surrounding their region.
People who are already dealing with retirement are also concerned about the situation, however. Even though they are already receiving their benefits and have retired from their roles within the workforce, there are many who are concerned about what could happen if the payments and pay scale were to change. Essentially, there is the fear that changes to retirement plans for current employees would affect the amount of money and retirement that retirees are receiving now.
There are many who don’t want to run the risk of experiencing a cut after having devoted decades of their hard work and payments towards pension and retirement, as this would mean that the majority of their efforts were in vain and that they didn’t receive anything that the state had promised them. Some also feel that if employees in other states are having to pay more and are getting short changed in terms of their retirement plans, proposals to reform these issues should be made in those states instead of in Oregon.
Retirement plans and financial counseling for younger employees is becoming increasing popular through the United States. Oregon is an example of how retirement benefits can assist in the proper planning of retirement funds, therefore many states are now taking notice and using Oregon as the example.