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This is what happens when you mess with people who have advanced degrees:
A former Southern Illinois University finance professor has created a tool to help State University Retirement Systems participants see what impact the governor’s proposed pension reforms would have on their retirement pay.Andrew Szakmary, who is vested in SURS and now teaches at the University of Richmond in Virginia, said he developed the spreadsheet because he was very upset by Gov. Rod Blagojevich’s proposals, particular those that apply to university employees.
“I want to ensure that his proposals become transparent so that SURS members understand how they will be affected,” he said.
Szakmary estimated that his own retirement benefits would be reduced by 17 percent if the governor’s proposal to change the way interest is credited to members’ accounts under the money purchase formula is enacted.
The money purchase option is a pension calculation formula that SURS members may select upon retirement if it provides a better annuity than the regular formula. That is typically the case for about 60 percent of the system’s participants.
The calculator is here.
And a quick note to the News-Gazette’s webmaster: What’s with the lack of spaces between paragraphs? Your paper is difficult to read online.
One more thing while I’m at it. Why isn’t Katie Clements’ column online?
posted by Rich Miller
Tuesday, Apr 19, 05 @ 2:22 pm
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Previous Post: Clergy Call on Senate to Pass HB 1100
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The News-Gazette has a terrible website, with absolutely minimal content - it’s something I complain about often, and something they refuse to address. Instead, the come out with a snazzy new format for the Dead Tree version.
On the other hand, they do have some reporters’ blogs, which are infrequently updated but still pretty cool.
Comment by IlliniPundit Tuesday, Apr 19, 05 @ 2:59 pm
For those of us without advanced degrees.
We can’t keep paying more taxes so your retirement can be excessive.
With the 17% cut , which is miscalculated if you are already retired, is alot more than most of us in the private sector will be getting.
Comment by Anonymous Tuesday, Apr 19, 05 @ 8:49 pm
You know, more and more companies are ditching pensions.
Mine did this year, for new hires.
It’s a sad comment on globalization.
Comment by Pat Collins Tuesday, Apr 19, 05 @ 9:07 pm
If this guy is a finance professor he should know that there in a free market there are no risk-free decisions … yet every SURS participant gets a free hedge: if your “private investment account” does better than a state pension, keep the extra money. If it does worse, don’t worry, we’ll guarantee you the state pension even if you made a bad decision!! Any company that followed that strategy for its employees would rightfully be bankrupt. Any government that does so is morally bankrupt. My kids are already hundreds of thousands of dollars in debt from “W” and decades of malfeasance in Springfield. Keep your hands off their piggybank!
Comment by Stop borrowing from my kid Tuesday, Apr 19, 05 @ 10:39 pm
This is a great example of why the electorate has to get interested in the boring subject of state pensions.
I abolutely agree with anonymous who said we can’t keep paying more taxes so your retirement can be excessive.
When will taxpayers revolt? They are paying for lush pensions for
teachers and state employees while
they themselves will have only Social Security and whatever is in their defined contribution account–probably not enough to live on, plus whatever else they can save.
The guv is way too conservative in his proposed changes–another failure of leadership. If we have to give these employees defined benefit pensions at all, make them pay a lot more into them. Or go to a defined contribution system. Illinois should not be a welfare state for its government employees and teachers.
Comment by Anonymous Wednesday, Apr 20, 05 @ 3:59 am
All these people threatening a taxpayer revolt because their own benefits suck are cowards. Why don’t you revolt against your employers?
Comment by Anonymous Wednesday, Apr 20, 05 @ 5:43 am
I agree with the above poster. Many people in government work long hours at difficult jobs. They do not deserve to have their benefits cut because the governor is being irresponsible. What is someone going to do if they are in their late 50s and Illinois decides to cut their benefits? It’s not like they can get a job in the private sector easily. Not everyone can be an Enron executive. To some, this is all we have and you want to take it away.
Comment by Anonymous Wednesday, Apr 20, 05 @ 6:59 am
If you compare most state titles to their average private counterparts, state titles are paid less not by a few dollars but by significant margins.
Why do state employees accept this? Because a defined pension and a lower chance of down-sizing are worth the trade-off of a lower salary.
It isn’t fair that because the politicians underfunded the pensions that the state employees are asked to pay more or accept less. Maybe had they been offered from the get-go, they would have accepted a higher salary in exchange for reduced pensions or defined contribution programs.
Maybe the taxpayer revolt should consider that before demanding their changes. Seems like a lot of ungratefuls if you ask me.
Comment by Anonymous Wednesday, Apr 20, 05 @ 9:11 am
Wow, as a state civil service worker I’d like to get in on those “lush pensions for teachers and state employees.” It might apply to faculty, but even then it’s suspect. We could likely earn more money in the private sector, but please remember that most of us also suffer the indignity of the Government Pension Offset (GPO) foisted on us by Social Security when we actually do retire from our CS jobs. Why should we suffer any pension changes that were never our choice to begin with? Most of us took these jobs because we needed them. Pensions (or lack there of) were the furthest things from our minds when we began working. As another writer pointed out, we could have been given an option for higher pay, with a lesser pension, but that’s not how we got hired in, so the rules shouldn’t change in the middle of the game just because prior governors didn’t fund the pension systems adequately. I don’t believe that pound of flesh should come out of my SURS pension, perhaps the former governors would care to kick in some of theirs?
Comment by Anonymous Wednesday, Apr 20, 05 @ 11:05 am
It wasn’t until the last decade or so that state employee pension %’s were increased, I believe. Illinois was at the bottom of the states in terms of this, and now we’re somewhere in the middle. I have to be in a deferred comp program (my money gets taken out every payday) so that when I retire I know I’ll have the decent money people think I’m going to get as a retired state employee.
I know a lot who retired who had to go out and get jobs to help make ends meet.
My retirement will never be as good as what my dad has and he never worked for the state.
The grass, as they say, is not necessarily greener on the other side. But state employees, university employees, etc. continue to get painted as the bad guys. We pay taxes and into social security like everyone else. And really, if you want what you think I’m gonna get, if the state ever lets go of the freeze, come try to do what I do.
Comment by Tessa Saturday, Apr 23, 05 @ 7:07 am