Source: Ben Southgate, Urban institute, Metro Trends blog, January 28, 2015
Over the past half decade, many states and municipalities have been tinkering with the retirement benefits they offer government employees. These changes consist primarily of raising mandatory employee contributions to the retirement plan and trimming cost-of-living adjustments for retirees.
It’s clear that these reforms have successfully cut costs—their primary goal—but how have they affected future retirement security for public-sector workers and the distribution of benefits across the workforce? Have these reforms made it more difficult for young employees who change jobs frequently to accumulate retirement benefits? Do they reward work at older ages? Are there better ways to reform state and local pension plans?
Our new interactive public pension tool has the answers. It allows you to design your own pension plan and see how employees would fare.