Under 50 and grabbing state pensions
Wednesday, April 10, 2013
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Hundreds of lucky state employees are opting to jump into retirement before they hit age 50 thanks to loopholes in the law, a Herald review of the latest pension report shows.
In the past three years, there have been 475 state workers who retired before age 50 — going into their golden years with full pensions for some and partial payouts for others, a Herald review found.
Click here for the complete pension database in the Herald's "Your Tax Dollars at Work" report
New reforms went into effect for state workers hired after April 2, 2012. Those reforms included increasing the retirement age for new hires and an “anti-spiking” clause preventing future retirees from padding the salary their pension is based on in their final few years of employment.
But state workers hired before those reforms are grandfathered in to the old rules, including a provision that hands out pension checks to anyone working at least 10 years by age 55.
“Under the pension reform plan that became law in November of 2011, Massachusetts raised the retirement age for public employees, required more years of service to receive full pension benefits and reduced benefits for those who choose to retire early,” said Jon Carlisle, spokesman for the state treasurer’s office, which oversees the state’s pension system. “The law will save a total of $5 billion at the state and municipal levels and put the commonwealth on the path to a fully funded pension system by 2040.”
Retirement officials estimate that nearly all the 86,000 members currently in the pension system can retire under the old rules.
“The pension system is not sustainable,” said Beacon Hill Institute’s Frank Conte. “We need to look at freezing the current system and protecting people on the system now. Going forward, we need to find a new system, like 401(k)s. You cannot continue the status quo. The governor’s reforms are just piecemeal. It’s going to cost a lot of money to fix this.”
The Herald review of the latest pension payroll report also shows:
• 19,650 pensioners in the state retirement system began collecting before age 60.
• Four pensioners began collecting from 90 to 95 years old.
• 212 pensioners collect six-figure paychecks, with the top five retirees earning $200,000 or more annually.
• $20,000 is the highest monthly pension.
• Former Senate President William Bulger, whose lofty pension sparked outrage in 2003, falls to sixth place on the list with an annual pension of $199,316.
• The University of Massachusetts system dominates the list of the top pensioners, from the medical school to the various university campuses.
• Pension checks are still being cut to former state employees who retired in the late 1950s.
Joe Dwinell contributed to this report.
In the past three years, there have been 475 state workers who retired before age 50 — going into their golden years with full pensions for some and partial payouts for others, a Herald review found.
Click here for the complete pension database in the Herald's "Your Tax Dollars at Work" report
New reforms went into effect for state workers hired after April 2, 2012. Those reforms included increasing the retirement age for new hires and an “anti-spiking” clause preventing future retirees from padding the salary their pension is based on in their final few years of employment.
But state workers hired before those reforms are grandfathered in to the old rules, including a provision that hands out pension checks to anyone working at least 10 years by age 55.
“Under the pension reform plan that became law in November of 2011, Massachusetts raised the retirement age for public employees, required more years of service to receive full pension benefits and reduced benefits for those who choose to retire early,” said Jon Carlisle, spokesman for the state treasurer’s office, which oversees the state’s pension system. “The law will save a total of $5 billion at the state and municipal levels and put the commonwealth on the path to a fully funded pension system by 2040.”
Retirement officials estimate that nearly all the 86,000 members currently in the pension system can retire under the old rules.
“The pension system is not sustainable,” said Beacon Hill Institute’s Frank Conte. “We need to look at freezing the current system and protecting people on the system now. Going forward, we need to find a new system, like 401(k)s. You cannot continue the status quo. The governor’s reforms are just piecemeal. It’s going to cost a lot of money to fix this.”
The Herald review of the latest pension payroll report also shows:
• 19,650 pensioners in the state retirement system began collecting before age 60.
• Four pensioners began collecting from 90 to 95 years old.
• 212 pensioners collect six-figure paychecks, with the top five retirees earning $200,000 or more annually.
• $20,000 is the highest monthly pension.
• Former Senate President William Bulger, whose lofty pension sparked outrage in 2003, falls to sixth place on the list with an annual pension of $199,316.
• The University of Massachusetts system dominates the list of the top pensioners, from the medical school to the various university campuses.
• Pension checks are still being cut to former state employees who retired in the late 1950s.
Joe Dwinell contributed to this report.
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