What does 2% @ 55 PA mean??

[chrisari]

Hi,
Does anyone know what 2% @ 55 PA Misc. mean from CalPERS. Thanks.

[hbliam]

Hi,
Does anyone know what 2% @ 55 PA Misc. mean from CalPERS. Thanks.

2% times the years of service... available to you at 55 years old.

Example. you start at 25 years old and work until 55 years old. 30 (years of service) times 2% equals 60%. You get 60% of your highest year base salary as your pension. If your highest base was 100K you now get 60K to do nothing. They usually have a cost of living increase every year as well.

Most "good" agencies are 3%@50. A much better program.

[ElDiabloJoe]

...Most "good" agencies are 3%@50. A much better program.

Yep, but that won't last forever, there is an impending fear of the doom expected by the California Pension Crisis that is looming and near-future politics will reflect that.

I'm expecting my agency to introduce a "third tier" of employees. You know, one of those "Those hired on or before such-n-such date get benefit / retirement package A+" while those hired afterwards get package B-.

FWIW, 3%@50 means that if you work from 21 to 51, you can retire at age 50 with 3% of your highest year (or average highest three years depending on agency) salary. If you retire at 51 earning $100K, you get $93K/year as your retirement

3% of $100K times 31 years = 93% of highest salary

I may be eating at the public trough, but it ain't slop. They got filet mignon in that public trough

EDJ

[L-1]

Hi,
Does anyone know what 2% @ 55 PA Misc. mean from CalPERS. Thanks.

Just to add to what the others have said, 2% @ 55 Misc is what is known as the Miscellaneous Members retirement plan. It is not a Public Safety or police retirement program. Instead, it is the same retirement that is given to civilian employees such as janitors, file clerks, mechanics and building managers.

One of the biggest drawbacks to this plan is the disability feature. If you become injured on the job to the extent that you can no longer work and you have been in the retirement system for at least five years, your disability pension under Miscellaneous Membership will only be 2% of your highest year's pay, times the number of years worked. (10 years on the job = 20% of your salary). If you have worked less than five years, you get nothing. OTOH with a public safety plan, disability retirement will get you no less than 50% of your highest year's salary, tax free, with no minimum amount of service required.

[pulicords]

Just to add my $.02. The retirement formulas are not "just" salary, it can also include certain benefits if the POA has worked it out with the city/county employer. Example: An agency pays 100% of the employee's contribution to the retirement system (PERS), but rather than paying directly to the system the city/county pays the amount to the officer and then deducts this amount from the gross and sends it to PERS. The total "PERSable" salary from which the percentage is computed can actually end up giving an officer more cash than he/she was taking home while working. Our city includes vacation time, holiday time, longevity pay, educational incentives and all retirement costs in our gross. So when I retire (at least initially), I'll get more in cash than I'm getting now. Also, most departments to my knowledge in the 3% @ 50 program limit the percentage to 90 (of the gross). Keep in mind though that once retired, I'll only get a max of 2% per year increase for cost of living. If inflation occurs above that, I'll have to be prepared.

[kcr]

I believe the 90% cap is put in place by PERS. The agencies that allow 100% are 1937 Act agencies that run their own plans.