For state workers, however, traditional pensions are still the norm. If states are to keep their promises to retirees as well as current workers, pension reform is essential.
State and Local Pensions
Alaska, Michigan, Oklahoma, Rhode Island and Utah are examples of states that have enacted reforms to enhance the retirement security of current and former workers alike. Unlike traditional pensions, k -style retirement plans offer state employees true retirement security, with the advantages of flexibility and mobility. With private retirement accounts, state employees would finally have real ownership and control, while minimizing costs for the state taxpayers they serve.
Stability — Government pensions should be secure and safe from high risk assumptions.
What does that mean? It means state and local officials will have difficult decisions to make.
Do they raise taxes or lower expenses or both? The debts are coming due, so as much as politicians like to avoid being the one who raised taxes or reduced services, they will have to be honest with voters about the choices that were made and what it will take to eliminate the underfunding.
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- Is your public pension safe? States with the best retirement funding.
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And the picture was even worse if liabilities are valued using "low-risk" discount rates. I also write for the Tax Analysts blog.
Financial Advisers Can Help State and Local Government Workers Understand Their Imperiled Pensions
I am an expert on s Crowding out effects can already be seen at the local level in Illinois. Because of a statutory provision that allows the state comptroller to intercept state money due to local governments that underfund their pensions, many other municipalities could soon find themselves in a similar situation.
The city of Peoria on Aug. Public employment data from the U.