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Except you haven't included the pension benefits, or the limited number of days worked.

Not necessarily. With layoffs in different industries, it's very possible the person in the private sector wouldn't be making >$90,000 if they've had setbacks in their career - such as having to take a paycut after a layoff.

Plus the private sector person most likely isn't pension eligible, can't stay in a company healthcare plan once they retire, and doesn't get 3 months of vacation time.


True, its not entirely apples to apples. Many teachers do find part time work in the summer, either tutoring, teaching summer school, coaching, etc that increases their annual pay.

The pension benefit for her requires her to contribute 9% of her gross pay to the pension program (not as bad as it seems since she's not contributing the 6.2% the rest of us contribute to social security); and her contributions are HER if she leaves the school system, unlike the private sector where your social security taxes aren't yours (basically she has a semi-privatized social security plan, which isn't good enough for the rest of us, but good enough for public teachers, the irony of which is not lost on me)

But at the same time, until she gets close to retirement age, we have not idea what her benefit will be, since its based on number of years in the school system and highest annual earnings. There is a 50 page booklet that outlines what her benefit will be, but its not easy to follow, and I have a degree in finance.

While my 401k isn't set it stone either, at least I can calcuate today what my balance is, and apply an estimated growth rate to that balance. With her pension plan, there are a great many more variables, many of which are hard to estimate with any accuracy.

Of course, the pension plans and other post employment benefits other than pensions are not being fully funded by the states, which is pretty scary considering many of these benefits are in the state constitution, meaning lawmakers eventually will need to modify the constitution to reneg on a promise made to public employees, or drastically raise taxes to fund public employee's promised benifits.

I interned at standard and poors (it was back in 2004ish) and did some research on an upcoming, at the time, accounting rule change (GASB 45) and I can only imagine the situation has gotten worse. The accounting for it can be pretty generous, in terms of amortizing unfunded liabilities over 4 decades.

http://latrobefinancialmanagement.com/Research/Pensions/Risi...

http://www.nasra.org/resources/medical/SandPOPEB0711.pdf
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