Californians See Their First Pension Cut More below. . . . economize on pension payouts! Er, cut your pensions payments by 60%. Such are the wages of believing the pension cabal when it says, "Everything's good!" It isn't, and if you have money in a public pension you need to become proactive in it, NOW!
"For years, we’ve been warning this day was coming: California pensioners in the small town of Loyalton have just been told that their benefits will be cut in 2017. Fox Business reports (h/t Pension Tsunami): For the first time in its 85-year history, the California Public Employees Retirement System, CalPERS, is drastically cutting benefits for public retirees. Starting January 1st, four retired City of Loyalton public employees will have their pensions cut 60 percent. For 71-year-old Patsy Jardin, that means her pension will drop from about $49,000 a year to a little more than $19,000. In an interview with the FOX Business Network, Patsy asked, “How am I going to make it now? What am I going to do?” Fellow Loyalton retiree John Cussins is asking the same question since his pension will also drop 60 percent, to $1,523 a month. Three years ago, Loyalton pulled out of CalPERS for current employees after being told that its accounts were only 40 percent funded even though the city had reliably paid its dues to the system. Now, CalPERS openly admits it’s punishing current Loyalton retirees for that decision." This is uglier than it sounds. Cities leaving are hit with massive losses, even though they paid in exactly what the pension fund said they needed to pay in. The reality was that because the discount rate was much too high, the cities were not paying in enough, but CalPers knew that demanding more would have resulted in investigation, and ultimately accountability, so they didn't. Now when the cities take the reasonable position of leaving, they get hammered. I expect this to devolve fairly quickly into myriad lawsuits, because everyone should have the opportunity to litigate their pension benefits. Or something. The blue states are in terrible condidtion regarding the pension issue, the red are in a better state, but still precarious. All need to address the issue now, not later, all will defer until the bankruptcy. Good luck to all who have public pensions, regardless of state. Time to become active, and to understand your status. Oh, and for all who believe that the best option is for cities to stay in the system, please, using math, show how over time this is the case, it isn't.
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