Skip to comments.Detroit retiree on pension cuts: 'I can't live on what I get now'
Posted on 02/23/2014 8:23:59 AM PST by Signalman
Thousands of retired and current Detroit workers face pension cuts as deep as 34%, and some say they aren't sure how they'll make ends meet if the plan announced Friday is approved.
"They have worried me from the day they started this mess. You sit on pins and needles all the time," said 69-year-old Donald Smith, who retired in 2005 after decades of work as a civilian detention officer and other general city jobs.
For Smith, the cuts could mean a loss of around $300 a month from his $889 in monthly pension benefits, even as he already struggles to pay for rent, groceries and medical bills. Between his pension and Social Security, Smith currently lives on less than $23,000 a year.
"If they go and cut that, how am I going to live off of that?" he said, "I can't live on what I get now."
At the same time, retirees could face increased medical bills due to proposed deep cuts to their retiree healthcare benefits.
(Excerpt) Read more at money.cnn.com ...
If he truly worked “decades” that is a fairly meager pension for a civil servant.
Of course the devil may be in the details.
Considering he can’t live on what he gets now, any cut would be superfluous.
Maybe a reverse mortgage would help... I mean with Detroit property values being what they are.
Perhaps Donald should have planned better for his old age. Maybe even saved some of his income over the years. It’s not like getting old is an unexpected event.
I think I would start raiding the bank accounts and personal properties of the city council members and union leadership who approved impossible deals.
Your mistake is thinking that the Democrats who promised you the pension to buy your vote back then care about whether you live now.
Your mistake is thinking that the Democrats who promised you the pension to buy your vote back then care about whether you live now.
They’ll make sure he keeps voting long after he’s gone.
I don’t understand how you get a public employee pension AND social security. I thought that if you got a public employee pension you didn’t even pay into social security.
that is the way it is in California and the unions in Michigan are at least as strong as they are in California
Yes it is. CNN must have spent months finding this guy.
Guy has been retired for 9 years which means he retired at age 60...
G.A.S. meter is busted...
The average city employee pension is $19k. For police, $30k, not inlcuding cola. Throw in some of the higher pensions of $100k, and the obvious groundwork has been laid for the commons there to be pissed with the cuts.
Pension being reduced? Do you normally plan for something like that. If the stock market was to totally crash, do we plan for that? If currency becomes inflated into wheelbarrows, do we plan for that?
I'm retired and I'm in good financial condition, but I never would think that I have prepared for every contingency and that I couldn't end up like this guy.
He may have earned enough quarters to collect SS if he worked at all in the private sector.
Also, I believe some state and local government employees do participate in SS.
His pension based on those numbers now is slightly over 10K. He was on a defined benefit plan and worked decades meaning more than 20 years. To me that seems like a small number and if accurate, cutting that pension a third is not realistic. Perhaps pensions at that meager amount should be excluded from the decrease. Incidently, the average pension of general employees in Detroit is about 18.5K per year.
If there is not money to pay these meager pension costs, somebody der been skimming da pot for der own benefit I think. Perhaps the politicians who made this mess up should be sued for their entire pensions citing they violated their fiduciary responsibility to their employees.
Well, maybe I'm a paranoid, tin-hatted weirdo, but I did. And for the last 20 years preached to anyone who would listen or read, that this was coming.
Exactly right. He was promised it and he had faith in what he was told, and also remember that to get his vote the guys doing all the promising probably had their arm around his shoulder offering him a cigarette with a smile.
It’s usually not the brightest bulb in the pack that we are dealing with here anyway, at least not at his level. All I see him guilty of is trusting what was promised to him and thinking 1990’s dollars would get him by in 2014.
Most of us could all be in his position no matter how well we planned someday, no one can really tell what the future holds.
“If they go and cut that, how am I going to live off of that?”
Public Sector workers too often do not realize that someone has to pay for their pensions. When there isn’t enough private sector activity to tax, and when pension funds were not funded - but pensions were promised, then there is a disconnect.
How is the private sector worker supposed to retire when there are so many public sector retirees “living off of that”?
Which means some are getting too little and some too much. This fellow is on the bottom end of that spectrum.
but i still don't think public employees should get to retire before the rest of the country
i do support early retirement for the military though as they have well and truly earned it
Sue the Democrat party. They caused this and they have lots of money.
Who did you vote for all those years Donald?
So what did you do? I need to protect what I got.
Years ago, the average male would be dead by age 70. So it was hard to begrudge the retirement age of 65. However, many of us are living well into our 80s and 90s. Not only that, but most men in their 60s still have their health and must of their vitality. They should be in the workforce.
I'm 52 years old and I'm not even thinking about retirement. I'm having too much fun in my job (Regional manager for a large firm) and I figure I easily have another 20 years in the tank in which I could go full throttle and maybe make it to the Senior VP level. I still feel as healthy as I did when I was in my mid-30s.
So I am expecting to be working well into my early 70s. Also, my biggest money making years are still ahead of me. It would be crazy for me to retire now and I don't understand the mindset of others who think they should be retiring when still in their 50s or even 60s (unless they have health issues or are so financially independent that they simply don't need any additional income).
Can’t live on $2000 a month (after the cut)?? May be he has all his medical paid for, too.
Here’s the interview you’ll never see.
“I voted for the con men in the Democrat party. They promised me benefits that they knew would never be possible and stole money like crazy from the city treasury to finance their lavish lifestyle. Now, I’m in trouble because I believed that there was a free lunch. I don’t believe that I should be held responsible for voting for people that I knew were thieves. I believed that the Democrat thieves would steal enough for me to retire on. How was I supposed to know that my electing thieves to office in Detroit would make taxpayers leave Detroit? I’m stupid and greedy. Doesn’t that mean you should feel sorry for me and give me some of your money? Yes, I will continue to vote Democrat. They look out for me.”
He retired at 60 not 50, but just the same he should have gone to the minimum of 62.
I am 60 and still working full time!!! If he had waited another 10 years
To retire his SS would have been ALOT higher, I think 60 is young to
retire but that is just me! He can always get a job as a Walmart greeter!
But of course that nasty Walmart probably wasn’t allowed to build in his
Who did the fellow vote for all these years? DIMs/LIBs? If so...Bwaahahahahahahahahahahahahaha!
“Perhaps Donald should have planned better for his old age.”
I planned. Will it be mine when I retire? Or will my savings be confiscated?
After all, it’s not fair that others thought they could really make it on Social Security, and I knew otherwise.
Those retirees voted all those Dims into office for years believing the promises of pensions made of gold. Now, too late the retirees learn that their pensions aren’t worth the paper they are printed on.
It is just so absolutely sickening that these government PUBLIC SERVANT
POLITICIANS end up with WEALTH beyond belief! They ALL decry nasty
Horrible CEO’S of companies, and the equality of earnings! SOMEONE has got to start SCREAMING about their OWN wealth and how they have
ALL become so wealthy on the TAXPAYERS DIME and LOBBYISTS!!!
JUST REVOLTING! Americans have become SO STUPID!
Sorry, Too late.
“I dont understand how you get a public employee pension AND social security. I thought that if you got a public employee pension you didnt even pay into social security.”
Many retired public employees found employment full time in the private sector and worked many years after retiring from public service and paid into SS. Those employees then earned sufficient SS credits to get some SS retirement benefits, although they are penalized by a reduction in those SS retirement benefits.
A Public Pension and Full Social Security Benefits? No Way
Social Security benefits can be reduced for retirees who receive a pension from the federal, state or local government.
September 10, 2010
EDITOR’S NOTE: This article was originally published in the August 2010 issue of Kiplinger’s Retirement Report. To subscribe, click here.
Perhaps you had two careers. In one job, you were a government employee whose earnings were exempt from the Social Security payroll tax. You also worked in the private sector, paying into the Social Security system. When you retire, you’ll get your public pension, but don’t count on getting your full Social Security benefit.
Under federal law, any Social Security benefits you earned will be reduced if you were a federal, state or local government employee who earned a pension on wages that were not covered by Social Security. Reductions also apply to Social Security spousal or survivor benefits that are claimed by government pensioners.
David Walrath, a lobbyist for the California Retired Teachers Association, says many government employees don’t realize their Social Security will be squeezed until they apply. “People will get their annual statement with a benefit number, but they’re not told they’re subject to an offset,” says Walrath, with the consulting firm of Murdoch, Walrath & Holmes, in Sacramento, Cal.
The two rules that cover government employees are the “windfall elimination provision” (WEP) and the “government pension offset” (GPO). The WEP applies to workers, and the GPO applies to government pensioners who are applying for Social Security spousal and survivor benefits.
Patricia Kohlen got hit by both. Kohlen, 61, paid into a public pension system for 28 years when she worked as an elementary school teacher in Atascadero, Cal. She also worked part-time as a secretary and paid Social Security taxes through that job.
Just before Kohlen retired with a disability in 2003, her statement showed that she was due $247 a month in Social Security disability payments. The windfall provision reduced the payments to $108 a month. Her monthly teacher’s pension is currently $1,930.
Welcome to my world of 30 years as LE supervisor. That seems very much in line. Take 1/4th off the top for property taxes alone and tell me it’s easy to live off the remainder. No government freebies here.
I am sure my father (who is still working at the age of 74) will feel real sorry for this guy who retired at 60 (rolling eyes)
This is nothing compared to the weeping and gnashing of teeth that will come about when Social Security runs out of money, and it will. There is no way that the unemployed rising generations can fund the ever-increasing life span of the elderly.
I got squeezed out at 60 when our company was bought by “private equity” and the “consultants” came in to “rationalize” our work force LOL.
Now I know that doesn’t happen very often in municipal employment, like I said for this Detroit guy the devil is in the details.
That is B.S. It may be too late to use your methods to accumulate wealth but somehow that wealth has to be protected. If you have a failsafe way of doing that let your fellow Freepers know. Like I said the market can collapse, gold can collapse, currency can collapse, housing can collapse, society can collapse but evidently you found a way to avoid these things.
You should have tried the fire department. Depending on the city many of them retire millionaires after 20 years. And with their schedule they have the time to run one or two businesses on the side.
He's 69 now and retired in 2005. ??????
It isn’t about accumulating wealth.
It is about acquiring self sufficiency.
I suppose you are right about it not being too late.
If you have a couple of million to spend now, you can probably duplicate, before the collapse comes, what it took me 20 years to build with my own hands.
And of course nothing is failsafe.
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