Posted on 03/14/2019 11:29:53 AM PDT by SeekAndFind
Turns out Congressmen make a lot of money...
A study found that while the average American’s net worth increased 3.7% per year between 2004-2012, members of Congress averaged 15.4% annual gains.
That high level of pay means half the members of Congress are millionaires today… and continue to collect their $174,000 annual salary.
Of course it’s you, the taxpayer, paying that cushy salary.
But did you know the taxpayer also foots the bill for insane retirement benefits for Congress?
Each retired member can start collecting a pension at age 62 if they’ve spent just five years in Congress.
And they’ll collect 80% of their $174,000 annual salary.
That’s almost $140,000 a year, for the rest of their lives… for five years of service.
Where can I sign up?
Meanwhile, 40% of Americans can’t cover an unexpected $400 emergency expense… 57% have less than $1,000 in savings.
And a third of baby boomers—the generation currently retiring—have NOTHING put away for retirement.
While Congress’ pension is secured by your tax dollars, only 13% of regular Americans have pensions today. And even if you were promised one, collecting it is another story...
A recent Boston College report estimates 25% of private US pension funds—the pools of capital that pay out retirement benefits—will go bankrupt in the next decade. Public local, state, and federal pension funds are in even worse shape: $7 TRILLION short on what they promised to pay retired government workers.
But most Americans are relying on a different broken retirement fund… Social Security.
The Social Security Administration admits it is $50 trillion underfunded, and will run out of money by 2034.
That means cutting payouts, raising the retirement age, or both. And even that is only a short term solution…
There are, however, at least two Senators who see the injustice in all of this. They introduced legislation to eliminate pensions for members of Congress.
They say it’s not fair that while the poor get poorer, Congress gets richer.
The median American household net worth declined .94% per year from 2004 to 2012. And over the same period, 100 members of Congress watched their net worth gain 114% per year.
Members of Congress added $316.5 million to their net worth during this time period.
(But it wasn’t the Socialists in Congress who introduced the bill to address this wealth gap. They’re happy to ignore this prime example of the rich literally stealing from the poor.)
Getting rich at the taxpayers’ expense, collecting a salary 3x the median household income, and getting a six-figure lifetime pension…
That’s Congress’ reward for sinking the US government $22 trillion in debt… for creating debt bubbles in housing and student loans… for utterly failing to address a broken Social Security system… for wasting billions on things like a broken Obamacare website, defending Congressmen from sexual assaultlawsuits… and fighting like children during a government shutdown while millions of Americans were out of work.
But whatever happens next with the economy, whatever destruction their actions cause, rest assured, they’ll take their money and run…
Just like they did in 2008 before the big financial crash. Strange how 34 different members of Congress rearranged their investment portfolios within two days of talking to top Treasury and Federal Reserve officials.
One Senator even sold up to half a million dollars’ worth of Lehman Brothers stock the day after he met with the Treasury Secretary… just months before the firm declared the largest bankruptcy in history.
These politicians suffer no consequences for the policies they force on the entire nation. On the contrary, they personally gain tremendously from the turmoil they cause.
Even if their pensions are cut — I’m not holding my breath — it is largely a symbolic move. It won’t make a dent in the dire debt and liabilities of the US government.
Unlike members of Congress, you’re on your own for retirement.
One option is, if you can’t beat them, join them. Run for Congress and watch your net worth skyrocket. Even without their golden pensions you’ll be all set for retirement.
But a more realistic (and ethical) solution is to plan your retirement assuming the government promises will not be fulfilled.
One solution is to take matters into your own hands by using self directed structures for your IRA or 401(k).
But perhaps a better solution is to become a better investor. Saving an extra couple grand a year, and putting it into the right places can make a huge difference over the course of a couple of decades.
Sovereign Man’s Chief Investment Strategist Tim Staermose was on our Podcast last week explaining two different targeted investment strategies with proven track records. You can listen here.
Worst case scenario is we are wrong—the government by some miracle saves Social Security, pays off the debt, funds its pensions, doesn’t tank the economy and avoids another recession…
And you’ll still be better off having prepared for the worst.
They take care of themselves first and foremost. Always remember they are there to serve themselves, not us.
And we keep electing the same old scoundrels election after election. And we wonder why nothing ever changes.
“Each retired member can start collecting a pension at age 62 if they’ve spent just five years in Congress.
And they’ll collect 80% of their $174,000 annual salary.”
I would like to know the source for this claim. I do know that members of CONgress gave themselves some of the same perks that fed LEOs and firefighters get accruing pension credit 80% faster than most feds. Their staff get extra benefits also.
And if CONgress critters get convicted of felonies they can always collect fed disability like Jesse Jackson Jr. does. $8,000+ per month for life ain’t bad for a convicted felon.
But perhaps a better solution is to become a better investor. Saving an extra couple grand a year, and putting it into the right places can make a huge difference over the course of a couple of decades.
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That is all true but its easier said than done. Study after study shows that most investors buy high and sell low. They get spooked easily and dump their stocks at a loss. They can’t stick to a plan and just don’t have the discipline to accumulate wealth. Reading about it is one thing, but becoming a better investor with patience and discipline is altogether another matter.
and their cost of living increases- back when obama was president- that miserable decade, people didn’t get cost of living increases, but by golly congress got theirs every single year-
(1) How Congress Retirement Pay Compares to the Overall Average Members of Congress are eligible for a pension dependent on the member's age at retirement, length of service, and salary. The pension value can be up to 80 percent of the member's final salary.Crap like this that is so factually incorrect gets people riled up for no reason. There are plenty of legitimate reasons to get riled up over those wastrel lazy bastards in Congress, but not this.(2) Can members of Congress retire with full pay after just one term? To collect, a congressman or senator must be age 62, or be at least age 50 with 20 years of service, or be any age with 25 years of service.
Under the most recent pension program, adopted in 1984, the size of a pension is based on the highest three years of a member's salary, the number of years of service and a multiplier, which is 1.7 percent for the first 20 years of service and 1.0 percent for subsequent years.
Here’s an example, using a typical 25-year rank-and-file member who retired this year. The pension would be the sum of two calculations. First, multiply $172,443 [the average salary over the last three years] times 20 years times 0.017. Then, multiply $172,443 times 5 years times 0.01 and add that number to the first calculation. The total: about $67,250 per year.
A three-term congressman (or one-term senator) who has now reached retirement age would be eligible for an annual pension of $17,588 for six years of work. That's generous, but not close to full pay.
(3) Congressional pension (Wiki) When the FERS program went into effect, all Members elected in 1984 or later were automatically enrolled in the new plan. More senior Members were free to remain under the CSRS or enroll in the new FERS plan.
The FERS program takes into account the years served and the average pay for the top three years in terms of payment. For example, a member elected before 1984 and thus qualifying under the CSRS plan, who worked for 22 years and who had a top three-year average salary of $154,267 would be eligible for a pension payment of $84,847 per year. A member elected after 1984 would have been enrolled under the FERS plan, and their pension payment under similar conditions ($154,267 top three-year average salary, but with only 20 years of service, rather than the 22 in the CSRS example) would be $52,451.
The accrual rate for congressional service between 1984 to December 31, 2012 is covered by a FERS "special" computation that is similar to that for Federal employees such as First Responders, FBI Special Agents, and Air Traffic Control Officers. The accrual rate is 1.7% for the first 20 years and 1.0% for each year beyond the 20th. The basic retirement annuity under FERS is equal to the (Average High-3 Salary x .017 x Years of Service through 20 years)+(High-3 Salary x .01 x Years of Service over 20)= Annual Pension Members who began congressional service before 1984 and who elected to join FERS will receive credit under FERS from January 1, 1984, forward. Thus, at the close of the 108th Congress in December 2004, participants had a maximum of 21 years of service under FERS. Assuming that a Member retired at the end of 2004 with 20 years of congressional service under FERS, and a high-3 average salary of $154,267, the initial annual FERS pension in 2005 would be: [$154,267 x .017 x 20] = $52,451 There is no maximum pension under FERS. (It would take 66 years of service under FERS to reach the 80% maximum permissible under CSRS.)
Proposed Amendment to the Constitution: Elected officials and those appointed by said officials will not be exempt from any laws, rules, regulations, decrees, codes, statutes or ordinances that apply to any citizen or legal resident of the United States. In addition, elected officials or those appointed by said officials will not pass or implement any law, rule, regulation, decree, code, statute or ordinance that applies only to themselves and not the rest of the citizens or legal residents of the United States.
NO PENSIONS!!!
“Serving” in Congress is NOT, or SHOULD NOT be considered a career.
It is a SERVICE.
Fake news. A congressman who served five years and reaches 62 will be eligible for a pension of around $14,000.
Term Limits.
Term limits and a minimum age requirement guaranteeing that the members of Congress - that all elected officials - have to have a life as a private citizen before and after public service. And no government employment counts towards that.
If there are 535 in congress, I believe I can count on one hand those who are trying to do some good for us. Out of 535 men and women... their percentages are pitiful.
That’s astounding!! useless... too high in their own opinion and do not earn their pay. One goes to Washington and magic: they become an important person... and rich...
Truth be known, they are not any more important than we are out here in work a day land.
Thanks for posting this information! Very few people realize how the Congressional retirement program really works.
I have no problem with the pension aspect, HOWEVER, term limits would take care of the career problem, and also help return the House and Senate to their original purpose.
I’ve asked for years: why aren’t congressional salaries & pensions on the ballot? Every 4 years, during POTUS elections, when most voters would see.
Plus, IMO, they should be required to stay in their districts, communicate & vote by Skype, & only come to DC when absolutely necessary.
Would really drain the swamp, keep ‘em accountable, & save trillions.
These idjits are grossly overpaid. Most of what they do is mere posturing, speechifying, & passing symbolic resolutions.
Very few ever write bills that get passed into law, & most vote on bills they haven’t bothered to read.
Why pay them anything?
SS COLA raise this year is the biggest in 10 yrs. 2.8% MOST going to MEDICARE.
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