Teacher Pensions Blog

2017 was a busy year for teacher pension reform. Pennsylvania passed a new pension law that moves most government employees, including teachers, into a hybrid pension plan, Michigan followed suit with a reform that automatically enrolls new teachers into a 401k plan over the summer, and Florida began "nudging" teachers into a portable retirement plan. And in Illinois, as part of an upgrade to its school funding formula, the state will help Chicago cover the district’s teacher pension costs.  

We’ve been busy here, too. To recap the last year in pension blogging and analysis, I’ve collected some of our most popular and significant work from 2017.

1.Why Do Private School Teachers Have Such High Turnover Rates? Perhaps surprisingly, teachers leave private schools at twice the rate of teachers in public schools. It is unlikely that teacher pensions are a factor in this difference since evidence shows that they do not act as a meaningful retention incentive outside of a small effect for teachers nearing retirement.

2.Retirement Reality Check: Grading State Teacher Pension Plans. Not all state pension plans are created the same. We evaluated the state pension systems in all 50 states and Washington, D.C. Overall, we found that states have expensive, debt-ridden retirement systems in which most teachers fail to qualify for a decent retirement benefit.

3.Illinois’ Teacher Pension Plans Deepen School Funding Inequities. Statewide teacher pension plans exacerbate school funding disparities. This is largely because pensions are based on teachers’ salaries, which are unevenly distributed among schools. After accounting for pensions, the funding gap between high-and low-poverty schools in Illinois doubles. And race-based gaps increase by more than 250 percent.

4.Bayou Blues: How Louisiana’s Retirement Plan Hurts Teachers and Schools. The state’s teacher pension fund is around $12 billion in debt. To stay afloat, schools must contribute more than 30 percent of teacher salaries. Most of which goes to pay down debt. In this report, we describe four ways Louisiana could revamp their system and offer all teachers a path to a secure and more valuable retirement benefit.  

And for a bonus, I’ve included the following four blog posts that year-after-year remain among our most popular pieces.

1.What is the Average Teacher Pension in My State? This post is as straightforward as the title. In it, we catalog three key statistics: the average value of a teacher’s pension, the median value, and the percentage of teachers who qualify for a pension.

2.Why Aren’t All Teachers Covered by Social Security? Around 40 percent of teachers do not participate in Social Security. With over half of teachers not qualifying for any pension, this is a real problem that can threaten teachers’ retirement security. Check out our short video to learn more.

3.Colorado’s Unreal Teacher Retirement Plan. In Colorado, teachers and the state make extremely large contributions to the pension system. In fact, every teacher who started teaching at 25 remains in the classroom would be a millionaire by age 54. So why isn’t Colorado filled with millionaire teachers? Debt. The state has $14 billion in pension debt that eats up a lot of the pension contributions made on behalf of teachers.

4.A Tale of Two Teachers: A Retirement Story. For teacher pensions, where you teach matters. When you start teaching also matters. If you move across state lines, you also can adversely affect your pension value. In short, two teachers who retire at the same age and teacher for the same length of time can end up with very different levels of pension wealth. Check out our short video to learn more.