Louisiana’s teacher pension system is one of the worst retirement systems in the country. It's bad for teachers and bad for school district budgets. But there are solutions within Louisiana that would improve the financial stability of the system and offer all teachers a path to a secure retirement.
After we created a rubric to grade state teacher retirement plans, we found a mostly depressing picture: States have set up expensive, debt-ridden systems where most teachers fail to qualify for decent retirement benefits.
Half of today's new teachers will not stay in a single pension system long enough to qualify for even a minimal pension benefit. Instead, they'll face thousands of dollars in lost compensation in the form of forfeited employer contributions.
Due to backloaded pension structures, teachers must work many years before their future benefits exceed the value of their required contributions. In the median state, teachers must serve at least 25 years to receive a pension worth more than their own contributions.
Eighty-five percent of Colorado teachers will leave public employment with insufficient retirement savings and no Social Security benefit for their work.
Half of all Americans who teach in public schools won’t qualify for even a minimal pension benefit, and less than one in five will remain long enough to earn a normal retirement benefit. As a result, while the system works for a few, it creates an enormous problem affecting many—especially given the sheer size of the teaching workforce.