Pension millionaires

Do you know someone who’s a millionaire?

Hi, I’m Andy Matthews.

Your immediate response might be ‘no,’ but if you know a retired government worker, chances are, you do.

A new study finds that Nevada’s pension benefits are the most generous in the entire nation, even compared to wealthy states like California and New York, where the cost of living is high.

Receiving an average pension of over $64,000, the average government retiree with 30 or more years of service in Nevada is on track to get more than $1.3 million over the course of retirement! And this doesn’t include the tens of thousands of dollars in health care benefits many retirees receive.

This study doesn’t even consider public safety employees, who can retire in their 40s and make several million dollars in retirement.

If a $64,000 retirement pension sounds like a lot, that’s because it is. In Nevada, the median household income is $54,000. In fact, Nevada’s retirees are doing better, salary wise, than 87 percent of the state’s current, full-time work force.

Is it any wonder that Nevada PERS has an unfunded liability of around $41 billion?

Eventually, this burden will catch up with us. While the legislature has increased contribution rates in recent years, retirees risk benefit reductions unless the system is soon reformed. As bankruptcy proceedings in Detroit have shown, not even public pensions are safe in times of fiscal collapse.

It’s time to enact retirement plans comparable with private-sector plans. Just as with Social Security, defined-benefit plans should base payouts on an employee’s career earnings, not the final three years’ wages, and all employees should be shifted into a hybrid or defined-contribution plan.