The Public Pension mess

Private pension plans tend to be defined-contribution pensions -- in which the employer makes a fixed contribution to the employee's retirement account, rather than guaranteeing a fixed payout.

By contrast, nearly all of the more than 22 million federal, state and local public employees enjoy defined-benefit pensions -- with payouts fixed at some percentage of the individual's pay for the last year or two they worked (often including overtime and payments for unused sick or vacation days).

These public pension plans are a ticking time bomb, with an estimated $3.2 trillion in unfunded mandates, or $21,500 per household. (That is taxpayer household, not recipient household.)

Read more: http://www.nypost.com/p/news/opinion/opedcolumnists/facing_the_pension_mess_2x9CfnClQRu9usCxH5E1eO#ixzz18lqxkGci
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