Teacher Pensions Need Overhaul
One of the appeals of public-school teaching is the promise of a lifetime pension. At a time when defined-benefit pensions are disappearing in the private sector, the allure remains strong for many college graduates. But a closer look reveals that they deliver far less than they seem ("Why Most Teachers Get a Bad Deal on Pensions," EducationNext, May 16).
Although all teachers in public schools are required to pay in, only some get full benefits. A study of pensions plans in all states by Chad Aldeman and Kelly Robson found that only 20 percent ever receive full benefits, while more than half receive nothing at all. That's because the plans are heavily back-loaded, rewarding teachers who work for 25 or 30 years. Those who leave before then are severely penalized.
That disparity is becoming more common in light of the increasing demands made on teachers. Many veteran teachers who admit to being burned out would like to retire, but they stay in order to avoid receiving a reduced pension. I saw that time and again during the 28 years I taught in the Los Angeles Unified School District. It was a little like watching an overwhelmed boxer clinching round after round to avoid being knocked out.
One of the ways of addressing the issue, which I believe will become more acute in the years ahead, is to offer all new teachers a choice of a traditional back-loaded plan or a new plan that offers much higher starting salaries paid for by lower pensions. New teachers might find the latter more attractive. I say that because many college graduates today are eager to use their education to make a difference in the lives of young people. But they are put off by the low starting salaries. The new plan would harness their idealism and dedication. Allowing all new teachers to choose is the fairest way of solving the increasing teacher shortage, particularly in high demands fields.