California has been actively recruiting “second-career” teachers, professionals with specialized skills wanting to share their knowledge with children. These individuals should not suffer Social Security reductions because of their making a choice to give back to California’s future.
Faced with increased costs of living, California’s retired teachers struggle to make ends meet. Teachers need an 80 percent retirement replacement ratio to maintain the same standard of living postretirement.
The median California State Teachers’ Retirement System (CalSTRS) pension accounts for 62 percent of their salary, which means that without their Social Security, many retirees will not be able to maintain their standard of living.
The Culprits: Social Security Offsets Government Pension Offset (GPO)
This provision of federal law reduces public employees’ Social Security spousal or survivor benefits by two-thirds of their public pension.
One Story: Thinking of Quitting
“I have worked since 1961, including for 15 years in the private sector where the only retirement was Social Security. I also held summer jobs that required Social Security payments.
For the past 14 years, I have been teaching in public schools and participating in CalSTRS. Because of this, I will not be allowed to receive my own Social Security. This is so unfair. I have paid into the system and now I will not be allowed to collect what belongs to me.
I have been advised to quit teaching and take another job, so that when I retire, I might get my teacher's pension and my Social Security. Is this fair when there is a teacher shortage and I love my job?” - A California Teacher
The average teacher retires at age 60 and receives a monthly pension of $2,431
Windfall Elimination Provision (WEP)
Reduces the earned Social Security benefits of an individual who also receives a public pension from a job not covered by Social Security. These provisions were adopted by Congress in 1977 and 1983, respectively, from an effort to reduce federal budget deficits at the time and as a rapid solution to pension “double dipping.” The unintended consequences have been to victimize teachers and other public sector employees in California and 14 other states.
Law Undercuts Efforts to Reduce Achievement Gaps
California’s Department of Education has made one of the state’s highest priorities shrinking the achievement gap that exists for many of the state’s ethnic majority children.
An important element in addressing this important problem will be attracting and keeping a diverse population of teachers whose own demographics reflect the many hues of the state’s more than six million students.
The promise of a secure retirement is an important draw, especially to employees working in other industries including aero-space engineering.
Federal law that reduces their earned Social Security benefits because they change careers works against the state’s recruitment efforts.
The Faces of California Retirees
The CalSTRS has over 848,000 members. Of those members, approximately 233,000 are retirees.
Median Pension: $2,431
Median Service Years: 28
Median Age at Retirement: 60
Median Pension Replaces: 62 percent of salary
71 percent are women – of those, 60 percent are unmarried
Most retired CalSTRS members do not receive Social Security benefits
62 percent of members 65 and older do not receive health care coverage from employers
* Source: CalSTRS
Excerpted from Perspectives: A Briefing for Congress on Issues of Importance to California’s Educators - Provided by the 325,000 Members of the California Teachers Association/NEA