Saturday, October 15, 2011

Jodi and Susi plan for retirement

Note: The story of Jodi and Susi is fiction--at least the main characters. The amounts and the disparities in the pensions are true. This is why I’m voting for Issue 2 in Ohio.

Jodi and Susi are both 55 and were roommates at a Christian college. After graduation Jodi went on for an MBA right away, but Susi took a teaching position in a poor community because she could get assistance paying her college loans from the government. Later she got an M.S. with assistance from the school district where she settled. Jodi spent years paying off her school loans; Susie invested her windfalls from the federal and local governments.

Both women today make $90,000 a year, Jodi as a manager of several Wendy’s restaurants working about 60 hours a week, 12 months a year, and Susi as an assistant principal working about 40 hours a week, 10 months a year. Susi goes interesting places in the summer to teach teachers in 6 week workshops, does a little touring on the side, and invests her additional summer salary, looking ahead to when she can retire with 35 years next year at 56 in the state teacher‘s system. Jodi would like to travel, but keeps it modest because she needs to invest in her 401-k and private savings, looking ahead to when she can retire at age 67 or later.

Next year Susi will begin drawing her $70,000 pension and will begin substituting in different districts, selecting carefully only those jobs she truly loves--like working with low-income children slipping through the cracks of all the regulations imposed by the U.S. Department of Education and the State Board of Education, and the local board. There are days when she's reduced to tears by the burden of what is expected of her. The school districts will benefit because they won’t need to pay her as much as a regular teacher who will need union negotiated benefits, plus she’s an outstanding teacher with experience and will do a better job than a beginner.

Jodi has another 12 years to work and pay into Social Security, to which she began contributing at age 16. When she retires, her “government” pension will be $28,150 (this figure will be larger in 2023, but that’s what it would be today). She has paid much more into FICA than Susi has paid into STRS because restaurant managers don’t have a powerful union. Technically she’s Susi’s employer so she’s also been contributing to Susi’s pension. She has also worked longer days, and more days per year than Susi. She too is reduced to tears some days as she has to do basic remediation for some of her employees who attended schools where Susi taught because they are unprepared for the work world.

Susi, by the way, never actually joined the teacher’s union, but she had to pay dues anyway if she wanted to teach in a public system in Ohio. Like the majority of teachers in the United States, she votes Republican and doesn’t like it that the unions contribute primarily to Democratic candidates and causes. She’s also pro-life, and is really bothered that teachers unions contribute heavily to candidates and organizations that support abortion, and especially to Barack Obama, who is very pro-abortion and pro-embryonic stem cell research. She contributes to pro-life organizations, but not as much as she surrenders to the union.

In any case, next year at 56 she has great plans to enjoy her retirement with her pension and her private investments. Meanwhile, Jodi puts a smile on her face, her lunch in her briefcase, and heads for the free-way.


Rain Trueax said...

This is the kind of thing that drives most of us nuts. I don't know the solution because we are a people really torn and our values are so divergent.

Anonymous said...

Glad you corrected the issue #. I was getting confused.