Fact Sheet Policy Brief: How Will Teachers Fare in Rhode Island's New Hybrid Pension Plan?
Richard W. Johnson, Barbara Butrica, Owen Haaga, Benjamin G. Southgate
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Hybrid retirement plans that combine defined benefit pensions with 401(k) type, defined contribution accounts can play important roles in the reform of public-sector pensions. Summarizing results from our longer report, this brief shows that most public school teachers in Rhode Island will earn more retirement income from the states new hybrid plan than they would have earned in the former stand-alone defined benefit plan. However, teachers with at least 25 years of completed service, who account for only one-quarter of the total employed by the state, will fare worse in the hybrid plan.
Research Areas Education Wealth and financial well-being Aging and retirement Taxes and budgets
Tags Economic well-being Pensions School funding Wages and nonwage compensation State and local tax issues Retirement policy
Policy Centers Income and Benefits Policy Center