[quote=CA renter]Social Security is a defined benefit retirement plan/insurance, and while employers contribute to it (which would likely always be the case), it is a public plan. I am a staunch supporter of DB pension plans…for everyone. Always was, and always will be. 🙂
I should amend my comment by saying that the employer would contribute to the plan, but that the plan is fully portable, and not on the employers’ books.[/quote]
SSI is a good model of a DB. 12.4% contribution rate that provides a payout of 28% your maximum earnings after 35 years of services and minimum retirement age of 66 to get the 28%. Life expectancy at 66 for a male is 16 years. If you retire at 62, that payout goes to 21% of the last year max income (and is calculated off all 35 years) If you didn’t earn max for 35 years, you get even less.
Let’s contrast with California Safety worker plans, paying 90% payout at 30 years of service for 1 year of maximum contribution as early as age 55.
a little different aren’t they?
And yet, SSI will have problems if they don’t increase the contribution rates or levels.
