One of the Fire Department training objectives for this year that I came up with is hazardous materials. We've never had it before and given all of the old mines in the area it seems like a good idea (beyond all the regular hazmat that people have in their homes). There are several levels of hazmat training and this month I am taking the Hazmat First Responder Operations class through Yavapai College. It meets every Sunday in April except for Easter. I'm taking this class as a sort of guinea pig for the rest of the department.
The instructor, whom I just met at the first class session yesterday, is an interesting guy who seems to be a great example of some of the retirement things that I write about here. Without getting too specific (obviously I don't know any of his numbers) he is in his early 60s and married. Most of the guys in this class want to become career firefighters so our instructor talked at length about how the pension works.
He said his pension is 50% of his highest pay for a year and that he has been collecting for 17 years, so since his mid 40s. He has two part time jobs now that he loves doing because they tie in with two of his interests. He teaches hazmat classes all over the place including the college and works two afternoons a week at the college's photo lab--he told us he likes to take pictures with film.
I have no idea if there is any sort of investment portfolio but I can't imagine a pension for a captain who retired 17 years ago can be a fortune but his wife has a pension from teaching plus his two jobs (not sure if she works) and he seems to be doing well. The interesting thing is this was exactly his plan when he joined the Prescott FD in his mid 20s. Work 20 years and then take the pension. The ambition of the plan was financially modest but tailored to his interests which is something I've obviously been writing about for years here.
There is a hazmat class called Hazmat First Responder Awareness which is only eight hours that I'll probably arrange for the rest of the group.
Short post, the hazmat class moved around my regular Sunday routine.
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27 comments:
We are now seeing what a great deal these retirement packages have been for local governments - NOT! Let's hope sanity returns! Now the guy is on another government gravy train teaching at a community college.
I don't want to hear about how hard firemen have it either.
The taxpayers are being hosed by pension schemes like this. If the guy wants to go back to work for a government agency, he should forfeit his pension.
By the way, I don't blame the guy for gaming the system...but the system is unsustainable. Isn't that why you don't like muni bonds? The high default risk?
Roger, it seems like you are condoning a practice you don't see as financially viable.
This makes me so livid, I could scream. My (increasing) taxes are choking me.
It was just a story about someone who made a plan early on, stuck to it and then added in income streams from his interests.
It is unlikely that someone in their early 60s will feel the brunt of underfunding.
This model was viable (so we thought) for decades and now appears not to be. I don't like muni bonds for the most part because the fundamentals of the states looks bad (but have improved in quite a few places) but not really relevant to the post.
Your comment about how hard firefighters do or don't have it hard is pretty messed up.
I said I didn't blame the guy for gaming the system it too. The politician who allowed it to happen are to blame.
This is relevant as a matter of principle. You don't like muni bonds because the fundamentals of states look bad. Just read today's WSJ. The governor of Michigan is going to have to take over Detroit because the politicians can't bring fiscal sanity to their budget.
Rather than hold this up as a great retirement model, I would think that you would step up and point out the folly of such nonsense.
I am sick of working my a** off way beyond my early forties just to see over half of what I earn be confiscated by all levels of government...mostly to pay for stupid retirement packages.
And please, I know firemen who mostly say their job is not that difficult. Some that I know also work a second job because of so much time off. They get paid to work out for heaven's sake...If they can handle the physical aspect of the job, let them find something else to do...at their own expense.
Early forties is just too young to be on a publicly funded pension program.
The exceptions I would make are those who take a bullet (or something that disables them in the line of duty) for their country, community etc. The rest...let them keep working like everyone else.
Roger, Your story is a perfect illustration of exactly what is WRONG with this country.
Allowing a public employee to retire in his 40s at 50% of his highest one year salary is an incredible insult to the taxpayer.
I live in an upscale community in SW Prescott and we have teachers and a variety of other public service government workers here who are living large in early early retirement on the backs of the taxpayer. These people mostly CLAIM to be conservative Republicans EXCEPT when it comes to THEIR public employee union benefits.
I worked for a Fortune 500 company for 29 years and then retired early ON MY OWN with just a small "vested right" that I could take with me. That is far more typical (and even that is going away) than what you described for TWO public employees. All I can say is shame shame shame.
The very reason you don't like muni bonds is because huge pension and retirement healthcare packages given to people like your fireman/teacher acquaintance by Government negotiators who were gleefully eating at the public trough is WHY you say "fundamentals of the States look bad"...
I'm sorry Roger but you really blew this one.
Roger, Your story is a perfect illustration of exactly what is WRONG with this country.
Allowing a public employee to retire in his 40s at 50% of his highest one year salary is an incredible insult to the taxpayer.
I live in an upscale community in SW Prescott and we have teachers and a variety of other retired public service government workers here who are living large in early early retirement on the backs of the taxpayer. These people mostly CLAIM to be conservative Republicans EXCEPT when it comes to THEIR public employee union benefits.
I worked for a Fortune 500 company for 29 years and then retired early ON MY OWN with just a small "vested right" that I could take with me. That is far more typical (and even that is going away) than what you described for TWO public employees. All I can say is shame shame shame.
The very reason you don't like muni bonds is because huge pension and retirement healthcare packages given to people like your fireman/teacher acquaintance by Government negotiators who were gleefully eating at the public trough is WHY you say "fundamentals of the States look bad"...
I'm sorry Roger but you really blew this one.
The subject you present haS diversified multiple income streams.
There is no better way to find financial peace.
To date, no one I am aware of the one million+ subscribors and contributors to Seeking Alpha has had a piece on this approach published. I know of a couple that were rejected!
T
Another former state employee here. Spent 27 years in service and retired at 50 in 1995.
No debt, good health benefits and 80% pension. Summer at the New England beaches, go to Red Sox games and winter in Florida.
Life is great!
Thank you all for your support.
j
Roger, you do your readers a great service with this blog. Nice job!!
T,
I wonder if those public retirees who have the terms of their pensions changed by a bankruptcy judge will second your opinion of financial peace.
Stop and think what is happening to private pensions that have gone bust. In some cases retirees are getting less than 50 cents on the dollar after the PBGC get finished with them. United airline pilots anyone?
There's an old saying that pigs get fat and hogs get slaughtered. These public employees should not have allowed their union reps to negotiate an unsustainable package. Eventually, they will be slaughtered when their benefits are modified.
And why do public employees even need union representation? Where are the politician with backbone like Ronald Reagan who fired the air traffic controllers? People at the time were wringing their hands that there would be no one available to fill their shoes. Guess what? there really wasn't that much disruption and the public was well served by a president with backbone.
thank you T!
and to my fellow Red Sox, I am still mystified and stupefied at the Bobby Valentine hiring
jolo,
Pretty smug remarks. I bet there are very few people who were employed in the private sector with those kinds of benefits.
You are no doubt in the golden era of public employee gravy trains...enjoy.
For 8:28
I have a public pension that has been "modified". So does my wife. We both worked in public education positions to achieve full retirement benefits. I worked harder :)
With our diversified multiple income streams, the pension hits did not impact us in any meaningful way. IMO, our pensions were too generous from the getgo.
With all the extra time public employees have vs. many in the private sector (direct observation), there was plenty of time to open up ventures and investments to fund the good life after age 65...oops....52! We found it while raising four children along the way. Plus, neither of us can ever touch the $$ we paid into social security because we have a defined benefit retirement plan (thanks, President Reagan, circa 1986).
Perhaps unionistas should start electing union officials and politicians who tell us the truth, not fan our desire to visualize a pot of gold waiting for us at retirement that is/was both unrealistic and unsustainable.
T
T,
Interesting comments. Goes back to the pigs get fat/hogs get slaughtered observation.
In no way am I attempting to trivialize public sector employee's contributions. Heck, there is no way I could make it as a public school teacher...And a police officer on domestic dispute calls...no way.
I did my public service in the military...faced more hazards than firefighters and don't get pension benefits. I don't feel like I deserve them. In fact, I can't believe they paid me to have so much fun!
You rightly point out some of the benefits are unrealistic and unsustainable. Refreshing to hear from a recipient.
T for city council!
Lots of folks getting distracted from the big picture today.
Speaking as someone who never worked in the public sector but figured out how to manage the system and amplify benefits in the private sector, your example is excellent Roger for exactly the reasons cited:
A retired person analyzed their abilities, circumstances and preferences, chose a career path that fit, and pursued that path with purpose and intelligence.
If one wishes to lambast the system within which the particular example occurred, fine, but it has nothing to do with the moral of the tale.
NB: There have been some fantastic bargains in muni bonds the past few years because many people, including some otherwise stellar analysts (e.g., Meredith Whitney), made the mistake of using the same variables and applying the same analytic techniques as those used for business and incorrectly assumed that many municipalities had no choice but to declare bankruptcy (as if that was the only way a group of people with differing lives and purposes had to sustain the environment supporting household and quality of life in the presence of a balance sheet problem).
Not missing the big picture RW.
I think Retired in Prescott summed it up well.
I don't think one should one on hand bash muni bonds as an investment and on then the other hand laud generous public pensions that are contributing to the muni bond problem.
I think most people get the connection.
It would be a much better tale if the fellow used in the example retired early from mega-corp or some other private employer for 50% salary for the rest of his life.
Anon 10:32, I guess you'll have to spell out what "most people see" because I fail to see any logical connection between Roger's opinion on muni bonds (or the reasons he doesn't favor them) and the approach to retirement in the example he cites.
Retired-in-Prescott's distaste for some of his neighbors is his own affair, why would a retired person and the customized path they developed and pursued be analyzed differently if Roger or RiP or anyone else had a better opinion of mega-corp than a town or some other organization?
RW says, "why would a retired person and the customized path they developed and pursued be analyzed differently if Roger or RiP or anyone else had a better opinion of mega-corp than a town or some other organization?"
because in a private pension I'm not paying for it. My taxes are killing me. I feel tax rates are punitive to success. Property taxes, sales taxes, excise taxes, income taxes, use taxes, estate taxes, gift taxes, self-employment taxes, state unemployment taxes, federal unemployment taxes...where does it end?
What can I do about it? I vote for the politician who is fiscally conservative. The masses elect politicians that like to give away other people's money. Short of that, all I can do is vent when I see examples like Roger pointed out.
What is the present value of this guy's pension? How do I achieve that same value and pay all the onerous taxes? I can't. I take all the risk and the government takes much of the reward. What risk did this guy take...he was a fireman...big deal.
The guy in Roger's example is reaping the benefits from a public pension plan and then being paid by another public source and meanwhile public finances are a disgrace.
It is very distasteful for me. Maybe you like paying excessive taxes...I don't. Maybe you like living in a world where governments in general live beyond their means...I don't. In fact, Roger preaches so much about living below ones means that I can't believe he doesn't take the opportunity to point out that politicians are living beyond their means. How are my kids going to pay for it? I'll tell you...Bernanke and company are going to inflate their way out of it and then they can punish savers like me even more.
I have to quit now before I have a complete meltdown.
By the way Roger...I understand what you are pointing out and I don't blame the guy for taking advantage of the options available to him.
But someone has to take a principled stand.
Let me add to the fray...
Of course, government employees can no longer expect to receive these type of pensions in the future. But also, I don't think CEO's, BOD, and other top execs should be given huge retirement packages either...this is legalized rape of the financial system.
12:16,
True.
But you don't have to invest in public securities, you do HAVE to pay taxes.
Good story, i understand why you told it, but i echo retiredinprescott's thoughts. Here in illinois, just today, the director of the teachers retirement system announced finances are so bad they may need to reduce the pension benefits of current retirees. I took some college classes couple years ago with a cop in his late 20's who had a similar plan - work for 20 years, retire with a great pension, then do whatever he wants for the next 40-50 years. With the fiscal condition of practically every municipality/state being bad, this should not be allowed to happen.
Friend of a friend was a state policeman. Worked for 20 years and retired at 80% of his last year's salary (this in a state where revenues have fallen so badly that public positions are being eliminated.)
Anecdotal evidence is worth ...not much
what a neighbor or friend of a friend did (learned 2nd or 3rd hand not doubt) is worth ...less
demonizing civil servants because they work (and retire) in a system approved by democratically elected politicians is worth ...less than that
Assuming that the passed-through costs of corporate mis- and malfeasance, accounting fraud, monopoly, regulatory capture, chief executive moral hazard and golden parachutes do not constitute a tax on citizens that is not only unavoidable but also more pernicious because it is hidden is ...erroneous
Moral outrage is a good thing ...getting the target of that outrage wrong is probably going to lead ...to some really bad moves.
well RW, we're all about to see what happens when the voters DEMOCRATICALLY elect leaders who continue to pass out goodies without bothering to look beyond the next election.
the minority who have to pay for the goodies will no longer have a say in the matter.
somehow, I don't think this will end well.
and Roger presents his instructor as a "great example." In a hazmat class, the instructor "spoke at great length about how the pension works." Also, "he likes to take pictures with film" using the college's photo lab. Isn't that nice...using taxpayer supported facilities for his hobby because he "likes it."
This whole tale sickening.
Not sure if it is the person who is so pissed off here but the post is an example of someone who in the mid 1970s laid out a plan for himself and stuck to it and who then monetized a couple of hobbies.
In past posts I've written about seasonal work for national parks (and the like) which the way you frame would not seem to be too far removed from working at a community college. Someone is going to serve you a burger at the Old Faithful Lodge and someone is going to manage the photo lab a couple of days a week.
He is a great example, I say, of some of the things I write about here which is planning and monetizing of a hobby. How often have I written about public pensions as part of a financial plan? I can save you some time--I haven't. Later on in the post I say his plan is tailored to his interests--not a validation of how public pensions work.
You are adding 1+1 and getting eleven if you take it as an opinion or validation of anything beyond that. The anger I think I am reading is a little misplaced versus the the intention of the post, an example of a financial plan.
the first sentence is missing the word "same" as in the same person
Good conversation and rants today!
I, for one, appreciate Roger inadvertently stirring up the peanut gallery from time to time.
There is nothing wrong with venting.
T
"...the minority who have to pay for the goodies will no longer have a say in the matter."
This is the kind of evidence-detached commentary that makes rational discussion very difficult: There is no "minority who have to pay" -- the greatest tax burden as a percentage of income remains solidly on the poor who pay a far more than anyone else in those terms even if that does not include income taxes; e.g.,
Do the poor really pay no taxes? http://tinyurl.com/y535yww
The 53% Myth: Working Poor Pay More Of Their Income In State And Local Taxes Than The Rich In 49 States http://tinyurl.com/6swqyuh
The Poor Pay The Highest Marginal Rates In The Country http://tinyurl.com/6qgfjj5
I do agree it will probably not end well, particularly if folks refuse to keep their eyes open, but then the French Revolution didn't end particularly well either.
And, pardon the bluntness, but the bilious envy exposed in condemning the hazmat instructor's legal and appropriate pursuit of his interests using publicly funded resources (that his taxes in part paid for) is both sickening and frankly rather small.
NB: There is nothing wrong with venting but by the same token there is nothing wrong in disagreeing with the vent.
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