leaving state job / pension. ..... bad idea?

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UnclePhil
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Joined: Wed Jun 11, 2014 7:38 pm

leaving state job / pension. ..... bad idea?

Post by UnclePhil » Thu Apr 18, 2019 10:05 am

Hello.

I'm at a crossroad in my life where I just can't decide what to do with my career. I'm 44 years old and have worked in government for the last 16 years. Problem is I started maxed out at 82k and now make 112k per year; those increases have been cost of living adjustments only; no merit pay or bonuses or anything like that. I feel like I'm missing out on making more $$ in the private sector. The work here has been piling on, additional duties assigned, etc. In some years I can make 10k to 15k in OT when it gets busy. With my education and experience I am sure I can find a job that easily pays 150k. I have a good work/life balance here.......work doesn't follow me home and usually 40 hour work weeks. I'm only considering moving because I bought a new home and expenses are just too high and need to bring home more $$ and sometimes feel that I am thrown way too responsibilities (ex. I administer a dozen high level enterprise apps, each on its own can command a six figure salary). I came to public sector from a top consulting firm where I made similar salary working on just one app.

Some great things about job: good team; 7 weeks PTO; OT option; low cost healthcare; fully vested. I can retire in 12 years with a $4300/mo pension; or $8000/mo at 15 more years; or even $10.3k/mo if I stay til 65. I have the option too to cash out the 300k I have currently in pension.

Things that make me want to leave: high level of bureaucracy, some lazy coworkers that don't bother to help, stagnant pay, no room for growth.

Financially I have 30k in an emergency fund, 80k equity into home, but owe 22k in credit card debt and also owe 10k on a new car. Does it make sense to start over now or should I try to ride it out?

Phil in KY.

Tool-Time
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Re: leaving state job / pension. ..... bad idea?

Post by Tool-Time » Thu Apr 18, 2019 10:14 am

Private industry has its disadvantages also. OT expected but no additional pay. We need to use our own vehicles when traveling. Older workers often treated poorly and get pushed out the door. I get no training while younger people do so. Younger employees are encouraged to join professional organizations and get they get reimbursed. I cant get the pay range for my position so I don't know where I stand. I have a 401k, no pension. Very little advancement opportunity. Politics is huge.
Last edited by Tool-Time on Thu Apr 18, 2019 10:18 am, edited 1 time in total.

dziuniek
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Re: leaving state job / pension. ..... bad idea?

Post by dziuniek » Thu Apr 18, 2019 10:16 am

At 44, your savings seem quite low. Additionally, that's a lot of credit card debt for your income, if that's even a thing.

I would stay where you are due to such a high pension monthly payment.

Run the math to see how much you would need to save to get so much in monthly income. I doubt it you can do it in your working years left. At the very least, it would have to be a very high savings rate.

Also, don't kid yourself. You're 44. in 6 years, you'll be 50. Ageism is a real thing and in private sector, even more so. Guaranteed state/gov employment in your 50s is as safe as it gets.

That being said, doubling your income is enticing. First, why not get on LinkedIn and talk to some recruiters, no harm seeing what your skillset is actually worth.

Topic Author
UnclePhil
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Re: leaving state job / pension. ..... bad idea?

Post by UnclePhil » Thu Apr 18, 2019 10:24 am

dziuniek wrote:
Thu Apr 18, 2019 10:16 am
At 44, your savings seem quite low. Additionally, that's a lot of credit card debt for your income, if that's even a thing.

I would stay where you are due to such a high pension monthly payment.

Run the math to see how much you would need to save to get so much in monthly income. I doubt it you can do it in your working years left. At the very least, it would have to be a very high savings rate.

Also, don't kid yourself. You're 44. in 6 years, you'll be 50. Ageism is a real thing and in private sector, even more so. Guaranteed state/gov employment in your 50s is as safe as it gets.

That being said, doubling your income is enticing. First, why not get on LinkedIn and talk to some recruiters, no harm seeing what your skillset is actually worth.
Well aware of ageism in the workplace, but the technology that I deal with is very niche and in high demand. I like the LinkedIn idea...maybe I'll give that a look. As far as low savings, I've had so many unexpected expenses in life that I won't go in detail now. I had an additional 80k in savings but I recently dumped that as a down payment on a home.

stoptothink
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Re: leaving state job / pension. ..... bad idea?

Post by stoptothink » Thu Apr 18, 2019 10:33 am

dziuniek wrote:
Thu Apr 18, 2019 10:16 am
At 44, your savings seem quite low. Additionally, that's a lot of credit card debt for your income, if that's even a thing.

I would stay where you are due to such a high pension monthly payment.

Run the math to see how much you would need to save to get so much in monthly income. I doubt it you can do it in your working years left. At the very least, it would have to be a very high savings rate.

Also, don't kid yourself. You're 44. in 6 years, you'll be 50. Ageism is a real thing and in private sector, even more so. Guaranteed state/gov employment in your 50s is as safe as it gets.

That being said, doubling your income is enticing. First, why not get on LinkedIn and talk to some recruiters, no harm seeing what your skillset is actually worth.
With the current low savings level, age, and the pension; OP would be nuts to leave unless we're talking a significant (like 100%) raise.

smitcat
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Re: leaving state job / pension. ..... bad idea?

Post by smitcat » Thu Apr 18, 2019 10:53 am

UnclePhil wrote:
Thu Apr 18, 2019 10:05 am
Hello.

I'm at a crossroad in my life where I just can't decide what to do with my career. I'm 44 years old and have worked in government for the last 16 years. Problem is I started maxed out at 82k and now make 112k per year; those increases have been cost of living adjustments only; no merit pay or bonuses or anything like that. I feel like I'm missing out on making more $$ in the private sector. The work here has been piling on, additional duties assigned, etc. In some years I can make 10k to 15k in OT when it gets busy. With my education and experience I am sure I can find a job that easily pays 150k. I have a good work/life balance here.......work doesn't follow me home and usually 40 hour work weeks. I'm only considering moving because I bought a new home and expenses are just too high and need to bring home more $$ and sometimes feel that I am thrown way too responsibilities (ex. I administer a dozen high level enterprise apps, each on its own can command a six figure salary). I came to public sector from a top consulting firm where I made similar salary working on just one app.

Some great things about job: good team; 7 weeks PTO; OT option; low cost healthcare; fully vested. I can retire in 12 years with a $4300/mo pension; or $8000/mo at 15 more years; or even $10.3k/mo if I stay til 65. I have the option too to cash out the 300k I have currently in pension.

Things that make me want to leave: high level of bureaucracy, some lazy coworkers that don't bother to help, stagnant pay, no room for growth.

Financially I have 30k in an emergency fund, 80k equity into home, but owe 22k in credit card debt and also owe 10k on a new car. Does it make sense to start over now or should I try to ride it out?

Phil in KY.
You describe a non competitive environment where you are in a supervisory role with great benefits that includes OT. That combined with the pension leaves you well along a lifestyle and good work/life balance that is currently impossible to replace.
What you will bring home after taxes with an increase is likely dwarfed by your current benefits.
My vote is to stay put and get a side gig if you really want to add income to the mix.

dharma student
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Re: leaving state job / pension. ..... bad idea?

Post by dharma student » Thu Apr 18, 2019 11:03 am

As someone on the other side, getting a state pension and in the private sector now...STAY PUT....your in-demand skills today will be outsourced to India soon. (alot of our IT is). It gives me great peace of mind to know I have a very stable pension.

Yes, do I make more here in the private sector? Yes..so now I get a secured pension and at this stage make more $$. Make the money once your pension is secured...then you have the best of both worlds.

rjbraun
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Re: leaving state job / pension. ..... bad idea?

Post by rjbraun » Thu Apr 18, 2019 11:04 am

UnclePhil wrote:
Thu Apr 18, 2019 10:05 am
Problem is I started maxed out at 82k and now make 112k per year; those increases have been cost of living adjustments only; no merit pay or bonuses or anything like that. I feel like I'm missing out on making more $$ in the private sector. The work here has been piling on, additional duties assigned, etc. In some years I can make 10k to 15k in OT when it gets busy. With my education and experience I am sure I can find a job that easily pays 150k.
Roughly speaking, I would think $112k in annual comp is at least on par with $150k in the private sector, assuming a greater required contribution for health insurance and no DB plan. Not to mention likely less vacation and maybe more stress, etc.

Why did you leave the top consulting firm? Were you there long enough to get a feel for the private sector and the environment you might like to return to?

scottgekko
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Re: leaving state job / pension. ..... bad idea?

Post by scottgekko » Thu Apr 18, 2019 11:07 am

The difference in $150k a year and your current $112k doesn't make up for $4400/mo pension in 12 years & certainly not $8000+ in 15 years.

I would hang on - you're making 6 figures, 7 weeks PTO, 40 hours a week, have the opportunity to work OT. Your 59 year old self will thank you when you have $8000+ mo coming in.....

The only way I would consider leaving would be for $200k+ base and some kind of stock or bonus plan that would allow you to quickly stock pile savings.

Keep in mind - even if you got the above $200k+ job, if you got laid off in 5 years, then what? Even solid companies make moves internally that may leave you on the outside looking in....

Admiral
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Re: leaving state job / pension. ..... bad idea?

Post by Admiral » Thu Apr 18, 2019 11:09 am

Your finances are not in order, which is unfortunate. Why did you buy a new car when you had 22k in cc debt? Don't let the debt tail wag the job dog. That is: don't daydream about some new, much higher paying job because you need to pay off debt.

I think your first step is not to speculate about what you "could" or "might" make in the private sector.

Apply for some jobs, get an offer, and then see where you are. I say this because a) a new job with a 20% raise could have a much higher health insurance cost or b) a retirement plan with no match. It could require a terrible commute. It could have less vacation. Conversely, it might have stock options or some other benefits.

Until you have a job offer in hand, it's all speculation (at least about the finances).

I would not bother comparing what your pension "might be" in 12 or 20 years. If you're miserable you won't make it that long. Compare a new opportunity to what you're giving up over the next year or two. A pension is a valuable thing, but not more valuable than having a job you love.

rjbraun
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Re: leaving state job / pension. ..... bad idea?

Post by rjbraun » Thu Apr 18, 2019 11:14 am

dharma student wrote:
Thu Apr 18, 2019 11:03 am
As someone on the other side, getting a state pension and in the private sector now...STAY PUT....your in-demand skills today will be outsourced to India soon. (alot of our IT is). It gives me great peace of mind to know I have a very stable pension.

Yes, do I make more here in the private sector? Yes..so now I get a secured pension and at this stage make more $$. Make the money once your pension is secured...then you have the best of both worlds.
Glad your situation has worked out for you. I think there's also merit in the reverse scenario as well: work to earn a high wage in the private sector early on, save (reasonably aggressively), let that money compound in future years when one aims to get a job in the public sector. Granted, the pension terms in more recent years are probably less attractive but at least the final average salary used to determine the pension will be based off a more current, and thus, hopefully, larger number.

I am making a general comment, not targeted specifically to OP.

GlacierRunner
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Re: leaving state job / pension. ..... bad idea?

Post by GlacierRunner » Thu Apr 18, 2019 11:36 am

Only you can decide whether you want to make the jump.

I am a state employee. I think you need to take a closer look at quantifying the benefits afforded you at your state job. When I have looked at other jobs, they have typically been consultant types with zero benefits and so it was pretty easy to see what I would need to make in dollars to break even. And I have a spouse that is also a state employee that could cover my health insurance at slightly greater cost.

My benefits currently represent 52.5% of my pay, so very simply if you are making $112k, you would need to make $170k private sector (assuming no retirement or health insurance). You would need to find health insurance and fund retirement and so, unless you reduce your retirement you likely won't have any extra money to spend now. I see it as a trade off between having money now and having money in retirement. For some people, they need the money now.

An alternative, if you need more cash, are you using all seven weeks of PTO or just banking it? Would you be interested in cashing it out to pay off your debts?

TallBoy29er
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Re: leaving state job / pension. ..... bad idea?

Post by TallBoy29er » Thu Apr 18, 2019 11:41 am

I would think more about job satisfaction than just the financial aspect. Your pension in 15 years will be able to likely sustain you for life. And don't even get me started about 7 weeks PTO. That is not going to happen in the private sector. Think more in line with 4 weeks best case (usually). Private sector has its own sets of problems, including some poor co-workers and bureaucracy.

Do you like what you do? Who you work with?

bhsince87
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Re: leaving state job / pension. ..... bad idea?

Post by bhsince87 » Thu Apr 18, 2019 11:52 am

Will you be eligible for health insurance after you retire? If so that could also be a huge advantage to sticking around.

I have a friend who just retired from a fed job. I couldn't believe that he can buy health insurance for about $5k per year for life!

We're using cobra as long as we can, which is $18k per year. Then we hope and pray that ACA will still be available at $24k per year.

And yeah, 7 weeks PTO, and paid optional overtime are huge. I worked 50+ hour weeks in tech for 30+ years, and never got more than 4 weeks off!
"If ye love wealth better than liberty, the tranquility of servitude better than the animating contest of freedom, go home from us in peace." Samuel Adams

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rh00p
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Re: leaving state job / pension. ..... bad idea?

Post by rh00p » Thu Apr 18, 2019 11:54 am

Sounds to me the OP bought too much house + too much debt - too little savings. And the math won't add up no matter which way he goes.
Preparing for the worst. Hoping for the best.

Ybsybs
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Re: leaving state job / pension. ..... bad idea?

Post by Ybsybs » Thu Apr 18, 2019 1:45 pm

Can you moonlight more while keeping the state job?

A 40hr/week and 7 weeks of paid vacation job sounds like the kind of position that leaves enough time to run a consulting business on the side. You mention being able to get $10k-$15k in overtime, but perhaps you could make more than that consulting. If the side business goes well, you'll have more information about how much in demand your skillset is and your increased income (if applied to that debt) would put you in a better financial situation for if you choose to leave the state job for the private sector.

ponyboy
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Re: leaving state job / pension. ..... bad idea?

Post by ponyboy » Thu Apr 18, 2019 1:46 pm

I would stick with your state job/pension. If you enter the private sector...you're not going to save for retirement. Do you even have a roth ira? You're relying solely on your pension. Your savings are really low, too much debt for how much you make. Yeah...you dont have a not making enough problem...you have a spending problem.

MP173
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Re: leaving state job / pension. ..... bad idea?

Post by MP173 » Thu Apr 18, 2019 4:40 pm

Start listening to Dave Ramsey.

I would keep the current gig. The pension is well worth it.

Control spending.

ed

Trader Joe
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Re: leaving state job / pension. ..... bad idea?

Post by Trader Joe » Thu Apr 18, 2019 5:58 pm

UnclePhil wrote:
Thu Apr 18, 2019 10:05 am
Hello.

I'm at a crossroad in my life where I just can't decide what to do with my career. I'm 44 years old and have worked in government for the last 16 years. Problem is I started maxed out at 82k and now make 112k per year; those increases have been cost of living adjustments only; no merit pay or bonuses or anything like that. I feel like I'm missing out on making more $$ in the private sector. The work here has been piling on, additional duties assigned, etc. In some years I can make 10k to 15k in OT when it gets busy. With my education and experience I am sure I can find a job that easily pays 150k. I have a good work/life balance here.......work doesn't follow me home and usually 40 hour work weeks. I'm only considering moving because I bought a new home and expenses are just too high and need to bring home more $$ and sometimes feel that I am thrown way too responsibilities (ex. I administer a dozen high level enterprise apps, each on its own can command a six figure salary). I came to public sector from a top consulting firm where I made similar salary working on just one app.

Some great things about job: good team; 7 weeks PTO; OT option; low cost healthcare; fully vested. I can retire in 12 years with a $4300/mo pension; or $8000/mo at 15 more years; or even $10.3k/mo if I stay til 65. I have the option too to cash out the 300k I have currently in pension.

Things that make me want to leave: high level of bureaucracy, some lazy coworkers that don't bother to help, stagnant pay, no room for growth.

Financially I have 30k in an emergency fund, 80k equity into home, but owe 22k in credit card debt and also owe 10k on a new car. Does it make sense to start over now or should I try to ride it out?

Phil in KY.
You should stay at your state government job. Your prime earning years in industry are now way behind you.

Thegame14
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Re: leaving state job / pension. ..... bad idea?

Post by Thegame14 » Thu Apr 18, 2019 6:28 pm

this is a no brainer, stay and take the $8K per month pension and probably insurance when you retire.

mnnice
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Re: leaving state job / pension. ..... bad idea?

Post by mnnice » Thu Apr 18, 2019 6:41 pm

How well is your state pension funded?

What happens to inactive accounts? I have two and have opted to keep my money. The one plan continues to grow and the other doesn’t.

gougou
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Re: leaving state job / pension. ..... bad idea?

Post by gougou » Thu Apr 18, 2019 6:51 pm

UnclePhil wrote:
Thu Apr 18, 2019 10:05 am
... but owe 22k in credit card debt ...
Get rid of that ASAP.

retire2022
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Re: leaving state job / pension. ..... bad idea?

Post by retire2022 » Thu Apr 18, 2019 8:39 pm

gougou wrote:
Thu Apr 18, 2019 6:51 pm
UnclePhil wrote:
Thu Apr 18, 2019 10:05 am
... but owe 22k in credit card debt ...
Get rid of that ASAP.
I concur, with new job or higher paying job, if you don't know how to manage spending a new job won't solve that problem, sorry if we sound harsh.

I would track everyday expenses and self access any over spending, end of the month tally up, or use automated bank tracking.

Yooper16
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Re: leaving state job / pension. ..... bad idea?

Post by Yooper16 » Thu Apr 18, 2019 9:48 pm

Your post says you " bought a new home and the expenses are just too high". Your words in " ".

Sounds more like a case of buyers remorse and that to afford your home and lifestyle you need more money. Time to tighten the purse strings, sell off some stuff, pay off your debt.

I'd stick with the present job because in your mid-late 50s you probably will have it aced because of pension etc.

dziuniek
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Re: leaving state job / pension. ..... bad idea?

Post by dziuniek » Fri Apr 19, 2019 7:57 am

stoptothink wrote:
Thu Apr 18, 2019 10:33 am
dziuniek wrote:
Thu Apr 18, 2019 10:16 am
At 44, your savings seem quite low. Additionally, that's a lot of credit card debt for your income, if that's even a thing.

I would stay where you are due to such a high pension monthly payment.

Run the math to see how much you would need to save to get so much in monthly income. I doubt it you can do it in your working years left. At the very least, it would have to be a very high savings rate.

Also, don't kid yourself. You're 44. in 6 years, you'll be 50. Ageism is a real thing and in private sector, even more so. Guaranteed state/gov employment in your 50s is as safe as it gets.

That being said, doubling your income is enticing. First, why not get on LinkedIn and talk to some recruiters, no harm seeing what your skillset is actually worth.
With the current low savings level, age, and the pension; OP would be nuts to leave unless we're talking a significant (like 100%) raise.
Yup!

Jelloanddon
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Re: leaving state job / pension. ..... bad idea?

Post by Jelloanddon » Sat Apr 20, 2019 5:06 pm

I worked 38 years at a non-govt job. Receiving a pension (about 60% of my wages, no COLA) and some medical benefits. Most of my friends worked for the state. Although I made more than many of them while we all worked, they retired earlier than me, with a pension of 80% of their last year of wages, get a COLA, and ALL their medical benefits.

I wish I opted for a government job.

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Re: leaving state job / pension. ..... bad idea?

Post by Grt2bOutdoors » Sat Apr 20, 2019 5:30 pm

Very bad idea. You leave that state job and you will be kicking yourself for the rest of your life. The next time you get the idea to leave, just calculate how much it would cost to generate an additional $4K in monthly income for the rest of your life. In fact, you can do it now, go to www.immediateannuities.com, click on deferred annuities and throw some numbers in. Once you see the true cost of your pension plan, all thoughts of going over to the private sector will go right out the window.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

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Re: leaving state job / pension. ..... bad idea?

Post by Mitchell777 » Sat Apr 20, 2019 5:33 pm

It depends on where you live but I can't even relate to benefits like that. They would be lavish in my area. I look at the people I know retired and living very well and they mostly split out into high level managers in the private sector or government workers. There is no way I'd walk away from those benefits at this point in your career with the job security of a government job. I've seen too many very smart, skilled, dedicated people in the private sector lose their jobs because the next quarter or two were not hitting the corporate financial goals.

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Re: leaving state job / pension. ..... bad idea?

Post by TheAccountant » Sat Apr 20, 2019 8:00 pm

You have it made. Do NOT leave that job.
Making cents out of every dollar.

BradJ
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Re: leaving state job / pension. ..... bad idea?

Post by BradJ » Sat Apr 20, 2019 8:15 pm

Allow me to piggy-back off this individuals question. What if he was 35 and debt free?

Leemiller
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Re: leaving state job / pension. ..... bad idea?

Post by Leemiller » Sat Apr 20, 2019 8:45 pm

I’ve left a federal job for the private sector twice. Both times for a substantial raise. Last time I was in my mid-40s and have no regrets so far - I’ve been promoted get headhunting calls for positions I wouldn’t have dreamed of while in the government. I put aside enough extra in savings each year to more than make up for the pension, plus my heirs will keep the money when I die and I can use the money to retire early. Personally, I’m confident I would go back to a federal job if I wanted to. I’m much happier in the private sector as well.

retiredflyboy
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Re: leaving state job / pension. ..... bad idea?

Post by retiredflyboy » Sat Apr 20, 2019 8:56 pm

The pension is huge! Stay put!
Facts are stubborn things. Everything works until it doesn’t.

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Re: leaving state job / pension. ..... bad idea?

Post by Ron Ronnerson » Sat Apr 20, 2019 11:48 pm

I have some similar stats as you. I’m also 44 and have worked in my job for the past 16 years (I’m a public-school teacher). You and I have almost identical incomes and expected pensions. I plan to retire around age 61 with a pension of right around $100k. Unlike you, my work doesn’t provide any health insurance, though I do work a lot fewer hours than you.

I’ve given thought to the value of the pension I’m expecting. The bottom line is that it is worth a lot. Being mid-career and in mid-40s makes it much harder to walk away than being younger with fewer years under your belt. To leave at this point, the other opportunity needs to be beyond amazing.

Based on your post, I get the impression that you’re feeling an itch to change something because you’re not satisfied with your financial situation. It is not clear why your net worth is only $80k and maybe you think that a higher income will make that situation better. However, you do have the option to lower expenses as well. The one piece of really good news you have in your overall financial picture is this pension that should provide you with a comfortable life in retirement. Yet you’re considering abandoning it. If you go through with it, I think there is a good chance you’ll regret it (and regret it a lot).

smectym
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Re: leaving state job / pension. ..... bad idea?

Post by smectym » Sun Apr 21, 2019 12:46 am

UnclePhil, hang in there and get up every day and count your blessings. It’s not very cool to say it, but today but a secure job with a defined benefit pension is “better than...” well, you fill in the blank. In fact, odds are you know this already, and therefore are either seeking external validation, or trolling the poor unsuspecting bogleheads. Either way, have at it.

Smectym

pindevil
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Re: leaving state job / pension. ..... bad idea?

Post by pindevil » Sun Apr 21, 2019 1:19 am

I would stay put. You don't mention but I'm guessing you have access to a 457b which is an excellent vehicle for savings that is not available in private sector jobs. With your current salary you should be able to max out the 457b.

3504PIR
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Re: leaving state job / pension. ..... bad idea?

Post by 3504PIR » Sun Apr 21, 2019 3:37 am

You’re 44 with no retirement savings. Even if you cashed out your pension you would need to save close to $50,000 per year toward retirement if you leave. Also I would assume in the private sector companies will begin to want to be rid of you beginning in about 6 years. If you get let go at 52 AND you saved $50,000 per year between now and then you’d have about $700k depending on return rates. Is that enough to retire on? I don’t think you can afford to move jobs.

If you want to improve how you feel about how much you make, improve your cash flow, i.e. get out of debt. Start by taking your 30k and get rid of the cc debt and most of the car debt and finish paying off the car over the next 2-3 months. If you do that and stay out of debt you’ll have more money than you know what to do with. Frankly right now you’re working to feed the beast - your debt.

inbox788
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Re: leaving state job / pension. ..... bad idea?

Post by inbox788 » Sun Apr 21, 2019 4:15 am

UnclePhil wrote:
Thu Apr 18, 2019 10:05 am
owe 22k in credit card debt
What did you buy? How much have you paid in bills and interest in the last 12 months? last 3 years? What was your credit card debt 12 months and 3 years ago?

What is the interest rate? How quickly do you plan to have this paid off? Why isn't this an emergency? How much are you earning on your emergency fund and what is it costing you to keep that cash liquid?

You need income to pay this debt off, so you should be making good progress on a payoff plan before contemplating any risk to your income flow.

bltn
Posts: 604
Joined: Mon Feb 20, 2017 9:32 pm

Re: leaving state job / pension. ..... bad idea?

Post by bltn » Sun Apr 21, 2019 4:51 am

I agree with most of the other posters. With no retirement savings. your pension prospects are a huge part of your future. If you leave your job, you would have to make up for the loss off your pension with large personal savings. And you would lose your vacation time. And job security in the private sector is less.
Treat your increased house expenses as you would a perceived need to save more. A necessary adjustment.
If you want more income, get a second job. With a 40 hour work week, you have more flexibility than many.

dekecarver
Posts: 429
Joined: Mon Feb 22, 2010 10:24 am

Re: leaving state job / pension. ..... bad idea?

Post by dekecarver » Sun Apr 21, 2019 5:15 am

Been there and I'm still here after running multiple scenarios, including work hours, travel time, etc..Gov't work can be a drag and it can also be rewarding just like the private sector but it does depend on your department and agency leadership/vision. I've found staying involved with a considerable project every year takes some of the doldrums out and keeping life away from work interesting is a must. Run your numbers especially your potential retirement income streams e.g. Gov't vs Private e.g. (Gov't Pension, 457 Deferred Comp, IRA, Social Security, Taxable) vs (Non gov't....)

In the end, gov't work is not for everybody but neither is private sector. Strike a balance.

It is true that older workers can get left behind in the private sector e.g. training, promotions, etc..vs gov't opportunity; older meaning entering the 4th decade age group.

ponyboy
Posts: 816
Joined: Fri Feb 06, 2015 10:39 am

Re: leaving state job / pension. ..... bad idea?

Post by ponyboy » Sun Apr 21, 2019 6:04 am

Leemiller wrote:
Sat Apr 20, 2019 8:45 pm
I’ve left a federal job for the private sector twice. Both times for a substantial raise. Last time I was in my mid-40s and have no regrets so far - I’ve been promoted get headhunting calls for positions I wouldn’t have dreamed of while in the government. I put aside enough extra in savings each year to more than make up for the pension, plus my heirs will keep the money when I die and I can use the money to retire early. Personally, I’m confident I would go back to a federal job if I wanted to. I’m much happier in the private sector as well.
Of course. You can make a lot more money in the private sector. Thats fine as long as you set aside money, invest and save. Most people cant control their spending...like the OP. For them, if they leave, they're going to spend any extra money they make...which is the reason why everyone is telling them to stay put.

mancich
Posts: 748
Joined: Fri Sep 05, 2014 2:05 pm

Re: leaving state job / pension. ..... bad idea?

Post by mancich » Sun Apr 21, 2019 7:54 am

The grass isn't greener. I would stay put. I work for a MegaCorop, and as others have pointed out, there are a lot of downsides there too. And I agree with the ageism comments. A company would never talk about age outright for fear of being sued, but it is a very real thing.

student
Posts: 4348
Joined: Fri Apr 03, 2015 6:58 am

Re: leaving state job / pension. ..... bad idea?

Post by student » Sun Apr 21, 2019 8:01 am

It really depends on your risk tolerance. Personally I would stay put as your pension is valuable and there is essentially no risk of losing your job.

Pinotage
Posts: 295
Joined: Sat Nov 12, 2011 6:02 am
Location: Springfield

Re: leaving state job / pension. ..... bad idea?

Post by Pinotage » Sun Apr 21, 2019 8:22 am

Great feedback already.

What I'd do:

- Interview for other positions - find out what your options are. May be better/worse than you are thinking.
- Make a financial plan
- Get rid of debt

Sounds like there is a lot to like about your current position. However I would seriously consider how long the pension will be around. KY has made a lot of news recently re: pension cuts, protests, etc..

hudson
Posts: 2122
Joined: Fri Apr 06, 2007 9:15 am

Re: leaving state job / pension. ..... bad idea?

Post by hudson » Sun Apr 21, 2019 8:41 am

UnclePhil wrote:
Thu Apr 18, 2019 10:05 am
Hello.

Some great things about job: good team; 7 weeks PTO; OT option; low cost healthcare; fully vested. I can retire in 12 years with a $4300/mo pension; or $8000/mo at 15 more years; or even $10.3k/mo if I stay til 65. I have the option too to cash out the 300k I have currently in pension.

Phil in KY.
I would apply for the job above and hold on until they ran me off.

retired early&luv it
Posts: 83
Joined: Sun Feb 22, 2015 8:52 am

Re: leaving state job / pension. ..... bad idea?

Post by retired early&luv it » Sun Apr 21, 2019 9:49 am

I assume you will also be able to draw social security if you keep your state job?

Or are you in one of the states where your pension is the only thing you get? If you are in one of these states, look into the rules for social security, as having that pension and also trying to draw social security later from any future job you might get in private sector might be an issue? For more info on this do a google search for social security windfall elimination provision.

Some states offer post-retirement health care benefits that range from poor to great. Does your state offer any that you would lose if you walk out the door?

I retired early from a state job. When you adjust for inflation my income peaked when I was in my early to mid 40s, so I clearly understand your concerns. But considering that I never got a penny of overtime for the thousands of extra hours I worked, your description almost makes me jealous.

My sister was laid off from her executive job in the private sector when she was about 60 or 61. If you go to the private sector and find yourself out of work for one reason or another, once you are in your mid to late 50s, it can be extraordinarily hard to find another job at comparable compensation. My sister with her MBA and great resume could not even get interviews from the companies that all wanted younger people.

Whatever you do, get your fiscal situation in order, I retired with a ton of savings but I have only bought one new vehicle in my life, and that one vehicle I paid off the loan in one year. You really do not want to retire with debt.

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