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The Three Rs of Teacher Retirement: Recruitment, Retention, & Retirement
Source: National Institute on Retirement Security

As early as the turn of the 20th century, American legislators seemed to understand the importance of teacher quality to students’ education. A 1917 report on public education noted that “a school-teacher’s work is personal, direct, and positive. It works for the good or the ill of each pupil.”1

Defined benefit (DB) pension plans were first introduced for teachers in the United States to help with the recruitment of high quality educators, and as an incentive to keep those educators in the teaching profession. By 1916, some form of retirement plan was made available to public schoolteachers in 33 states. It was thought that such a retirement system might serve two purposes: 1) bringing more diverse, and highly qualified teachers into the profession; and 2) creating a more productive workforce that actually saves public employers money, as one dollar in pension benefits was seen as worth more than a dollar in salary.2

Today, the vast majority of public school teachers in the United States participate in a traditional DB pension plan.

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2018 IPPFA Illinois Pension Conference – Registration Now Open
Source: IPPFA

Come join the IPPFA for its 2018 IPPFA Illinois Pension Conference, held May 1st through May 4th, 2018 at the Embassy Suites by Hilton, East Peoria, IL (the subject matter of this conference meets or exceeds state mandated requirements for trustee education; CEU’s are issued through Northern Illinois University).

For over 30 years, the IPPFA has offered public pension trustees the best and latest in trustee training education, striving to offer the best available training. Please join us for sessions in ethics, investment procedures, fiduciary responsibilities, and legal and legislative updates, all presented by nationally renowned speakers.

Register NOW

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Employee Contributions to Public Pension Plans
Source: NASRA Issue Brief

Unlike in the private sector, nearly all employees of state and local government are required to share in the
cost of their retirement benefit. Employee contributions typically are set as a percentage of salary by
statute or by the retirement board. Although investment earnings and employer contributions account for a
larger portion of total public pension fund revenues (see Figure 1), by providing a consistent and predictable
stream of revenue to public pension funds, contributions from employees fill a vital role in financing
pension benefits.i Reforms made in the wake of the 2008-09 market decline included higher employee
contribution rates in many states. This issue brief examines employee contribution plan designs, policies
and recent trends.

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