On a recent trip to Phoenix, Arizona, I drove through Sun City on the way to a Spring Training facility.  At a large intersection, my attention was drawn to a couple of signs at a large investment business. The front business marquee advertised a program to maximize retirement savings and a smaller sign at the back of the parking lot announced an upcoming food distribution event from the local food bank. Certainly diverse messages for the seniors in the area, home to primarily retirees. A poignant reminder to us all that retirees find themselves all along the financial security continuum. The same is true for retirees in our system. The SDCERA website, Facts at a Glance section, shows that the median annual pension, for a SDCERA retiree, was $21,924 in fiscal year 2010. This median or middle amount indicates that half of all pensions fell below that amount and half were above that amount. The average annual pension, for the same time period, was $30,479, an amount determined by adding all pensions together and dividing by the number of pensions. In San Diego County, that average pension amount is basically equivalent to the per capita/average income of $30,479 as reported by the United States Census Bureau for 2010. Neither pension amount comes close to the “$100,000 club” popularized by the media in recent years. Retired County employees who have earned an annual pension of $100,000 or more represent approximately the top 3% of SDCERA retirees, 352 of 13,922 retirees as calculated in 2010.

The debate wages on, in the media and legislative assemblies, over our defined benefit retirement model versus the 401(k) individual employee investment account model. Much has been written by financial and investment professionals, on the merits of the defined benefit approach wherein plan participants earn a predetermined annual pension based on years of service and final average salary. The positive impact of a reliable pension extends into the community where retirees are regular consumers of goods and services and are taxpayers. This positive impact is described in detail in Pensionomics 2012, published by the National Institute of Retirement Security, and can be found on the SDCERA website, under the pension facts tab, as well as via the California Retired County Employees Association (CRCEA) website.

As you know, all RESDC members are members of the statewide association, CRCEA, which is comprised of the twenty 1937 Act County retirement systems in California.  CRCEA is a strong and viable lobbying force in Sacramento with a membership over 160,000 retirees. An important CRCEA subcommittee, Retirement Security Committee, was formed last year and has put together an impressive database of pension related documents to assist CRCEA members by providing “information you are looking for to respond to negative pension articles and refute myths and misunderstandings associated with current pension reform proposals,” according to committee chair Dave Muir of Orange County. The database will expand as the committee’s work continues. I encourage you to look at the material at www.crcearesearch.com and watch for updates on the work of this important effort on behalf of us all.