The Basics of the Public Pension

When you dive into your pay stub you've undoubtedly seen those hard working hours and that OT for that short-shift your Captain asked you in-person you did not have the heart to tell them "no" and swore you would avoid walking by the "west wing" at all costs next time.

The "Gross Pay" is pretty substantial...then you start your deductions. Standard federal, state, medical and then the PERS (or near comparison). This is your Public Employee Retirement System. Unlike Federal and State, this is very unique to what type of law enforcement officer you are (State, County, City, etc.), and when you started. Here is how it goes...

DEPENDING one what type of agency, state, and time you started you will contribute say around 10% of you gross salary to a fund, which is typically matched to some degree by your employer (State, County, City, etc.) and then goes to a state management fund which then may use an investment agencies (hedge fund) to invest the money to keep the large pool of money solvent (more in than going out to pay for liabilities (retirees + cost to manage)).

Law Enforcement primarily (some have lost it) has a defined benefit program. Meaning you can calculate what will be paid to you upon becoming eligible for retirement. If you leave early you may take whatever money is in your pension account (DON'T!); however, this will be your contributions only + a little interest.

Why Shouldn't I Cash Out?!?!?!?

CNN did an article on defined benefits titled Just how common are defined benefit plans? The long of the short is if you are in the private sector there are about 4% of companies that still offer some type of program. Why? Less liabilities. Once you pass the torch you are now a liability (Sounds bad, but it is actually very good for you) meaning you start drinking from the pension punch bowl.

Typically you pension alone should be enough to live off of; however, this is about becoming a millionaire cop.

In order to collect the pension you must do your set amount of years, what to do with all that extra capital in the meantime? Stand. By.

-AMO