OPERS considers COLA changes
Survey in the mail; new FAQs published
By Michael Pramik, Ohio Public Employees Retirement System
Aug. 30, 2017 – The Ohio Public Employees Retirement System is considering changes to the cost-of-living adjustment provided to retirees. And we’re listening carefully to your thoughts about this issue.
If you are an OPERS retiree, you should receive a survey that includes a self-addressed, stamped envelope. The survey asks for replies by Sept. 8, but OPERS will accept and tabulate all responses received through Sept. 15. If you haven’t received a survey, just give us a call at 1-800-222-PERS (7377) from 8 a.m.-4:30 p.m., Monday through Friday, and we’ll resend a survey to you.
Also, we have published a set of frequently asked questions from OPERS retirees about the COLA. You can find the FAQs at our COLA Web page, www.opers.org/cola. You also can find an article and a video that explain the reasons we’re considering changes to the COLA.
We’ll update the COLA page regularly with additional information as it becomes available.
Michael Pramik
Michael Pramik is communication strategist for the Ohio Public Employees Retirement System and editor of the PERSpective blog. As an experienced business journalist, he clarifies complex pension policies and helps members make smart choices to secure their retirement.
I am retired and I paid what was asked of me while I was working so I could have a solid retirement income. The COLA was , I thought , a part of my retirement . I have been receiving 3% of my original retirement, not 3% rolled up. I’m not complaining, you have done a wonderful job with managing the fund. But why should I receive less money so someone else can retire? Shouldn’t they fund their own retirement? Salaries have been so inflated because of labor agreements and that should not have any affect on me or other retirees like me. Thank you for your time.
I agree with James 100%
So give us what we paid
For !
Good point. Agree
When you refer to the COLA it is a bit misleading as the 3% only applies to the amount you receive in your first year of retirement which is the basis for all future adjustments. The percentage increase is reduced each year there after. If changes are made, will the COLA be based on your current benefit or your original amount?
The CPI is based on a certain ‘basket’ of goods that the government watches to determine the inflation rate. Not all items have the same effect on retirees, mostly health care. We can cut back on our Dorito consumption but not how much we utilize health benefits. And the cost of health care has certainly surpassed the inflation rate for Doritos. One extra prescription per month can easily surpass a COLA adjustment for someone who wasn’t a high wage earner to begin with.
Why not institute a graduated amount of your COLA based on earnings? Certainly higher wage earners and those who benefitted from ‘double dipping’ can afford to absorb a lesser cost of living adjustment or a suspension for awhile. Social security benefits are not the same percentage across the board and those with higher wages receive a lesser percentage.
I received the survey and the presentation of it leads me to believe there is already a foregone conclusion that this thinly veiled ‘survey’ was trying to convince us of.
Note I meant social security not Medicare for cola comparison
I want OPERS to be solvent. I don’the think OPERS should eliminate CO LA altogether, nor base it on rate of inflation. I think it should be capped at either 2 or 2.5 per cent.
I think you’re right OPERS has decided to cut COLA IN SPITE OF our wishes. They want us to agree using fear as their motivator. OPERS works for themselves, not the members. You have only to look at their video to realize numbers are not behind them or they would have mentioned them–they’re just shaking the trees to see what leaves fall out. Don’t fall out!
They got you afraid already. That is exactly what they were looking for. Remember when they stated we were already financially strong? Why would you have to cut our costs when we are already strong? This is just to manipulate you into being afraid of losing your pension. They have you already in their grasp.
I lost $700.00 per month when I retired. I am now on a fixed income with my husband also retiring at the end of 2017.
I look forward to my 3% cost of living raise every May 1st.
I have many medicla issues at hand and I need the extra money to pay the bills that insurance won’t pay. Please don’t take this from us.
Right on! We worked hard for what we have and we want to keep it.
I object to the survey.
I was asked which of the several bad options I would support.
I wrote in a new box, entitled “None of the above”, which I checked.
I believe OPERS will use this slanted survey to try to persuade legislators and other OPERS members that most OPERS members support cutting or freezing COLA benefits even when most probably don’t.
I also question why OPERS rather cut benefits, instead of expanding its income.
The Stock Market is booming, yet, OPERS is trying to persuade us that these cuts are necessary, when they aren’t.
OPERS members should considering a change of OPERS leadership, board members, and investment managers if it hasn’t significantly increased its assets and income in the booming stock market.
I agree with Arnold Frye and did not do the survey.
Good point. Agree
I know of several retirees that did not get the paperwork in the mail to vote!
Debra,
All retirees should receive a survey by Sept. 1. Although the survey asks for replies by Sept. 8, OPERS has extended the deadline until Sept. 15. If you or someone you know hasn’t received a survey by Sept. 5, please call us at 1-800-222-7377 between 8 a.m. and 4:30 p.m., Monday through Friday and a survey will be resent to you.
Julie, OPERS
Please take into account the many levies that are passed for new schools and other services in our communities, which increase our property taxes. Older retirees can become even more frugal with their expenses, but taxes and medical expenses cannot be changed. Many younger retirees can work at another job after retirement if they desire to supplement their pension, but older retirees, in many cases, are not able to. Although you say the cost of living has not increased near the three percent point in many years, prices on almost everything have risen: food, communication and general city services, medical expenses, even local newspaper subscriptions, to name a few. I hope OPERS will take into consideration the many retirees who held lower paying jobs before retirement and do not receive a large cost of living increase each year. I’m sure there are plenty of retirees who held a high paying job and get a very nice increase each year. You should focus more on them to generate savings.
Good point. Agree
I have received the survey, filled it out and mailed it back. But I would also like to comment here about my concerns with this matter. The first concern that I have is the statement about the COLA of 3% being higher than inflation 60% of the time over the last several years. This statement is misleading and not actually true. The 3% COLA is based on the first years retirement salary and does not increase in future years. Therefore, ten years down the road, retirees are not actually receiving a 3% raise. The percentage is going down each year due to the fact that it is not being calculated on the current salary but has been frozen at a set amount calculated on the first year salary. Decreasing the COLA to 2.5% or lower would decrease a raise even lower and would definitely not keep up with inflation. Also, the inflation rate that you will be using does not reflect a true and accurate increase in everyone’s expenses. There will be higher expenses that some older retirees will face that is not included in the inflation rate such as healthcare. I do not feel that current retirees should be included in any changes. We have paid our dues and are basically on a fixed income. Any changes should be applied to future retirees who can plan for the changes and make retirement decisions based on those changes.
This retiree states it best. The cola is based the first years’ retirement salary and not compounded.
I suggest that if more money is needed for the future, then OPERS should request an increase percentage that is taken from current employees and increase the percentage that the Government Employer contributes to the OPERS account. Many other Public Employee Agencies have done this to protect the retirement fund such as Police and Fire Retirement Programs. This is only fair since the current employees can work longer to build up the “High Earning Years” and years worked will greatly increase their yearly retirement income. people already retired do not have any way to increase their retirement! Retirees should not be penalized by reducing our income that is FIXED!!!
PLEASE DO THE RIGHT THING AND NOT CHANGE OUR FIXED INCOME!!
Good point. Agree
I retired in 2012 because when I retired I was told I was guaranteed 3% had I known I wasn’t going to get the 3% increase , for my retirement years I’m have work 2 more years to increase the amount I got on my monthly check if you’re going to change the cola you should grandfather Us in and do the cola on the people who are coming up to be retired where they can plan ahead we have already planned to receive the Cola in our retirement years this is not right we have already been denied our social security full benefits we should be grandfathered in
That is the same as me, I retired 1/1/2013 mainly because by doing that I was guaranteed the 3% every year.
More time should have been allowed for response. Given that the time for us to receive the survey which may most likely be after Labor day; with a request to have it returned by Sept. 8th shows a lack of consideration on the part of OPERS.
Ken,
Although the survey asks for replies by Sept. 8, OPERS has extended the deadline until Sept. 15. If you don’t get a survey by Sept. 5, just give us a call at 1-800-222-7377 between 8 a.m. and 4:30 p.m., Monday through Friday and a survey will be resent to you.
Thanks,
Julie, OPERS
I would recommend leaving the COLA alone. As soon as organizations begin making changes, the retiree loses. Federal COLA is a mess. I have not seen an increase in years (military or social security). As long as PERS continues to attract and retain quality personnel to manage the PERS account, we will continue to be solvent. Would be nice to get the state out of our business. Thank you for your time.
Totally agree. Once changes start to be made things begin to get turned upside down and messed up. We retired with a certain understanding, please don’t change it now.
As a widow receiving retirement from my husbands 31 years of service I feel my income will be diminished enough due to insurance being my responsibility . How much more is PERS going to take from a surviving spouse that a husband worked for.
Good point.
This is not what we were promised when we hired in or what we were told when we signed our retirement papers . for the people already retired leave our cola alone and start with changes after Jan of 2018.
The cost of living in today’s world is rising faster than ever and as the years or months go by it seems that groceries, fuel, utilities, housing market have all INCREASED in cost. I don’t understand your justification for this removal of a necessary supplement to a very meager pension benefit. I don’t want to have to get a job, but you are forcing us retirees to enter the workforce when we should be reaping what we paid into for 30 or more years. Does not seem fair or just to me. Someone is getting rich off this, but it certainly isn’t the majority of retirees. Please reconsider other methods to fund your pockets. Thank you very much.
I retired in 2013 in order to receive the 3% before the changes. Please do not take away my guarantee 3% cola. I retired specifically to receive this benefit and counted on it for my future income.
From what I’ve read on the OPERS website, it seems that the driving force for this change is your claim that retirees are living longer. When we start dying off from the stress of having our healthcare reduced while the premiums skyrocket and now having our COLA attacked, will you return it to 3 percent for the retirees that survive?
I am very much AGAINST any change to our Cola. The retirees are still experiencing the raising prices of food, health care, property tax, etc. It is not fair to take money from my pension for any reason. My cost of living is going up every day and will continue to raise with the catestrophic events that are happening in our country, most recently Texas. We will be paying for these events, indirectly, for the rest of our lives through insurance premiums and many other ways. I have not received a survey and will return it as soon as I do. I am not in favor of changes to my COLA.
Thelma,
You should receive a survey by Sept. 1. Although the survey asks for replies by Sept. 8, OPERS has extended the deadline until Sept. 15. If you don’t get a survey by Sept. 5, just give us a call at 1-800-222-7377 between 8 a.m. and 4:30 p.m., Monday through Friday and a survey will be resent to you.
Julie, OPERS
I agree, COLA should stay at 3% for current retirees as we have no way to increase our income. I had previously worked under social security and due to the “windfall ruling” my social security decreases when i RECEIVE THE COLA and also medicare and supplemental insurance premiums are going up and
paying less toward prescriptions which are increasing too. There has also been increase in property taxes, food, home owners and auto insurance plus food and every other item that is a necessity. As a
widow I already have financial difficulties, a decrease in COLA will only increase these
Amen!
All adjustments to COLA should have been made prior to a fixed income retirement.When I retired COLA was given as a purk towards retirement. Not as adjustable on a downward sliding scale.
I feel the COLA is great! And not-so-great… When I first retired I was very happy to see that my retirement system provided a COLA. Then I realized after the first year that the dollar amount I received would be the same for the rest of my retirement…I was thinking it was a percentage of my total retirement allowance and that total would grow by the COLA each year and the percentage would apply to that each year (thus the total dollar amount of my COLA would grow)…whoops, no that isn’t how it worked…so I got over it. So, now we are looking to tie the COLA to the consumer price index. I know nothing about how that index comes up with it’s number. I do know that number has been below our 3% for years but no guarantee it will stay there – so, why the cap? Tie it to the CPI but without a cap.
I can understand your concerns about COLA. My husband is on social security and he just shakes his head when he sees my cola and his – uh- nothing…. you are right to review your policy and make adjustments
I hear ya Pat, social security got nothing, zero, zilch for 2 years in a row because they said inflation did not go up. Wow, for who? Yet we got our COLA increase from OPERS.
Well, for this year (2017) my social security increased by .01 cent. I’m not lying. Talk about disappointment, I got it in spades.
I count my blessings every day for my OPERS retirement and my yearly COLA.
Social Security CPI averaged 2.5% over the last 20 years. I included the recent years where SS got 0 in the average. That 2.5% average was applied to the current year of earnings. Unlike OPERS, which only applies to our intial base salary. We do not get a compounding 3%.
Since the campaign started to reduce retirement benefits, Opers has cost retirees thousands of dollars a year. And now they want to further reduce the purchasing power of their members. Just who is looking out for the members ? Most of us are too old or sick to return to the workforce. This has to stop now.
Why such a short turn around time for the retirees to complete the survey? These should have been mailed weeks ago. You have a major national holiday that will slow down the mail delivery; almost seems like this was done on purpose and the OPERS administration knows the outcome already before the survey is tallied. Could this survey been posted on the website and downloaded to save valuable time?
Neal,
You should receive a survey by Sept. 1, which includes a self-addressed stamped envelope. Although the survey asks for replies by Sept. 8, OPERS will accept and tabulate all responses received after that date. If you don’t get a survey by Sept. 5, just give us a call at 1-800-222-7377 between 8 a.m. and 4:30 p.m., Monday through Friday and a survey will be resent to you.
Thanks,
Julie, OPERS
Why can’t I find a copy of the survey anywhere on line? I would like to re-read it.
Ms. Milligan,
The surveys were mailed to OPERS retirees only.
Julie, OPERS
Good point. a copy of the survey should be posted online for anyone interested to view.
And the even more valuable, our money!
I retired bc of the guaranteed 3% COLA. That was the deciding factor for my retirement. I understand what you’ve been saying about it not being there to offset costs, but I was “promised ” that when I retired. That’s all I’m saying. Please take that into consideration. I think the “grandfather/grandmother” idea is best.
I too retired when I did because of the 3% COLA. I considered that a promise by OPERS, not some MAYBE.
I agree with you Paula! That is why I decided to retire!
I agree. I was told if i retired before a deadline. I would receive the 3 percent?
If changes to the COLA are inevitable, strong consideration should be made to using compounding and not simple interest. Almost all financial models, including that of OPERS, use compounded interest for rates of return, forecasting, etc. The COLA our nation’s Social Security Income recipients receive is based on compounded inflation from year to year, not on the base amount when they first began receiving benefits. I am looking forward to completing this survey as soon as I receive it in the mail.
I agree!
Right, in regards to our COLS, this is the only time simple compounding is used. Everything else in the Real World is calculated using compounding interest.
I already sent my survey back to you. I appreciate your questions. I understand the situation. Thank you for allowing me some input.
You know…I receive every little thing from OPERS in the mail. Funny….I did not ; however receive this IMPORTANT survey in the mail. Guess I need to call and request it.
Sue,
If you are an OPERS retiree, you should receive a survey by Sept. 1, which includes a self-addressed stamped envelope. Although the survey asks for replies by Sept. 8, OPERS will accept and tabulate all responses received after that date.We have extended the deadline to Sept. 15.
If you don’t get a survey by Sept. 5, just give us a call at 1-800-222-7377 between 8 a.m. and 4:30 p.m., Monday through Friday and a survey will be resent to you.
Julie, Ohio PERS
I have not received a survey yet. But I will comment here.
When I retired in 2004 I was counting on receiving the COLA for my entire retirement. I was counting on having my spouse covered by my OPERS health plan. I was counting on paying the same health care premium. In 2011 I received a notice my spouse would no longer be covered by OPERS health plans. So we had to purchase an individual plan at a substantial cost.
In 2012 I went back to work part time at a OPERS workplace to help pay the bills. In 2015 I was told I would have to pay an extra amount for my health care because of the Cadillac Tax. Well, the Cadillac tax has still not been instituted but you are still taking extra money from my paycheck. Now you say you need to cut out the COLA! When will the take backs end? Please leave the COLA alone , you have taken enough back.
Hank, OPERS
I just received it today…unfortunately the last three questions give no choice but to “pick your poison”. I hope OPERS doesn’t use the “survey” results as their vehicle to say it is what we “chose” to happen with the COLA because we we’re not given any choices but varying degrees of “poison” in the survey. If we must mess with the COLA, how about first off making it a compounding proposition, then tie it to the CPI but don’t CAP it. If we go down we should be allowed to go up too!
Well put Paul. We need to let the OPERS hierarchy now how we feel and when the time come let our legislators know also. The survey doesn’t leave us much room for comments and I intend to attach a note with my response detailing my dissatisfaction with any reduction or elimination of the COLA.
Paul and Ken are right on the money! OPERS has already determined what they are going to do
and the survey is nothing more than a scare tactic. I encourage retirees to contact their
legislators in Columbus before OPERS rams this through.
Paul Lopez is 100% on the money. I did not answer the last questions as they were all poison that I would not vote for – ever.
I put a LARGE X through those stupid final questions…give me a break!!!
I would think that all retirees would like to see our retirement solvent enough to where we can receive a cost of living raise. Considering that some funds in other systems are in jeopardy, I am happy that ours is solvent enough to receive what I am getting.
Having already lost income from the so-called “Windfall Provision,” there is no way I can survive a cut in COLA benefits. And we will certainly see increases in our medical insurance costs by the beginning of 2018.
Please do not decrease our COLA benefits.
Thank you,
Maxine DurJava
I agree about the Windfall Act. Whatever happened to repealing that and allowing those of us who worked a number of years under Social Security to receive our rightful benefit. I too am not in favor of taking the COLA away from retirees. We should be grandfathered in. Thanks.
There has been no resolution to windfall elimination provision reform, also known as WEP reform. HR 711 introduced by Reps. Kevin Brady (R-TX) and Richard Neal (D-MA) has been pulled from consideration.
OPERS’ ultimate position on a WEP reform bill would be based on how the final bill’s provisions would benefit or harm OPERS members. In the current fiscal environment in Congress, any WEP reform legislation will most likely include consideration of both the cost to Social Security and ways to offset that cost.
We look forward to working with Congressman Brady and other members of Congress when they revisit this issue to find a solution that works for the most people.
Julie, OPERS
Please consider capping at 3% or no less than 2.5%.
Ms. Fahner is 100% dead on! The windfall already hurts, if you lower our COLA and social security does what is usually does (nothing) then we the retiree are losing our retirement, our purchasing power. The CPI hurts every year. I have written my congressional personnel in D.C about the windfall provision being wrong. We paid into social security for long enough to qualify for a return and we have paid into PERS for long enough to qualify for a return. Why should we be penalized for being smart enough, lucky enough to fit this niche. We worked for it, nothing was given to us. Keep COLA at 3%.
believe si ce the goverment is fiancially solvent, the cola sh ould stay as it currently in the law..i also think that if struggle come to the retirement accounts, the board should swiftly gather, and review the information. Then just review the results out to the
t to stake holders
ond
I believe the CPI (which doesn’t lend itself well to the retirees expenses) has been volatile enough in just the last 10 years to justify NO CAP for our COLA if we should decide to tie our COLA to the CPI as I believe is being proposed. Also, compound calculation of the COLA dollar amount yearly would be a compassionate improvement on the current calculation especially with the “Windfall” calculations reducing all of our SSN benefits that many of us paid into for years.
I agree with those who have pointed out that the 3% was based on the first year, which means it is NOT 3% in the future. It becomes a fixed annual amount, which is less than 3% of the current year’s income. And I agree that OPERS does a great job. AND I agree with those who think that the survey is a veil to make us think we have input when, in fact, the matter has probably been predetermined. It will be interesting to see what happens next. As a retiree, I have to pay increased property taxes, etc. whether or not my income increases; and the longer I’m retired, the tougher it gets.
I have been a OPERS retiree since 2001. I have always been very impressed with OPERS management and services. I am, however, very concerned about the talk of changing our COLA. The increase in the cost of my health insurance more than ate up my COLA last year. So you see your point about the CPI seldom reaching 3% may sound good, but in reality, it just doesn’t fly.
I completely understand and appreciate the diligence OPERS demonstrates in keeping our retirement system healthy. It is however, disingenuous to change course midstream.
Please, please find another way
I agree with others that we have paid our dues. I also retire in 2012 so I could get the 3% every year. You have already taken away benefits, medical for our spouses, that was promised when I retired. You raised the contribution for retirement years ago when I was still working. Why not consider that for the ones going to retire in future instead of taking away from us that do need that 3% a year to cover higher medical costs, taxes, medication, and auto & home insurances.
The executive director seems to try to compare apples and oranges, when it comes to CPI. Since she thinks the 3 % is comparable, then OPERS needs to review the compounding issue. This has resulted in the 3 percent actually becomes less than 2% in the 18 year. Instead of looking for the retirees to foot the bill of over estimating returns on investments or under funding by the governmental entities, OPERS should look at the funding sources percentages to increase. A small increase the the employer share would eliminate the unfunded amount over the next several years.
I looked at the survey and it is slanted to obtain the answer OPERS is looking for and not good answers.
Finally received the OPERS COLA ‘survey’. I say ‘survey’ in quotation marks because its not really a survey at all. Its filled with false equivalencies meant to frighten people that either they need to take cuts in COLA or else loose health insurance or their pension. All this is of course predicated with our finances are “strong” & so not in peril as these questions are framed! OPERS obviously already has their mind made up regardless of what we think. They are just trying to spread fear so we support it.
The CPI has never been an accurate measure of inflation. http://www.newsmax.com/Finance/JohnMauldin/inflation-economy-spending-higher/2016/05/13/id/728644/
A pension doesn’t mean much if we become bankrupt with it.
Good article but OPERS has made their decision. They are just hoping they can get enough feedback to justify their decision and that’s not going to be hard with the questions they asked. As for the healthcare question, I thought is was funded separately funded.
Steve, quite a few of us are in agreement that a decision has already been made and they are just feeling out people so they can judge the fallout. As most of us retirees still have pretty good memories, just like regular politics, people are elected, re-elected, or replaced. At our level, it does not take millions of voters to make the changes.
At retirement our annual cola is based on our salary at retirement. Not on our salary each year. We shouldn’t have to help fund future retirees. I agree with everyone else leave it alone.
ihave already given up my spouses health care then we gave up what pers gave us towards medicare and now this .how much more can we afford to give up please leave our COLA alone
We have endured the upheaval caused by the destruction and, then, the reinvention and downgrade of the OPERS Health Care Benefits. And now, it seems that the tinkering continues. Enough! I expect the fulfillment of the promises given me when I became employed. and then retired. under OPERS. The 3% COLA is a lifeline.
I did not receive the notice to share my feeling about the COLA. I did receive the 2017 Mail-in Ballot for Representatives.
Marsha,
All retirees should receive a survey by Sept. 1. Although the survey asks for replies by Sept. 8, OPERS has extended the deadline until Sept. 15. If you or someone you know hasn’t received a survey by Sept. 5, please call us at 1-800-222-7377 between 8 a.m. and 4:30 p.m., Monday through Friday and a survey will be resent to you.
Julie, OPERS
I have not received my questionare as yet, but I am telling PERS that the 3% COLA is very important to a retiree on a fixed income. 3% doesn’t sound like much until it is taken away. Keep the 3% as is.
Leave our COLA alone. You already changed things we were promised. Leave our COLA as ls as promised.
The 3 % COLA was the reason a majority of people left on 1/1/13. The COLA needs to be kept for retirees if there was any idea of changes to this I and others would have continued working. Do not penalize us again after cutting spouses from healthcare availability.The phasing out process has done wonders for peoples budgets.Try to find a decent job at our age -Good luck to that.The economy has rebounded since your analysis/restructuring of the pension plan after the Great Recession. The stock markets are at all time highs so OPERS Investments should doing very well.You might as well raise the retirement age to 65 and call it a day. If you must do something grandfather in the current retirees .
I don’t think it’s fair that the people who were at the mercy of their public employers should now be at the mercy of their retirement fund I don’t appreciate it at all. Why does OPERS always have to tamper with our money?
Did OPERS lose a bunch of money in the stock market again? Really tthat is my question or where did all the money go?
Mr. Powers,
OPERS regularly reviews its plan design, and we don’t wait for a financial crisis to arise to make adjustments. Prudent planning can avert a crisis. OPERS has made changes to the COLA several times. From 1935 to 1970, OPERS did not have a COLA, and from 1970 on, we have made changes to the COLA based on changing circumstances, as we are considering now. Changes to the COLA will help adjust for longer retiree lives, the long term financial strength of the System, and to serve its intended purpose-mitigating inflation for retirees.
Julie, OPERS
I, for one, am grateful that OPERS is trying to make the COLA program safer.
God forbid a catrastophy happens and we lose it all. Then what? That 3% will not make anyone a millionaire.
Social Security gave us NOTHING 2 years in a row and we survived. I’ll tell you again, my SS increase for 2017 was ONE CENT….. What can I do about that??? NOTHING, so let’s just be patient and see what happens.
It’s great that you get Social Security and that means your covered by Medicare Part A. That may not be the case for everyone. If they have a spouse that is not covered by OPERS anymore that’s an additional expense that can be offset by a COLA payment.
Margaret, if you are affected by the WEP/GPO discriminating punishment, there is something you can do. Insist that OPERS support, 24/7, that unjust law signed into law by Pres. Reagan and approved by Congress. Time to protest.
Social Security average CPI increase over last 20 years us 2.5%. ( that includes the last few years of 0%) And SS increase is compounding, unlike OPERS.
Most people before they retire do some Financial planning based on the benefits they will receive . Working over 30 years a person would recieve an additional 2.5 % of there (FAS) for each year worked. However, many retirees like myself were faced with retire before 2013 and recieve a fixed 3% COLA or work longer and increase your initial retirement . And now that our retirement % is lower OPERS wants to reduce the COLA. I’m hoping OPERS realizes that people cannot rehire themselves or Chang there retirement date. COLA should not be an option for OPERS !
Daniel,
OPERS was founded in 1935. We don’t currently offer the same level of benefits or services we did when we were founded. Times change, and OPERS must adapt to changes.
OPERS has made changes to the COLA several times. From 1935 to 1970, OPERS did not have a COLA, and from 1970 on, we have made changes to the COLA based on changing circumstances, as we are considering now. That is why we are seeking your feedback now, due to our long-standing practice of proactive planning to ensure the long-term funding of our System.
Julie, OPERS
I would like to know if the COLA is changed, will the COLA then be an actual COLA increase based on our actual annual pension, or still be based on our first year pension?
Ms. Rothgery,
It is still very early in the process. The Board is weighing several options and has not voted yet. After the Board voted, the proposal would go to the Ohio legislature.
Julie, OPERS
I feel that the PERS board has already decided that they are going to cut the COLA and this is all a smoke screen. It is like seeing a car go left of center. You just know it is going to hurt, it is just how you will be injured. I am going on the record that I do not want to loose any benefit that I that I had upon retirement.
I think you’re right OPERS has decided to cut COLA IN SPITE OF our wishes. They want us to agree using fear as their motivator. OPERS works for themselves, not the members. You have only to look at their video to realize numbers are not behind them or they would have mentioned them–they’re just shaking the trees to see what leaves fall out. Don’t fall out!
Like most, I’m not happy about the impending reduction to the 3% COLA change which we all know is coming. Pretty apparent that a decision has been made and all that remains is the degree of the reduction. As others have stated, I planned very carefully before retiring and this is one more of those things that are being taken away. We retirees seem to be asked to pay more than our fair share of the “solution”. Certainly there are other options being studied such as having current employees chip in to fund their future retirement benefits.
Greg, I agree and stated the same minus my thoughts that the decision had already been made.
The COLA is not a 3% annual adjustment – – it’s a flat dollar amount based on the initial benefit and declines over time as a percentage.
Most inflation measures do not include health care, which has been rising at a much faster rate than 3%. Over the last several years, OPERS retirees are responsible for an increasing share of premiums and co-insurance, in part due to OPERS’ premature response to a non-existent and unlikely “Cadillac” tax.
If the system is financially strong (as you maintain), what is the rationale for this step at this time? Is this motivated by political pressure in response to the STRS freeze on its retirees’ COLA?
The survey’s questions are designed to force responses that can be used to demonstrate retiree “support” for an option that would otherwise be opposed. This is a not fair assessment of retiree opinion. The unfortunate conclusion from this skewed survey is that the OPERS administration and Board have made a decision and are now looking for support, or what can be construed as support.
I value and appreciate my pension benefit and health care insurance, and served in the public sector for many years when I could have pursued other options. This choice was strongly influenced by the retirement system. I am willing to do my part to address legitimate financial concerns, as in the wake of the 2008 recession. But this seemingly politically motivated shift in policy with no clear rationale or documentation deserves to be questioned. We deserve better explanations than what we have seen so far.
Ms. Burnell,
We value your input. Please send us your survey if you have not already done so. I encourage you to read the FAQ son the OPERS website at https://www.opers.org/retirees/cola.shtml#faq.
Thank you,
Julie, OPERS
just what is “unfunded pension liabilities”?
Like everyone else…for the same reasons as they stated, NO… I don’t want a cola reduction, cola elimination, or any other pay cut… who in their right mind would ? I thought this pension solvency problem was taken care of when the health care changes were made several years ago along with cola reduction and other pension changes for future retirees. As of now, I am already receiving less than 2% of my current yearly pension amount
From what I have been able to discern, this is the first time in OPERS history that cuts have ever been proposed to retirees’ pensions after they had signed their retirement contracts. Also, there are many other ways that OPERS can save money without cutting into retired people’s pensions. Those cuts should be made to those who receive subsidies. Investment costs are also an area that should be reduced.
Mr. Martin,
Thank you for your comment. It is settled law that COLAs to be granted in future years do not vest. (OPERS is considering changes only to COLAs to be granted in future years.) The COLA changes under consideration are for purposes of ensuring the financial integrity of the pension funds and the security of all members’ and retirees’ pensions. Any contemplated changes will be made in a prudent manner for the fiscal integrity of the system, and within the parameters of the law.
OPERS did not offer a COLA for the first 35 years of our existence. We’ve also adjusted the COLA several times since first offering it in 1970. It was initially based on the U.S. Consumer Price Index, and this peg to inflation didn’t change until 2002. That’s one of the current considerations, and we’ve based the COLA on the CPI more often than we’ve provided a flat-rate increase.
Changes to the COLA will help adjust for longer retiree lives, the long term financial strength of the System, and to serve its intended purpose-mitigating inflation for retirees.
Julie, OPERS
Not enough information to make an informed decision, how will this be calculated, how much will this add to our 80 % funding level. If we have to go to the legislature for approval have you considered other changes such as having new hires, those hired after 2019, to work until they are 65 Medicare eligibility age with x years of service wouldnt this help both the retirement account and health care. This would make a change to a group not yet in our system. What else needs done so we hopefully could take a breather. I want a solvent system, as I am sure we all do, so please supply the additional information for me to make an informed decision.
Linda,
Thank you for your comment. We are exploring several options and will be taking your input into consideration, so please complete this important survey. The OPERS Board of Trustees has taken no action up to this point, and it will be both a public and legislative process. Any actions taken by the Board will be shared with you.
Julie, OPERS
Will you be having informational seminars throughout the state to further explain and gather COLA feedback ? If not why?
Mr. Christofis,
We are gathering feedback, and your comments are important to us. We encourage you to send us your completed survey if you haven’t already done so.
Thanks,
Julie, OPERS
Like other comments I read here, I too retired 1/1/13 to secure the 3% COLA increase each year. Now you want to pull the rug out and go back on your word. The written survey I received is a misleading document that slowly steers us toward answering questions about ‘HOW MUCH DO WE WANT TO BE CUT”, Really? I want to go on record as saying “Leave our money and promised guarantees alone”. Let the folks working toward retirement plan their own income goals and grandfather us in at our 3%. It really makes me angry to feel that OPERS has made a promise they don’t intend to keep. We are victims of the “Bait and switch”. In addition to this response I intend to make my voice heard with my legislators, in hopes they may listen. KEEP YOUR PAST PROMISES !!!
Since our COLA is currently 3% of the base amount of our benefit at the time of retirement, that 3% is now just barely above 2% of my current benefit. I read that one of the possible changes is to mirror our COLA to that which Social Security reciepents recieve. I certainly hope that includes Social Security’s method of calculation based on the current benefit, thereby compounding the increase. Any change to the percentage increase that does not include a change to include compounding will result in an even greater loss to us.
Do what you have to and save / preserve our pension system. I’s rather see a decrease in COLA than in my monthly benefit.
What a Large, Large disappointment this proposal is. I think that the most valuable lesson here is not to put as much faith in promises of future benefits as we have in the past.
I retired in time to have the 3 percent cola and that was a large determiner of when I would retire.
I expected that with rapidly increasing health care costs for my non-Medicare spouse that my yearly cola would help us get by.
As time goes on OPERS continues to offer shrinking benefits to retires who are becoming more strapped each year. I do not think it is news to any retiree that even with their cola as it is that it does not come close to covering the increase in living cost we see, but it does help some.
I know that this, as well as other recent changes have continued to diminish my confidence that OPERS will provide what was promised when I was a working member making contributions every payday.
So naturally I want to retain my 3 percent cola.
Just read an email about OPERS evaluating whether to adjust, downward of course, the COLA for pre-2013 retirees….are you kidding me? You reduce the health care benefits when there are funding concerns and now you are considering reducing other benefits when there is not. OPERS always stresses planning for themselves, but does not consider the planning of the individual retiree!
I agree with numerous others on this blog that you have already factored in an adjustment and asking for comments will have zero impact on your decision making. Hopefully, our voted-in legislators will decide differently!
When I retired I took a in come cut then.Lost my normal pay and then took a bigger hit from social security (GPO}. As I get older medical bills are going up which are not figured into cola. Our Cola should be cap at 3% .Since we have already retired,if you want to have a lower rate for those who havent retired yet that is different they will know what to expect.Dont make those who already retire take a cut or freeze,since that is what social security does .
From the survey it appears that we are only being asked how we want to lower the COLA. I retired prior to the 2013 deadline, in an effort to maintain a 3% COLA. Had I known then that in 2019 everyone would go to the CPI, I would have continued to work. If we must take a COLA reduction, then I suggest that some sort of tiered approach be implemented, where those with the higher pensions receive the least COLA. Across the board cuts and / or straight percentages are never fair to those that have the least.
I’m happy to have the opportunity to add to the discussion. A couple of clarifications . . there was never a “promise” or “guarantee” that we would receive a COLA . . it was always based on whether or not the financial health of our retirement system we paid into could afford to provide one. So, from there . . . . . math is a slippery slope. If I retired in 2000 and received a 3% COLA increase of my base retirement amount every year for 17 years, my base rate would have increased 51%. According to http://www.data.bls.gov, $100 in 2000 has the same “buying power” as $141.76 in June, 2017 . . I’d say that’s a 42% increase since 2000. So by that measure, the OPERS annual 3% COLA kept us ahead of inflation by 9%. (That 42% is actually the accumulative total of CPI-based COLA’s from 2000 to June, 2017).
I agree with many comments before this that a decision has already been made, and the questions on the survey have been structured to support that decision . I believe there will be a freeze (no COLA) in 2018 and 2019, then we will begin COLA’s based on the Consumer Price Index as utilized by the Social Security Administration. I also agree that the CPI does not accurately reflect increases in our actual cost of living. 0.0% increases in 2010, 2011, and 2016, and a 0.3% increase this year are stark evidence of that.
SO . . FINALLY, a question to our administrators at OPERS: Will the CPI-based COLA’s we receive be based on our previous year’s benefit as is applied by the Social Security Administration (www.ssa.gov/OACT/COLA/colaapplic.html) or on the base rate at which we retired some 10, 15, or 20 years ago???
Tom,
Thank you for your comments. We are exploring multiple options, and the OPERS Board of Trustees has taken no action up to this point. It will be both a public and legislative process, and any actions by the Board will be shared with you. No changes would take effect until on or after January 1, 2019.
Julie, OPERS
I would agree with Tom if the system is in financial hardship. But that’s not what they are saying is it?
Mr. Christofis,
OPERS regularly reviews its plan design, and we don’t wait for a financial crisis to arise to make adjustments. Prudent planning can avert a crisis.
Changes to the COLA will help adjust for longer retiree lives, the long term financial strength of the System, and to serve its intended purpose to mitigate inflation for retirees.
Julie, OPERS
If you don’t stop the COLA’s to save money, what is your plan B to make the system stronger?
I received the COLA survey, it is an obvious attempt to slat towards OPERS putting into place what has already been predetermined. Who makes up these questions? My prediction: The COLA will be reduced or eliminated for several years in a row. Which is unfortunate since it is based on the first year of retirement salary at the simple interest rate not the compounded rate and is eaten up by healthcare cost anyway. After 30.5 years on job I had to go back to work to cover spousal heath care and now I will have to continue to work longer than anticipated. You are correct in your thinking that my COLA is important to me and I would hope that OPERS would grandfather those who retired before the 01/01/2013 date when we were told that the 3% amount will continue throughout our retirement years.
Lots of us with you Deb. Appears to all be predetermined. Not what we were promised.
I agree with Tom Brent’s post. If we don’t shore up OPERS COLA now, down the road we will get nothing.
We got nothing from Social Security two years in a row, we had no choice but to “make due”. My increase from them for 2017 was, believe me, I’m not joking, a measly ONE CENT, ONE PENNY. That yearly .12 cents surely won’t put me in another tax bracket.
I count my blessings everyday for what I get.
I agree that lowering the % of our COLA will help keep us from losing it all together.
OPERS has lost all of its credibility.
I was one of the misled at retirement to believe I would get a 3% increase each year. What I found out later is that it is figured only on the first years pension amount. The amount of increase is the same exact dollar amount each year. This means that each year the actual percent of increase in your current year pension goes down. 1st year it is 3%, year 10 it is 2.3%, year 20 it is 1.8%, etc. So as we get older and sicker we get less.
Don’t get me wrong, I am glad to have any increase to offset the yearly increases in food, medicine, medical care, insurance premiums, utilities, property taxes, and etc. But for those of us with poor health in our 70’s and 80’s we don’t have any options left to offset these cost increases except the cola.
Many of us that worked in the public sector did not earn large salaries and as a result draw smaller pensions. With the lose of spouse medical coverage we now have to pay the entire premiums and medical care cost for our older sick spouses out of our pensions.
When the board does their review they need to take in consideration this segment of older sick retirees that have NO other options. Please don’t drive us out of our homes onto the streets.
I guess they will have to toss out this survey since the comments are overwhelming that COLA should be left alone. The survey is slanted and the questions poorly written. What retirees have had to endure the last few years and the benefits we have lost have had a very negative impact on our lives. Now this, come on.
Question 12 of the survey is missing a third option. Retirees will need to draw in a box for “none of the above”.
I retired in 2010. One of the deciding factors was the promise of a 3% COLA increase (based on my first pension check). In 2015, my insurance increased due to the Cadillac tax, which never went into effect, yet i’ve been paying higher premiums for 2 years. In 2012 OPERS changed the COLA for future retirees to be based on the CPI, so future retirees could plan for it. I planned my retirement based on the figures that were promised to me when I retired. What I didn’t plan for, however, is for OPERS to take away my benefits during retirement.
I inked “none”.
I am very much against any change to our COLA. I think the retirees gave up a huge benefit when they took away the spousal health care. Enough already!
As for the survey, I added a box and it says NO CHANGE
Here is another inconsistency. In her video, Karen Carraher states that the 3% COLA has outpaced inflation 60% of the time over the last 3 decades. Yet in an OPERS blog from 2011 they stated that the CPI averaged 3.17% per year over the last 3 decades. Which is it?
*** from an April 2011 OPERS blog***
Our proposal is to link cost of living adjustments for future retirees to the Consumer Price Index (CPI), a measurement based on a market basket of goods and services. The maximum increase would be 3 percent. Over the past three decades, the CPI has averaged 3.17 percent per year. Our projection for the next 30 years is that the CPI will average 2.8 percent annually.
Based on our proposal, current retirees would retain the 3 percent COLA. The new adjustment would apply to anyone whose effective date of retirement comes on or after the effective date of the legislation, which is typically 90 days after the governor signs it. To be fully grandfathered, a member’s last day of work should be in the month preceding the effective date of the legislation.
Published in PERSpective (OPERS blog), April 7, 2011
I’m glad you researched and found this. A lot of us relied on this in our decision to retire when we did.
Questions 10, 11, 12 of the survey is missing a third option. Retirees will need to draw in a box for “none of the above”.
I retired in 2010. One of the deciding factors was the promise of a 3% COLA increase (based on my first pension check). In 2015, my insurance increased due to the Cadillac tax, which never went into effect, yet i’ve been paying higher premiums for 2 years. In 2012 OPERS changed the COLA for future retirees to be based on the CPI, so future retirees could plan for it. I planned my retirement based on the figures that were promised to me when I retired. What I didn’t plan for, however, is for OPERS to take away my benefits during retirement.
One last comment from me…., everyone should realize that if changed to the CPI and capped at 3% we will never get what we are due when inflation is high. We will never get above 3% and so then will not keep in step with inflation over time. We will always be behind it in the long term. When it is low we will get low but anything above 3 we will never get. It also will not, as far as it seems, be compounded like the Social Security recipients get. It will be a simple COLA that will always be based on our initial benefit. Even with the current 3% it is not really 3% for very long.
Please OPERS, do the right thing and don’t take away this benefit that we as retirees can not compensate for. We have already retired and can’t go back to our jobs. This really will have a significant impact on most if not all of us. Most of us already didn’t see the benefit of our COLA last year and won’t next year due to our healthcare premiums. My property tax increase and healthcare premiums alone have well exceeded my COLA the last 2 years. That doesn’t include all the other cost increases. Please reconsider making these changes.
Thank you.
I was one of the misled at retirement to believe I would get a 3% increase each year. What I found out later is that it is figured only on the first years pension amount. The amount of increase is the same exact dollar amount each year. This means that each year the actual percent of increase in your current year pension goes down. 1st year it is 3%, year 10 it is 2.3%, year 20 it is 1.8%, etc. So as we get older and sicker we get less.
Don’t get me wrong, I am glad to have any increase to offset the yearly increases in food, medicine, medical care, insurance premiums, utilities, property taxes, and etc. But for those of us with poor health in our 70’s and 80’s we don’t have any options left to offset these cost increases except the cola.
Many of us that worked in the public sector did not earn large salaries and as a result draw smaller pensions. With the lose of spouse medical coverage we now have to pay the entire premiums and medical care cost for our older sick spouses out of our pensions.
When the board does their review they need to take in consideration this segment of older sick retirees that have NO other options.
I have received your survey about the Retirees COLA, and filled it out, but I think the plan is already in place and the survey is just JUNK. First off let me say that I think you should NOT reduce my COLA. One of my solutions would be to have any new members to OPERS wait for 35 years before being able to retire. The other is up the amount new hires pay into the system.
I know that some of what I say here will not sway anyone one way or another, but I am tired of being a victim of the system that purports to be for Retirees. When I was hired, I was told “Even though you wont make as much as the private sector, we have the best retirement in the country, 30 years and full benefits, a very good medical coverage.
But when I got ready to retire, OPERS changed the rules: No longer would they cover spouses at 100%, it would be phased out, “Couldn’t afford it” . OK so I adjusted, worked for 32 years, to get a little extra to cover the insurance. And when I was going to all the seminars, the Reps said “Yeah, you will get a 3% COLA, ” I know the speech, the Medical was never guaranteed, but it was implied, and now you are going to say the COLA was never guaranteed, but that was what I was told by your Rep. The COLA was making up for the hit I took on the insurance, little by little. And my COLA is based on the amount when I first year retirement, that 3% is now down to 2.8%. Now you are talking about NO raise for 5 years???? I went for 10 years with NO raise, on the job, no money in the budget!!! I went to all the financial seminars, plan for the future, know your expenses, save money for your retirement, know what you need and plan! WELL how can anyone plan for financial security when the rules keep changing? This is like playing a baseball game, knowing there will be 9 innings, then the management comes down to the dugout, says we’re going to go 12 innings, haven’t sold enough beer and hot dogs yet, and you have to clean your own uniforms.
My insurance is now over almost one third of my retirement. I had to go back to work just to cover my insurance.
Also you should base our COLA on cost increases that effect us retirees, cost of insurance & medications have gone up very dramatically.
Wonderful analogy Jim. Couldn’t have said it better.
I received the COLA Survey and I am somewhat confused by Question 10. It’s about “freezing” the COLA. Does it mean to “freeze” the COLA at the current level or does “freeze” mean zero ($0) COLA for those years?
I would hope that most current and future retirees appreciate the efforts of OPERS in maintaining an excellent retirement system. I also believe OPERS should not be surprised that not many are going to favor any reduction in their retirement benefits.
Let me also say that I know what applies today will probably not apply in the future. Even the people that get paid to predict future trends are usually wrong. Most retirees have seen many ups and downs in the U.S. economy through the years whether its during periods high inflation or low inflation. But not much changes financially either way for most of us. When you think you are able to put aside some money for savings, along comes something to wipe it away.
A “freeze” would mean a zero COLA for that year.
Julie, OPERS
Thank you for your comment on WEP/GPO. This link might interest you and the OPERS Board. It states how unfair and harmful the WEP/WEP is to the survivor of one who should be drawing widow/widowers benefits: http://www.ssfairness.com/wp-content/uploads/2013/03/The-Case-for-repeal-of-the-GPO-WEP-rev.pdf
The 3% COLA was guaranteed to retirees who retired before 2013. If OPERS is going to change/cut the COLA, you should do so going forward from when the first changes took effect. It’s the only fair thing to do. The retirees who retired before 2013 should be GRANDFATHERED IN.
Is the annual 3% COLA currently in place with the Additional Annuity Program “negotiable ” also?
Changes to the COLA would include all benefit types including the Additional Annuity. OPERS staff and the Board will continue to evaluate all changes to the COLA including Additional Annuity accounts.
Julie, OPERS
OPERS stated in the newsletter:
“We have begun to gather feedback from members, retirees and stakeholder groups about potential changes to the cost-of-living adjustment that would affect current retirees.”
I read this to mean that many more people than the current retirees affected by this proposal will be giving feedback also. It shouldn’t be too hard to predict how stakeholders and the members that lost the COLA because of pension reform would vote. The current retirees that should now be grandfathered will be outnumbered by this tactic and OPERS will “conclude” a majority of respondents want to see more changes to COLA.
OPERS, if you could please answer:
How many surveys were actually mailed out and what other means are being used to gather input?
Thank you
Thank you for your question. The survey was sent to more than 194,000 retirees and we are receiving a steady stream of responses in the mail every day. We are of course also receiving mail and comments on social media. In an effort to be inclusive and to gauge a true cross section of perspectives, OPERS has met, and continues to meet, with many stakeholders, including representatives of retirees, active members, and employers.
Julie, OPERS
Essentially OPERS is a two tiered system. One tier for people that worked for 40 hours a week at a not so great wage in exchange for retirement and health care security. Another tier of members:
-Occupied a part time elected position but through connections jumped into Opers for a few years and received a retirement out of proportion to their lifetime OPERS earnings.
-Were able to book massive amounts of over time in their final years and received a retirement out of proportion to their lifetime OPERS earnings.
-Those employed by a OPERS employer that allowed them to maintain outside Social Security employment. This allowed them to earn enough SS credits to avoid the WEP penalty that cause other OPERS retirees to lose most of their SS.
-Those who came into elected positions that allowed them to buy additional credit/time at a substantially reduced rate.
While I understand that actions were taken to eliminate these windfalls for certain members, nevertheless there are many drawing large OPERS benefits as a result of these past practices. Therefore any reduction of benefits should go against these members first at a higher rate than members who worked traditionally for their benefit.
The folks most likely to oppose change will be posting comments here. The majority of people in agreement with change will probably not bother to post or even return the survey. So there is probably a large silent majority of retirees in favor of making prudent small changes now in advance in order to avoid making larger reduction in benefits in the future. But of course, older retirees are not too concerned with the distant future, only the present.
Your taking a lot of liberty in your assumptions Joe. I figure you either are not retired or are receiving a a nice comfortable pension. I suggest you have compassion for those struggling w/ every penny.
Thank you for stating what I think, Joe. I do not think that we “older retirees” are as selfish and self-centered as you may assume.
I am an older retiree and hope to live longer to enjoy a retirement as promised.
I think Joe makes some very wise observations. If the survey were actually a “vote”, and if we only considered the 100 or so comments posted here, there would likely be no change in the 3% COLA. But I think the vast majority of retirees understand that these financial decisions are being made and proposed to salvage the pension fund and ensure we will receive our pensions into the future. What other reason would OPERS have to make changes in medical coverage and COLA’s if not for the financial health of the system?? Of course, all of these reductions hurt, but I applaud OPERS for being good stewards of the fund.
Sure, these observations are quite obvious in the fact that something needs to occur to forestall future problems. But we focus on percentage(as accountants and actuaries must do) instead of the effects of the actual dollars. I worked in a field that certainly reflected society where we had those who were quite well off(and certainly earned it) to those who did the payday to payday routine we hear so much about. Most of us where in the middle. It’s the lower earners who need to be assisted. Not everything that happens is under one’s control. I state again why can’t this be graduated based on income? Social Security is interpreted to mean a social benefit that makes us all better when the lower income earners have some means to subsist. And this applies to PERS also. If you reduce the safety net for some then we are all affected and how do those most affected begin to get ahead? A degree of compassion certainly wouldn’t hurt in how these changes are implemented.
Then there is a disconnect between what they are saying in there annual report and this COLA change. I would assume that when they say there at 80% funding even after the make their assumption change on investment returns from 8% to 7.5% they took into consideration the 3% COLA. But may not!!
Yes, this forum is mostly for people opposed to any COLA reduction to just blow off some steam. The changes are coming regardless of how any of us feels, like it or not.
I disagree completely with Joe. He is posting and obviously had no financial concerns.
you can disagree all you want but it wont change what is coming
You are likely correct. Those who feel they don’t have any ‘skin in the game’ often adopt the attitude that it doesn’t matter what happens to everyone else as long as it doesn’t happen to me.
Every retiree has skin in the game, if you are inferring that I dont have any so called skin in the game, which I believe that you are.
It is happening to everyone including me, as I am a retiree also.
The corollary to this is that everything is “fair” if it affects others but “unfair” if it affects me.
Joe, I think your comments are short sighted. Most retirees have had to adjust and change their plans and positions on many subjects including finances. These changes are based on our perceptions of the best course to follow. They are not taken lightly. We understood and experienced the changes made after 2008 financial crisis. What was done then was necessary to stabilize funds. What I don’t understand is why the Cola for current retirees needs to be altered. What crisis or change has made it critical? The Cola will phase out as retirees die. I never considered myself or any other retiree as part of a 2 billion dollar liability. I’ve already given up eye and dental coverage to compensate for the increased medical costs. The only other choice to save 3% income is to move where they don’t tax the retirees.
I wish you well but try and understand, our situations are unique. This change will alter our lifestyles in a very negative way.
Mike C.
It’s a survey Joe, with people with opposing views no need to make to pick winners or losers or pit older retirees against those of younger status. It’s a blessing to live a long life.
COLA should not be capped. What happens when inflation exceeds COLA? Does one ever recover? Keep pressure on participant contributions and those managing investment fund. If a freeze occurs, need a program to allow retirees to have some catch-up.
Health care costs have been increasing faster than other COLA components. The CPI is based on the average consumer. It does not reflect the fact that older folks are not average consumers. We spend a higher percentage of our income on health care than the average consumer. OPERS retirees will experience a lower standard of living under ANY COLA which does not acknowledge the difference in spending patterns.
Hi, I say anyone currently retired and getting COLA should continue with COLA as is (including retirees in group A). We have already retired based on promises made.
However, I say change the rules now for future retirees in 2020. They will have the opportunity to plan and prepare for retirement based on the new rules (reduced COLA or no COLA).
If we were never promised COLA we wouldn’t expect it, so don’t promise it to future retirees.
You already changed the COLA in 2012 when you made it a simple interest formula. Now you want to reduce it again. The market has gone upward of 100% since 2012 and the State continues to influence our retirement benefits downward. We have all bought an annuity of sorts but the insurance company wants to keep changing the payout…yet we aren’t given the option of working longer or changing the way we want to be paid. No one seems to have any ideas on increasing income to pay the benefits promised…only to cut benefits from people promised good benefits even if your wages were considered lower. Seems that our investment advisors are gaining a lot of the market increase. Maybe we should invest more like a Chase Bank that earns billions more on their 70,000,000,000 equity. Increase the income stream, think out of the box instead of following accountants that only come up with cut answers. Change the rules invest in our own… establish our own 18% credit card program. Invest in our own people instead of saying we can only get a safe 6% in the market that is setting all time highs. What would a Chase Bank tell our investment advisors if they were employed by a bank in this market? One added note… your proposed changes don’t talk about any future inflationary rates and how the average pension will be adjusted upward? Thank you.
COLA was changed to simple compounding in 1970 I believe, not 2012. But either way, the 7.5% that OPERS assumes to earn annually will get knocked lower during the next recession, and further cuts in our pensions will probably be coming then.
This board is truly entertaining. Everyone crying and whining and thinking only of themselves.
The 7.5 percent includes market fluctuations.
I made a comment but it wasn’t published. So I’ll try again. I retired when I did because I was given the impression that the 3% was to be given to me until death. I included those figures in calculating future needs in retirement, most specifically medical bills. Now you want to take that from us. Make changes for future retirees, not those of now retired and unable to supplement our income with employment.
Our fixed retirement benefit is figured on a percentage (xx%) of our computed salary at the time of our retirement. Our fixed COLA is figured on a percentage (3%) of our computed monthly retirement benefit at the time of our retirement. This fixed dollar amount never increases no matter how long we are retired.
All the discussions focus on a 3 percent COLA. This is not what we really receive.
We are told the Board is weighing several options. An update of these options is provided by OPERS at: https://www.opers.org/pdf/retirees/cola-update-20170921.pdf
This update states the following:
“Current considerations include:
• CPI based COLA subject to a cap less than 3 percent
• Extending the waiting period for the first COLA for new retirees
• Flat dollar amount COLA”
One of the considerations by the board is a “Flat dollar amount COLA”. We are currently getting a Flat dollar amount COLA. Rather then OPERS continuing to focus on the 3% we would really like for OPERS to just let us know how much they really want to cut our fixed (COLA) amount.
Mr. Sessor,
Several options are being considered by the OPERS Board and they have not voted yet. Please note that a “flat dollar” COLA would be a set amount not tied to a retiree’s pension amount.
Julie, OPERS