Of course, it’s not that simple. The state’s two major public pension systems, the State Employees Retirement System and Public School Employees Retirement System, have an unfunded liability of more than $36 billion.
The governor said he was not prepared to recommend any solutions at this time, though he supports a 401(k)-style pension plan.
The House State Government Committee on Tuesday discussed several pension bills, including measures that would move all future state workers, teachers and lawmakers into a 401(k)-style defined contribution plan instead of the existing defined benefit plan.
In a defined benefit plan, benefits are guaranteed based on a formula that includes years of service and salary. A defined contribution plan allows workers to save for retirement and invest as much or as little as they choose.
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