Though not widely known, Ohio teachers have three retirement options: a traditional pension plan, a 401(k)-style defined contribution plan, and a hybrid plan that combines features of both. A large majority of teachers are in the pension plan—the result of either an affirmative choice or by default, not having selected a specific plan at the beginning of their careers.
But is the pension option the best choice for most teachers? In this new report, national pensions expert Chad Aldeman of Bellwether Education Partners calculates the financial benefits under each retirement option and finds that the 401(k)-style plan would be expected to yield significantly higher benefits than the “default option”.
We urge you to dig into the findings and see for yourself how simple changes to Ohio’s teacher retirement policies could yield important benefits for our teachers.
On November 12, 2020, author Chad Aldeman presented his findings via a Zoom event. Video of that presentation is below:
