If you don’t give city employees a pension, what happens?
San Diegans voted five years ago this month to switch all new city hires, except police, from pensions to 401(k)-style individual investment plans, becoming one of the first big cities to take the plunge.
Jacksonville, Fla., took a bigger step last April, switching all new employees including police and firefighters to 401(k)-style plans. Last week, Pennsylvania’s governor signed legislation switching new state employees and teachers to three 401(k)-based options.
The Michigan legislature approved legislation last week that puts new teachers in a 401(k)-style plan unless they opt for a “hybrid” pension-401(k) plan. Michigan was the first to switch state employees to 401(k)-style plans two decades ago, followed later by Alaska and Oklahoma.
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