Are you a public service employee who retired “young?” How are you spending your retirement? Is vacationing part of your retirement plans? If you’re not retired yet, have you been saving in your 457 plan to supplement your pension? If not, why not? If so, what tips can you share with us? Your first-hand experience is valuable. Tell us how you did it.
For some workers in the public sector, the answer might be “most definitely,” you can retire young.
People who work in local and county government tend to retire at an earlier age than most other workers. Why? Well, they are our police officers, firefighters, and public administrators. And they usually have what’s called a defined benefit plan, a pension set up by their employer to save money for when they retire.
Over the last 30-some years, many local government employees have also had the added benefit of a deferred compensation (457) or a defined contribution (401) plan that their employer sponsors and allows them to save pre-tax dollars in — further boosting potential retirement savings.
So what does it mean to retire young? It means that many in public service can often afford to retire in their late 40s or 50s because they have a pension and supplemental retirement savings through their 457 or 401 plan, and the combination, hopefully, has been fruitful. The rest of us, without the back-up of a pension, will most likely retire in our late 60s or 70s and hope Social Security is available.
If you were a public employee and you enrolled in your employer-sponsored 457 or 401 plan when you first started working, and contributed regularly through payroll deductions, you would most likely have been disciplined in your savings habit and have a growing nest egg to show for it — at your “young” age.