As a Texas Teacher, Will I Avoid the Social Security WEP?

For many Texas teachers who will receive TRS, you should understand the rules for getting Social Security. If you have paid into Social Security and expect to receive this retirement benefit and a government pension, such as TRS, you may see your Social Security benefit reduced due to the Windfall Elimination Provision (“WEP”).

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Rules of Thumb for Educators Saving for Retirement

For those in the education field, such as teachers, professors, and administrators, it incumbent upon them to save for retirement. One of the benefits of working in education is the generous employee benefits, which many educators don’t take full advantage of. In this blog, I will discuss 4 rules of thumb to follow to save for retirement, focusing on educators. Although following these rules won’t guarantee success, they can put you on a good path.

1. Save at least 15%

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The inadequacy of TRS and what to do about it?

Teachers Pension Inadequacy

A defined benefit pension plan, such as TRS, provides a small group of long-serving teachers with good benefits while leaving short and medium-term teachers behind.1 TRS carries no investment risk if the teacher continues until retirement. The teacher is guaranteed a stream of income for the rest of their life with the option of a survivor's benefit. Prior research has found pension plan benefit formulas disproportionately reward very long-term employees at the expense of short- and medium-term workers.2

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Professional Women Saving for Retirement

As of 2018, women earned 85% of what men make, according to a Pew Research Center analysis.1 This is paired with the fact that women tend to live longer than men and often have to draw down their retirement wealth over a longer period of time. In 2020, the average life expectancy at age 65 is 21.1 years for women and 18.6 years for men.2

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How to choose the right 401(k) investment fund?

401(k)s for retirement savers are extremely important especially for those in corporate careers as they are one of the best vehicles to fund your retirement. Americans have $6.3 trillion invested in these tax-deferred workplace savings accounts. There are more than 58 million active 401(k) participants.1

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