Public pension plans have long been assumed to be safer than their private counterparts. But the reduction, suspension or elimination of cost-of-living adjustments in 17 states proves there are no guarantees in retirement income, according to a brief issued by the Center for Retirement Research at Boston College.
Public pension plans at the state and local level fall outside ERISA's domain, but are often protected by laws that constrain the ability to change benefits, including COLAs.
Yet as the recession exposed systemic underfunding in public pensions, the center said some states cut COLAs not only for current workers, but also for current retirees.
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Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
