State of Illinois employees have always had a pretty good package to rely on as they consider retirement. But that may no longer be the case.
During Sound Money, Edgar Norton, director of Illinois State University's Institute for Financial Planning and Analysis said there are ways employees can guard against the effects of a possible bankrupt State University Retirement System (SURS).
Earlier this year, SURS' Chief Investment Officer Daniel Allen said the state will run out of assets to pay retirement costs within ten years.
"As of last January, SURS was 42 percent funded, which means the state only has 42 cents to play for each dollar owed," said Norton. Norton outlined some options university employees can take to safeguard their own situation.
"There are 403(b) plans, which are essentially like 401k plans, but in an educational setting. If you have the money and are under age 50, you can put up to $18,000 into a 403(b).
Norton said the current set-up allows members to also invest in a 457 plan, which is for anyone who works for state government.
Norton said non-state workers should be concerned about the dwindling state retirement accounts.
"Something's going to happen down the line where the state government either cuts spending in programs that you favor, or they'll have to come back and raise taxes to help bail the state out," said Norton.
Also, since non-state employees pay into the federal social security system, Norton said a similar fate awaits them.
"The actuaries of the social security system say the trust fund will be empty by 2034," Norton said.
He added one option that some soon-to-be retirees can choose-- keep on working.
