By Elliott Brack
Editor and Publisher, GwinnettForum
FEB. 8, 2022 | News stories about this time of year cite the highest paid Georgia state officials. And yes, it is a sad state of affairs that we pay the top football coaches far more than our university presidents. We won’t go into this more here.
Other highly paid state officials are those running the state’s retirement systems. And why not pay them handsomely? For state government must guarantee that it’ll keep its word and adequately manage retirement funds contributed by teachers and other state employees to give them peace of mind in their senior years.
Charles Cary, chief investment officer of the Teachers Retirement System of Georgia, is the highest state agency official, making $1,018,236 last year.
And his two co-chief investment officers, Michael Majure and Thomas Horkan, both were rewarded with pay of $862,200 last year.
Sounds high? They are.
Yet there’s a reason that they make such salaries. That’s because all three are paid incentives based on the return of the retirement system investments.
You may be pleased that your own IRA funds may have seen a pretty good return last year, say in the range of 8-10 percent, depending on your risk factor. That’s a really good year for anyone.
But the investments for retired Georgia employees earned a whopping 29.3 percent last year. Few states or private investment groups make such returns. Now you can understand why these three state employees made such good salaries last year.
The pay rate of these top officials is set by a joint committee of the Teachers Retirement System, and the Employees Retirement System (retired state employees, not teachers.) The chair of the Teachers Retirement System board is Deborah Simonds, who for 27 years was a special education teacher at Berkmar High School, and has been on that board for 10 years. She is also a former state president of the Georgia Association of Educators.
“Yes, a joint committee set the salaries for these top investment people, and pay them for performance. In the long range, the teachers and state employees benefit, and so do the state and taxpayers. It’s a win-win all across the board if we can attract and retain quality people.”
So, how much do retired teachers in Georgia make from the retirement system? A teacher who retires after 30 years, with a master’s degree, would see a return of 60 percent of their highest two year salary. For this person, most would see a defined benefit plan check of $3,500 a month, or $42,000 a year. The teacher will have paid into the system six percent of their salary each year. Ninety percent of Georgia teachers also get a Social Security check in addition to their teacher retirement pay, once they reach certain ages. (A few county school systems do not participate in Social Security or other additional retirement plans.)
Joe Heffrond, the chief financial officer of Gwinnett County Public Schools, says that teachers in Gwinnett do not participate in Social Security, but pay into the Gwinnett Retirement System. On reaching age 65 (similar to Social Security), a teacher with a master’s degree and 30 years service would get an additional monthly benefit of $2,300, or $27,600 a year.
As a comparison, the Gwinnett Retirement System (GRS) rate of return for calendar year 2021 was 14.4 percent. Hmmm. Not bad. Many retirees don’t see their IRA funds that solid!
These guaranteed benefits for our retired teachers come as the investment officers of the retirement funds do their best to insure a solid return, and sound future for the pension of our teachers.
- Have a comment? Send to: elliott@brack.net
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