retirement

Derek DeVries / Grand Rapids Community College

 

Some of America's top business leaders are breathing a big sigh of relief as Democratic U.S. Sen. Carl Levin of Michigan prepares to retire.

It turns out that Michigan's senior senator has been running a very tight ship in chairing a Senate subcommittee that's done some deep probing into the workings of some very big businesses.

The Permanent Subcommittee on Investigations, or PSI, was created back in Harry Truman's time to investigate war profit hearings. Today, the organization looks into practices in government and business. 

Kelsey Snell wrote a piece about it for Politico. She notes that the subcommittee chaired by Levin has a big focus on going after tax evasions and unfair business practices on Wall Street.

Senator Mark Jansen, R-Gaines Twp, introduced Senate Bill 727.
Michigan Senate Republicans

New legislation in the state Senate would close Michigan’s teacher retirement system to new teachers. Instead, all new teachers would get a “defined contribution” 401(k)-style plan.

Under a partial overhaul of teacher retirement approved by state lawmakers in 2012, new teachers can choose between that or a “hybrid” plan, which combines elements of a defined contribution plan and a traditional pension. The new legislation would end that choice, giving new teachers only the 401(k)-style defined contribution plan.

Steve Carmody / Michigan Radio

Michigan Congressman John Dingell is in the hospital. 

Dingell was admitted to Henry Ford Hospital after complaining of abdominal pain.

A spokesman says the 88-year-old congressman is receiving intravenous antibiotics and is expected to remain in the hospital for a few days.  Dingell is the longest-serving member of Congress in American history. He was first elected in 1955. He announced earlier this year he plans to retire after his current term.  

One dollar bills
Steve Carmody / Michigan Radio

About 36% of Americans aren't financially prepared for their retirement, according to a recent survey by Bankrate.com.

Detroit News personal finance writer Brian O’Connor said the number isn't that surprising, given what's happened in the last several years.

“A lot of people wound up having to raid their retirements. A lot of people got nervous and took their money out of retirement accounts when the stock market fell,” O’Connor said.

O’Connor added that there are people living paycheck-to-paycheck, with wages not keeping pace with inflation. Although jobs are coming back to Michigan, those jobs aren't paying what they used to.

The survey found 69% percent of younger Americans between ages 18 and 29 don’t have anything saved. That’s understandable, because they have student loans, are trying set up households, and are getting businesses launched.

However, the 14% of people aged 65 and older with no savings are in a tight spot. These people may have had a financial crisis – a divorce, bankruptcy, medical issues, etc.

“It’s going to be a serious, serious problem,” O’Connor said.

O’Connor said one of the reasons that people aren’t saving is that there are relying on their pensions. But as we have seen in the Detroit bankruptcy, pensions are not always guaranteed.

Steve Carmody / Michigan Radio

The 2010 census showed about 1,700 people in Michigan were more than 100 years old.

A new U.S. Census report says those centenarians are overwhelmingly women, with less education and higher rates of poverty than other American retirees.

Brian Kincel is a statistical analyst with the U.S. Census Bureau. He says the numbers reflect social and economic conditions in the 1920s, when the current crop of centenarians came of age.

Flickr user SalFalko / Flickr

It used to be a worker could set his or her sights on retiring at age 65, get that gold watch and join the ranks of the retired.

No longer.

From longer life expectancy to the baby-boomers whose investments and house values were tanked by the Great Recession, to younger workers being squeezed out by older workers who are hanging on to their jobs longer, retirement in America has changed.

The American Retirement Initiative has come about to help lead the conversation about how to improve retirement planning for all of us.

It’s headed up by a Michigander who got his undergrad in economics and graduate business degrees from the University of Michigan. Keith Green is the President at the American Retirement Initiative and he joined us today.

Listen to the full interview above.

Lindsey Smith / Michigan Radio

The city government in Kalamazoo is working through the final stages of a major transition.

Kalamazoo is wrapping up an early retirement incentive it first offered city workers a couple years ago.

“I think we will be affected by this early retirement initiative for a long time to come,” Mayor Bobby Hopewell said.

Steve Carmody/Michigan Radio

Some Lansing city workers have a new three year contract.

The Lansing city council gave the final OK to the contract with the city’s UAW employees last night.  

Under the contract, the city’s UAW employees will pay more toward their retirement benefits.   Also, the families of new city employees will not be eligible for health benefits after the employee retires.   The contract also includes a slight pay increase.   

Last week, Michigan Attorney General Bill Schuette did something many found startling, especially those politically liberal. Schuette announced that in Detroit's bankruptcy filing he intended to intervene on behalf of those who have pensions coming.

Bernt Rostad / creative commons

Detroit’s bankruptcy could impact many people’s daily lives, perhaps the city’s retirees most of all. At a banquet hall in Livonia this week the Detroit Retired City Employees Association held its annual luncheon. Over one thousand people attended. Many of them worry they may lose part or all of their pensions in the bankruptcy. 

Hear the worries, frustrations, and thoughts of retirees with close to 200 years of city service between them in their own voices below.  


User: Brother O'Mara / flickr

Buena Vista and Inkster school districts to be dissolved

The state is moving ahead to dissolve the Inkster and Buena Vista school districts. Both districts failed to meet a deadline yesterday to prove they could keep their doors open next school year. Now state officials say it could be a matter of days before the districts are dissolved, Michigan Public Radio's Jake Neher reports.

Protesters arrested at pipeline worksite

Enbridge energy is building a 285 mile pipeline across Michigan that will carry tar sands oil. The pipeline will replace the one that ruptured three years ago. Yesterday, protesters chained themselves to heavy equipment at a worksite southeast of Lansing. They say the new pipeline will present an environmental threat. Twelve people were arrested at a protest yesterday, Michigan Radio's Steve Carmody reports.

Will Detroit retirees see pension cuts?

A federal bankruptcy court will now be the scene for some huge decisions about the future of Detroit which filed for Chapter Nine protection last week. One of the key issues is whether retirees will see their benefits cut. Michigan Radio's Sarah Hulett has more.

User: Brother O'Mara / flickr

Detroit Public Schools get new emergency manager

Governor Rick Snyder has named Jack Martin as the new emergency manager for Detroit Public Schools. Martin replaces Roy Roberts, who is retiring after two years in the position. Martin is leaving his position as Detroit’s chief financial officer.  Roberts says DPS still has a long way to go, but conditions are noticeably better than when he started; the current budget deficit is more than $70 million.

Retiree health care coverage suspended in Pontiac

Pontiac’s emergency manager Louis Schimmel has proposed the Emergency Loan Board address an expected $6 million general fund shortfall in the current budget year. The board approved a plan to suspend health care coverage for retirees from the city of Pontiac and increase their monthly pension payments. The city's roughly 1,000 pensioners will get an extra $400 a month to buy their own health care, the Associated Press reports.

EPA now accepting Great Lakes grant applications

The U.S. Environmental Protection Agency has $9.5 million to distribute for Great Lakes projects and is looking for takers. The money comes from the Great Lakes Restoration Initiative, an Obama administration program to clean up and protect the lakes from a variety of threats. A webinar explaining the application process will be held July 30.

User: Brother O'Mara / flickr

Snyder holds town hall meeting on Prop 6 today

"Governor Snyder will hold a town hall meeting with members of the Canada-United States Business Association in Detroit today. He’ll be stressing the need for a new Detroit-Windsor bridge—and for voters to reject Proposal 6. Proposal 6 would require voter approval for any new international bridges or tunnels for motor vehicles,” Sarah Cwiek reports.

Voters in West Michigan can learn more about Prop 3 this week

"People living in West Michigan will have two opportunities early this week to learn about and discuss the so-called 25 by 25 ballot proposal. If voters pass Proposal 3, utility companies in Michigan would have to get 25-percent of their energy from renewable sources like wind and solar. There’s a panel discussion tonight with people for and against Proposal 3. It’s at the Michigan Alternative and Renewable Energy Center in Muskegon. Tomorrow morning in Grand Rapids the President of the Union of Concerned Scientists will travel from Massachusetts to join west Michigan business leaders in favor of Proposal 3," Lindsey Smith reports.

Some Michigan lawmakers looking to increase retirement age for public school employees

"Michigan lawmakers are looking at a plan that would increase the minimum retirement age for public school employees. The current retirement age is 60. But some people want to index the retirement age according to life expectancy, which would be determined every year. Mark Guastella is with the Michigan Association of Retired School Personnel. He says the system paid more than $700 million in benefits last year to people who outlived their life expectancy," Rina Miller reports.

Thousands of state employees are applauding a judge’s ruling that they shouldn't be forced to pay for their pension benefits.

An Ingham County Circuit Court judge said today that a rule requiring state employees cough up four-percent of their salaries to keep their pensions is unconstitutional.

She said it’s effectively a pay cut, something only the Michigan Civil Service Commission has the authority to enact.

Ray Holman is with UAW Local 6000, the largest state employee union in Michigan.

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Another law requiring state employees to pay more for their benefits was struck down in court today. This requirement governed pension plan contributions. Another law requiring retiree health care contributions was found unconstitutional last year.
Politics & Government
Jennifer Guerra / Michigan Radio

Governor Rick Snyder will sign legislation into law Tuesday that will make some changes to how teachers and other school employees save for their retirement.
    
School employees will have to pay more for their benefits, and those hired after today will no longer get retirement health coverage.

Instead, they will get savings accounts to help them buy insurance once they are done working.
    
Governor Snyder said he understands that many school employees are upset.

“We had to make some reforms to make it fiscally viable and financially sound f or their future, too, in terms of their retirement benefits," said Snyder. "So, it’s a case of us all working together, and sometimes change is tough on people and I appreciate that. We’re just trying to make it something that lasts for the long term for the benefit of all."

Snyder said the new approach will begin to retire a long-term pension liability estimated in the billions of dollars.

He said it will also shore up the state’s credit rating, and ensure taxpayers won’t be saddled with the costs of a bailout years down the road.
    
Teachers unions say the plan breaks promises made to school employees, and went to court on Friday with a legal challenge.

Steve Carmody/Michigan Radio

Retirees are expected to play a pivotal role in this fall’s election.

Republican Party leaders in Michigan and Florida are particularly interested in one unique set of voters - the so-called Snowbirds.

Snowbird is the term used for northern retirees who spend the winters in Florida.

Flickr

LANSING, Mich. (AP) - The Michigan Court of Appeals has ruled unconstitutional a state law forcing school employees to pay 3 percent of their salary toward retiree health care.

A copy of Thursday's 2-1 ruling was released Friday.

The contribution was put into place in 2010, and unions representing teachers filed suit. In 2011, retired Ingham County Circuit Judge James Giddings, who was hearing the case before he stepped down and returned to finish the job, ruled that school employees were paying into a system that may not ultimately benefit them.

The contribution was instituted as part of an effort to save hundreds of millions of dollars for the state. MLive.com reports some unions want the money to be refunded.

Flagstar Bank branch in Ann Arbor
Dwight Burdette / Wikimedia Commons

Some current and former employees will get another chance to pursue a lawsuit against Flagstar Bank over company stock in their retirement accounts.

A federal appeals court has reinstated the case in Detroit federal court. The Troy-based bank is blamed for offering Flagstar stock to employees at a time when the bank was in perilous shape.

Flagstar's stock price lately has been under a dollar, compared with nearly $15 in 2007. The court says the lawsuit raises a "plausible claim" that Flagstar breached its fiduciary duty to employees during that time.

The bank has said workers made their own investment decisions.

Flagstar recently announced its first profitable quarter since 2008. It has 111 branches in Michigan.

GM Renaissance Center in Detroit.
John F. Martin / Creative Commons

Today is the deadline for more than 40,000 General Motors retirees to accept their former employer's offer of a lump sum buyout of their pensions.

Otherwise, their pensions will be taken over by Prudential Insurance.

GM's Randy Arrix said the change is part of the company's efforts to create what it calls a "fortress balance sheet."  Getting underfunded pensions off the books strengthens the balance sheet.

"Pension obligations are very volatile, and they're volatile because they're dependent on some things within our control like contributions, and other things that are not, said Arrix.

Some GM retirees are angry about the change, which they see as a broken promise by GM, but for others, the buyout is an opportunity to control their own money.

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