Show 55 - TL;DR Pensions with Karl Fisch
In this episode, I talk with Karl Fisch, author of the TL;DR pension systems books, about how you can maximize and best use your pension.
10/16/20241 min read
Most generic financial advice isn’t geared toward teachers in one crucial way--they don’t talk about your pension. The big problems are that fewer and fewer people have a pension every year, they are complex, and they vary from state to state, so it doesn’t make sense to talk about them. That’s why I brought on Karl Fisch. Karl is the author of the TL;DR pension systems series (currently 33 books/states and counting) that help YOU understand your pension; not only how your pension works but how to think about your pension in your larger financial picture. That’s what we talk about today in this episode.
Key Ideas
Unlike most investments, pensions are guaranteed income for life. You will never run out (unless the pension becomes defunct, which means there are some major problems!).
You have control over your pension by maximizing your salary and buying years of service (the earlier the better for both of these!).
Even the cost of schooling doesn’t offset the benefits of moving along the salary schedule because you get the higher salary now AND in retirement as a benefit for going back to school.
The pension is part of a larger financial strategy. For example, investing half of every raise you get will allow you to take advantage of compound interest without really feeling the effect of setting aside money to invest.
Show Notes
Karl's blog post on salary schedules
TL;DR books (scroll down to find your state)
403bwise.org episode with Dan Otter
Karl's blog post Financial Literacy in One Sentence
Twitter (X), Bluesky, FB @Karl Fisch
Another episode with a TL;DR co-author; taking advantage of dual incomes