Overview
The state of Georgia maintains two pension systems for employees in public schools: the Teachers Retirement System (TRS) and the Public School Employees Retirement System (PSERS).
TRS members include full-time, certificated public teachers and school leaders. Once you retire, a formula dictates your monthly check based on your years of service and highest annual pay. Members also earn a cost-of-living adjustment, or COLA, twice annually.
PSERS was created to provide a supplemental retirement plan for employees such as bus drivers, food service workers and custodial personnel. Unlike TRS, the benefit calculation for PSERS does not consider the salary and does not offer a regular COLA. The pension is calculated using a dollar amount set by the General Assembly and the total years of employment.
In 2022 TRS members pay six percent of their paycheck to the system, averaging around $3,200, while PSERS members pay a flat $90 a year. Employers also pay a vastly different sum. In 2020 the state paid $889 per PSERS member, while the employer rate for TRS was 21 percent, or over $10,000 for a teacher making $50,000.
Strengths
Both systems are defined benefit plans. Since the state absorbs all financial risk for the plans, members who worked at least 10 years are guaranteed benefits through their retirement. Further: Georgia lawmakers continue to support these pensions even in economic downturns. Georgia is unique amongst states in that lawmakers have always paid the full amount experts calculated was needed to keep the plans viable.
Weaknesses
PSERS is hampered by low benefits and no regular COLAs. Also neither system collects any data on the race of its members. Too often the story of a policy’s success or failure is told with averages, which can mask the impact on specific communities. Adding this data will help state leaders better understand if, for instance, PSERS contains more people of color and could be a tool to advance economic justice.
Investing in the Schoolhouse
TRS enjoys support statewide, offers a generous benefit, and has a comparable employee contribution rate to other states. PSERS, however, has a smaller contribution rate from the state and employee and lower benefits than most other states. Georgia should consider raising the contributions to PSERS specifically, and the collection of data on race from both systems. State leaders must take care of all the people in the schoolhouse. Retirement security can be an important step in that direction.
