Defined Benefit Pensions Reward California’s Educators

Statement

UC Berkeley research shows California educators are better supported by CalSTRS’ Defined Benefit pension versus a 401(k)-style plan. Various other studies focus on teacher tenure data by using only young, new-hire turnover statistics in order to represent the majority of the educator workforce, which is inaccurate and misleading.

Here are the facts: Only 6 percent of California’s educators leave their jobs before vesting at the five-year mark. Additionally, 86 percent of active CalSTRS members stay in their careers until at least age 51, which is also when their DB pension becomes greater than a 401(k). Also, for committed teachers who begin at age 25 and retire at 55, the CalSTRS pension generates 21 percent more wealth than a 401(k).

CalSTRS’ DB pension is a powerful workforce retention tool supporting retirement futures for more than 914,000 California educators and their families for over 103 years.

Jack Ehnes, CEO
California State Teachers’ Retirement System


For accessible versions of files on this page, contact ADACoordinator@CalSTRS.com.