Studies to date, while few in number, find no positive effects on workforce quality of back -
loading pension wealth.
Not exact matches
Pension wealth is higher and more back -
loaded for school leaders because their pay is higher than it is for teachers and, crucially, higher at the end of a career.
That is not the case with current systems, where
pension -
wealth accrual is highly back
loaded and concentrated at certain arbitrary points in teachers» careers.
These formulas translate into a back -
loaded structure where benefits are low for many years until, as teachers near their normal retirement age, their
pension wealth accelerates rapidly.
In the old system,
pension wealth is back -
loaded and accumulated mostly in the later service years.
If the vast majority of workers remained in one
pension plan for the life of their career, the back -
loaded nature of defined benefits would create some perverse incentives around the normal retirement age (where
pension wealth comes to a steep spike), but it wouldn't matter that the employee was accumulating very little early in their career.
The paper shows that this back
loading produces very large losses in
pension wealth for mobile teachers.