Teacher Pension vs 401(k)
Teacher pension: avg 70-80% replacement at 25-30 yrs service. Supplement with 403(b) for additional income. WEP/GPO reduce Social Security.
| Avg salary | — |
| Years service | — |
| Pension % | — |
| 403(b) balance | — |
| Monthly pension | — |
| 403(b) safe withdrawal | — |
| Total monthly | — |
| Replacement rate | — |
Teacher retirement plans typically combine state pension (defined benefit) plus optional 403(b) (defined contribution). State pensions can replace 70-80% of salary at 25-30 years service. Adding 403(b) reaches 100%+ replacement comfortably.
State Pension Variations
Generous: Texas (TRS), Massachusetts, New Jersey — 75-80% at 30 years. Average: Florida, Illinois, California — 60-75% at 30 years. Modest: states with hybrid systems — 50-65% at 30 years. Always know your formula.
403(b) for Teachers
$23,500/year limit (same as 401k). Catch-up $7,500 if 50+. Plus 'special catch-up' for 15+ years service — additional $3K/year for 5 years. Best: low-fee provider (Fidelity, Vanguard). Avoid: high-fee annuity sellers.
WEP/GPO Social Security Impact
Windfall Elimination Provision (WEP): reduces Social Security if you have pension from non-SS work (some teachers, gov). Government Pension Offset (GPO): reduces spousal/survivor SS by 2/3 of pension. Could reduce SS by $500/month or more.
Last updated May 2026. Sources: NEA Retirement.