CalSTRS & CalPERS Retirement Guide
Your pension is a great start — but it probably won't cover everything. Johnny helps California educators and public employees fill the income gap with strategies designed for your unique situation.
Why Your Pension Alone May Not Be Enough
California public employees have strong pension benefits, but several factors can create a significant income gap in retirement.
Pension replaces only 50-60% of income
Even with 30 years of service, CalSTRS typically replaces only 60% of your final salary. The recommended target is 80%.
CalSTRS members get no Social Security
Unlike most workers, CalSTRS members don't earn Social Security from teaching. This eliminates a major income source most people count on.
Benefit adjustments may trail inflation
CalSTRS provides a flat 2% annual adjustment (not compounded). CalPERS compounds at up to 2%, but neither may keep pace with actual inflation.
Healthcare costs rise faster than inflation
Medicare premiums, supplemental insurance, and out-of-pocket costs can climb significantly during a 30+ year retirement.
Longevity means 25-30+ years of retirement
Teachers often enjoy long retirements. A retirement that lasts 30 years requires a sustainable, guaranteed income plan.
Spousal benefits may be insufficient
If something happens to you, your spouse may receive reduced pension benefits. Supplemental income can protect them.
CalSTRS vs. CalPERS: Key Differences
Understanding which system you're in — and how it affects your retirement — is the first step to building the right plan.
| Topic | CalSTRS | CalPERS |
|---|---|---|
| Social Security | Members do NOT earn Social Security from teaching | Most members DO earn Social Security |
| Annual Benefit Adjustment | 2% simple (not compounded) | Up to 2% compounded annually |
| Career Bonus | Yes — 0.2% bonus with 30+ years (2% at 60 only) | No career bonus |
| Purchasing Power Protection | 85% protection, paid quarterly | 75% protection, paid monthly |
| Supplemental Account | Yes — Defined Benefit Supplement (DBS) | No supplemental account |
| Post-Retirement Work | Limited — cannot work in classified positions | Up to 960 hours/year as retired annuitant |
The Teacher's Income Gap: No Social Security
As a CalSTRS member, you face a unique challenge: you don't earn Social Security credits from your teaching career. While CalPERS members typically receive both a pension and Social Security, teachers must rely almost entirely on their CalSTRS pension.
The Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) can further reduce any Social Security benefits earned from non-teaching work. This creates a larger income gap that requires careful planning to fill.
CalSTRS Teacher Income Replacement
Personalized CalSTRS & CalPERS Planning
Johnny has deep experience helping California public employees coordinate their pension with supplemental retirement income strategies.
Review Your Benefit Estimate
We analyze your CalSTRS or CalPERS benefit estimate, including age factors, service credits, and final compensation calculations.
Calculate Your Income Gap
We identify the gap between your pension income (plus any Social Security) and your actual retirement expenses.
Evaluate Service Credit Purchases
Determine whether purchasing additional service credit or airtime makes financial sense for your situation.
Coordinate Spousal Benefits
If your spouse has Social Security or a different pension, we coordinate both to maximize your combined income.
Design Supplemental Income
Using a fixed indexed annuity, we create additional guaranteed lifetime income to fill your gap — with principal protection.
Social Security Bridge Strategy
If you or your spouse qualify for Social Security, we may use an annuity bridge to delay claiming for higher lifetime benefits.
Ready to Close Your Income Gap?
Schedule a free, no-obligation consultation. Johnny will review your CalSTRS or CalPERS benefits and show you exactly how to create the retirement income you need.
Free consultation. No cost. No obligation. Johnny is compensated by insurance carriers, not by you.