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Why are pensions better than 401(k)s?

Data, research, and the experiences of educators nationwide all show that defined benefit plans (pensions) are far superior to defined contribution options (401Ks). Here’s why.
Published: 06/22/2020

Most educators won’t face a choice between a pension or a 401K. Pensions for public educators are built into state law. But there are some who want to weaken pensions and pension protections for educators and other workers in favor of moving to defined contribution retirement savings plans. 

This is why we must ensure pensions remain strong. All information comes from the information linked to in the resources and downloads sections. You can get more information by clicking through.


Pensions are an effective tool for recruiting and retaining skilled educators because they reward longevity. The longer an educator stays in the classroom, the larger their annual retirement benefits will be.


401(k) plans offer few of the same rewards as pensions. They put the burden of saving entirely on the employee. At a time when we face teacher shortages nationwide, we need all the tools we can get attract talented workers to our field.

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The National Education Association (NEA), the nation's largest professional employee organization, is committed to advancing the cause of public education. NEA's 3 million members work at every level of education—from pre-school to university graduate programs. NEA has affiliate organizations in every state and in more than 14,000 communities across the United States.