In an effort to help out the state's struggling retirement system, Hawaii's Governor recently signed a bill that will raise the retirement age for some public employees and increase contribution rates by employees and employers.
Officials have said this is a way to combat the growing burden on taxpayers and the government alike. However, it may cause some residents to make changes to their investment portfolios and life insurance policies to offset the new policies.
"This measure will help curtail and minimize the future growth in the overall pension liability. This action is the first phase in our overall strategy to tackle the underlying reasons for growth in the state’s long-term pension liabilities," said Kalbert Young, Director of Department of Budget and Finance.
The state's current liability for the Employee Retirement System is around $7 billion. Experts believe the new changes will help the ERS become more well funded. Officials said that while these changes serve to help alleviate some of the pressure on the system, they know that it is not a permanent solution and it will continue to need close monitoring.