After a retired California woman’s $48,000-per-year pension was reportedly cut to just $19,000 with only three months notice, a Santa Clarita financial advisor is reminding local residents not to put all their eggs in one basket when it comes to retirement planning.

Patsy Jardin, 71, worked for the city of Loyalton, Calif. for 34 years, and was notified in September of last year that her CalPERS benefits would be slashed by about 60 percent starting Jan. 1, 2017.

“Here is the first chink in the armor, the first crack in the armor,” said Arif Halaby, a Certified Estate Planner and president/CEO of Total Financial Solutions, referring to the current pension system. “I want you to realize, this is, I think, the beginning of a problem.”

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The reported reason for Jardin’s drastic benefit reduction is that the small-town city of Loyalton — which has a population of only about 700 — stopped paying its share of dollars into the pension system, which resulted in CalPERS being forced to make cuts, according to Halaby.

“This is something that is unprecedented,” said Jeff Girard, Halaby’s co-host on KHTS AM-1220’s “Total Financial Solutions Safer Money Hour.” “We’re talking about a financial system that has 1.8 million members part of the CalPERS system. This is the largest retirement system that we know of, so for this to have an issue … could be the writing on the wall.”

While Jardin’s situation is likely what Girard called “unfathomable” to residents planning to rely on the pension system for their own retirement, Halaby is advising SCV residents take it as a reminder to be prepared for just about anything.

“Let me tell you — surprise — if you are part of any pension system, it can and will make changes,” Halaby said. “We don’t know what the coming years are going to be.”

The only way to safeguard against situations like Jardin’s is to plan a secondary source of income for retirement — or even better, a third, fourth or fifth source of income, according to Girard.

“In this lady’s case, if she had one other source of income I’d be surprised,” he said. “It sounds like, from the interview that she’s given to some of the media sources out there, that this is everything to her. And what a drastic cut this is going to be for her.”

Halaby added, “Be prepared, just like earthquakes and car insurance — you wear your seatbelt before the car accident that never happens… So why don’t you protect and prepare just in case the pension system does exactly what it did for this particular lady?”

Total Financial Solutions offers assistance with preparing for retirement and financial planning in Santa Clarita and the surrounding valleys. Santa Clarita financial advisor Arif M. Halaby, a Certified Estate Planner, and Total Financial Solutions staff work with people of all ages, helping them protect, grow and preserve their assets through an individualized approach. Arif Halaby is also the host of “Total Financial Solutions Safer Money Hour” on KHTS AM-1220. Launched in 2004, the show offers listeners from Santa Clarita financial planning tips and guidance for dealing with today’s ever-changing financial needs.  

Total Financial Solutions, Inc.

24322 Main Street

Newhall, CA 91321

661-753-9683

800-990-7344