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A preview of the U.S. without pensions

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Re: A preview of the U.S. without pensions

#71

Post by exclusiv »

nunez wrote: post #24
jstewartmobile wrote: post #18

Earlier quoted context omitted.

I'm not sure 401ks are so great. Many charge ridiculous management fees for funds that track mundane things like the S&P 500, but if you want that employer match, no way around it. Mostly a case of perfectly intelligent people throwing wads of money into the market on autopilot because that's all the 401k lets you do. Lambs to the slaughter! edit: Example: Back when I was on 401k, was into a S&P500 fund that had an e…

Yeah the only time it makes sense to have a 401k is if your company matches your contributions.

Or if your 401k has decent funds available and you also want to lower your taxable income for the year.

Re: A preview of the U.S. without pensions

#72

Post by mwfunk »

user5994461 wrote: post #55
selestify wrote: post #38

Earlier quoted context omitted.

> More and more elderly to support > The younger population is suffering from vast unemployment It appears there is a lot of work to be done and a lot of idle workers to do it. The fact that both can exist in tandem seems like an indictment of how horribly inefficient our economic systems currently are.

Not sure what you mean. Retirees don't create jobs. They just get money handed to them monthly as promised by the pension formula decided decades ago. (that money is supposed to come from taxes on active workers's salaries) The whole system collapse when taxes are not enough to cover the pensions that were promised. It's a ponzi scheme.

That’s a problem of demographics and unemployment, not a Ponzi scheme. Ponzi schemes are scams, but they do effectively take money from people and give it to other people, which doesn’t happen if there’s no funds to transfer.

I don’t think any country can sustain a 25% unemployment rate for any length of time without it having catastrophic second- and third-order effects. That’s the problem, not the concept of taxpayer-funded pensions. All sorts of things are going to be underfunded or otherwise hosed if you’re struggling with 25% unemployment for any length of time. Nations have imploded over far less.

Re: A preview of the U.S. without pensions

#73

Post by exclusiv »

jstewartmobile wrote: post #30
nunez wrote: post #24

Earlier quoted context omitted.

Yeah the only time it makes sense to have a 401k is if your company matches your contributions.

Don't they all have a match? It would be nice if people could keep the match and have more control over their portfolios. Buy & sell stocks, bonds, commodities, etc. whenever instead of a very small basket of mutual funds that can only be juggled a few times a year.

We don't do a match but offer a safe harbor automatic 3% contribution which everyone gets. This is nice because some younger employees don't contribute anything but we're still helping out their 401k.

Re: A preview of the U.S. without pensions

#74

Post by mwfunk »

clackanon wrote: post #62
cmurf wrote: post #35

Today, Social Security provides only enough for a bare-bones budget, about $14,000 a year on average. Republicans: This is too much money, we can't afford it, it's take from the rich, give to the poor, these social programs need to end. Grandma deserves to die under a bridge by herself, it's her own fault she didn't work harder or save more. Me: A bullet to the head of the aging is more ethical than the Republican pr…

I'm not saying I have a better answer, but wealth redistribution is theft. That's every bit as immoral as leaving grandma on the street.

That’s not remotely as immoral as leaving grandma on the street. It’s a compromise, like everything else in the world that does more good than bad.

Re: A preview of the U.S. without pensions

#75

Post by robert_foss »

bagels wrote: post #19
lewis500 wrote: post #17

This is horrible. A few years ago I realized my parents were way behind on savings and just incessantly nagged them until they got on a good plan. They kicked and screamed the whole time ("You're our son. You can't tell us what to do."), but it's turned out to be one of the best decision I ever made. Next year they are actually going to retire. I dunno what I'd do if they had to work at Wal-Mart just to make ends mee…

Would be nice if the birth year were adjustable.

Or even better, birth place!

Re: A preview of the U.S. without pensions

#76

Post by Bahamut »

jedmeyers wrote: post #26
dguaraglia wrote: post #16

Earlier quoted context omitted.

It’s easy to consider putting 20 to 30% of your salary towards savings and investments when you are making Silicon Valley money. It’s not so easy when you are making minimum wage while paying school loans, or even if you are one of the families earning the median household income of ~$60k and you have a couple kids.

> It’s easy to consider putting 20 to 30% of your salary towards savings and investments when you are making Silicon Valley money. Only if you are making Silicon Valley money somewhere outside of Silicon Valley. Otherwise, not so easy.

Hm? I dump about 25% of my compensation while living in the Valley (right in Sunnyvale), even while paying 100% of the rent/costs for my 2 bedroom apartment and take multiple vacations a year. I actually even debated dumping almost 6% more, but I want to save up for a trip to Japan in a couple of months.

Re: A preview of the U.S. without pensions

#77

Post by Gibbon1 »

user5994461 wrote: post #59
konschubert wrote: post #52

Earlier quoted context omitted.

You can have a "contract of the generations", where the younger generation finances the pensions of the older generation through social security payments. Many countries do it like that.

That's a ponzi scheme. That's what many countries in Europe do and that is currently collapsing. It takes something like 4 active workers to pay the pension of 1 current retiree. The proportion was fine after the baby boom, it's not anymore and it's getting worse.

> That's a ponzi scheme.

In no away shape or form a ponzi scheme.

Re: A preview of the U.S. without pensions

#79

Post by ineedasername »

zzleeper wrote: post #64
konschubert wrote: post #52

Earlier quoted context omitted.

You can have a "contract of the generations", where the younger generation finances the pensions of the older generation through social security payments. Many countries do it like that.

To double down on what user5994461 said, that's indeed a ponzi scheme and quite stupid if you know current population trends. It also creates quite perverse incentives, as older folks want to reduce their retirement age (even as they live way longer) and raise the contributions of younger people (to pay for the extra costs).

Except that retirement age has been gradually extended, and there is no significant lobying effort by AARP or anyone else to go back in that trend.

Re: A preview of the U.S. without pensions

#80

Post by alkonaut »

hkmurakami wrote: post #67
konschubert wrote: post #52

Earlier quoted context omitted.

You can have a "contract of the generations", where the younger generation finances the pensions of the older generation through social security payments. Many countries do it like that.

Basically only works when you have a growing economy and a growing population. Both things are sort of not true anymore in developed nations.

A declining/aging population is problematic but a stable one isn’t. And you need some buffers in the system to manage the variations in birth rates. I thought this type of system was the most common these days?
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