81–90 of 221 posts
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.
World Economic Forum estimates retirement shortfalls in public pension/private pension/individual savings in 2015 at 70 trillion$, and projects nearly half a quadrillion (400 tril) shortfall in 2050, with the lion's share belonging to the US. [1, page 7] Interest rates stuck at the 0 bound (and negative real) for nearly a decade haven't helped. I foresee a bumpy ride figuring out who gets stuck with the bill. [1] htt…
Why will the world be so much worse off at 400 trillion instead of 70 trillion? Presumably “the world” will have many many more folks making more money by then given the rates of economic growth in third world countries. 10B people can cover 400T in 10 years paying just $10 a day.
Earlier quoted context omitted.
Basically only works when you have a growing economy and a growing population. Both things are sort of not true anymore in developed nations.
Except the US has positive average Gdp growth in the range of 2%, and positive population growth as well.
We have population growth fueled by immigration. If not for this the US would have population decline. This is what makes us very much an outlier amongst developed nations [1]. Despite this our pension funding situation does not look good.
[1] Germany probably has strong net inflows of educated workforce from EU nations as well.
Earlier quoted context omitted.
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?
[1] The only systems I see are either underfunded due to growth assumptions they haven't been able to hit, or are funded through natural resources that the country just happened to have. If there are exceptions I would genuinely like to know.
And the best part is that the next generation will have it even worse. They’ll have 75% Social security payments, little chance of building net worth through home purchases and a lifetime of $10/hr jobs.
Perversely, it may not be the worst thing if an entire generation decides that building wealth through your primary residence is not the best idea, and forgoes this in their lives and pushes their representatives to repeal the slew of incentives currently written into the tax code.
Personally, I pay more in student loans than every one of my parents, aunts, and uncles pay on ybeir mortgage. I pay 2-3 times more in rent than their mortgage. I might be ok but only because of a high paying tech job. Those at the lower end the scale are absolutely fucked.
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. 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.
> Years ago, Coomer and his co-workers at the Tulsa plant of McDonnell-Douglas, the famed airplane maker, were enrolled in the company pension, but in 1994, with an eye toward cutting retirement costs, the company closed the plant.
Did the McDonnell-Douglas company not pay into a separate pension fund, or did they raid the fund somehow?
Yet these old folks all voted for trump/GOP. Good luck trying to make a living when they cut social security next year.
If I am a 50 year man who lost his job, I am going to vote for Trump.
It is just amazing that lot of people including you and Clinton don't understand this simple point.
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…
Here's a fun game for everyone. If you don't save, and your company doesn't save, and your government doesn't save then how the hell do you figure you're going to retire?
Lower life expectancy solves the pension issue easy peasy....