Bye-Bye, Pension! The trend in the US to reduce middle class worker wages

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Aaron Lupo

I have to consider myself fortunate for the time being. The company I work for has your typical 401K matches dollar for dollar up to 3%, but on top of that they also contribute 5% weekly to a pension fund that the employee controls how it is invested. So that is 8% free money they are giving me every week.
 

Jim Wynne

Leader
Admin
Aaron Lupo said:
I have to consider myself fortunate for the time being. The company I work for has your typical 401K matches dollar for dollar up to 3%, but on top of that they also contribute 5% weekly to a pension fund that the employee controls how it is invested. So that is 8% free money they are giving me every week.

That's a good deal, but if you think that it's free, quit the job and see if they keep giving it to you. :D
 
Wes Bucey said:
Isn't it time to think about joining with other "soon to be oldsters" and fight against the seeming inevitable?
Too right! Even though I said "oh well", I'm actually raising all sorts of, you know :censor: (hot place), using all channels at my disposal. I just left the details out in consideration of the Cove TOS.

/Claes
 
A

Aaron Lupo

Jim Wynne said:
That's a good deal, but if you think that it's free, quit the job and see if they keep giving it to you. :D


Free in that they don't have to contribute a red cent if they don't want to.:D
 

Jim Wynne

Leader
Admin
Aaron Lupo said:
Free in that they don't have to contribute a red cent if they don't want to.:D

I understand, and like I said, it's a nice thing to have. But my point was that businesses do what's in the best interests of the business, one way or another. There's very little true altruism, especially when it comes to employees--not that there's anything wrong with that.:D The level of benefits any company offers are keyed to how well the company believes that it will keep existing employees happy and attract new ones. As we're seeing now, if compensation packages aren't wisely managed, bad things will happen to both sides, and if it's not in the company's best interests to keep feeding 401(k) and pension plans, it will stop in a hurry.
 
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Bill Pflanz

The baby boomers whine better than any other generation that has lived. I do not have the reference, but the following was written about our (I am one of them) generation. More than likely we will "rise up" to get what we want the same way.

Boomers have gotten our way ever since we arrived in this world, and the onset of gray hair, bifocals, and arthritis is not going to moderate our unswerving self-indulgence. We are the same people, after all, who forced the lowering of the drinking age when we were young, so we could drink, and forced it back up when we got older, so our kids couldn't. On top of that, we're used to the best of everything, and plenty of it. We weren't dubbed the Me Generation because we neglect our own needs, Junior. If politicians think the current geezers are greedy, they ain't seen nothin' yet.
But responsible middle-aged sorts may yet be brought to their senses when they realize that their usual impulse to get all they can will sooner or later collide with another boomer obsession: the insatiable desire to furnish our kids with every advantage known to humanity. Load Social Security with more obligations than it can bear, and our precious offspring will be squashed under the weight. To fund all the obligations of the Social Security system, payroll taxes will have to more than double by 2040—on top of whatever it costs to buy all those prescription drugs. At that point, our children will realize the trick we've pulled and start to hate our guts. That would be a cruel blow to a generation that thinks of itself as the most wonderful parents in history.
To avoid that fate, boomers need to recognize the need to stop writing checks that today's youngsters will have to cash. With the eager help of our own parents, we've created an entitlement that is fast becoming unaffordable. To bring Social Security into conformity with reality, we'll have to resign ourselves to a higher retirement age reflecting our prospective vigor and life expectancy. We'll have to accept more stringent controls on Medicare spending and take more responsibility for our own medical needs. We'll have to abandon our assumption that the point of the health-care system is to keep each of us alive forever. At some point—don't worry, not anytime soon—we will have to embrace a duty to stop functioning as a fiscal burden on our children and start serving as a nutritional resource for worms.

I don't believe the problem is how much money do you have for retirement but how much is needed for medical care. For those who would like to retire early, there is no inexpensive way to obtain medical insurance. Companies that did provide medical insurance for retirees are doing away with it. There are plenty of stories of people who took retirement packages in their 50's and then a few years later had to return to work because they could keep the insurance but at a high cost. Some companies just did away with the retiree medical insurance entirely. Eventually we will whine enough to solve this problem. Or at least get the government to bail us out.

For those baby boomers that did not save for retirement, it is probably too late to "live the good life" when you retire. Due to the time value of money, it is extremely difficult to make up for the investments not made when you were young. It can be done but as the article above notes, it would take sacrifice - something the baby boomers are not good at.

Bill Pflanz
 
C

chaosweary

Alternatives

I believe one must explore all the alternatives to pensions as well as compensation in general. We can never believe that business or government is going to "take care of us". I do feel some pity for those who actually gave loyalty to their place of work and expected the same in return. Ever so often I see that people give human traits to a place of business (such as caring), which has always bewildered me, but then again I am a generation X'er. If people feel they are not getting the compensation they deserve then quit or find "other additional means" of compensation. I believe we have fallen into part of the economizing problem trap of unlimited wants. If we all limit our wants and focued on needs we would be fine. I really didn't need a new house last year. I had 25% of my income left over every month before I had bought the house. If I had put that extra money into retirement, and didn't have the new mortgage I would have ample money for my old age and health care. Now I am back to paycheck to paycheck. Lets think about how often we put those granite counter tops and jetted tubs infront of our own health care and retirement...
 
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Bill Pflanz

chaosweary said:
I believe one must explore all the alternatives to pensions as well as compensation in general. We can never believe that business or government is going to "take care of us". I do feel some pity for those who actually gave loyalty to their place of work and expected the same in return. Ever so often I see that people give human traits to a place of business (such as caring), which has always bewildered me, but then again I am a generation X'er.

I glad to see a comment from a gen X'er. Like many of your generation, I am sure that you tire of hearing about us boomers. What you describe as bewilderment about caring businesses and government is not the shared feelings we had. Unlike your parents, our parents did believe and had the experience of lifetime employment and a government that tried to care of them. Maybe we were naive in thinking our lives would be the same.

chaosweary said:
If people feel they are not getting the compensation they deserve then quit or find "other additional means" of compensation. I believe we have fallen into part of the economizing problem trap of unlimited wants. If we all limit our wants and focused on needs we would be fine. I really didn't need a new house last year. I had 25% of my income left over every month before I had bought the house. If I had put that extra money into retirement, and didn't have the new mortgage I would have ample money for my old age and health care. Now I am back to paycheck to paycheck. Lets think about how often we put those granite counter tops and jetted tubs infront of our own health care and retirement...

Easier said then done on quitting. Family considerations have a way of getting involved when decisions like that need to be made. Two income families make it complicated plus you also move your kids. It was also not consistent with how we grew up (see above). I hope your generation is not doing what mine did and limit your wants or you will be in the same position.

Bill Pflanz
 
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