Tilted Forum Project Discussion Community - View Single Post - What should be done with the autoworker pensions?

Yakk · 12-19-2008, 09:59 AM

There are no guarantees in this world.

An investment plan requires that you invest in things that continue to make money and be worth others buying.

A pension plan requires that the pension plan make similar investments, or the company you work for continues to exist, and that the rules don't change via fiat.

Buying enough goods to survive your twilight years requires that property laws continue to be enforced, and that they aren't taxed out from under you.

Basically, when you are 80, you need enough people out there to feel an obligation to you to provide you with what you "feel you need", because you probably cannot trade on your current usefulness to keep your standard of living high enough.

One method would be to lower your current standard of living a bunch, and massively increase your own investments and savings, and aim for less risk (spread your assets geographically, over multiple industries, over multiple investment devices, etc). Then when things go bad, you are better off than you would be if you had saved less.

The fact is, if the economy isn't strong enough to support the number of retired people, if the workers don't feel that they owe it to the retired people to throw money at them, then you (the retired folk) won't have resources to spend.

Any attempts to deal with the aggregate retiring problem without taking that into account is likely to fail.

12-19-2008, 09:59 AM	#3 (permalink)
Yakk Wehret Den Anfängen! Location: Ontario, Canada	There are no guarantees in this world. An investment plan requires that you invest in things that continue to make money and be worth others buying. A pension plan requires that the pension plan make similar investments, or the company you work for continues to exist, and that the rules don't change via fiat. Buying enough goods to survive your twilight years requires that property laws continue to be enforced, and that they aren't taxed out from under you. Basically, when you are 80, you need enough people out there to feel an obligation to you to provide you with what you "feel you need", because you probably cannot trade on your current usefulness to keep your standard of living high enough. One method would be to lower your current standard of living a bunch, and massively increase your own investments and savings, and aim for less risk (spread your assets geographically, over multiple industries, over multiple investment devices, etc). Then when things go bad, you are better off than you would be if you had saved less. The fact is, if the economy isn't strong enough to support the number of retired people, if the workers don't feel that they owe it to the retired people to throw money at them, then you (the retired folk) won't have resources to spend. Any attempts to deal with the aggregate retiring problem without taking that into account is likely to fail. __________________ Last edited by JHVH : 10-29-4004 BC at 09:00 PM. Reason: Time for a rest.