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Re: More bad news for pensions today
Sweeps, you're trying to pour milk into VJW's glass - which is perpetually half empty.
Sweeps, you're trying to pour milk into VJW's glass - which is perpetually half empty.
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Re: More bad news for pensions today
I was always jealous of anyone that had a 401 plan, but now I am not so sure. I have never worked for anyone that offered them, and my husband has always been self employed. all we have to look forward to is s/s which will pay us less than $1000 a month, so I am trying to save what we will need to retire on.Comment
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Re: More bad news for pensions today
I have enough trouble getting people to fully READ my posts, now I have to concern myself with what people read INTO my posts ?Originally posted by Sweepsplayer
Why not compare the same time frame as people retiring on Social Security ?Anyone could slice and dice a performance chart to find a really bad short-term streak for stocks. Why not just go for the ultimate slam dunk and choose 1929-1933?
* The stock market declined in inflation-adjusted dollars from 1966 through 1982, and did not get back to it’s 1966 value until about 1992.
* Then we had the gains through 2000.
* Then it has declined again.
It’s VERY important, as it makes MY point. The proposition of moving more and more retirements onto Wall Street is undercut by the reality of having to have been lucky enough to have retired between 1993 and 2000.What about the serious gains people earned from 1980 to 2000? Oh-- I guess that's not important.
Well, let’s look at the performance of the asset classes over the last five years:If you're putting all your retirement money in the Dow 30, then you have to expect some serious volatility in the short run. A better question would be, what is the performance of a balanced portfolio that includes large U.S. stocks, small U.S. stocks, international stocks, bonds, and hard assets/real estate?
ASSET ALLOCATION
Again, if you had the foresight to pick the correct asset classes, which history has shown the vast overwhelming number of Americans has not, only then did you make acceptable returns.
Yes.Have you factored dividends into your analysis?
You completely missed the point.It really puzzles me why someone would say to their company, "You know what, you hang on to that $X. Don't give it to me now. I trust you'll take good care of it over the next 30-40 years, even if you go through tough times including bankruptcy." If you're really risk-adverse, why not just take that money and stick it in your 401(k)'s money market fund? I bet the employees of United Airlines wish they could have done that...
The issue is not to not have 401(k)s, but that retirement has always been the proverbial three-legged stool of Social Security, employer pensions, and private investsments.
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Re: More bad news for pensions today
Why does it seem that everyone misses your point?Originally posted by VJW
The whole gist of this thread was whether to do away with pensions in favor of a company match to a 401(k). Maybe you're the one that missed the point.Comment
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Re: More bad news for pensions today
Sweeps, there was a turn made before I posted. Someone said they couldn't wait until it was all privately managed. That person either directly said SS or implied it very heavily (or I just read into it because that's all I hear around me).
I was commenting that 401(k)s can be extremely stressful and my experience with losing value. I didn't mention my father's 401(k) which is still down 10s of the thousands of dollars from pre-2000 (and he's 63.5, so not a whole lot of time to get it back). His company moved from a guaranteed pension (with a guaranteed monthly payment amount) to a 401(k) (they somehow gave credit for the years he was on pension, I'm not sure how that worked). At this point when he retires in a year and a half, he'll be lucky if he gets half of the pension amount he was guaranteed when he took the job. He'll be forced to retire. I have no doubt he will have to take a job in retirement as his retirement income looks to be very, very low.
Are 401(k)s better than pensions? You trade security for a chance of greater returns. Pensions are insured - they used to be 100% but with all the CEO shenanigans, that no longer happens, why those CEOs aren't in jail, I'll never know - 401(k)s aren't. If the choices your company gives you are bad choices, you could end up with next to nothing. On the other hand, if your company gives you great choices, you could end up with quite a bit.Comment
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Re: More bad news for pensions today
and when a company has to drop its pension, the gov pension boys will ask for higher premiums from the companies still participating, which will cause them to drop their pension, which means higher premiums, etc.Pensions are insured
Don't think of retirement as a three-legged stool. Think of it as a tricycle, that is now a bicycle, that will soon be a unicycle. The one wheel you have to go on is your own tenacity, hard work, and education that should be used toward building your retirement nest egg.Comment
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Re: More bad news for pensions today
cercis, there are always exceptions. A lot of times we get on here and foolishly generalize: X is good, Y is bad. There are pensions out there that are backed in good faith by strong companies. There are also really bad 401k plans with poor management, few fund options, and little to no company match. But in general, I will always favor an option where I get the money paid to me now for me to do with it what I please vs. allowing someone else to hang onto it -- even if they pinky-swear they'll be good with my money.Comment
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Re: More bad news for pensions today
Only certain people miss the point. My guess is it is those who fail to fully READ other’s posts.Originally posted by Sweepsplayer
Which is exactly what I responded to.The whole gist of this thread was whether to do away with pensions in favor of a company match to a 401(k).
Nope.Maybe you're the one that missed the point.
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Re: More bad news for pensions today
That won’t work, as evidenced by historical investment performance.Originally posted by jmjj215
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Re: More bad news for pensions today
Historical performance does not guarantee future results.Comment
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Re: More bad news for pensions today
Short-term historical performance does not guarantee future results, but long-term historical performance is a darn good future indicator.
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Re: More bad news for pensions today
How long is long term? What span of years?Comment
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Re: More bad news for pensions today
Is 80 years long enough ?Originally posted by jmjj215
In inflation-adjusted dollars, the Dow was around 400 in 1925, around 500 in 1965, and under 1,000 today.
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