Pension Funding Issues

People's pension can get dragged into this mess.

Hey! There are pension funds in there, how dare you./end humour

The problem of pension is that it doesn't come out of thing air. Someone still has to pay for it. In US the company pension get raided. In France pension is gonna run out soon and it put much pressure on the young people. Unless you have deep pocket like Norway oil money, pension would always favor the old. I have never seen a pension system that favors young people instead of the old yet. I think 401k style of you get what you pay is at least fairer to the individuals.

This is a great example of the kinds of problems with "defined benefit" pensions compared to "defined contribution" plans.Defined benefit plans rely on the firm to correctly manage their pension plan, allocate funds for it, invest them wisely etc. In public sector there is political pressure to reduce forecast costs of a defined benefit pension. In many places it's completely legal to operate an underfunded defined benefit plan. Defined benefit plans are also traditio

Why doesn't a pension serve as their pension?

why is that? why couldn't the private approach (withholding x amount per paycheck, adding to a pension fund) work at scale?

With you on the pension fund remark, bit whats next / else?

Your pension funds at work, people.

"A pension is easier for people who are bad at money"I am pretty sure you did not mean it this way, but you're absolutely right.The pensions that were granted in the 50s and 60s and not funded have left an enormous debt for many companies that the federal government will have to make good.Even today, the pensions of many police and firemen are underwater and not likely to be solvent.So pensions are great for company managers who really don't ever plan to fund them

Pensions are very rare in private industry because they’re incredibly expensive and amount to a Ponzi scheme due to chronic underfunding. In the US everyone has moved onto 401k, except government jobs. But almost all state pensions are in a bad shape. Taxpayers are wasting tons of money paying out pensions that simply never made sense and were never deserved - after all offering up something that is “risk free” would be insanely expensive in theory. Unfortunately some states like California make