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PBS Frontline : The Retirement Gamble, sorta Must See (1 Viewer)

Just to move on in this thread I thought I'd say I'm sorry to Chad for being so harsh.  Chad is a good dude for sure and someone who posts thoughtful things and stands his ground.  I won't apologize for the message and content however, I stand by that. 

I don't lump any workers into groups, I'm the type of person who appreciates car wash guy trying to grind it out.  I also find it insincere for private industry folks to make broad generalizations about government, dead weight, bureaucracy, and that like.  Government has dead weight, I have a piece of it myself that I'm trying to jettison, but the private sector has a ton of it too.  You're more easily able to get rid of those people than I am, but based on what I've seen a lot of dead weight keeps on collecting checks out there too.  Sure you can fire them, but you don't because of the conflict and instability it creates.  Guy shows up, people like him, he does the minimum, and you keep him on.  Hell, probably half the work force is like this IMO. 

I have a contract employee I like but he doesn't fit our scheme, and I have to get rid of him.  It sucks, he's not like the govey I have who'd I'd love to fire tomorrow, but it's business.  I have a job to do for the American people and I have to try to and do right by them, no shtick.  I can't have employees who aren't 100% consumed in operations, and if I can trim the fat I will. 

As far as what sparked this, those comments from fedsmith...well I saw one comment in there about a mid-level employee living beyond her means and Grace Under Pressure turned it into all these goveys living the good life.  What :bs: Don't tell me there aren't plenty of people in your office that live beyond their means, job security has little to do with it.  And so we get down to thread business, people putting aside money for retirement, living within their means, and considering what life will be like 20-40 years from now.  Those mid-level goveys are going to get an ok pension, but it's not enough to live off of if they don't contribute to TSP (govt 401k). 

If that shoe buying chick who doesn't contribute to TSP retires a GS-7 after 30 years her pension is gonna be in the neighborhood of $20k before taxes.  If you ghostride the TSP and have less than $100k, well you're not gonna be in a good spot.  You failed to take advantage of the 5% match, you probably never saved anything on the side, and you're not a whole lot better off than your private sector counterpart who also had a taste for shoes and purses.  If you don't want to take responsibility for your financial future, no one should feel sorry for you.  Private, public, whatever.  :2cents:

 
Doctor Detroit said:
Just to move on in this thread I thought I'd say I'm sorry to Chad for being so harsh.  Chad is a good dude for sure and someone who posts thoughtful things and stands his ground.  I won't apologize for the message and content however, I stand by that. 

I don't lump any workers into groups, I'm the type of person who appreciates car wash guy trying to grind it out.  I also find it insincere for private industry folks to make broad generalizations about government, dead weight, bureaucracy, and that like.  Government has dead weight, I have a piece of it myself that I'm trying to jettison, but the private sector has a ton of it too.  You're more easily able to get rid of those people than I am, but based on what I've seen a lot of dead weight keeps on collecting checks out there too.  Sure you can fire them, but you don't because of the conflict and instability it creates.  Guy shows up, people like him, he does the minimum, and you keep him on.  Hell, probably half the work force is like this IMO. 

I have a contract employee I like but he doesn't fit our scheme, and I have to get rid of him.  It sucks, he's not like the govey I have who'd I'd love to fire tomorrow, but it's business.  I have a job to do for the American people and I have to try to and do right by them, no shtick.  I can't have employees who aren't 100% consumed in operations, and if I can trim the fat I will. 

As far as what sparked this, those comments from fedsmith...well I saw one comment in there about a mid-level employee living beyond her means and Grace Under Pressure turned it into all these goveys living the good life.  What :bs: Don't tell me there aren't plenty of people in your office that live beyond their means, job security has little to do with it.  And so we get down to thread business, people putting aside money for retirement, living within their means, and considering what life will be like 20-40 years from now.  Those mid-level goveys are going to get an ok pension, but it's not enough to live off of if they don't contribute to TSP (govt 401k). 

If that shoe buying chick who doesn't contribute to TSP retires a GS-7 after 30 years her pension is gonna be in the neighborhood of $20k before taxes.  If you ghostride the TSP and have less than $100k, well you're not gonna be in a good spot.  You failed to take advantage of the 5% match, you probably never saved anything on the side, and you're not a whole lot better off than your private sector counterpart who also had a taste for shoes and purses.  If you don't want to take responsibility for your financial future, no one should feel sorry for you.  Private, public, whatever.  :2cents:
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Thanks. I don't have any problems with disagreeing with anyone but really try to avoid making it personal even more so with someone I respect and like. I appreciate the sentiment expressed here.

My comments were not aimed at individual people but rather in terms of the organizational structure and how that impacts the efficiency and effectiveness of the organization. Government and private sector start off with vastly different organizational structures, goals, demands, stakeholders and resources to name a few. The short of it is that in the private sector when efficiency and effectiveness lag the organization will cease to exist in it's form. In government, if efficiency and effectiveness lag it is extremely rare that he organization will cease to exist in it's form. That is a huge difference and there are real consequences to that in terms of how people tend to work within those organizations. I certainly don't view government employees as money grubbing so and so's- they are taking advantage of what they can get. I do the same in the private sector as does everyone else in life.

One of the nice things about government jobs are the benefits. These on average exceed that of the private sector. In terms of retirement, it is worthwhile to point this out because the cost will be a burden on all taxpayers. Some states are steadily marching towards a massive reckoning on this- California and Illinois highlighting that. Many financial experts place more of an emphasis on Roth IRA's and 401k's simply for the one reason that they expect tax rates to be higher in the future than they are now. As taxpayers we all have stake in that. As future retirees it is something to realize, understand how it impacts us and plan for the future accordingly. Ideally, I would like to limit the impact through changes politically but there is slim chance of that happening.

 
Doctor Detroit said:
Just to move on in this thread I thought I'd say I'm sorry to Chad for being so harsh.  Chad is a good dude for sure and someone who posts thoughtful things and stands his ground.  I won't apologize for the message and content however, I stand by that. 

I don't lump any workers into groups, I'm the type of person who appreciates car wash guy trying to grind it out.  I also find it insincere for private industry folks to make broad generalizations about government, dead weight, bureaucracy, and that like.  Government has dead weight, I have a piece of it myself that I'm trying to jettison, but the private sector has a ton of it too.  You're more easily able to get rid of those people than I am, but based on what I've seen a lot of dead weight keeps on collecting checks out there too.  Sure you can fire them, but you don't because of the conflict and instability it creates.  Guy shows up, people like him, he does the minimum, and you keep him on.  Hell, probably half the work force is like this IMO. 

I have a contract employee I like but he doesn't fit our scheme, and I have to get rid of him.  It sucks, he's not like the govey I have who'd I'd love to fire tomorrow, but it's business.  I have a job to do for the American people and I have to try to and do right by them, no shtick.  I can't have employees who aren't 100% consumed in operations, and if I can trim the fat I will. 

As far as what sparked this, those comments from fedsmith...well I saw one comment in there about a mid-level employee living beyond her means and Grace Under Pressure turned it into all these goveys living the good life.  What :bs: Don't tell me there aren't plenty of people in your office that live beyond their means, job security has little to do with it.  And so we get down to thread business, people putting aside money for retirement, living within their means, and considering what life will be like 20-40 years from now.  Those mid-level goveys are going to get an ok pension, but it's not enough to live off of if they don't contribute to TSP (govt 401k). 

If that shoe buying chick who doesn't contribute to TSP retires a GS-7 after 30 years her pension is gonna be in the neighborhood of $20k before taxes.  If you ghostride the TSP and have less than $100k, well you're not gonna be in a good spot.  You failed to take advantage of the 5% match, you probably never saved anything on the side, and you're not a whole lot better off than your private sector counterpart who also had a taste for shoes and purses.  If you don't want to take responsibility for your financial future, no one should feel sorry for you.  Private, public, whatever.  :2cents:
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Not to continue to derail the thread, but this "small" benefit is worth around $250k.  Plus the opportunity for a 5% match.  And the healthcare benefits are probably worth more than both of those.

In just about all cases, retiring from civil service is certainly more lucrative than retiring from the private sector.

 
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Chadstroma said:
Thanks. I don't have any problems with disagreeing with anyone but really try to avoid making it personal even more so with someone I respect and like. I appreciate the sentiment expressed here.

My comments were not aimed at individual people but rather in terms of the organizational structure and how that impacts the efficiency and effectiveness of the organization. Government and private sector start off with vastly different organizational structures, goals, demands, stakeholders and resources to name a few. The short of it is that in the private sector when efficiency and effectiveness lag the organization will cease to exist in it's form. In government, if efficiency and effectiveness lag it is extremely rare that he organization will cease to exist in it's form. That is a huge difference and there are real consequences to that in terms of how people tend to work within those organizations. I certainly don't view government employees as money grubbing so and so's- they are taking advantage of what they can get. I do the same in the private sector as does everyone else in life.

One of the nice things about government jobs are the benefits. These on average exceed that of the private sector. In terms of retirement, it is worthwhile to point this out because the cost will be a burden on all taxpayers. Some states are steadily marching towards a massive reckoning on this- California and Illinois highlighting that. Many financial experts place more of an emphasis on Roth IRA's and 401k's simply for the one reason that they expect tax rates to be higher in the future than they are now. As taxpayers we all have stake in that. As future retirees it is something to realize, understand how it impacts us and plan for the future accordingly. Ideally, I would like to limit the impact through changes politically but there is slim chance of that happening.
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Let's face it.  Illinois as a state and Chicago as a city are dead broke.  Actually well beyond dead broke.  And pension obligations on the state level are guaranteed in the constitution, so there is no way around the fact that taxpayers will be getting some extra special levies in the future to cover these costs.  That state is well and truly ####ed.

 
James Daulton said:
Not to continue to derail the thread, but this "small" benefit is worth around $250k.  Plus the opportunity for a 5% match.  And the healthcare benefits are probably worth more than both of those.

In just about all cases, retiring from civil service is certainly more lucrative than retiring from the private sector.
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Sure they are. I'm sure Google employees who get stock options will be destitute in retirement making $250k over 10 or 15 years seem like lottery winners. :rolleyes:  I have a friend who gets a 15% match, I have many others who make double what I do doing half the work. So "just about all cases" is a huge reach, especially since most of my private counterparts live better than I do now. I also didn't say the pension mentioned was "small" you did ftr. Again if you take issue with any of it apply for a position or contact your congressman to complain. 

Also to chad>the federal retirement system FERS is solvent through the year 2070. The system was changed in the early 80s, again you seem to be #####ing about a problem that doesn't and won't exist. I don't work for the state of Illinois. 

 
Sand said:
Let's face it.  Illinois as a state and Chicago as a city are dead broke.  Actually well beyond dead broke.  And pension obligations on the state level are guaranteed in the constitution, so there is no way around the fact that taxpayers will be getting some extra special levies in the future to cover these costs.  That state is well and truly ####ed.
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Absolutely. Illinois and Chicago are a wreck and any person that truly tries to tackle the problem gets blasted for it. Both Rahm and Rauner get some people foaming at the mouth with anger around these parts. There is plenty I disagree with both of them on but I like that they are both trying to reverse course and change things but so many people have vested interest in things remaining broken.

I am hoping that within the next 5 years or so I can exit Illinois. There are several reasons for this but really the top two are current cost burdens and the future meltdown that is coming.

 
Doctor Detroit said:
Sure they are. I'm sure Google employees who get stock options will be destitute in retirement making $250k over 10 or 15 years seem like lottery winners. :rolleyes:  I have a friend who gets a 15% match, I have many others who make double what I do doing half the work. So "just about all cases" is a huge reach, especially since most of my private counterparts live better than I do now. I also didn't say the pension mentioned was "small" you did ftr. Again if you take issue with any of it apply for a position or contact your congressman to complain. 

Also to chad>the federal retirement system FERS is solvent through the year 2070. The system was changed in the early 80s, again you seem to be #####ing about a problem that doesn't and won't exist. I don't work for the state of Illinois. 
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FERS is not the only cost of benefits.

Where you work or do not work is of no consequence to the cost to taxpayers or in other words- to us. State government is obviously state specific but it does not mean it can not be mentioned simply because you are a Federal employee. I never made my original comment about you or any person but rather the nature of the organizational structure of government and the cost it has to us.

 
I don't care about your state or local government, that's your problem. It has nothing to do with the federal government pay and benefit structure, nor the services the federal government provides to you. 

 
Doctor Detroit said:
I don't care about your state or local government, that's your problem. It has nothing to do with the federal government pay and benefit structure, nor the services the federal government provides to you. 
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You don't care about it but this is not a thread about what you care about. It is a thread about retirement and a worthwhile discussion in that light. Everyone needs to know what the likely future prospects are of their state and local governments and plan accordingly for retirement. Either realize the likely cost and plan to pay for that cost or plan to move. Further, government is in charge of a couple of massive things for retirement: social security and medicare. The ability to effectively administer those are also worthwhile subjects. This is all associated with my comments and view of the nature of government. I really don't see the need to keep going in circles on this. My point is not complicated and we know you don't agree with me. What more is there to say?

 
I definitely came across as ####ting on government employees. That wasn't my intent. The point was better made with this statement one post down "The employment 'agreement' has been moving to become very one sided to the advantage of companies. I realize that freewill employment has advantages for both employers and employees, and that placing artificial constructs on the labor market is tricky. But by and large, in the private sector, you can be gone tomorrow. I think that uncertainty absolutely factors into retirement savings, or lack thereof, for a significant portion of Americans."

Point is, employment uncertainty plays into decisions about retirement savings, and that a significant portion of workers in America lack employment security. The federal workers on that site didn't appear to worry about keeping their jobs for 40 years. That's not typical. I limit the scope of my comments to those individuals. I also root for everyone to work hard, save, and retire well. I pass no judgement on type of work, industry, white collar, blue collar, whatever is good with me. Saying things like 'oozing out of their pores' was inflammatory. I apologize for the tenor of those comments. 

So generalizations aside, the current retirement programs assume a certain longevity that seems nearly impossible to guarantee in today's employment market, by-and-large. I believe this stacks the retirement deck against those who may be in riskier employment arrangements, or careers where longevity is less certain. When the topic of responsible retirement savings comes up, it's easy to dismiss those not participating as lazy or ignorant. It may be the case that some don't feel secure enough in their employment to participate.

 
Grace Under Pressure said:
I definitely came across as ####ting on government employees. That wasn't my intent. The point was better made with this statement one post down "The employment 'agreement' has been moving to become very one sided to the advantage of companies. I realize that freewill employment has advantages for both employers and employees, and that placing artificial constructs on the labor market is tricky. But by and large, in the private sector, you can be gone tomorrow. I think that uncertainty absolutely factors into retirement savings, or lack thereof, for a significant portion of Americans."

Point is, employment uncertainty plays into decisions about retirement savings, and that a significant portion of workers in America lack employment security. The federal workers on that site didn't appear to worry about keeping their jobs for 40 years. That's not typical. I limit the scope of my comments to those individuals. I also root for everyone to work hard, save, and retire well. I pass no judgement on type of work, industry, white collar, blue collar, whatever is good with me. Saying things like 'oozing out of their pores' was inflammatory. I apologize for the tenor of those comments. 

So generalizations aside, the current retirement programs assume a certain longevity that seems nearly impossible to guarantee in today's employment market, by-and-large. I believe this stacks the retirement deck against those who may be in riskier employment arrangements, or careers where longevity is less certain. When the topic of responsible retirement savings comes up, it's easy to dismiss those not participating as lazy or ignorant. It may be the case that some don't feel secure enough in their employment to participate.
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It's against human nature, but uncertainty about the future should, logically, serve as motivation to save money.  Not spend more.  Your point about retirement savings being tied to safety would still be sound, but way too many people (both government and private sectors) spend more than they earn and not only don't save for retirement, they don't save for the possibility of being unemployed.  Maybe that's because we have a safety net for the unemployed (granted, not a perfect one), but more so (IMO anyway) it's because of our short-term mindset.  We tend to live for the moment, YOLO! 

 
mquinnjr said:
John Oliver in on the party, fantastic 21 minute piece: http://digg.com/video/john-oliver-financial-planners?utm_source=digg&utm_medium=facebook
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:goodposting:

Hard to believe there isn't discussion about this. 

So here is a little blip about the crix of the issue:
 

The new rule was staunchly opposed by the financial industry and its allies on Capitol Hill. However, Obama defended the measure in his veto statement. He said it reflects “extensive feedback” from other members of Congress and has been “streamlined to reduce the cost of compliance and ensure consumers continued access to competent advice.”

“Because this [congressional] resolution seeks to block the progress represented by this rule and deny retirement savers investment advice in their best interest, I cannot support it,” Obama said in his veto message to the House of Representatives. “I am therefore vetoing this resolution.”

The new rule mandates that all advisors act as fiduciaries and be responsible for not only advising clients but also managing their assets. Asset managers, bankers, accountants and others can all be considered fiduciaries when entrusted in good faith with the responsibility of managing others’ assets.
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So guess what happened?  Congress sent this back because all the annuity snakes, some who have posted in this thread and other retirement related threads trying to sell their :bs: , are going to lose their fat bonuses for fleecing clients.  No longer will Mel be allowed to sell you a #### sandwich variable annuity and collect a nice bonus and vacation voucher, he'll have to do what is in your best interest.  And anyone with a brain knows that interest never includes a God forsaken variable annuity. 

So the insurance lobbyists ran to Congress and said they'd have to lay off people and wouldn't be able to line everyone's pocket on Capitol Hill.  Obama, your president, said :no: So say what you want about him, but he came to the defense of the people here.  Now when it comes to your retirement accounts the provider will have to comply with federal law and they will be held accountable for selling you bull####.  The annuity snakes will still be able to get you outside of your IRA and retirement accounts, but hey, a little progress is better than nothing.  :thumbup:  

 
HRC has it going on.  In the records hacked it showed she has between 5 to 25 million in a vanguard total index fund.

 
FatUncleJerryBuss said:
She knows to stay away from high expense ratios.
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This isn't a political thread, so wasn't going that angle but I did think it matter to see what someone that wealthy did with their funds.  I didn't get too in depth but it seems she has it all in one basket. And we know she gets great advice.

 
I am currently in a pre-retirement seminar with the gubment and wasn't expecting to learn much.  I'm at least 13 years from being able to retire but since I was eligible for the seminar, I thought I'd take it. 

So day one was all about the federal pension system, payouts, survivor benefits which I didn't know much about, health insurance, life insurance, and tax implications.  I was pleasantly surprised as they covered things like what states have no state income tax, and what states offer tax exemptions specifically for federal employees.  They explained how to do the math to figure out your pension, the survivor benefit, and I got a personalized worksheet with all my data.  ####### awesome, I thought this was going to be something here I learned almost nothing. 

Anyway less than 20% of private sector employees now work somewhere that offers a pension, and that number is going to fall further.  Still, if you are currently in a pension program I would learn about it inside and out.  Even if it goes away in your private sector job you are likely to get the contributions you put in, and often you'll at least get a buy out.  For the others that work in the energy sector those pensions will likely be there for you so get to know them. 

For government workers at the local, state, and federal levels know your entitlements and make sure your career data (pay raises, time in service, in service promotion data, etc) are accounted for.  For military folks who bought their time back like me, make sure that you have that paperwork saying you paid it back.  This is crucial. 

Regardless of your situation starting to look at all teh factors that go into retirement is something you should definitely get a handle on in your 40s.  ric Edelman and other financial planners offers retirement workshops, but check with your company first.  If you can go then go, even if you are 15 years out and all the people in the class are people in their 90s, lol.  I think it offers peace of mind and it's a wake up call for some, even if you think you have a decent plan now. 

Tomorrow is the 401k (TSP) session so I'm looking forward to that also.  Didn't think I'd learn anything today and was surprised, hope the same happens tomorrow.  :thumbup:

 
FatUncleJerryBuss said:
This isn't a political thread, so wasn't going that angle but I did think it matter to see what someone that wealthy did with their funds.  I didn't get too in depth but it seems she has it all in one basket. And we know she gets great advice.
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It's actually fairly unique, at least if that's the bulk of her savings. 

It's said the best return on a fund you could get would be based on one that tracked the 'blind' investments made by US Senators. For whatever reason, they miraculously consistently earn 20% or better while in office. 

 
Doctor Detroit said:
I am currently in a pre-retirement seminar with the gubment and wasn't expecting to learn much.  I'm at least 13 years from being able to retire but since I was eligible for the seminar, I thought I'd take it. 

So day one was all about the federal pension system, payouts, survivor benefits which I didn't know much about, health insurance, life insurance, and tax implications.  I was pleasantly surprised as they covered things like what states have no state income tax, and what states offer tax exemptions specifically for federal employees.  They explained how to do the math to figure out your pension, the survivor benefit, and I got a personalized worksheet with all my data.  ####### awesome, I thought this was going to be something here I learned almost nothing. 

Anyway less than 20% of private sector employees now work somewhere that offers a pension, and that number is going to fall further.  Still, if you are currently in a pension program I would learn about it inside and out.  Even if it goes away in your private sector job you are likely to get the contributions you put in, and often you'll at least get a buy out.  For the others that work in the energy sector those pensions will likely be there for you so get to know them. 

For government workers at the local, state, and federal levels know your entitlements and make sure your career data (pay raises, time in service, in service promotion data, etc) are accounted for.  For military folks who bought their time back like me, make sure that you have that paperwork saying you paid it back.  This is crucial. 

Regardless of your situation starting to look at all teh factors that go into retirement is something you should definitely get a handle on in your 40s.  ric Edelman and other financial planners offers retirement workshops, but check with your company first.  If you can go then go, even if you are 15 years out and all the people in the class are people in their 90s, lol.  I think it offers peace of mind and it's a wake up call for some, even if you think you have a decent plan now. 

Tomorrow is the 401k (TSP) session so I'm looking forward to that also.  Didn't think I'd learn anything today and was surprised, hope the same happens tomorrow.  :thumbup:
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:thumbup:  Curious to know what you mean by "get to know your pensions" if you think they'll be there when you retire.  Anything specific I should be looking for?

 
FatUncleJerryBuss said:
This isn't a political thread, so wasn't going that angle but I did think it matter to see what someone that wealthy did with their funds.  I didn't get too in depth but it seems she has it all in one basket. And we know she gets great advice.
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It's Wall St.'s dirty little secret. In the Frontline Retirement Gamble piece, pretty much all fund managers interviewed off the record said they invested their own money in low cost index funds and ETF's.

Picking stocks and paying fees to do so, buying options, investing in high management fee funds, variable annuities, etc. are how they make money, not you. Smart money (Hillary Clinton in this example) is all over this, and the brokers lead the rest of the uninformed public picking stocks like sportsbook rotation numbers and paying $7.95 a trade to try and beat the house and buying 2% management fee S&P 500 index mutual funds overseen by a "superstar active manager" to the eventual slaughter.

 
mquinnjr said:
It's Wall St.'s dirty little secret. In the Frontline Retirement Gamble piece, pretty much all fund managers interviewed off the record said they invested their own money in low cost index funds and ETF's.

Picking stocks and paying fees to do so, buying options, investing in high management fee funds, variable annuities, etc. are how they make money, not you. Smart money (Hillary Clinton in this example) is all over this, and the brokers lead the rest of the uninformed public picking stocks like sportsbook rotation numbers and paying $7.95 a trade to try and beat the house and buying 2% management fee S&P 500 index mutual funds overseen by a "superstar active manager" to the eventual slaughter.
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I am sure as heck not a fund manager but all my money in the market is invested in either ETF's or individual stocks which I buy and hold long term with very limited transactions in and out.

I have posted it several times but feex.com is an awesome resource that everyone should do. I spent a lot of time and energy picking low cost funds. I used this and it found even more savings for me which will amount to thousands over the life of my investments. All that it does is tap into your investments and see what you have. If there is a similar fund at a lower cost, it tells you which to move it to and the cost savings associated by doing it. Can't recommend it enough.

 
Elizabeth Warren wants to rescue stranded 401(k) plans
Sens. Elizabeth Warren, D-Mass., and Steve Daines, R-Mont., have introduced legislation that calls for a database of all retirement accounts, and for investing abandoned accounts in target-date funds, according to this article on Bloomberg. The bill is intended to offer a solution to the retirement rollover problem. “This is a commonsense approach that will empower individuals to take control of their retirement future,” said the Montana senator in a statement. –Bloomberg
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Finally, Warren does something that I not only like but love. Hope this goes through.

 
Tiger Fan said:
:thumbup:  Curious to know what you mean by "get to know your pensions" if you think they'll be there when you retire.  Anything specific I should be looking for?
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When am I eligible? 

How is the pension calculated?  is it a flat rate like 40% of final salary? 40% of my high three salary years? Is it a percentage of my final salary/high three multiplied by years on the job? Is it calculated on tge amount I put in times a number company puts in. 

How will it be paid out? Lump sum then annuity, lifetime annuity, in installments, frequency of installments. 

What is the survivor benefit? How much does it reduce your pension? What is the survivor benefit payout if you die? 

That would be most of it but I'm sure there are a few more considerations based on your company  

 
mquinnjr said:
It's Wall St.'s dirty little secret. In the Frontline Retirement Gamble piece, pretty much all fund managers interviewed off the record said they invested their own money in low cost index funds and ETF's.

Picking stocks and paying fees to do so, buying options, investing in high management fee funds, variable annuities, etc. are how they make money, not you. Smart money (Hillary Clinton in this example) is all over this, and the brokers lead the rest of the uninformed public picking stocks like sportsbook rotation numbers and paying $7.95 a trade to try and beat the house and buying 2% management fee S&P 500 index mutual funds overseen by a "superstar active manager" to the eventual slaughter.
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:yes:   through the years I've tried trading individual stocks with some small success but mostly failure.  Right now I have three individual stocks which represent 1.3% of our portfolio. 

 
Doctor Detroit said:
When am I eligible? 

How is the pension calculated?  is it a flat rate like 40% of final salary? 40% of my high three salary years? Is it a percentage of my final salary/high three multiplied by years on the job? Is it calculated on tge amount I put in times a number company puts in. 

How will it be paid out? Lump sum then annuity, lifetime annuity, in installments, frequency of installments. 

What is the survivor benefit? How much does it reduce your pension? What is the survivor benefit payout if you die? 

That would be most of it but I'm sure there are a few more considerations based on your company  
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:goodposting:

I have the math on mine down to memorized, and it's what keeps me at my current employer. Truly a unicorn, I'm legitimately grateful every day to know that I have a defined benefit pension plan.

I was talking to a friend of mine who was saying that he might be getting one via a merger (which I would bet against, as this is usually the first thing to get shut down to "realize synergies," etc.), and how pumped he was to now be able to stop contributing to a 401k. My eyes almost popped out of my head instantly, might possibly have set the wooden chair I was sitting in on fire. While a pension is awesome, vesting and accruing can be frozen at a moment's notice in the private sector, and "you've got what you've got." Plus the prospect of not taking advantage of a pre or post-tax freebie from the US Government over your entire working life is just insanely bad business IMO. It scares me more that people think this way. You take a mile on any inch our government extends to us in the form of a tax break, this one specifically, because we don't get many.

 
FUBAR said:
:yes:   through the years I've tried trading individual stocks with some small success but mostly failure.  Right now I have three individual stocks which represent 1.3% of our portfolio. 
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I have done fairly well with individual stocks if you take out the huge amount of loss I took when an old employer went bankrupt and wiped a large part of my investments out because I invested way too much into that company.... but if you do add that in.... I have sucked. Badly. Now, the individual stock holding I have are somewhere around 5-10% of my total value of investments.

 
Doctor Detroit said:
When am I eligible? 

How is the pension calculated?  is it a flat rate like 40% of final salary? 40% of my high three salary years? Is it a percentage of my final salary/high three multiplied by years on the job? Is it calculated on tge amount I put in times a number company puts in. 

How will it be paid out? Lump sum then annuity, lifetime annuity, in installments, frequency of installments. 

What is the survivor benefit? How much does it reduce your pension? What is the survivor benefit payout if you die? 

That would be most of it but I'm sure there are a few more considerations based on your company  
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Gotcha.  Already got all that figured out for mine...thought you would be ahead of me ;)

16 more years is my magic # to when I hit my 80 points.  After that...all gravy.

 
Tiger Fan said:
Gotcha.  Already got all that figured out for mine...thought you would be ahead of me ;)

16 more years is my magic # to when I hit my 80 points.  After that...all gravy.
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Seriously though, people don't know #### about retirement.  Federal government has good benefits, not nearly as good as the public thinks, but good. I swear that half the feds have no idea what they are going to get until they retire, and they get their first pension check and they panic because it's 33% of their salary.  Then they realize they have a 401k, and ask for half of it in a lump sum because they are poor.  Then they realize they can get a social security bridge or social security, and they regret taking a bunch of money from their 401k account.  Then they fall off a cruise ship into the Aegean Sea on their first overseas vacation and I have to read about it FedWatch. 

No excuse for stupidity on this stuff when people are handing you the answers.  I guess I'm a dick for loving this stuff and making it a priority, but I'm ok with being a dick as I've demonstrated many times in these forums.  ;)

 
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Chadstroma said:
I have done fairly well with individual stocks if you take out the huge amount of loss I took when an old employer went bankrupt and wiped a large part of my investments out because I invested way too much into that company.... but if you do add that in.... I have sucked. Badly. Now, the individual stock holding I have are somewhere around 5-10% of my total value of investments.
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I have also done decently with stock picking.  Managed to turn my poker stash into a not-insignificant part of my total investments.  I post what I buy in the stock thread.  Mostly very defensive dividend stuff, preferred stocks, etc.  Not a TSLA among them.  

Still, the vast majority of my holdings are spread as best I can between appropriate asset classes.  Very hands off.  And that works great, as well.

 
Doctor Detroit said:
Seriously though, people don't know #### about retirement.  Federal government has good benefits, not nearly as good as the public thinks, but good. I swear that half the feds have no idea what they are going to get until they retire, and they get their first pension check and they panic because it's 33% of their salary.  Then they realize they have a 401k, and ask for half of it in a lump sum because they are poor.  Then they realize they can get a social security bridge or social security, and they regret taking a bunch of money from their 401k account.  Then they fall off a cruise ship into the Aegean Sea on their first overseas vacation and I have to read about it FedWatch. 

No excuse for stupidity on this stuff when people are handing you the answers.  I guess I'm a dick for loving this stuff and making it a priority, but I'm ok with being a dick as I've demonstrated many times in these forums.  ;)
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agree completely. :thumbup:

 
Doctor Detroit said:
Seriously though, people don't know #### about retirement.  Federal government has good benefits, not nearly as good as the public thinks, but good. I swear that half the feds have no idea what they are going to get until they retire, and they get their first pension check and they panic because it's 33% of their salary.  Then they realize they have a 401k, and ask for half of it in a lump sum because they are poor.  Then they realize they can get a social security bridge or social security, and they regret taking a bunch of money from their 401k account.  Then they fall off a cruise ship into the Aegean Sea on their first overseas vacation and I have to read about it FedWatch. 

No excuse for stupidity on this stuff when people are handing you the answers.  I guess I'm a dick for loving this stuff and making it a priority, but I'm ok with being a dick as I've demonstrated many times in these forums.  ;)
Click to expand...
The number of people who know nothing about retirement and have done nothing to prepare for it is mind boggling.

 
Grace Under Pressure said:
It's frustrating that events like today in the market have such an impact on retirement savings. Brits want to leave the EU? Minus 5% from your portfolio.
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I wish I had cash on hand or I would be buying right now.

 
Chadstroma said:
I wish I had cash on hand or I would be buying right now.
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Cash on hand in a 7 year bull market? Like if money fell from the sky, of course I'd be buying as well. 

For those Americans that are in the 401K system trying to do the right thing, not being a lazy fool, putting in 10% of their paycheck or whatever, to be impacted by the whims of the market is a travesty. This is how we fund our retirements? My point throughout is this inherently risky retirement system doesn't seem right, and yet we're all banking on it.

 
Grace Under Pressure said:
It's frustrating that events like today in the market have such an impact on retirement savings. Brits want to leave the EU? Minus 5% from your portfolio.
Click to expand...
I expected a complete bloodbath today but so far it is not so bad.  The Dow has already clawed back to just down 2.2% now.

If the day can finish around 2-3% down, I think we will be ok.  Long day to go though so anything awful can still happen I guess.

 
NewlyRetired said:
I expected a complete bloodbath today but so far it is not so bad.  The Dow has already clawed back to just down 2.2% now.

If the day can finish around 2-3% down, I think we will be ok.  Long day to go though so anything awful can still happen I guess.
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On a long term horizon, agreed. It's important not to panic, of course, it's just disheartening. I liked the quote from Dentist about shedding a tear about paper losses. 

 
Grace Under Pressure said:
Cash on hand in a 7 year bull market? Like if money fell from the sky, of course I'd be buying as well. 

For those Americans that are in the 401K system trying to do the right thing, not being a lazy fool, putting in 10% of their paycheck or whatever, to be impacted by the whims of the market is a travesty. This is how we fund our retirements? My point throughout is this inherently risky retirement system doesn't seem right, and yet we're all banking on it.
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If you are old enough to have this market turndown really impact you then you should be in other investments other than the market. In time this will correct itself. This is all about fear and not about actual impact.

 
Chadstroma said:
If you are old enough to have this market turndown really impact you then you should be in other investments other than the market. In time this will correct itself. This is all about fear and not about actual impact.
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True. But we gamble with our retirement funds. Per the thread title. Doesn't seem entirely right.

 
Grace Under Pressure said:
True. But we gamble with our retirement funds. Per the thread title. Doesn't seem entirely right.
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The title is more about the large amount of money lost by investors through high costs in retirement funds and how that game is played. The overall investing money over time in a well diversified portfolio and gradually migrating to safer investments as you get older is not a gamble- it is preparing for your retirement.

 
Chadstroma said:
The title is more about the large amount of money lost by investors through high costs in retirement funds and how that game is played. The overall investing money over time in a well diversified portfolio and gradually migrating to safer investments as you get older is not a gamble- it is preparing for your retirement.
Click to expand...
These are two different conversations you are trying to have at the same time

1- there is a right way that smart savvy people plan for retirement.

2- the current retirement set up is terrible.

Both can be (and are) true

 
Chadstroma said:
The title is more about the large amount of money lost by investors through high costs in retirement funds and how that game is played. The overall investing money over time in a well diversified portfolio and gradually migrating to safer investments as you get older is not a gamble- it is preparing for your retirement.
Click to expand...
This is fine when things go according to "normal". Then 2007 happens. Under the 401k system, we're risking our retirement funds to market forces in order to grow them. That's the real retirement gamble. I know what the PBS doc was about.

 
Grace Under Pressure said:
This is fine when things go according to "normal". Then 2007 happens. Under the 401k system, we're risking our retirement funds to market forces in order to grow them. That's the real retirement gamble. I know what the PBS doc was about.
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Not really. You take on your risks (high % of equities) in your youngest investment years, and slowly migrate over time to safer investments like bonds (low % of equities), like a see saw. The logic, if 2008 hits or Brexit hits and your high equity, you're young and ride it out no issue. If you're older, you've moved to more stable non-equity investments, and are shielded from the type of volatility currently taking place in the equity market.

The point is to save money, follow the above formula, and stay away from high management fee funds. It's remarkably simple.

 
Grace Under Pressure said:
This is fine when things go according to "normal". Then 2007 happens. Under the 401k system, we're risking our retirement funds to market forces in order to grow them. That's the real retirement gamble. I know what the PBS doc was about.
Click to expand...
It is not really a gamble over time downturns correct themselves. There is tons of data to support that over time even with the downturns in markets a well diversified portfolio will return a decent amount of return. The gamble is if you are old and trying to catch up because you did not prepare when you were younger and then take large losses that you don't have time to recover from. The closer you get to retirement the more your funds should be pulled out of the market and put in protective assets that don't return as much. The risk, or gamble as you want to focus on, is mitigated with time. If you don't have time then don't take the investment risk. The "gamble" is all on you. Be smart and invest and don't gamble.

 
The guys providing the rational retirement advice under the current system are cracking me up. 

ghostguy123 said:
These are two different conversations you are trying to have at the same time

1- there is a right way that smart savvy people plan for retirement.

2- the current retirement set up is terrible.

Both can be (and are) true
Click to expand...

 
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