Author Topic: Barrons article "Many in US Have Zero Retirement Savings"  (Read 2347 times)

Mother Fussbudget

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Barrons article "Many in US Have Zero Retirement Savings"
« on: October 17, 2016, 12:40:51 AM »
Interesting read.  An article pointing out that 'lack of savings for retirement' has *NOT* been brought up as an issue in the current election cycle.  Even though pension funds in many major cities (Dallas, TX cited) are falling below the return rate they need to stay afloat.  Most pension funds are 'actively managed portfolios', and as such regularly underperform the market.  Pity they don't just put their funds in VTSAX or VFINX and leave it at that.

https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=newssearch&cd=1&cad=rja&uact=8&ved=0ahUKEwjX6-KezeDPAhUL9mMKHWS-BTkQqQIIHigAMAA&url=http%3A%2F%2Fwww.barrons.com%2Farticles%2Fmany-in-u-s-have-zero-retirement-savings-1476506571&usg=AFQjCNFRW8IOf0K-afMtGq5551_ARAuVXA&sig2=kFvbq22lFo5wvt4Udve3cg

NOTE:  the link may not work - if it doesn't, search for the article while on the news.google.com page.

exterous

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Re: Barrons article "Many in US Have Zero Retirement Savings"
« Reply #1 on: October 17, 2016, 07:13:07 AM »
Most pension funds are 'actively managed portfolios', and as such regularly underperform the market.  Pity they don't just put their funds in VTSAX or VFINX and leave it at that.

Sadly, if you read some of the pension information out there, a lot would be in trouble even if they did leave it there because they require 8-9% ROI each year in order to meet their targets. Whats worse is that there are places where people are getting their pension in lieu of Social Security. The big one in trouble right now is the Chicago teacher's pension. Right or wrong the resisting of the reform there has them hurtling towards a brick wall with no safety net.

Mother Fussbudget

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Re: Barrons article "Many in US Have Zero Retirement Savings"
« Reply #2 on: October 17, 2016, 10:34:17 AM »
Precisely.

FIREby35

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Re: Barrons article "Many in US Have Zero Retirement Savings"
« Reply #3 on: October 18, 2016, 06:59:12 AM »
Precisely.

The only reason I ponder as a defense to the catastrophe is that the plans, generally are very generous and still have a lot of money. In my mid-size mid-western city, the pension is slightly underfunded (not as bad as the worst cities) but that is with fire/police receiving pensions that are 70% of their last three years salary and that, until recently, allowed them to "spike" their pension by working huge overtime in their last few years. The result was working for 20 years and retiring at 45-50 with a 70k a year (sometimes higher) pension. Then they would go work at a neighboring municipality and be making a salary on top of the pension. That is a very sweet deal.

Anyway, my point is if those benefits end up being less than expected, some people will be very upset but not homeless.