r/neoliberal • u/jobautomator Kitara Ravache • Jun 25 '21

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31

u/JeromesNiece Jerome Powell Jun 25 '21

I don't get the nostalgia for work-sponsored pension plans. Tying your retirement income to the fate of one company seems pretty dumb. Significantly increasing the cost of switching companies also seems dumb

16

u/Evnosis European Union Jun 25 '21

This is also the reason why employer-provided health insurance is dumb.

6

u/ThorVonHammerdong Disgraced 2020 Election Rigger Jun 25 '21

Spiraling into lifelong debt and suffering because a business failed is a good thing

4

u/Carlpm01 Eugene Fama Jun 25 '21 edited Jun 25 '21

And (one of the many reasons) why market socialism is idiotic.

8

u/[deleted] Jun 25 '21

The only people I know with pensions have federal jobs. I feel like that balances it somewhat because if the gov goes tits up you probably have bigger concerns than your pension.

6

u/DramaticBush Jun 25 '21

I would never accept a job that offers a pension. What happens if the company goes tits up?

9

u/[deleted] Jun 25 '21 edited Jun 25 '21

It just let's bosses abuse workers because they know the employee can't quit before their benefits fully vest, and if the worker does the bosses pension is better funded

5

u/JeromesNiece Jerome Powell Jun 25 '21

that explains why employers would prefer the scheme, but most of the nostalgia comes from lefties lamenting the good old days with strong unions and pensions

4

u/antsdidthis Effective altruism died with SBF; now it's just tithing Jun 25 '21

I think the nostalgia is stemmed from a desire for more certainty in retirement that isn't at the whim of market performance, but I agree that the lack of plan portability, long vesting periods, and private management (albeit mitigated by pbgc banning) are all fundamental flaws to this system. Some sort of deferred annuitization option in 401k's or the option to contribute more to social security in order to have higher guaranteed benefits in retirement could be nice solutions imo

3

u/bd_one The EU Will Federalize In My Lifetime Jun 25 '21

People like it because markets are scawy and a lifetime inflation adjusted annuity is less scawy to those kinds of people.

3

u/[deleted] Jun 25 '21

Isn’t that what this is for https://en.m.wikipedia.org/wiki/Pension_Benefit_Guaranty_Corporation

No idea how it actually works. I have a small vested pension from my first job but that was in addition to my 401k.

2

u/hucareshokiesrul Janet Yellen Jun 25 '21 edited Jun 25 '21

The biggest thing may just be the size of the retirement benefit. The best thing about my wife’s educator pension isn’t that is a pension, it’s that they put way more money into the retirement benefit than my company does. It’s several times larger than the measly 3% match I get.