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I would not rely on one form of income for retirement! You don’t know if they are even going to be around! I keep trying to teach this on my YouTube channel too 👍🔥💰
Pension?!?! What’s that. Lol.
Excellent points Chris Hogan. I have 2 pensions, yes I ask the questions you stated. Both are funded til the last retiree collects. Meaning they have stopped taking in new members. Plus I have my personal investments.
I’m 31 and have 16 years in one pension and 3 in another. If they don’t go bankrupt I feel pretty good about the extra income they will provide 💵💵💵
If I was paying into a pension plan I’d definitely want to see what’s under the hood. Some pensions are VERY poorly run. I don’t trust my company to take care of me now, decently not going to bet on them taking care of me in retirement.
Take it as a lump sum when you are ready to retire and invest it yourself!
I will have a public employee pension that honestly is the best benefit in the world. That said my wife and I invest separately in multiple retirement accounts, Roth, 457B, and 401k. Very important to grow a nest egg, in addition to your pension.
What would be the approximate value of a defined pension plan that’s been paid into for 35 years and average salary of 250k?
this is why you have t created your own type of penison, multiple steams of income and investmentment stocks out side the one your job you work for, i never liked any jobs 401k's i like to created my own
I could keep working an extra five years to increase my pension amount 44% /year , invest the lump sum final withdrawal, or just get a second job that's less stressful and more flexible. Or just get on motorcycle and live it up. Decisions. Decisions. 😁
The Pension Fund from The Big Three was put into a fund ran through the UAW.
Now when you work for them there is no pension fund.
Strictly 401K.
Big Three can keep you as a temp for 4 Years.
All those programs take our money so they can become wealthy now, with a promise to make us wealthy later maybe.
My dad worked for GM and when he turned 65 and started collecting social security they cut his pension by 1/3
What do you do?
Invest in Roth IRAs and taxable accounts so that if you want to change companies or move you aren't shackled by the potential of the immature pension.
Financial advisors hate pensions because they don’t get to handle any of that money. They will do anything they can to scare you into thinking they are not reliable sources of income.
This pension crisis is important.
corporate pensions are a scam, the second you hand over your money to someone else, it isn't yours
A pension should be considered as “icing on the cake”. You need to be responsible on your own for saving and investing to have enough at the end of your career. That is… unless you like being dependent on what may turn out to be a poorly managed plan over which you have zero control, perhaps after you are 80 years old.
My Pension is working out great for me so far. I've been getting my increases as expected and all of my benefits (medical, vision, dental are basically free). However, I do have contingencies in place (I have a decent savings, 401K/457 , Stock investments that garner dividend income, etc.). Main thing is that i don't have any debt other than my home. Chis & Dave you guys are great keep up the work.
And save on your own in IRAs and other investments. Even if you put away a few dollars each paycheck, eventually you will have enough to open an IRA or other mutual fund account. If it's an IRA, most companies will then allow small contributions.
My husband's company that offered a defined pension went bankrupt. Our pension was "modified" (read shrunk), and
the life insurance, vision and dental cancelled. The loss of the $150,000 life insurance policy has caused great concern
with us, because we were already in our late 50s, and that insurance policy was the "leg in the stool", which is not
able for us to catch up on. However, we did start saving/investing in our 40s, and compound interest, dividends,etc may
save us.
A pension from GM is like their vehicles, UNRELIABLE!
So teachers should retire n rollover their retirement into an IRA?
I am also relying on OPERS, but plan to invest another 10-15% once we’re debt free and get a nice emergency fund of 3-6 months of expenses saved 👍🏻
This is how folks feel when its said social security wont be there. Well they are deducting it from our pay and now we are expected to let them do that, plus survive and save with the remaining
In the video, Chris conflates the question-asker’s PUBLIC employee pension with a GM PRIVATE employee pension. This distinction is important. Private companies can go bankrupt (Chapter 7 or 11), and while their pensions are insured to an extent by a federal entity, full benefits are not guaranteed. On the public employer side, municipalities can go bankrupt or into reorganization, but no STATE has ever gone bankrupt and as a practical matter, it’s unclear if one ever could. Moreover, current court precedents are generally interpreted by states as preventing them from cutting benefits for any current retiree, or even any current employee. Meaning, as states reform their pensions, reform is most likely to primarily affect those people who are brought in as new employees in the future — not change the terms of a pension that’s already been promised to an existing employee or is already being collected on by an existing retiree.
Of course these things are fluid, but I’d argue on balance that a public employee pension is a substantially safer bet than a private employee pension.
That said, many public employers (states, school districts, etc.) will allow employees to contribute additional dollars into a 403(b) or 457 account. These are not pensions — they’re in addition to pensions — and they’re almost exactly like a 401(k) for private-sector workers. Even if there’s a slim chance that your pension could get reduced or evaporate, the 403(b)/governmental 457 is truly “your money,” and will only get reduced or go away if you choose poor investments or get unlucky in the market (again, like a 401(k)).
So, if you’re afraid the pension is not going to be able to fully pay out benefits by the time you retire, then just contribute additional dollars into the 403(b) or 457 to make up the difference. Yes, it sucks that this means the person who asked the question could have to contribute up to 20-30% of their total income to retirement (between the pension and the 403(b)/457), but you gotta do what you gotta do.
I will have pension and just signed up for a 401k at work and I have a Roth IRA and savings too. My previous employer changed the formula retirement last year. It happens
We have private pensions here in the UK (sipp). My employer matches what I put in (free money) plus we have tax relief. For example, for every £80 invested the government adds £20 (basic rate tax payer). You're then able to take out your sipp from the age of 55. 25% of this is also tax free, so not to bad.
I have been a teacher for 9 years now and most likely the state is taking 7 or 7.5% out of each of their paychecks, so 14% combined as a couple. They are only in their mid 20s, they can easily open a 403b, 457 and definitely a ROTH. I started my Roth at 28 and only put in very little per month. I wish I would have started earlier and have all that time for compound interest to do its magic. Because here is the other thing, and it might depend on states, but there is a full retirement age that you have to be to take out your pension without a penalties as well.
I currently work a local government job here in Ohio, and I have paid into PERS(Public Employees Retirement System) for 14 years now. But when I first started 14 years ago I signed up for an additional program called deferred comp that was offered at my job. Deferred comp looks like a 401k plan. I can’t believe the amount of people at my job who don’t take advantage of the program. Especially when you can invest as low $15 every pay period.
Strs Ohio is solvent! Go in and talk with a person. They can explain to you how long they’re solvent for your situation.