At Newsweek, David Cay Johnson takes a closer look at the Detroit ruling lifting protections on state pensions, and explains some of the history that has led to the shortfalls all across the country. This, of course, is a huge deal for retirees who've worked who are bracing for pension cuts.
Over at Reuters, Linda Stern looks at how 401(k) lawsuits are slowly making small but important changes to our retirement plans, helping make an imperfect system of saving for retirement better by helping decrease fees and give employees better investment choices. As we know—especially when it comes to fees—these things really count!
Carrie Bradshaw may well secretly fear she will end up a bag lady. Miranda and the others, probably, not so much. So, ladies, I asked, are you a Carrie/Schwarzbaum?
Michelle: I'm 26, a senior corporate tax accountant, and I live in Rockland County in N.Y.
In China, filial piety is so important that it has actually become law. The monetary support of filial piety is important because government assistance is limited and much of the elderly population depend on family support to get them their retirement years. And as someone who grew up in an Asian American household and watched my parents support my grandparents, and was told I would one day support them too, none of this is really surprising to me. Different cultures have different ways of doing money (see the tanda story).
In The Globe and Mail, Joyce Wayne has a column about leaving her full-time job after working for 37 years, and what retirement means to her: Being able to pursue a dream of writing books, while continuing to work part-time for additional income (so she can continue helping her daughter pay for her college education; her partner was also recently laid off). She says retirement has never meant ceasing to work for her.
In the Washington Post, Joe Heim, a father of a six-year-old son and a four-year-old daughter discusses a thing a lot of parents go through: Wanting to save for his kids' college educations, but not actually saving for his kids' college educations.
After I published my post on our on-going retirement crisis yesterday, I got a few emails asking me the same question: I don't want to be working when I'm 77 years old. How much should I be saving for retirement?
According to the Melbourne Mercer Global Pension Index, the retirement system in the U.S. gets a "C" grade—"a system that has some good features, but also has major risks and/or shortcomings that should be addressed. Without these improvements its efficacy and/or long-term sustainability can be questioned." In the Harvard Business Review, Justin Fox argues that retirement risks are best when shared, and uses the Dutch as an example (an imperfect example, but one with a system that scored much higher than the U.S.), where more than 90 percent of the workforce belongs to a pension plan, and its funding ratio (ratio of a pension assets to its liabilities) is 104 percent. Reuters reports that the average funding ratio for state pension plans in the U.S. is under 70 percent.
The last paragraph of the MarketWatch article sums it up (the keyword here is "assuming")...
Billy is a 37-year-old husband and father who decided to give up his job earning six figures when he was 33 to move to a small town and take a position that paid half as well. He says it was one of the best decisions he's ever made.
The U.S. is facing a retirement crisis with too many Americans who will be hitting their retirement years without very much money saved up: "59 percent of households headed by people 65 and older currently have no retirement account assets, according to Federal Reserve data analyzed by the National Institute on Retirement Security," reports Bloomberg. Nearly 7.2 Americans over 65 were still working last year.
If you've read Helaine Olen's Pound Foolish, you know why the 401(k) and our current system of saving for retirement is problematic and have seen Olen run through the many problems.
Since 1992, Australia has had compulsory superannuation (AKA "super"), which is somewhat comparable to a 401(k) in the United States. Currently employers in Australia have to pay 9 percent of worker’s wages (this is not taken from your wages, this is on top of your wages) into a nominated super fund. Soon this amount will rise to 9.25 percent and over the next seven years head on up to 12 percent. There are some exceptions to this compulsory payment—if the employee is under 18 years old, over 70 years old, or earning less than $450.00 per month.