Somewhere between 80-99% of the language of those things is confusing word soup primarily designed to insulate against liability. Disclosure -- what can't it do? Why regulate in any other way?
Sorry, Capitalism takes everything. The dream of a gov't guaranteed pension or decent retirement is going the way of the dodo, first in localities, then states, and nations. We see it happening unevenly already. Greece thought they had pensions, thought they had a welfare state. Soon nation-states will be subject to hostile takeover and liquidation.
I suspect it has a lot to do with the end of war and geo-political competition, where citizens had to be involved in decision-making to generate loyalty. Now the nation-state is just another economic entity, like Exxon or Sony. Capital will rationalize it, and if it isn't generating adequate surplus to and for capital, throw it into Chapter 7.
1 gets it right.
There are actually existing techniques out there for how to deal with volatility, but they chose to give you bullshit instead.
You know what would be even more helpful? If I didn't have to gamble with the stock market in order to avoid living in poverty when I'm old.
What would you prefer? That's a serious question. Do you think social security alone could realistically (just thinking about the economics, not the politics) provide enough money to be your sole support in retirement at a standard of living you would consider comfortable?
Fixed-benefit corporate pensions??
On the other hand, I'm not sure pushing all your risk into the tail of "government changes its pension policy" is a great deal either.
4: A Basic Income would help, and is probably workable economically.
Fixed-benefit corporate pensions, on the other hand, were kind of a terrible idea, at least as usually implemented. (That is, where the counterparty is the employer and not some kind of third party insurer or trust.)
6: you mean for everyone, or just expanding SS to more universally cover the elderly?
I agree that would help, but doesn't seem like something that would do anything to address heebie's preference not to have to gamble in the stock markets.
If I didn't have to gamble with the stock market in order to avoid living in poverty when I'm old.
That's why you have children.
Right. You get used to living in poverty well before you are old.
8: Extra payments for categories of people less likely to be able to work, like the elderly and the dismembered, would reduce the amount of savings you'd have to accumulate, and the severity of the outcome if you ended up outlasting your savings. Meaning that there would be less pressure to put your money in high-growth options like the stock market.
If only there was a way for the government to create a pension system.
Reallocation and rebalancing both require you to tell them what your other assets are. That's the only way they know what you are allocated to and how balanced it is. It's also, entirely coincidentally, a very good way for them to find out what other funds you keep your money in just in case you would ever like to discussing doing a rollover. And the forms for a rollover are right here.
But also, right now there are alternatives to putting your money in stocks. Off the top of my head, there are:
Interest-bearing savings accounts (though you can't expect high returns, especially right now)
Bonds
Fixed-rate long-term annuities (or, if you're about to retire, lifetime immediate annuities, which are basically a way to buy a guaranteed pension).
Of course, the expected returns on these are lower, so you'd have to save more to get the same amount out at the end. But if that's the problem, then the complaint in the OP cashes out to "I wish I had more income." To which I can only reply: "Me too!"
11: Creating a super Social Security for those over say 85 or 90 would solve that also. Or at least make it less of a worry.
It would probably cause a more few cases of "stuff grandma in the freezer to keep her check" but really if somebody is willing to do that for money, I'd prefer not to meet them behind the register at the grocery store anyway. Pay them to stay home a mutter.
Indeed. As long as the Super Social Security payments were marginally higher than the 24/7 cost of operating an artificial heart and lung machine, I think there would be a real arbitrage opportunity.
What do enlightened topless countries do? Don't they just basically have a well-funded SS system?
Japan has a fair problem with "SGITFTKHC."
Ooh, this is fun. Some money was deposited in my TIAA-CREF account a week ago. But the current value of the account is smaller than what it was two weeks ago, by an even larger amount. I guess the markets really have been unhappy; I haven't been following.
What do enlightened topless countries do?
[Waves hands in air] Annuities! Hooray!
The markets have actually been rather unhelpfully not crashing as of late. A solid market crash might inspire Congress to stop fucking around.
14 Interest-bearing savings accounts (though you can't expect high returns, especially right now)
Unless there are savings accounts that are better than the one I have by more than an order of magnitude, calling that an "investment" is kind of laughable.
Anyway, 6 seems like the right answer.
23: I just bought some puts on the S&P 500, so I've done my part.
If only there was a way for the government to create a pension system.
Exactly. There's no good reason why SS couldn't be expanded to let people bump up their contribution percentage in exchange for a higher benefit.
Obviously we need a better funded and more universal SS system, but I still don't think that helps heebie. I think it's inevitable that she's going to need to save for her retirement, and by "save" I mean "invest". So, to help her, what we really need is a much better regulated financial sector. One with much stricter regulations on fees, plain english disclosures, rules against conflicts of interest, etc., at least when dealing with the retail public. So that normal people could get help making savings decisions. (This is supposed to be how financial planners work, but they are so riddled with conflicts of interest that no one trusts them.) There are ways to take a lot of the "gambling" out of it... such as, e.g., savings products that are backed by insurance companies, where your return matches the overall market but is bounded between something like 0-10%. Meaning, if the market goes down one year, you lose nothing--your balance can't go down. If the market goes up by 5% one year, you get the 5%. If the market goes up by 12% (or 32%) one year, you get 10%. On an actuarial basis this works for the insurer (meaning over 30 years you're losing some fraction of the return), but it helps people feel like they're not gambling as much. Yet lots of people are completely unaware that these products even exist.
Moral hazard is for the little people.
21 seems crazy to me. My US low fee fund is only down 2.5% over the past two weeks (and less than that if you measure 13 or 15 days ago).
Breaking. Different investment portfolios yield different results.
Too bad Shearer has not been around to explain people's realpreferences on these things.
Although his point on the miserable track record of government entities in managing their own pension obligations is correct (his root cause analysis is suspect).
essear's contribution is less than 2.5% of the total portfolio, so say he has $100k and contributed $2000 (
Fucking tags.
essear's contribution is less than 2.5% of the total portfolio, so say he has $100k and contributed $2000 (<2.5%) but the portfolio went down 2.5% so his overall account lost about $500 even with the contribution.
29- I find this very interesting and would like to subscribe to your newsletter.
One shouldn't have an investment profile that loses noticeably more money over some time period than the S&P 500, since any sensible portfolio consists of a low-fee boring-as-possible S&P 500 based fund plus less risky things than stocks. S&P is down a little under 3% over the past two weeks.
All my money is invested in baseball cards and Beanie Babies. Those sectors have been down for a long time, but are likely to rebound any time now.
I wonder if anyone in congress is making a killing in the stock market this week. It's such an amazing inside trading opportunity.
With today's surge, the S&P 500 index is unchanged since Sept 30.
The beauty is that Boehner only need to know what he's going to do tomorrow to make a killing. He doesn't even need a long term plan.
Well, even a representative not in leadership but with enough exposure could probably move markets somewhat. They can buy low, leak info that there's about to be a deal to do something that will make the market go up, sell and sell more short, leak again that the deal fell apart, buy to cover, rinse, repeat. The risk for them is that their action doesn't do what they think it will but as long as they don't overleverage they won't get too screwed.
35 essear's contribution is less than 2.5% of the total portfolio
Something like that. I would have to go through the arithmetic again, since I only eyeballed it -- maybe it didn't actually decrease by quite twice the contribution, but 1.5 times or something.
It is entirely possible that 31 is right but the crazy thing here is that I don't currently contribute enough to my retirement plan. (My employer pays into a different one, so this one only gets my contribution now, but a previous employer used to pay into this one, so it accumulated a lot more then. I don't pay much attention to any of this and will presumably die penniless someday.)
Ah ok, that makes sense.
Yeah, the markets aren't moving that much yet. If Boehner had billions to bet on a rise in interest rates of a few basis points, or were bribed by those who do have billions to bet...wait a minute.
Where Keynesian economics attempts to safeguard the productive economy against the fluctuations of financial capital, neoliberalism installs speculation at the very core of production. --melinda cooper, Life as Surplus
And production, consumption, and identity have fused
If this thread's not dead, is there a good retirement planning book/website people would recommend? I'm not thinking of "what do you want to do with your life" advice but more boring money management advice. There's a couple of plans here and I should have signed up for one already but haven't. There's also a pension here, but I don't think staying until it vests would be good for my long-term health.
Also, political insider trading seems like the kind of thing that's more likely to happen around "issues" that aren't heavily publicized, like the tariff on a commodity in a fairly specialized market where a small change could be a huge deal to a limited audience.
4: Here is the alternative . As a matter of public policy, it would be very easy to do better than our current crazy retirement system.
29: You're not talking about variable rate annuities, are you? They are notorious for high fees and other rip-off elements.
There's bogleheads.org, which is like the flyertalk of personal finance.
Websites where weird subcultures have extended conversations about things I don't care about are strangely compelling.
I totally buy the bogleheads philosophy, which is you don't want to try to outsmart the market, and you certainly don't want to pay someone to try to outsmart the market. Instead you want to invest in a boring way, while minimizing fees and taxes. (Low fee here means something like .07%.)
What I'm doing is 50/20/30 in the lowest fee available domestic stock index, international stock index, and bond index funds available through my employer. Every year it'll automatically rebalance and every 5 years I'll bump up the bonds by 5. That makes me a little overinvested in the US (33/33/33 would be the default plan), but I figure if the US does badly we'll be screwed anyway.
55: New scroll-over text?
I also like the philosophy because it seems the closest way to approximate the better system where you pay taxes and then get more out in Social Security than you put in because the US economy has grown. You don't want to gamble, you just want to invest in the US economy in general.
The U.S. economy is run by people who will invoke nihilism in an attempt to stop poor people from getting health care. Gambling seems safer.
Those same people also run the casinos, though.
Holy shit this fucking baseball game. Kid has now been kept up 2 1/2 hours past bedtime for nothing but ongoing pain.
... so you're saying that the Cardinals are spoiling her plans for retiring?
"Retirement Packages" should be the name of a geriatric pornographic magazine.
Fixed in come
Debbie does diversification
Social suck-yur-titty
Timely for me; I am seriously considering pulling a good chunk of my savings out of a boring investment to out into an early stage company. I know enough of the details to believe that the expected value for this is good, but that includes a good chance of losing all of it.
I wouldn't even consider it if my retirement savings options weren't so poor.
Inspired by an earlier suggestion for a Breakfast-at- Tiffany's-based pseud, I was just thinking that Holly Gonaked would be a good stripper name.
Invest in an mutual fund of index card makers.
61: that's right halford, teach her about life!
Boring investment is exactly what I'm looking for.