on CBS Sunday Morning this week there was a story about an unfunded pension in Prichard, Ala. that really gripped me. if you didn’t see it, or want a deeper view of a crisis that exists in many parts of the nation, i suggest you watch it or read it here -> http://www.cbsnews.com/stories/2011/02/20/sunday/main20034120.shtml?tag=contentBody;featuredPost-PE the city is in such a bad shape that it has filed for bankruptcy multiple times, the latest in an attempt to shed the pension obligation totally. how can the answer be to dump pensions? does anyone else see a problem here with the wave of retirees expected over the next ten years? i heard another statistic that the majority of retirees only have 25% of the amount of savings necessary to retire comfortably.
No one thinks that denying pensions is a good thing. However, what alternative plan is there?
I’m amazed that they can’t pay these people something. We have a client whose pension plan was 98% funded in 2007, before they hired us, that could have terminated the plan with a paltry $2MM contribution. 80% of the plan’s assets were allocated into equities and alternative investments. Apparently they’d never heard of asset liability matching. Now they’re looking at a significant eight figure contribution just to bring the plan up to an 80% funded status.
i misread the thread title
ohai Wrote: ------------------------------------------------------- > However, what alternative plan is there? Fiscal responsibility?
mar350 Wrote: ------------------------------------------------------- > ohai Wrote: > -------------------------------------------------- > ----- > > However, what alternative plan is there? > > > Fiscal responsibility? Unfortunately, that was the answer for the PAST 20 years which everyone ignored. I live in NJ, where the public worker pension fund is $60 BILLION in the red. Our total annual budget is around $30 billion. Fiscal responsibility at this point doesn’t get it done.
Combine greedy union lovers with gutless politicians, throw in collective bargaining powers that deal with management that has no incentive to say “No,” and this is what you get. If you owned a business that had 4 openings for a job that had no educational requirements, you (employer) provided all the training and consequently the line to get these 4 jobs went on around the block, how much would you pay for the open positions? $10 per hour? $12? Then… …why is the starting hourly for a firefighter almost $30 an hour? Answer that question and you will likely get to the problem of pension crises and government budget issues.
^agree. when the sh*t hits the fan, don’t forget who’s to blame - Politicians who bought the union vote.