Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 08-24-2010, 10:08 AM   #81
Thinks s/he gets paid by the post
Milton's Avatar
 
Join Date: Apr 2007
Posts: 2,077
Quote:
Originally Posted by kyounge1956 View Post
I think using the commonly-accepted meanings of words is better than Humpty Dumpty's method. (“When I use a word,” Humpty Dumpty said, in a rather a scornful tone, “it means just what I choose it to mean—neither more nor less.” from Through the Looking-Glass, by Lewis Carroll).
Good quotation!

Quote:
Originally Posted by kyounge1956 View Post
If there is more coming in from all sources—investment earnings, employee contributions, and employer match—than is being paid out in benefits, the excess will accumulate in the fund, which will eventually (one hopes) get back to the 100% level.
Pretty big "if" though, isn't it?
__________________

__________________
"To know what you prefer, instead of humbly saying Amen to what the world tells you you ought to prefer, is to have kept your soul alive". Robert Louis Stevenson, An Inland Voyage (1878)
Milton is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 08-24-2010, 10:52 AM   #82
Thinks s/he gets paid by the post
kyounge1956's Avatar
 
Join Date: Sep 2008
Posts: 2,171
Quote:
Originally Posted by Milton View Post
Quote:
Originally Posted by kyounge1956 View Post
(snip) If there is more coming in from all sources—investment earnings, employee contributions, and employer match—than is being paid out in benefits, the excess will accumulate in the fund, which will eventually (one hopes) get back to the 100% level.
(snip) Pretty big "if" though, isn't it?
You're right, it is a big "if", but at least it's there. I just want to inject a note of hope if I can, for anyone whose pension system is underfunded at this time. That's a bad thing, but "underfunded" does not necessarily mean "doomed". Sometimes in my crazier moments I even think of running for a position on the pension board. I would like to see a change in the investment policy that will keep the retirement plan from being so vulnerable to market downturns. The actuaries say the Seattle system can get itself back into a financially sound condition by significantly increasing employee contributions and employer match. The exact amount of the increase has not AFAIK been determined yet. Our current union contract says under these conditions it can go up as much as two percentage points (i.e. from ~8% to ~10%). That is less than the actuaries' recommendation. Maybe under our next contract contributions and employer match will go up still further. But I don't think we'll have the option of a big increase in contributions next time there's a market crash—that would send too big a slice of the total payroll into the pension fund. So IMO, the only way for the system to survive the next market crash is for it not to be hit as hard as it was this time (lost about 27% overall IIRC). To me, that means we need to use a more conservative asset allocation with less stock market exposure, which will be a "hard sell" when trying to raise the funding level, because of the perception that stocks always return more than bonds over the long term. And the "floor COLA" ordinance needs to be rewritten or even repealed, because as it currently stands it triggers an automatic (and unfunded) increase in benefits every time the funding level gets up to 100%, which in practical terms has meant "every time there's a stock market bubble", and of course, the bubble bursts right after the increase in benefits goes into effect.
__________________

__________________
kyounge1956 is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
The other side of the "thou shalt not retire early" coin DblDoc Other topics 4 04-28-2008 11:59 PM
"Book" report: The Adventurer's Guide to Early Retirement, 2nd edition Nords Life after FIRE 16 10-13-2006 11:27 AM
Book report: "The Complete Idiot's Guide to Early Retirement" Nords Other topics 0 06-21-2006 02:49 PM
MSNBC: "Few" people in their early 60s can afford retirement SLC Tortfeasor Young Dreamers 7 07-29-2005 08:46 AM

 

 
All times are GMT -6. The time now is 08:45 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.