Pension haters

[LinCella]

This forum is usually respectful to everyone, however, when the topic of public pensions come up, there are nasty folks that have to weigh in.

You do not pay for my pension. I paid for my pension, the City I worked for contributed to my pension and 75% percent of the rest is investments that the pension services makes. Did you want to make the pitiful income I made for 25 years, unable to buy a house or have extra money for investments?

I don't begrudge you your million here and your property there. I applaud you.

This why people with pensions keep their mouths shut on this forum or leave it.

 

[34rlsa]

We have a public pension... yet I haven't perceived any ill will here on the forums.

There does appear to be a difference in investment philosophies between those with pensions and those without. For us personally... we can be much more conservative in our AA. If we didn't have the pensions I suppose our risk tolerance would be considerably higher out of necessity to fund our future living expenses.

 

[FIREd]

I am pretty sure that a majority of people here get some kind of pension and they are not afraid to tell us about it, as was evident in this recent thread:

http://www.early-retirement.org/forums/f29/pensions-got-one-70528.html

 

[Ozstache]

We have a public pension... yet I haven't perceived any ill will here on the forums.

There does appear to be a difference in investment philosophies between those with pensions and those without. For us personally... we can be much more conservative in our AA. If we didn't have the pensions I suppose our risk tolerance would be considerably higher out of necessity to fund our future living expenses.

On the contrary, my risk appetite is much higher with the rest of my AA because my pension serves as the low risk element of my portfolio as a whole. In my case, the approximate PV of my pension is 70% of my total portfolio. Even if I put the entire remainder of my portfolio into shares, I have a maximum share risk exposure of 30% which is a pretty conservative AA overall.

Re being harassed here for having a pension. I haven't been (yet!)

 

[Major Tom]

This why people with pensions keep their mouths shut on this forum or leave it.

They do? I see plenty of posters here mention their pensions when discussing the various ways in which they are (or will be) funding their retirement.

 

[obgyn65]

I have also noticed that there are a few nasty posters and predators around here, and not only when we discuss pensions. I have been on the receiving end of some BS here on topics such as AA, my frugal lifestyle, my writing style since I am a non-English native speaker, and even about my volunteering activities. And because of the lack of fair moderation on this website sometimes, I spend less and less time here and share less info about my FIRE goals. And yes, I do have a pension too but I have never mentioned its amount.

 

[PERSonalTime]

This forum is usually respectful to everyone, however, when the topic of public pensions come up, there are nasty folks that have to weigh in.



You do not pay for my pension. I paid for my pension, the City I worked for contributed to my pension and 75% percent of the rest is investments that the pension services makes. Did you want to make the pitiful income I made for 25 years, unable to buy a house or have extra money for investments?



I don't begrudge you your million here and your property there. I applaud you.



This why people with pensions keep their mouths shut on this forum or leave it.

Linny727,

You're right, there are some "pension haters" out there. But, it's alright. What they actually reflect are folks who would love to go back to an era when pensions were more of a common place occurrence, both in the public as well as private sectors, than they are today. Then, maybe they could reap the benefits of having a pension too!

Those lucky enough to have a pension were not given some sort of "gift," but instead earned this benefit through years of dedication and hard work within a system that they did not create. Those "haters" should answer this question, "Pensions, if you ain't got one wouldn't ya like to have one if you could?"

 

[Midpack]

Anyone who doesn't have a pension is free to buy an annuity, similar retirement income sources and sometimes one in the same. There's no need for anyone to be critical or jealous of someone with a public or private pension.

And while there are "haters" everywhere (not confined to ER.org), some are undeservably labeled here and elsewhere. The perception varies even within this thread...

 

[2B]

I don't "hate" the public pensions. I would probably say I'm probably one of the most consistent in commenting that given the situation of many government bodies the financial reality is that public pensions are not totally risk free. This risk is something to keep in the back of your mind when planning. I'm sure the typical pensioner in Detroit did not abuse the system. The elected politicians did abuse the system by not properly funding these pensions. The unions did not meaningfully raise the issue assuming that the pensions would be paid whether or not the pension fund was adequate. Well, we all know now that it wasn't. It still hasn't been all sorted out but I don't think many expect the pensions to be paid in full.

Do I think that is good? No, I do not but it is reality. There are lots of things that are "unfair" but they happen. Goverments should never have promised what they clearly were not properly funding. These issues should have been addressed decades ago. Public pension benefits may have been reduced but they could have been properly funded. Short sighted politcos bought union favor and support with what is now turning out to be false promises.

I think we've all heard of public pension abuses where the pension system can be manipulated to push benefits far higher than what was probably assumed when calculating the benefits and contributions. Many public pension funds are seriously underfunded. To me that is an outrage. The answer is fiscal responsibility and that may mean reducing benefits in some form or fashion and/or eliminating the ability to cram higher benefits shortly before retirement.

This issue is not only in the big rust belt cities but it is also a real issue here in Houston. The public pension funds for the City of Houston are in terrible shape. Something will have to give soon even for one of the fastest growing areas of the country.

 

[frayne]

I've been on this forum for some time and never picked up any bad vibes from those who do not have pensions. We all have to remember, different strokes for different folks. Be real boring if we were all the same. I appreciate all and any opposing view points, to any subject matter.

 

[REWahoo]

I'll confess - I'm a pension hater. I hate the fact I don't have one!

 

[aim-high]

I don't "hate" the public pensions. I would probably say I'm probably one of the most consistent in commenting that given the situation of many government bodies the financial reality is that public pensions are not totally risk free. This risk is something to keep in the back of your mind when planning. I'm sure the typical pensioner in Detroit did not abuse the system. The elected politicians did abuse the system by not properly funding these pensions. The unions did not meaningfully raise the issue assuming that the pensions would be paid whether or not the pension fund was adequate. Well, we all know now that it wasn't. It still hasn't been all sorted out but I don't think many expect the pensions to be paid in full.

Do I think that is good? No, I do not but it is reality. There are lots of things that are "unfair" but they happen. Goverments should never have promised what they clearly were not properly funding. These issues should have been addressed decades ago. Public pension benefits may have been reduced but they could have been properly funded. Short sighted politcos bought union favor and support with what is now turning out to be false promises.

I think we've all heard of public pension abuses where the pension system can be manipulated to push benefits far higher than what was probably assumed when calculating the benefits and contributions. Many public pension funds are seriously underfunded. To me that is an outrage. The answer is fiscal responsibility and that may mean reducing benefits in some form or fashion and/or eliminating the ability to cram higher benefits shortly before retirement.

This issue is not only in the big rust belt cities but it is also a real issue here in Houston. The public pension funds for the City of Houston are in terrible shape. Something will have to give soon even for one of the fastest growing areas of the country.

I think where it gets (or may get nasty) is if federal or state governments use the power to tax to force private citizens to bailout such problems.

 

[panacea]

Haven't noticed the pension haters here but I suppose I'm not on this site every day either to see every post. I'm actually surprised to see how many members have pensions.

 

[HFWR]

Haters gonna hate...

 

[Which Roger]

I haven't noticed that sort of hostility to people who have pensions. The hostility is directed at the politicians and other entities who mishandle the money that is supposed to pay for those pensions.

 

[brewer12345]

Just a friendly reminder: As it has been repeatedly [-]beaten into me[/-] vouchsafed to me, forum rules are that if you have some sort of issue with moderation or a moderator, keep it to private messages.

 

[braumeister]

I must say I've never noticed that sort of hostility here.
Occasionally, someone asking about AA will get a bit testy when they get answers that take pensions or SS income into account (when the OP didn't think about those sources), but hostility? No.

 

[jerome len]

Really, I don't hate anyone with a public pension. My extended family lives in California and if you read the LA Times and their reporting of excessive pensions which have resulted in some prison time and bankrupt cities you might agree that it's the abuse of public pensions that most people dislike. Detroit is another good example; Many of their pensioners have reasonable pensions that may be partially lost through bankruptcy.....that's horrible. On the other hand their pension system was abused in many ways by members of the city council, and other individuals that helped take the city through bankruptcy. Many, many, companies are switching from pensions to 401k type programs......that's what I have and I'll probably enloy about 20k a year from my 25 years in a 401 k.....more if I turn it into an annuity. Most people on this board are compassiate individuals........I think I'm one as well. Regardless, I appreciate your public service and hope you enjoy your retirement.

 

[2B]

I think where it gets (or may get nasty) is if federal or state governments use the power to tax to force private citizens to bailout such problems.

I won't comment on any specific situations but some state pension funds have serious problems already. Higher tax rates start reconfiguring decisions by businesses and individuals as to where they will locate. Large cities are obviously more vulnerable to residents leaving the taxing entity but states are seeing the demographic shift too.

Of course, the federal government borrows and taxes as necessary to fulfill their vision of reality. The USA has the ability to print money to meet their needs which creates different issues than Greece, Cyprus and Italy. Argentina and Venezuala also do have the printing press available but it hasn't worked out so well for them. Ultimately, even the USA has a limit. We just can't be sure where it is until we get there.

 

[donheff]

OP - I suspect you are over sensitive on the topic. I have a Federal pension and have posted in numerous threads on pensions. I have not sensed significant hostility to pensioners. The main differences focus on appropriate steps to resolve underfunding of public pensions. From a public pensioner's perspective some of those posts seem insensitive to the financial sacrifices we made based on the promise of future rewards. On the other hand, many of us pensioners at times seem insensitive to the implicit promises of financial responsibility made to the taxpayers who we expect to pay for our pensions. I am more comfortable discussing pension issues here than I would be at most online forums.

 

[Greencheese]

I think a lot of the hostility towards public pensions are on the State level. Taking the case of Illinois for example. The public unions helped vote in [MOD EDIT] politicians who upped pension/retirement benefits and put laws on the books preventing the reduction of benefits. Those same politicians then either did not increase taxes to ensure the funding was adequate or in many instances just didn't put in contributions at all since the market was "doing so well we can just make up any shortfalls later". During this whole time the unions did nothing to force the state to fund the plan despite the stories and warnings coming out for YEARS that the plan was underfunded. Fast forward to today and Illinois has something like 40% of what it needs for the pensions and the talk of what it will take to fix it is coming up. The only plan the unions have offered is across the board tax hikes and immediately filed lawsuits to prevent the proposed benefit reductions from going into effect (from what I could tell they would mostly be changes going forward?). Throw in the news looking for poster child cases of individuals contributing something like 1% towards their retirement for 5-10 years only and you've got an easy case of the media painting a monster out of a group of people who almost entirely are just hard working citizens caught between a rock and a hard place.

Long story short, I think a lot of the hostility comes from unions voting in guys who promised lots of benefits but then the unions did nothing when the funding alarm bells started going off. Now that many entities are entering crisis mode the general population will not tolerate a 50-100% increase in taxes to fund the shortfalls that the unions are saying is the only answer. Not trying to be political or anything, but that's just how the news seems to "present" the case whenever I see it on TV.


Personally I have no qualm towards people with pensions. As someone just starting out in the workforce I do not have a pension. Since megacorp is in the process of phasing out the pension and on somewhat of a hiring freeze I am one of the few people in the organization who is not currently in the pension plan. I am envious of those who have that safer form of retirement income than I will, but I'm planning retirement around not having a pension to cover those risks as best I can. I also don't blame anyone taking a job, especially if it has lower pay, in order to get a pension. If the job was offered as is to me starting out, I would want everything I was promised too.

 

[jon-nyc]

My non-scientific impression is that a majority of people here have pensions.

 

[ziggy29]

I question whether or not the divergence between public pension costs and flat privater sector wages (and tax revenue) is sustainable and I wonder if changes to some relatively unstable pension plans may be needed for the future. Just the same, in your world would that be "pension hating", even if I have never suggested (or advocated) that anyone who has been playing by the rules and is already in the system have their benefits cut?

Just trying to see where your definition of "pension hating" is.

I'd also add that everyone should try to take a breath and look at it from the other person's shoes. If you are a so-called "pension hater" do you think it's right that someone spend 20, 30, even 40 years or more in a job, possibly earning below-market salaries for much of it, and tell them just before they reach the pot of gold at the end of the rainbow that they signed up for is being looted and they won't get a lot of it?

If you dismiss all the concerns of those who don't get pensions, do you not see how someone can see their own pensions taken away, their wages flat for many years, only to be asked to pay more and more taxes to shore up someone else's benefits when you get nothing? And seeing governments want to make pensioners whole but not care about pensionless people with battered 401K plans? (Yes, even if you pay into your plans, in some states if the pension plan struggles, the taxpayer may have to ante up.)

And instead of working through the problem, we (in the "new media" tradition) immediately resort to pointing fingers and blaming each other.

This is another example, IMO, of economic elites using wedge issues to divide and conquer the working class -- getting us too hateful and resentful of other ordinary people in order to prevent us from seeing -- together -- what said economic elites are doing to the working class overall, and uniting to reverse it.

[PS -- if you think it's bad now, you should have looked back to 2008-09 when everyone who didn't have a pension saw their 401Ks become 201Ks, and many states and cities were talking about drastic measures with tax money and tax policy in order to shore up pensions.]

 

[utrecht]

While I don't think it's what I would call significant hostility, I have definitely noticed a certain amount of dislike of public pensions. Jealousy might not be the correct word, but if does feel like some people are jealous of others with healthy pensions. Those people seem to forget about the perks that they may have experienced that a public employee would never dream of. I've seen plenty of discussions of signing bonuses, yearly bonuses, changing employers when fed up, opportunity to move across the country and other things that people with public pensions couldn't fathom. Everything in life has trade offs and pros and cons. I try not to be jealous of what other people have and enjoy what I have.

Lastly, I don't consider myself "lucky" to have a pension. I chose my career after carfeul consideration of the benefits that I would get and sacrifices I would have to make. There was no luck involved.

Edit: In regards to Ziggy's point about it being worse back in 2008-2009, hes definitely right. There was much more hostility towards pensions on this forum back then, which actually helps make my point that people are jealous. When people's 401ks got crushed, a lot of them were ticked off at people with secure pensions. Now that their 401ks have recovered, there is much less talk here about the evil public pensions.

 

[Nodak]

As a pension holder I have never perceived any hostility on this forum.