Re: [Pen-l] Other side of auto/Pension Fund Crisis in the US

["Jim Devine" <jdevine03@xxxxxxxxx>]

Henry Liu wrote:
> "Just like the social security trust fund, pension funds are money that
> belongs to the workers who are required to contribute into them out of their
> payroll deductions and matched by public funds as part of workers'
> employment benefits. These funds are not charity payments from government
> employers. They are compulsory savings of public sector workers."

CHAD is accurate when he writes that:
> Social security payments are not savings.  This is totally erroneous.

> Are
> pension fund payments "savings" that belong to the individual.  I think that
> this would depend on whether the plan was defined benefit or defined
> contribution.

Most "pensions" these days are defined contribution (since companies
don't like defined benefits). They represent workers' savings, but can
(and do) lose value with the stock market, etc. Defined benefit
pensions (true pensions) are obligations from the company offering the
pension plan and the workers. This kind of fund is also in trouble
these days as the pension funds' assets have lost a lot of value and
(as I understand it) tremendous amount of pressure is being put on
ERISA from all sides, from all of the true pension funds in trouble.
-- 
Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own
way and let people talk.) -- Karl, paraphrasing Dante.
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