athn64
Ruby
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Post by athn64 on Oct 10, 2021 14:22:52 GMT -6
I 100% have the golden handcuffs at my job with my benefits and pension. I'll never leave. This is H. He would love for me to get a full time out of the home position instead of my freelancing, but even if I do, we'll be better off if he stays in his position due to the benefits and pension.
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Post by Uncaripswife on Oct 10, 2021 16:52:36 GMT -6
Ask yourself who benefits from people saving for 15 years of retirement that they probably won't live to see.
Spoiler alert: it's the financial services industry
Guess what's not really portable if you leave it behind and forget about it, or the plan sponsor goes out of business, or nobody bothers to keep track of the records of your account and it "disappears"?
Spoiler again: it's your defined contribution retirement plan
What would free up millions of dollars for employers to fund defined benefit pensions?
Spoiler x3: socialized healthcare
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overboard
Sapphire
Dull normal
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Post by overboard on Oct 10, 2021 16:56:47 GMT -6
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cnf
Ruby
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Post by cnf on Oct 10, 2021 18:48:45 GMT -6
I 100% have the golden handcuffs at my job with my benefits and pension. I'll never leave. Yup. Same. This conversation is way over my head, I do not speak financials. But I have a pension and in two years I'll be fully vested and no longer required to contribute. And when I'm eligible to retire I'll end up with a sizeable amount for the rest of my life. Plus my 403B which I currently have set to be fairly aggressive, because in the words of my financial planner, that money is all gravy and I'm playing the long game for it, so why not. I won't ever leave teaching. The benefits are so, so good. Pension until I croak, summers off, home by 3pm, health care still covered and provided post retirement. And honestly, NY pays it's teachers very well. So I can't even complain about my salary when I know what other teachers get paid in other states.
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willow
Ruby
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Post by willow on Oct 11, 2021 8:23:58 GMT -6
cnf I think the teachers get paid decently in our district but I still have been sending amazon packages to my son's K teacher after every paycheck because she has her Amazon wishlist in her email signature. My H was like I hope she doesn't think you're trying to buy good treatment for our kid lol. I hadn't even thought of that. My love language is receiving/giving gifts so I honestly just am compulsory about buying the stuff and hadn't even considered that it may appear otherwise, lol.
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beaf12
Silver
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Post by beaf12 on Oct 11, 2021 8:27:12 GMT -6
I am very fortunate to have a union pension that I can move to another hospital in the same union. I have seniority perks and bonuses that keep me at my current hospital, but those are feeling less and less worth it these days. We have a “rule of 85” when your pension earning years plus your age equals 85, you can retire with no early retirement penalty. I’ll be 57. I can then get any old job to supplement or I can continue to work as a nurse in a non-union job. I do not currently live my job, but I love my pension.
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fatpony
Amethyst
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Post by fatpony on Oct 11, 2021 9:02:41 GMT -6
The financials are above me too. I have no idea when or if I become vested in my pension, but I also contribute to my 403b. (except for the time they took me off contributing it during my maternity leave and neglected to put it back on and I didn't discover it for 2 years).
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willow
Ruby
Posts: 19,607 Likes: 125,141
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Post by willow on Oct 11, 2021 9:42:33 GMT -6
fatpony PERA vests after 5 years, but we still contribute forever (or until retirement, anyway), I believe. The vesting means we just get all of the $$ if we leave vs only our contribution if we left before 5 years.
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Peekaru
Sapphire
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Post by Peekaru on Oct 11, 2021 9:44:21 GMT -6
The 401(k) was originally started for the upper management at Eastman Kodak, they lobbied to have a tax advantaged plan that they could stuff extra money into, so line 401(k) of the tax code was written. Read again, executives at eastman kodak wanted to pay less taxes, and had money to burn so they lobbied for the 401(k). It was never ever meant to be the sole retirement plan for most of the country; those execs also had pensions, just like every other worker in the US. And here's the thing, those huge pension payouts for the execs are usually the reason that pensions fail.
So now almost everyone has a 401(k) or equivalent instead of pensions, and we haven't truly seen the fallout from it yet, I'd say we are at least 10 years out from that; the average retiree has less than 90k saved for retirement.
Pensions for everyone; it could be done, and they could be portable.
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Post by greykitty on Oct 11, 2021 10:15:17 GMT -6
I thought these links aren't a bad initial general overview of the why and how of defined benefit vs defined contribution plans. I think we're all agreed that these days defined benefit plans are pretty much seen only in governmental and some unionized entities, while defined contribution is the norm otherwise for those having such financial planning/compensation benefits from their employers. I guess one outcome of this discussion might be just be updating what financial benefits we may have, how they work, and key contact numbers. To be fair, I don't think most people do know what they have, etc, even for the most universal of plans. Look how absolutely confused people are re Social Security and Medicare, every single year. And both those plans require some advance strategizing by many people to know what and when to elect to best suit their specific situation. In my case, when we switched from defined benefit to defined contribution, the employer stated clearly what contributions they would make. The second link is from the UK, but seems pretty applicable as well. And, if I correctly remember fairly recent law changes, when someone does elect how to receive their benefits from a pension plan (annuity versus cash payout/rollover into an IRA, let's say), it can be very challenging to decide which option will provide more security down the road. It can be psychological as well as just running the numbers. And require crystal ball gazing about the stability of one's employer, for those in the private sectors. www.investopedia.com/ask/answers/032415/how-does-defined-benefit-pension-plan-differ-defined-contribution-plan.asppensionadvice.org/defined-benefit/defined-benefit-vs-defined-contribution/
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Peekaru
Sapphire
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Post by Peekaru on Oct 11, 2021 10:36:38 GMT -6
I thought these links aren't a bad initial general overview of the why and how of defined benefit vs defined contribution plans. I think we're all agreed that these days defined benefit plans are pretty much seen only in governmental and some unionized entities, while defined contribution is the norm otherwise for those having such financial planning/compensation benefits from their employers. I guess one outcome of this discussion might be just be updating what financial benefits we may have, how they work, and key contact numbers. To be fair, I don't think most people do know what they have, etc, even for the most universal of plans. Look how absolutely confused people are re Social Security and Medicare, every single year. And both those plans require some advance strategizing by many people to know what and when to elect to best suit their specific situation. In my case, when we switched from defined benefit to defined contribution, the employer stated clearly what contributions they would make. The second link is from the UK, but seems pretty applicable as well. And, if I correctly remember fairly recent law changes, when someone does elect how to receive their benefits from a pension plan (annuity versus cash payout/rollover into an IRA, let's say), it can be very challenging to decide which option will provide more security down the road. It can be psychological as well as just running the numbers. And require crystal ball gazing about the stability of one's employer, for those in the private sectors. www.investopedia.com/ask/answers/032415/how-does-defined-benefit-pension-plan-differ-defined-contribution-plan.asppensionadvice.org/defined-benefit/defined-benefit-vs-defined-contribution/It does require a lot of educated guessing. When running the numbers I will usually run a SPIA (single premium immediate annuity) calculator, and that will help show the crossover point.
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Post by ldubhawksfan on Oct 11, 2021 10:36:58 GMT -6
The 401(k) was originally started for the upper management at Eastman Kodak, they lobbied to have a tax advantaged plan that they could stuff extra money into, so line 401(k) of the tax code was written. Read again, executives at eastman kodak wanted to pay less taxes, and had money to burn so they lobbied for the 401(k). It was never ever meant to be the sole retirement plan for most of the country; those execs also had pensions, just like every other worker in the US. And here's the thing, those huge pension payouts for the execs are usually the reason that pensions fail. So now almost everyone has a 401(k) or equivalent instead of pensions, and we haven't truly seen the fallout from it yet, I'd say we are at least 10 years out from that; the average retiree has less than 90k saved for retirement. Pensions for everyone; it could be done, and they could be portable. 😳 90k?!
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Peekaru
Sapphire
Posts: 2,518 Likes: 10,480
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Post by Peekaru on Oct 11, 2021 10:38:45 GMT -6
The 401(k) was originally started for the upper management at Eastman Kodak, they lobbied to have a tax advantaged plan that they could stuff extra money into, so line 401(k) of the tax code was written. Read again, executives at eastman kodak wanted to pay less taxes, and had money to burn so they lobbied for the 401(k). It was never ever meant to be the sole retirement plan for most of the country; those execs also had pensions, just like every other worker in the US. And here's the thing, those huge pension payouts for the execs are usually the reason that pensions fail. So now almost everyone has a 401(k) or equivalent instead of pensions, and we haven't truly seen the fallout from it yet, I'd say we are at least 10 years out from that; the average retiree has less than 90k saved for retirement. Pensions for everyone; it could be done, and they could be portable. 😳 90k?! It's worse than that: the average person in the US has less than 10k saved anywhere, period.
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LaRo422
Platinum
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Post by LaRo422 on Oct 11, 2021 10:57:00 GMT -6
cnf I think the teachers get paid decently in our district but I still have been sending amazon packages to my son's K teacher after every paycheck because she has her Amazon wishlist in her email signature. My H was like I hope she doesn't think you're trying to buy good treatment for our kid lol. I hadn't even thought of that. My love language is receiving/giving gifts so I honestly just am compulsory about buying the stuff and hadn't even considered that it may appear otherwise, lol. I pretty regularly ask my kids' teachers if they need anything throughout the year. I used to not be in a place to be able to do that, but now that I can, within reason lol, I do. When we took DS2 to 9th grade, we brought extra supplies that were on her list and she was so thankful. She told her no one ever brings extra supplies in for high school, which was kind of mindblowing to me! I can't imagine being a teacher and having to provide so many supplies to the classroom.
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Minerva
Ruby
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Post by Minerva on Oct 11, 2021 11:20:46 GMT -6
cnf I think the teachers get paid decently in our district but I still have been sending amazon packages to my son's K teacher after every paycheck because she has her Amazon wishlist in her email signature. My H was like I hope she doesn't think you're trying to buy good treatment for our kid lol. I hadn't even thought of that. My love language is receiving/giving gifts so I honestly just am compulsory about buying the stuff and hadn't even considered that it may appear otherwise, lol. I pretty regularly ask my kids' teachers if they need anything throughout the year. I used to not be in a place to be able to do that, but now that I can, within reason lol, I do. When we took DS2 to 9th grade, we brought extra supplies that were on her list and she was so thankful. She told her no one ever brings extra supplies in for high school, which was kind of mindblowing to me! I can't imagine being a teacher and having to provide so many supplies to the classroom. I loved that DS’s teacher provided an Amazon wishlist for fun classroom items at the beginning of the year, in addition to the normal school supplies and Lysol wipes. She also has a list of books that she’d like for the classroom library on the Scholastic books website. I make sure to add one on each time I put in a book order.
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LaRo422
Platinum
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Post by LaRo422 on Oct 11, 2021 11:26:36 GMT -6
I pretty regularly ask my kids' teachers if they need anything throughout the year. I used to not be in a place to be able to do that, but now that I can, within reason lol, I do. When we took DS2 to 9th grade, we brought extra supplies that were on her list and she was so thankful. She told her no one ever brings extra supplies in for high school, which was kind of mindblowing to me! I can't imagine being a teacher and having to provide so many supplies to the classroom. I loved that DS’s teacher provided an Amazon wishlist for fun classroom items at the beginning of the year, in addition to the normal school supplies and Lysol wipes. She also has a list of books that she’d like for the classroom library on the Scholastic books website. I make sure to add one on each time I put in a book order. That's such a good idea. DD's teacher hasn't shared a wishlist, but I should ask and see if she does.
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Post by blurnette989 on Oct 11, 2021 11:36:51 GMT -6
It's worse than that: the average person in the US has less than 10k saved anywhere, period. When so many places don't pay living wages how do we expect people to save for anything, much less retirement?
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willow
Ruby
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Post by willow on Oct 11, 2021 11:47:58 GMT -6
I had to think if I had 10k saved -- in retirement, yes. My own personal savings, no. Hello, being a millennial and having 3 young children with insane expenses. And I'm someone with a good income and I'm not living paycheck to paycheck (I could save more than I do each month, certainly). It doesn't shock me that most people can't even save more than $1k if that.
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Post by enchanted on Oct 11, 2021 11:51:16 GMT -6
It's worse than that: the average person in the US has less than 10k saved anywhere, period. When so many places don't pay living wages how do we expect people to save for anything, much less retirement? This. Then you add in that being poor is actually really expensive* and I'm not the least surprised. *There was a great Twitter thread shared awhile ago that explains this really well. Let me see if I can find it. ETA: I can't find it. Just search for "Being poor is expensive" or "Poverty is expensive" on Twitter, though and a lot of tweets come up about it with examples. This is just one:
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Peekaru
Sapphire
Posts: 2,518 Likes: 10,480
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Post by Peekaru on Oct 11, 2021 11:55:27 GMT -6
I had to think if I had 10k saved -- in retirement, yes. My own personal savings, no. Hello, being a millennial and having 3 young children with insane expenses. And I'm someone with a good income and I'm not living paycheck to paycheck (I could save more than I do each month, certainly). It doesn't shock me that most people can't even save more than $1k if that. I know. This is the exact reason I got out of Wealth Management and moved to coaching, I wasn't HELPING anyone by making sure wealthy people got more wealth. Now I'm at least helping people.
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LaRo422
Platinum
Posts: 1,695 Likes: 10,580
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Post by LaRo422 on Oct 11, 2021 11:57:36 GMT -6
When so many places don't pay living wages how do we expect people to save for anything, much less retirement? This. Then you add in that being poor is actually really expensive* and I'm not the least surprised. *There was a great Twitter thread shared awhile ago that explains this really well. Let me see if I can find it. When there was a lapse in unemployment benefits because of 45 not extending benefits, we had to pick and choose which bills to pay. We kept the bills in my husband's name current since we knew we were going to try to buy the house this year. We let a few CC's go past due and my credit took a pretty big hit. The car insurance was primarily in my name, and since premiums can be higher with a low credit rating, our premium went up at renewal. We've since changed insurance companies and switched it to my husband's name, but it went up like $45 a month. I don't understand how that's legal or how your credit rating can or should have anything to do with premium rates. I've heard the argument for it, but it's total BS.
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willow
Ruby
Posts: 19,607 Likes: 125,141
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Post by willow on Oct 11, 2021 12:06:54 GMT -6
LaRo422 It reminds me of the meme I have seen a few times that says something like "My credit score just went down 20 points because I paid off a loan so I love this very real system we have going here". It's so true though.
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lagom
Silver
Posts: 401 Likes: 2,184
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Post by lagom on Oct 11, 2021 12:24:11 GMT -6
When so many places don't pay living wages how do we expect people to save for anything, much less retirement? This. Then you add in that being poor is actually really expensive* and I'm not the least surprised. *There was a great Twitter thread shared awhile ago that explains this really well. Let me see if I can find it. ETA: I can't find it. Just search for "Being poor is expensive" or "Poverty is expensive" on Twitter, though and a lot of tweets come up about it with examples. This is just one: My gosh to the comments on that tweet. People suck.
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willow
Ruby
Posts: 19,607 Likes: 125,141
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Post by willow on Oct 11, 2021 13:33:50 GMT -6
Props to Chocolate Rain guy for speaking the truth. Not something I'd expect to say in 2007, lol.
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lion
Bronze
Posts: 216 Likes: 1,041
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Post by lion on Oct 11, 2021 13:45:17 GMT -6
Props to Chocolate Rain guy for speaking the truth. Not something I'd expect to say in 2007, lol. Tiktok only recently taught me that Chocolate Rain was a call out of systemic racism and it took me until 2021 to figure that out, just in case you were in the same boat. genius.com/Tay-zonday-chocolate-rain-lyrics Like. It wasn't subtle. I still somehow missed it. So he's been doing it the whole time.
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willow
Ruby
Posts: 19,607 Likes: 125,141
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Post by willow on Oct 11, 2021 13:59:18 GMT -6
Props to Chocolate Rain guy for speaking the truth. Not something I'd expect to say in 2007, lol. Tiktok only recently taught me that Chocolate Rain was a call out of systemic racism and it took me until 2021 to figure that out, just in case you were in the same boat. genius.com/Tay-zonday-chocolate-rain-lyrics Like. It wasn't subtle. I still somehow missed it. So he's been doing it the whole time. Huh! Well you learn something new all the time. I'll be honest and admit I don't even know that I listened to the lyrics back then. I was in college and just remember it being the latest entertaining video on YouTube. But yeah the lyrics were pretty poignant.
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Post by greykitty on Oct 11, 2021 14:14:59 GMT -6
I had to think if I had 10k saved -- in retirement, yes. My own personal savings, no. Hello, being a millennial and having 3 young children with insane expenses. And I'm someone with a good income and I'm not living paycheck to paycheck (I could save more than I do each month, certainly). It doesn't shock me that most people can't even save more than $1k if that. I know. This is the exact reason I got out of Wealth Management and moved to coaching, I wasn't HELPING anyone by making sure wealthy people got more wealth. Now I'm at least helping people. My biggest financial error was being just embarrassed take advantage of the financial planning benefits offered through my work. My credit card debt situation was ridiculous for many years, such a vicious cycle for more people than me. And for some reason I thought you had to be initially able to put a lot into savings to have it make a difference in later life. And then I learned planners have seen it all and can make good suggestions in so many situations. A good financial coach is such a Godsend to so many - I hope you feel that in your work with your clients, and know that they probably thank you so often in their daily lives.
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AmyG
Ruby
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Post by AmyG on Oct 11, 2021 16:49:26 GMT -6
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AmyG
Ruby
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Post by AmyG on Oct 11, 2021 16:53:03 GMT -6
LaRo422 It reminds me of the meme I have seen a few times that says something like "My credit score just went down 20 points because I paid off a loan so I love this very real system we have going here". It's so true though. Credit score is not based on if you are a good risk meaning you'll actually pay off your bills like we think. Credit score is based on if you will carry a balance always and forever, meaning you are a good risk to the bank, in that the bank will ALWAYS make interest off of you. The bank is risking loaning your money not that you'll default, but risking whether the bank will MAKE MORE MONEY off of you than what you borrowed. It's stupid.
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fatpony
Amethyst
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Post by fatpony on Oct 11, 2021 17:12:47 GMT -6
My dad was very lucky when the manufacturing plant he worked at closed when I was on college - he qualified for his full pension by about 4 months.
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