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RedCatWaves · 11-20-2012, 12:47 AM

Quote:

Originally Posted by munchkin

Quote:

Originally Posted by RedCatWaves

Quote:

Originally Posted by munchkin

Defined benefit pension plans became pretty much a thing of the past in the late 80's. Many of them were overfunded. Companies distcontinued the pensions, bought annuities for the participating employees, and took the excess cash. They found it cheaper to provide defined contribution plans; i.e., 401(k)'s. Our company did that.

Those people who have had pension plans for the past 20 years are the minority. It is not new for a company to discontinue the pension plan.

I never thought of it as necessarily a bad thing. My husband and I came out probably ahead of the game with our 401(k)'s.

In fact, I think the government should do this to their employees to save money for the taxpayers.

Overfunded? My fat ass they were overfunded. That's what the bloated CEO's who wanted to make millions instead of hundreds of thousands want you to think.

I'm glad for you that you've done better with a 401K than with a traditional pension, but that's not the case for millions of Americans. In fact, many respected economists feel that Americans have been SCAMMED with the fees on 401Ks and that converting to private plans was just another way to funnel money to bankers. Most people with 401Ks do not have enough money to retire with...and never will.

I worked in benefits at the time. The defined benefit plans were in most cases overfunded back then. The stock market was going gung ho. Many many companies discontinued their plans and put the overfunding back into the company; at least that is what ours did. And, no, the excess money did not go into the pockets of the top executives. Our company was a smaller company. Execs got bonuses but nothing that I considered out of line. Annuities from the pension plan were all based on what you individually had in the pension plan at the time. You had your option: an annuity purchased with the company contributions and a cash return of the money you contributed or an annuity purchased with the company and your contributions.

I don't know anything about your company particularly...I'm speaking generally. Executive compensation has increased over 300% in the past 30 years, while middle-income wages have been mostly stagnant. I do believe a lot of that "overfunded" pension money did indeed go into executive pockets. I spent the 80's working as a salary and benefits administrator for several Big Pharma companies. I saw the trend as it was happening. I see it now. Exec compensation bonuses didn't used to be out of hand...they sure are now though.

I'm glad you have enough retirement money. Really. But you are probably the last of the generations who do. The rest of us...the tail end of the boomers and younger generations...are pretty much screwed. We will be eating catfood.