

Ask HN: Who said you can work for 25 years and take the rest of your life off? - tomhogans

It seems more frequently every day I read about peoples' retirement plans going to shit.  Doomsday predictions about social security, woefully underfunded pension plans, and unexpectedly bad 401k performances.  I'm no economist or financial expert, but do these ideas seem flawed from the start to anyone else?
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failquicker
The modern assumption of retirement is a bi-product of the industrial
revolution. Retirement was a brass ring that was held up for workers to see as
a way to keep them productive and loyal for a long period of time. Just think
of how many times you've heard the phrase "You don't want to jeopardize your
pension do you?" said in a movie.

Unfortunately, greed, escalation, and bloat caught hold at lots of these
companies. And the concept of company retirement became much more of a well
organized ponzi scheme.

As one example, both of my parents were taught from an early age that they
should grow up to work at one company for their entire life. And that's what
they did. My mother, went to work for the local school system. And my father
went to work for the local chemical production plant. When they started work
they both expected a retirement package, payed into and provided solely by
their employer.

Neither one got that. My mothers retirement plan converted. Into a 401k with a
fractional matching contribution from the school district. So she went from
100% contribution from her employer, to 90% coming out of her paycheck. If she
was to retire "on time".

My father had a much worse fate. He had a pension from his company and a
company managed 401k. Both of which were gutted when the company was spun off
in debt reallocation. He still has the company letters that shows him having
over 1 Million dollars on paper as his retirement package. He retired with
little more than a gold watch for 40 years on the job. I had to support him in
the gap between his "retirement" and when his social security kicked in.

But the silver lining is that we can all learn from the fallacy of our
predecessors. We can take responsibility for our own lives, happiness, and
"retirement". That's a big reason why I work for myself.

And most of the people I know are into the "mini-retirement" concept that has
been more recently popularized by Tim Ferris. Live now. Don't work your whole
life to live later.

If you truly love the work that you do...who'd want to retire anyway?

~~~
zephyrfalcon
_"The modern assumption of retirement is a bi-product of the industrial
revolution. Retirement was a brass ring that was held up for workers to see as
a way to keep them productive and loyal for a long period of time."_

I am not aware of any company that paid pensions during the industrial
revolution, but then again I am not an expert on the subject, so maybe there
were enlightened employers that did. Mostly, though, this was the time of
16-hour work days and child labor.

Retirement was not a "brass ring" but rather a necessity. How are you going to
make a living when you're too old to work? In Europe, labor unions gradually
forced companies to take care of this, and eventually it was set into law (in
most countries anyway), with the government and employers cooperating to pay
for people's retirement. In the US, not so much. Which system is preferable
depends on one's outlook, I guess.

~~~
failquicker
Ok, maybe I abbreviated my train of thought there. Let me elaborate.

And I am speaking solely from my knowledge of US History.

"Bi-Product of the industrial revolution." retirement came about SOLELY
because of the industrial revolution. Prior to that most people were artisans
and self-employed. However, once everyone got onto an assembly line, older
people who couldn't keep up started gumming up the works. And they were being
laid off in droves. To counteract that, Roosevelt, enacted Social Security as
a form of "Old Age Insurance". Soon after, corporations started pension plans
of their own. And this ushered in the era of "Companies look after their own"
in America.

The point I was trying to make is that it use to be common belief that your
employer would take care of you. It's not that way anymore.

Did I do any better that time?

------
c1sc0
In my unqualified opinion retirement is one of the great lies of the 20th
century. Politicians lying to appease the general population after WWII. Baby-
boomers lying to their children if they still maintain the line today. And you
lying to yourself if you're below 40 and expect to retire 'normally'.
Retirement is the biggest pyramid scheme of them all. Madoff'd be proud.

------
ZeroGravitas
Something I keep thinking about is that if _everyone_ is going to be poor,
then that's relatively the same as _everyone_ being rich. If anything these
stories are good news as if you're lucky then whatever you can scrape together
will make you relatively wealthy compared with others, much like if you'd
retired to a developing nation.

~~~
hapless
But not everyone will be poor -- the rich will still be rich. Wage-earners who
believed in social security and the stock market may be very surprised to find
themselves in penury.

People who lived very nice lives in middle age and did everything "right" may
find themselves very poor in their golden years. Our system leaves no margin
for error. The millionaires down the road will be able to cope.

Lastly, equality with your elderly peers won't make you feel any better, if
everyone is dying in equally rotten ways. Worrying about status is a sport for
the young.

