Hacker News new | comments | show | ask | jobs | submit login

Wow. So much of Hostess' crisis, and the state of California and its cities hinge on pension obligations. It makes me wonder if it is even possible to create a pension plan that isn't eventually toxic.

Well, at least a private company can eventually just go bankrupt. Nobody knows what's going to happen in CA and IL.

Good point. San Jose discharged a lot of its future pension debt with negotiation. But my question wasn't how people get out from under the debt, rather it was how such a program could be designed so that it wouldn't have this issue.

For example, could you say

"You pay 10% of your salary and we'll match that, into an investment account that buys inflation protected treasuries, then when you reach the age of 55 you have the choice of getting 20%, 50% or 100% of your salary paid out annually until the total of the amount paid in + appreciation over that time reaches zero."

Basically once the company/state had matched the 10% they have no further obligation. And if you're genetics were great and you lived to 115 perhaps your 'salary' would run out at 75 long before you died. But what I don't know is how practical this is, it was so much easier when people actually died around 72 than it is now.

Guidelines | FAQ | Support | API | Security | Lists | Bookmarklet | DMCA | Apply to YC | Contact