Safe public pensions

itspossible

Senior member
2,778 557
1-If you are in receipt of a public pension do you think its fully safe.(teachers,civil service,fire service,police etc)
2-Do you think that the government could alter it at a later stage
3-Have any other countries altered safe public pensions.
Eg-you have been given a 80k lump sum(very safe imho)and you then receive £1110 per month.Is it possible that the government may try and reduce the £1110.
 

0007

Senior member
2,306 606
1-If you are in receipt of a public pension do you think its fully safe.(teachers,civil service,fire service,police etc)
2-Do you think that the government could alter it at a later stage
3-Have any other countries altered safe public pensions.
Eg-you have been given a 80k lump sum(very safe imho)and you then receive £1110 per month.Is it possible that the government may try and reduce the £1110.
They have always effected this previously by means of inflation. With it now being at a historic low (provided your purchasing is mainly TV's & electrical goods and you don't eat food etc) then they may have to resort to other means.
 

Jack o'Clubs

Experienced member
1,554 342
1-If you are in receipt of a public pension do you think its fully safe.(teachers,civil service,fire service,police etc)
2-Do you think that the government could alter it at a later stage
3-Have any other countries altered safe public pensions.
Eg-you have been given a 80k lump sum(very safe imho)and you then receive £1110 per month.Is it possible that the government may try and reduce the £1110.
There was a very good radio programme about this recently, I'll try and find the link. But to answer generally: public pensions come in two types, those that are funded on a pay-as-you-go basis and so are funded out of general taxation and those, mostly local authority ones, that were paid into and therefore have assets from which pensioners are paid. In the short term, yes you're safe, in the longer term the economics for both don't really add up.

For the LA pensions, the assumed returns were way too high, and the problem has been exacerbated by collapsing bond yields. Most now have a funding deficit. That deficit could be closed by returns going back up towards pre-GFC norms or by a cash injection, presumably by the government.

For the pay as you go pensions, the question is just one of demographics - can the taxes paid by the workforce keep pace with the public pension requirements of an ageing population - probably not. At some point the government will have to rethink public pensions, either by changing the conditions for those new to the schemes, or increasing retirement ages, or by cutting the amounts due. None of those are likely to be popular.

The problem we have (a nice problem to be sure) is that we are living much longer than the actuaries predicted when they came up with their original calculations.
 

hhiusa

Senior member
2,685 138
Many states in the US are phasing out public pensions or will be soon.:clap: Thank god. No more tax dollars for golden parachute pensions. It is high time people start learning how to save and invest. Social security will be going away soon as well. The house of cards that is Europe cannot stand forever. They too will eventually have to abolish these frivolous types of pensions if they are to survive.
 

Similar threads


AdBlock Detected

We get it, advertisements are annoying!

But it's thanks to our sponsors that access to Trade2Win remains free for all. By viewing our ads you help us pay our bills, so please support the site and disable your AdBlocker.

I've Disabled AdBlock