If Pensions were not guaranteed by govt, what would you do or have done differently?

[TuborgP]

Originally Posted by 58robbo

i probably didn't get my point across properly in the op, but what i really wanted to know is how behaviour might be different if we didn't have the "bailer-outer-in-chief". if that was the case would more or less people have a plan b and c? would we be more or less inclined to spread out our risk? (when i say spread out our risk i'm not only referring to dollar income related investments)

You are asking a hypothetical question to people who have a variety of different plans based on a variety of different contribution mechanisms. Considering the variety of pension plans and the many different complexities it can be difficult to answer the hypothetical in a RETIREMENT forum. The threat to most public pensions from the recipient perspective is long term and folks in a retirement mode are of a different mindset than those in a long term planning mode.

[NHartphotog]

We were fully vested in the pension plan when our 15,000-employee company underwent a phony "change of control." This allowed the robber-baron CEO to take the over $1 billion pension plan (about 75% of last 5 years average pay for life) and replace it with a cash settlement equal to about half a years pay (at that time). The change of control never actually took place, but the CEO had the lawyers write the papers so that it was "considered" a change of control upon vote to accept the merger by the shareholders. The CEO then sabotaged the merger, as he had always intended. Bye-Bye, retirement security. All perfectly legal.

[Devans0]

When I started with MegaCorp, pensions were freely given. Present promises of returns for employees against a future that would be someone else's problem. In rosy times, that promise seemed of little consequence, but in a few years, it started to become apparent that there was a problem.

At the approach of ten year vesting, a large percentage of employees became unwillingly unemployed, but after surviving the ten year cut off, again became model employees. I know that this isn't currently legal, if proved. But in past times, that were also high employment times, it wasn't fought. After a number of years, balance sheets then fell on that someone else, and pensions were left underfunded. MegaCorp could only pay out half of their liabilities, and COLAs for people still building pensions were frozen. Mega Corp, to their credit, did fund most liabilities, though. Enrollment to pensions were stopped. Employees had to start funding their own retirements. Older employees were stuck with playing catch-up to fund a eroding pension. I was one of these, but was jaded enough to aggressively take matters into my own hands and have come out far ahead. Trusting big entities (ie: corps, govt) is foolish, when real money is involved, IMO.

The point of this story isn't the evil of MegaCorp. Mega corporations by design, are robotic in morals and are duty bound to take care of their investors.

The point is the negligence of turning over complete control of your future and presumably your family's future, to others. Save, live under your means, invest carefully, and if promises are broken, you can still thrive.