Public/private Pensions

Foxrac

Foxrac

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What are you think about public and private pensions?

I noticed a lot of private companies killed pension and replaced with 401k, even some state government switched to independent contractors or 401k.

I'm not fan of 401k.
 
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I have a private 403b pension account, but it is through my work. But it is nowhere near as restricting as the 401. I think the 401 isn't so bad in that it tries to help you keep your money there.
 
401K is not bad at all too. The only issue is that max contribution per year is 18K (24K for 50 or over). I can't put any more in. I know that IRS don't want to put too much on pre-tax. My company can contribute half of what I contribute.
 
Pensions are great in that they provide a monthly income until you die but the problem is that nowadays companies may not last long enough so you can retire. Plus they are more costly from the employer perspective and its just a fact of life that some simply cannot afford them.

I personally have a pension but my compay will stop contributing to it on july 1st. So that means when i retire im projected to get about 700 per month. Its not a ton of money and i still have about 30 more years left to go. At that point due to inflation itll probably barely cover 2 weeks of groceries.

I do have a 403b plan as well and my company does matching contributions and if i keep up with my contributions i may be able to get around 2,300 per month when i retire. I would be getting more than the pension but the catch is that theres more risk and its not unlimited. If i somehow live to 200 years old I'll run out of money.

A 403b is at least a happy medium in that it doesnt depend on the company lasting that long and you can at least participate and control your contributions. For example in a bear market you can move all the allocations to bonds to reduce losses.

And thats my 2cts on it!
 
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