Pensions are the spectre hanging over America, and your problem too

Most private-sector workers grew up with no promise of pensions, but the problem of our cities and states haunts us all

Suzanne McGee
theguardian.com, Sunday 25 May 2014 12.00 EDT

Pensions – a word you may want to add to ghouls, ghosts, and long-legged spiders: the list of things capable of keeping you awake and anxious in the middle of the night.

Most of us under the age of 50 figure that pensions are pretty much irrelevant to our daily lives. Unless we pursued a career in teaching, law enforcement or some other kind of government service, we’ve grown up knowing we weren’t going to collect a dime in retirement income from a pension.

Rather, in the era of “defined contribution” plans, like a 401k, the size of our nest eggs will depend on how much we set aside, how generously our employers add to it and how well we invest, rather than how much our employers pledge to pay us monthly in our golden years.

The current system sounds – and is – riskier in one key way. It’s all up to us. We have to set aside the money, and make sensible investment choices. That's a lot of pressure.

(More here.)