AdministrativeWar594 t1_j3qkbdn wrote on January 10, 2023 at 11:41 AM

Reply to comment by xybet in Walmart cashier, 82, retires after TikTok raises $100,000 by greatestmofo

Saving and investing as your retirement is how the 401ks and Roth iras work here. Although you can have some limited control over it, most are hands off and through your job usually. There is a problem with that though. Whereas social security or a pension was usually guaranteed. If the economy takes a nosedive, so does your 401k because its value is attached directly to the market. My aunts 401k took a nosedive in 08 and took over a decade to recover. So you could be chugging along just fine and then when the economy goes into the shitter (which is a design in capitalism the boom/bust cycle) all your retirement goes out the window. Real estate seems to be safe because assets can be sold if you find yourself in a position to not be able to rent them out. But in general I think we need a better system than social security because it's not nearly enough.

xybet t1_j3qlgso wrote on January 10, 2023 at 11:54 AM

Yeah.. I invest some money monthly as well to diversified funds, so I guess that could be comparable to 401k, but investment is.. voluntary investment... it's not forced tax deductible.

Pension as set up here would be if you paid x% more taxes in to a shared saving account run by government, with government stating when and how much you can have it, and paying off other peoples benefits as well from it..

Current age diversifying is punishing for younger people, as so many old people reclaim pension but younger peoples solvency is not high enough, which means the young folks will be working more and longer to be eligible for the same pension earlier generations had with less work.. so in that sense, personal investment based pension would at least be "fair to all", allthough leaving people who didn't invest hanging for dry..

Real estate is a bitch here atm for investing 😅

Inaksa t1_j3u6chi wrote on January 11, 2023 at 2:13 AM

I understand what you are saying. In Argentina (and many countries) there were this private administered funds (specially during the 90s) and pensions were forced into them. Eventually what those entities did was gamble the funds buying high risk bonds, and you can picture how that went.

I dont trust my government, but even less an unaccountable private entity to guard those funds. You may say that couldnt happen in your country but when it does you end up with the government having to foot the bill in order for citizens to be able to survive. It sucks but those are the rules of the game apparently

CharuRiiri t1_j3uo8tw wrote on January 11, 2023 at 4:25 AM

Yeah, it sounds great on paper but ultimately the fund won’t lose money, it’s peoples pensions that will take a hit. Happened in Chile too, they advertised a lot for people to switch from the old system and join the new one, promising substantial pension rises and when the first people started getting their pensions they amounted to less than half the minimum wage.

SizzlerWA t1_j3uux5e wrote on January 11, 2023 at 5:23 AM

You can invest your 401k in US Treasuries, which is what I believe Social Security invests in. So you could engineer your 401k to have the same investment risk as Social Security (much less risky than stocks).

You can also buy CDs and other risk free investments.

Im sorry that your aunt’s 401k took a nosedive. But investing in a 401k can be as low risk as you want it to be …