# When your pension is cut by 50%



## PrincessFerf (Apr 25, 2008)

Not exactly a SHTF scenario, but these people expected this money to come in each month. 

http://www.jsonline.com/business/ma...ecipients-benefits-b99596712z1-333930951.html

IMO this is just another little nail in the coffin of our country. And with each little nail, I am motivated more and more to ensure that I have the skills and infrastructure to take care of my own family. 

Keeping a "stash" is great in the short term, but I believe we'll be looking at a very different way of life in the future. Not just a temporary bump in the road.


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## kasilofhome (Feb 10, 2005)

http://abcnews.go.com/Business/retirement-plan-compare-members-congress/story?id=19734379

*JUST FOR COMPARISON​*
pared with those of elected officials.

Though fewer than one in five private sector workers qualify for a pension, according to the U.S. Bureau of Labor Statistics -- down from more than four in five in the early 1980s -- members of Congress all qualify for federal pension programs that pay from $40,000 and up per year.

"Members of Congress and other federal workers pay very little for their retirement investments," Kahn said.

For example, members of Congress have access to the federal Thrift Savings Plan. The federal government matches contributions up to 5 percent, in addition to a 1 percent giveaway whether or not the employee contributes. The expense ratio of the TSP in 2012 was just 0.03 percent, an improvement from the expense ratios paid by 401(k) investors for equity funds. That's 0.63 percent, according to the Investment Company Institute. The average private sector employer match is just 4.1 percent. The TSP is on top of pensions congresspeople get.

Members of Congress can get health coverage through the Federal Employees Health Benefits Program in which the government pays between 72 to 75 percent of the premium cost.

A member of Congress retiring with 20 years of service under Federal Employees' Retirement System and a high three-year average salary of $174,000 would get an initial annual FERS pension of $59,160.


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## Roadking (Oct 8, 2009)

It's kind of like the old saying...if it's not in your hands, it's not yours.

Good read, thanks.

Matt


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## MO_cows (Aug 14, 2010)

Wow, I didn't realize they were hitting the members already drawing a pension so hard! 

We are in that crap storm, too. DH isn't old enough to draw it yet but he's fully vested for a Teamster pension that originally promised $2200 a month. And he was originally supposed to be able to start drawing it 5 years ago! But they keep increasing the age to start drawing and also reducing the amount on people who aren't drawing their pension yet. So I didn't think they would have to take that much away from the retirees that are already drawing.

The Central States pension fund lost a big chunk in the dot com crash, again in the 2008 crash, plus they have the same problem as Social Security with more people drawing out than paying in as the Baby Boomers retire. I think they went from $12 billion to $6 billion, lost half their value. The fund is in "critical" status, it's on life support. I don't understand exactly how it works but the Pension Benefit Guarantee Corp. apparently doesn't have enough in the coffers to fully guarantee this fund, either. They would pay about $200 a month, gee what a comfortable retirement - not!

The ultimate long term solution is going to be the employees paying some in addition to the company's contributions. It has always been funded by the employers but with fewer and fewer employers of union employees to pay in, the employees are gonna have to pony up and pay in some, too. 

And I think it's about time for some new trustees managing the fund, too. The fund came under the management of a board of trustees back when the govt. was extricating the mob from the union. Well geez Louise at least those mobsters knew how to grow the fund it seems!


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## TnAndy (Sep 15, 2005)

All private and state pensions are doomed in the long run when the economy crashes to the bottom.....it's nearly inevitable. They are all based on stocks and bonds, and when those go, so does the pension. 

Social security will go to 'means' testing first, meaning if you have ANY other assets (another pension, savings they know about, property, etc), yours will be reduced. Since the Feds have the ability to print, it won't cut out entirely until rock bottom, but what it will buy will be so severely reduced, it will be nearly meaningless.

This has ALWAYS been the way of the world. Never been a period in history that people 'retired', unless they were flat rich, until the last 75 years or so. That 75 years just happens to correspond with the foundation of the Federal Reserve System, and the use of debt based money to give us the illusion of something for nothing. 

At some point, reality HAS to set back in. You can't print wealth. You can't have people living on other people's wealth. The gov can't support people artificially. You can't put a tiny amount of money in a pension plan over the years and expect it to support you from retirement age for another 20-40 years. The math of real money simply doesn't work that way, despite the magic that has gone on for our lifetime.

Anyone that doesn't understand this is doomed. No politician will ever tell you this....if in fact, they even know it. Bankers won't tell you this....the average one doesn't know it, and the guys at the top convert their fake, paper profits to real wealth to ride out what they've created.

EVERYONE should understand this, and not base your future existence on paper promises that simply CAN'T be kept, even if they did want to. Your only hope of less pain (less, not zero) is be as self sufficient as you can, and have some savings in real money (gold/silver) to pay for things you can't raise/make yourself, or taxes.

We 'might' luck out and die early (  ) and never see the end game....but somebody is sure going to.


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## 1shotwade (Jul 9, 2013)

We all have personal versions of the same story. The fleecing of the american worker. The last two job I took were specifically for the retirement.One paid in 17% on top your salary into retirement. I locked in my 10 years to become vested and spent $10,600 to purchase some military and law enforcement time which put me over 15 years and a guaranteed medical health benefit free for myself and $60 a month for my wife.
I bailed having that locked in with a guaranteed $947 monthly income starting at age 60.Three years later they decided to change everything 'cause they made some bad investments and I lost all medical benefits for myself and my wife and my monthly amount was cur to $437.
The next job,I took for the same reason. They to would add 17% of your salary into retirement.After 10 years of service and becoming vested they just decided one day that they didn't need my positions as a facility's manager and offered me a position 4 pay grades lower which would take me out of that retirement system and put me in one that only paid in 3%.That's when I had enough and retired early on my own savings at 55.

When I turned 60 I went to start collecting from the first system only to find the reduction in pay and benefits.After to talking to social security at length and hours studying the windfall reduction act I came to realize it was only effective if you took the income as an annuity so I rolled the entire plan into an IRA. At age 62 I filed for social security which tried to deduct my payments from $831 a month to less than $300 because of the windfall act but because I had taken the annuity pay out they couldn't touch it.
Now I get my SS but because of another twist in the law i can not access my $10600 I put into the original retirement system without also drawing from the untaxed portion which would raise my gross income and knock my wife and i out of the veterans health care system.
You just have to fight these people right up to the time thy put you into the grave!
Wade


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## TnAndy (Sep 15, 2005)

1shotwade said:


> Three years later they decided to change everything '*cause they made some bad investments*...


Yep. Every pension plan has loopholes big enough to drive a truck thru....and if it doesn't, they will simply change the law.

The only retirement you can count on reasonably certain is the one you can see within shooting range of your house.

Even then, stuff can happen.


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## kasilofhome (Feb 10, 2005)

How's this little loop hole.

I paid for my whole life for private disability and thru company when it was available. When I married I covered my husband as well.

At the time of my husband's disability the company I had refused to cover till sed approved it. Now they would cover if he was approved within a certain length of time. I can't remember the length of time .... but it expired prior to the six years of denials. Ok, so I sort thought it was azhimzers.. ended up be a brain aneurysm..

Next was ssdi in checking the paper work saw I had had the private disability insurance... Well they were going to deduct what he would have got in ssdi by what he would have gotten by my disability insurance policy I privately paid. It took seconds to fax the denial due to time line.

Just something to stick under you hat.

The plan I had would have been greater that ssdi... thus zero would have been the amount from the government.... just think are insurance companies benefiting from the government.


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## Win07_351 (Dec 7, 2008)

I'd never trust in a pension, or SS.

God promises to provide if you seek him first. (Matt. 6: 25-34)


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## MO_cows (Aug 14, 2010)

I used to trust them. My grandfather drew a decent pension from Bendix and when he died fairly young it really helped Grandma even though she worked too. Lots of uncles and in-laws that had put in the years and had a good pension in retirement. Stepdad was drawing $5k a month! So when you see it your whole life you tend to believe it.

But now that we *know* we are well and truly screwed, we still have time to set up some alternate income streams. Those 70 year old retirees don't have as many options, which is tough.


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## Martlet (Apr 20, 2015)

I'm due a pension. I realized a few years ago that it certainly wasn't something I want to bank my life on, so I started making other plans. If it falls through, I'll survive. If it doesn't, I'll be doing well. 

Self-sustainment and low/no debt are key.


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## PrincessFerf (Apr 25, 2008)

TnAndy said:


> .....
> This has ALWAYS been the way of the world. Never been a period in history that people 'retired', unless they were flat rich, until the last 75 years or so. That 75 years just happens to correspond with the foundation of the Federal Reserve System, and the use of debt based money to give us the illusion of something for nothing.
> 
> At some point, reality HAS to set back in. You can't print wealth. You can't have people living on other people's wealth. The gov can't support people artificially. You can't put a tiny amount of money in a pension plan over the years and expect it to support you from retirement age for another 20-40 years. The math of real money simply doesn't work that way, despite the magic that has gone on for our lifetime.
> ...


YES!!! Finally... someone else who has been saying the same thing I've been saying for YEARS! People look at me like I'm crazy when I talk about "retirement".

I'm in my mid-40's. I have NO expectation of receiving money or benefits from the government when I reach "that age". I honestly don't expect to ever "retire" except when I'm dead. People in my generation are foolish to think there will be any money available after the baby boomers are done with it. And I was saying this well BEFORE the economy was going into the crapper (starting with the Dot Com bust).

With our current economic uncertainty (I'm being nice here), I expect the .gov to have a lot of other problems than trying to provide money or benefits for me in 25+ years.

To me, THIS is why I prepare... to be self-sufficient. I don't prepare for an EMP, Nuclear War, Traditional War or Disease. Those scenarios are simply the cherry on top of the shi* sundae of what I believe will be our "new world".


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## 1shotwade (Jul 9, 2013)

A couple of things here. To start with,social security WAS funded correctly. Over the years the government "borrowed" from SS for other things on numerous occasions.Now if you "borrow" that implies you will pay it back. They have NEVER put anything back. If you are not putting it back you are not a borrower,you are a thief. That is a criminal act meaning you are a criminal.You should go to JAIL ! The US attorney General should prosecute those that "borrowed!"
Secondly,annuity's are a joke! It should be made clear just how they operate.In my case ,the annuity payment was equal to about 6% annually of the principle in the account for life. [email protected] you die,they keep the principle.I took my lump sum principle and rolled it over into an IRA and invested it in bonds at an annual rate of 5 1/4 %. When I die my estate will retain the principle.
Every one out there has a chance to stick their hand in your wallet! The only way to stop them is to be informed.
Wade


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## TnAndy (Sep 15, 2005)

1shotwade said:


> A couple of things here. To start with,social security WAS funded correctly.


No Wade, you're wrong....it was always a ponzi scheme.

Take the very first person to draw a check. 

Ida Mae Fuller. 










She worked for about a year or so under the New Deal, paid in $24.75 into social security 'insurance'....then retired at 65. Got her first check on January 31, 1940. The check was for $22.54.....almost what she had paid in. She lived to the ripe old age of 100, died in 1975. During that 35 years, she collected $22,888.92.

Now Wade.....do you know of ANY reasonable investment you can stick 25 bucks in for a year, and pays out nearly 1,000 times that over the next 35 ?

Nope....because none exists.

So how did social security do it ? They took from those paying in today, and gave to those drawing today, and from the past.....which is the very definition of a Ponzi scheme. They used (and still do) *O*ther *P*eople's *M*oney to finance the deal. The average social security recipient gets back all the money they paid in within 3-4 years. From then on, it's *OPM*.....

At SOME point, you simply run out of new workers to handle the retired ones....which is why a Ponzi scheme collapses. Every time.

Now, I'd admit that Congress screwed up by adding SSI folks on it, and moving the money into the general fund.....and the demographics of the 'baby boom' threw a wrench in things....BUT THE THING WAS ALWAYS DOOMED TO FAILURE...it was just a matter of who got caught WHEN without a chair when the music stopped.


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## MO_cows (Aug 14, 2010)

TNAndy, what your ponzi theory doesn't account for is all the people who die younger. Look at any set of obits - lots of people die in 50's and 60's where they paid in but didn't live to draw much, if any, out. 

Also you didn't specify if Ida Mae's $24.75 contribution included what her employer paid. Still not a lot of difference in her individual case, but doubling the amount of contributions over a person's normal working life sure does make a difference as a whole. 

If they would have left the funds alone, SS would not be in trouble like it is now. I don't think the plan was so bad to start with, rather that the politicians robbed it.


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## NEfarmgirl (Jan 27, 2009)

I would like to know how SS can keep going paying out when there are so many on disability who have never put a penny in? There is SSDI which is for those who worked and contributed and then there is SS for those who did not contribute or went on disability before retirement age. There are a couple people I know who have not worked and get over $2000 a month in disability through social security and there are kids who are able to get social security disability through social security. The people who actually paid in and had businesses pay in their half get $450-around $1500 a month. Disclaimer: they are people I know and I realize amounts vary.

As for pension plans, I think they are somewhat of a joke. My father paid into one and was 5 months from being able to collect when he passed. All of the money he squirrelled away was for the most part was gone. My mom was able to draw a fraction (about 1/4 of what he would have gotten if he had lived 5 more months) of it since he was vested in the plan when he passed away.


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## TnAndy (Sep 15, 2005)

MO_cows said:


> TNAndy, what your ponzi theory doesn't account for is all the people who die younger. Look at any set of obits - lots of people die in 50's and 60's where they paid in but didn't live to draw much, if any, out.


Fine. Look then at the average person of ALL the persons......

Average US life expectancy is 78.8 years. That puts the average person about 8-10 years past whatever they and their employer contributed to the system, assuming they didn't do as I did, and retire at 62.

That comes from *OPM*...even before all the other monkey shining and demographic issues.

It is a Ponzi scheme.


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## TnAndy (Sep 15, 2005)

NEfarmgirl said:


> I would like to know how SS can keep going paying out when there are so many on disability who have never put a penny in?



Easy. The Feds have a printing press.

Taxes collected from all sources only make up about 1/2 of federal expenditures each year. That is why the national debt has grown by leaps and bounds for the last decade.


Alan Greenspan testified before Congress about 15 years ago, and when asked the same question, he responded:
*
"We ABSOLUTELY can make payments, but can not guarantee purchasing power".
*
Translation: We can print it.....it just may not buy much.

THAT is exactly what they are, and will continue to do.


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## NEfarmgirl (Jan 27, 2009)

TnAndy said:


> Easy. The Feds have a printing press.
> 
> Taxes collected from all sources only make up about 1/2 of federal expenditures each year. That is why the national debt has grown by leaps and bounds for the last decade.
> 
> ...


I know this is how they do it, but at some point it will catch up to us. I say us because we will be the ones paying; oh wait, we already are. If I were to go and buy blank checks from an office supply store and print a bunch of checks and wrote bad ones I go to jail. Govt basically does the same and I pay more to buy things. Sounds fair to me.


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## TnAndy (Sep 15, 2005)

NEfarmgirl said:


> I know this is how they do it, *but at some point it will catch up to us.*


Yep. That's why Greenspan added that second part about not being able to guarantee purchasing power.

Personally, we're WAY past the point I would have thought it would catch up with us...we passed that about 10 trillion ago (not counting the 100 trillion or so of unfunded liabilities.....like social security, medicare, and military retirement promises).

WHY anyone buys US debt issues is beyond me....except in a world of stinky paper promises, ours is maybe the least smelly. 

It's certainly going to be interesting to see how it plays out.....I suspect a whole lot of folks are going to be in a world of hurt down the road.


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## 1shotwade (Jul 9, 2013)

Nobody is buying them. The fed is buying back their own issues at a tune of 85 billion a month. China tried to short sell 45 billion last month with a "no bid".It's over,we just don't know it yet!Only way to get out from under it now is a false economic boost by creating another expensive war as in ww3!
Wade


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## TnAndy (Sep 15, 2005)

1shotwade said:


> Only way to get out from under it now is a false economic boost by creating another expensive war as in ww3!
> Wade



Afraid you are correct, Wade. Only problem is WW3 might just be an extinction level event.


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## where I want to (Oct 28, 2008)

1shotwade said:


> Nobody is buying them. The fed is buying back their own issues at a tune of 85 billion a month. China tried to short sell 45 billion last month with a "no bid".It's over,we just don't know it yet!Only way to get out from under it now is a false economic boost by creating another expensive war as in ww3!
> Wade


Do you have some references on this?


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## Declan (Jan 18, 2015)

The thing is it doesn't matter what someone was promised or what someone expects. Retirement plans are a risk. All future expectations regarding investments are a risk.


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## 1shotwade (Jul 9, 2013)

where I want to said:


> Do you have some references on this?



trying to remember. It's hard for an old man sometimes!LOL! The 85 billion buy back was on msnbc about 3 months ago on one of the Sunday morning shows. Seems like Andrea Mitchell was doing it which is strange 'cause she is married to Alan Greenspan! It was basically how Burnanky (spelling) has been doing this for a long time and keeping the economy afloat at a cheap cost of .25% interest compared to the foreign debt load.Kind of like he's been doing it for years kind of thing.
The 45 billion in no bid bond was in a financial story last month. I think it was an RBC Wealth Management publication. Can't say for sure. I did talk to one of their advisers about the same time about that and some other business.Who agreed with me on the future of the bond marked being effected by a no bid short sale.
Best I can do. Sorry! I have slept since then!
Wade


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## PrincessFerf (Apr 25, 2008)

1shotwade said:


> Nobody is buying them. The fed is buying back their own issues at a tune of 85 billion a month. China tried to short sell 45 billion last month with a "no bid".It's over,we just don't know it yet!Only way to get out from under it now is a false economic boost by creating another expensive war as in ww3!
> Wade


I sure wish you were wrong, Wade. But I'm afraid you're right.


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## jjmd (Oct 9, 2015)

don't trust SS, banks or gov. they will all fall apart, just a matter of when.


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## texican (Oct 4, 2003)

If you can't touch it in your hands, you don't really own it....
We're planning on NOT having any govt assistance (SS) by the time we retire.... instead, we're building infrastructure and investing in ourselves.... Only the good Lord can take that away....


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## Declan (Jan 18, 2015)

PrincessFerf said:


> I sure wish you were wrong, Wade. But I'm afraid you're right.


They are actually required to buy the bonds on the open market. The government cannot sell direct to the fed. It is a check in the system (theoretically) to require the government to sell to a third party and then the fed to buy them from that third party.


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## TnAndy (Sep 15, 2005)

Declan said:


> They are actually required to buy the bonds on the open market. The government cannot sell direct to the fed. It is a check in the system (theoretically) to require the government to sell to a third party and then the fed to buy them from that third party.



The feds sell bonds to "primary dealers", which in turn, sell to anyone else....assuming they can.

A fair number of primary dealers are also members of the FED.....so, in effect, selling to them IS selling to the FED. 

Whether that debt issue (bond, note, bill) is actually transfered to the FED's balance sheet as 'collateral' for newly digitized money transferred to the PD (a bank), OR simply remains on the bank's balance sheet if not sold until they do need funds is simply a matter of semantics. The fact is the FED is creating money out of thin air to 'buy' Treasury issued debt one way or the other if that debt isn't bought by some REAL third party.

List of Primary Dealers:

http://www.newyorkfed.org/markets/pridealers_current.html


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## sdnapier (Aug 13, 2010)

PrincessFerf said:


> People in my generation are foolish to think there will be any money available after the baby boomers are done with it.


"Done with it" ?!?!?! What kind of attitude it that?

I wasn't asked all my life if I wanted to "donate" to SS. It was taken from me. I don't think it's too much to ask to have it back.


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