Did you know that “if you scratch a man, you will find a little boy”. Who knew?
Your Mom and I went to see “The Hunger Games, Mockingjay, Part 2”. It was the last installment of the series. Katniss lives.
I see that Minneapolis got dumped on last night with 8-10 inches of snow. Grasshopper No.5 gets to fight her way to work.
Over the Thanksgiving holiday, a Grandson mentioned that his other Grandparent had been notified that his Teamsters retirement pension might be reduced. I proceeded to talk about unfunded plans, vesting, and the history of the Union sponsored Central States Pension Plan. As I shared my “vast knowledge”, the Grandson stopped me and asked “what is a pension”? Whoa. The question is kind of like Lombardi having to slow down and explain “gentlemen, this is a football”.
“What is a pension”? What a great question. A pension is a regular monetary payment (not wages) to someone who is retired (or disabled).
Pensions were common in companies years ago. A company would set aside profits each year for the benefit of employees when they retired in the future. Based on your years of service and salary at retirement, you could depend getting a monthly pension payment. A booklet including tables explained what you were entitled too.
Federal, State, and most public service employees are covered by some sort of pension. You and I, Mr. Taxpayer will pay for the retirement of public service pensions for years. We will pay, and pay, and pay.
The whole foundation of the pension system is that companies and communities set money aside each year to fund future retirements. There have been numerous bankruptcies of companies and communities (like Detroit) that can’t pay for their pensions. People that worked for 40-50 years anticipating a pension have either had the pension amount cut or eliminated. Imagine if that was you!
Here is a scary thought. Social Security is one big pension plan.
Love,
Dad