Originally Posted by PR_Phil

maybe you guys need to start the math part of this over. the money they put in does not sit in a checking account, pension funds are run by some of the best investors there are.

if I start working at 25, and work till I am 55, and make $10,000 a year. and I pay 10% into a pension fund. ($1000 a year) and a good investor can generate 10% return on that, (complaining that interest is to low to make 10% right now is irrelevant cause these funds have existed for decades and decades.) after a year my contribution is worth $1050, after 2 years $2155, after 3 years $3475, and so on, after my 30 years, at the young age of 55 I get to retire, and lets say they decide to give me a 100% pension WooHoo! my pension would be $10,000 a year, but the money I put into the pension is now worth $211,194.70, so the fund manager only has to make 4% on my money to pay me a 100% pension.

there is no this is how I feel about the subject on this, it is straight mathematics, the reality is that the magic # is 7%, If you are forced to put 10% of your earnings away every year in a pension fund, for 30 years, and the fund manager can get 7% return on your money, after 30 years you can retire, and take a 100% pension in perpetuity, and you can live to be 1000 years old without the money ever running out.