Life sucks and then you die, says Ernst & Young
July 29th, 2008
Ivy Ballicud at the fine Nerd News blog reports on a straw poll by Ernst & Young showing that 3/5 middle class Americans will outlive their pensions. Doom and gloom indeed. I for one find it entirely plausible this holds of the UK, for three reasons:
1) Life expectancy has been steadily increasing for the last hundred years
2) The retirement age hasn’t
3) We still operate a system whereby the working population pays for the pension of the retired population
It doesn’t take a genius to see we’re running a massive pyramid scheme, and sadly one that will probably collapse in my lifetime. To be honest, I don’t expect there to be anything left in the pot by the time I retire, which is one reason why I don’t bother to have a pension. Am I right to be so cynical? And how are we going to cope with an ageing population?
Entry Filed under: General
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5 Comments
1. pbergen | July 29th, 2008 at 4:08 pm
Lose the golden retirement dream; it is an aberration. It isn’t the end of the world to keep working. Many of the new forms of work including many in the service industry are age-independent. And staying even partly in the work force keeps a person socially involved and I suspect happier in general.
I also am looking forward to a no pension personal future and believe that I will be able to adapt one way or another. However, though I hope for a realistic adjustment in the aging population occurs I wouldn’t be surprised if many fight tooth and nail all the way. Kind of the natural effect of a culture that promises the moon to all.
It could be that the aging and retirement issue will vanish in the face of much more momentous changes such as resource depletion or the shift of economic dominance to the East.
2. pj | July 29th, 2008 at 4:12 pm
I think there’s something to this ‘most selfish generation’ thing. The baby boomers got their sexual and social liberation, their low tax monetarism and property owning fetishisation, when they’re old they’ll dominate the political landscape and the rest of us will be paying them generous pensions to enjoy their unprecedented life expectancy. Just don’t think about what will happen to us when we get old and the money’s all been spent.
3. manigen | July 30th, 2008 at 9:40 am
We’ll just all have to work longer. That doesn’t necessarily mean working forever, but certainly well past 65. As pbergen has pointed out, there can be benefits to working longer; even a little daily activity can massively improve your health. A lot of people retire, sit around the house, decline and die in short order.
That’s not much of a compensation, I’ll grant you, but it’s all I got.
4. Doctor Spurt | August 13th, 2008 at 1:21 pm
Agreed – there’s nothing wrong with working longer, lots of people want to and regard retirement age as a form of discrimination. For competent individuals the decision to stop work shouldn’t be handled arbitrarily.
5. poldergeist | September 7th, 2008 at 8:18 pm
Point 3 of your posting left me puzzled: is there a system that I do not know of, in which the pensions are not paid by the working population? I mean, except for a big frigorific vault that you fill with enough ham sandwiches to feed you for your entire pensioner’s life. I think, It does not fundamentaly change the problem to know if your pension will be diverted from the wealth produced by the worker as taxes on their salary or dividends from shares your pension fund holds in the company where they work. It only solves the demographic problem in the sense that only a fraction of the pensioners will benefit from a pension fund.
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