4 ms·

Wayyy more dangerous than pensions. I love the idea of BTC as retirement fund, and that's kinda how I treat it now -- throwing money occasionally into it and ho

Wayyy more dangerous than pensions. I love the idea of BTC as retirement fund, and that's kinda how I treat it now -- throwing money occasionally into it and hoping it's a nice sum in 20 years. But at least I know it's likely gone.

candiodari 9y ago
Really ? I think you vastly overestimate the security of pensions. There's 2 factors. Firstly, inflation. Inflation targets are 2% per year, and despite the last few years, we've generally been above that level. At 3,2% inflation, real money halves every 20 years (government calculators assume 7.5%). So if you're promised, say $60k per year at age 20, what you're actually being promised at 65 is a little under 1/4th of that, or $15k per year, and by the time you die at 85 or so, about 1/8th of that amount. Secondly, at this point loads of people in Greece [2], Austria, Poland, and various American states (most famously [1]) have seen ridiculous reductions in pensions, to the rate of having their pensions reduced by something like 75%, sometimes more. Given how well pensions are funded, this has to happen to a lot of pensions in the near future (public, and private alike). There's 2 options: either the pension funds themselves go insolvent, and you're screwed, or your pension is inflated away (most likely option) and the amount stays the same but it's not worth much anymore. Some reading for the interested: [1] https://www.forbes.com/sites/georgeleef/2016/08/05/who-will-bail-out-insolvent-union-pension-funds/#59bccdbf4354 https://www.forbes.com/sites/georgeleef/2016/08/05/who-will-... [2] https://www.ft.com/content/f6be12b2-f3ae-11e6-8758-6876151821a6 https://www.ft.com/content/f6be12b2-f3ae-11e6-8758-687615182... There has not been any state I know of that has always kept it's pension promises, even in the short time they have existed (mostly since WWII). The US hasn't. No European state has (I checked 5 northern European ones, the Netherlands hasn't, France hasn't, Belgium hasn't, the UK (let's just shut up about the UK, it's just sad), Germany hasn't. Now just so we're clear: what I mean by this is that, for instance, they retroactively changed (lowered) the pensions they originally promised to public sector workers in their contract (happened to my father). If any private employer did this is would be fraud and theft, but of course governments see no issues. If you are <40 today, I would say the odds of you actually seeing your pension are about 50/50 at best, less if you're in Europe. And I'm talking about that 1/4th inflated away amount of the amount you were promised, not more.
- dajohnson89 9y ago
  The odds of BTC yielding anything in 20 years are hard to quantify, but I think 50/50 sounds about right.

candiodari 9y ago

Really ? I think you vastly overestimate the security of pensions. There's 2 factors. Firstly, inflation. Inflation targets are 2% per year, and despite the last few years, we've generally been above that level. At 3,2% inflation, real money halves every 20 years (government calculators assume 7.5%). So if you're promised, say $60k per year at age 20, what you're actually being promised at 65 is a little under 1/4th of that, or $15k per year, and by the time you die at 85 or so, about 1/8th of that amount. Secondly, at this point loads of people in Greece [2], Austria, Poland, and various American states (most famously [1]) have seen ridiculous reductions in pensions, to the rate of having their pensions reduced by something like 75%, sometimes more. Given how well pensions are funded, this has to happen to a lot of pensions in the near future (public, and private alike). There's 2 options: either the pension funds themselves go insolvent, and you're screwed, or your pension is inflated away (most likely option) and the amount stays the same but it's not worth much anymore. Some reading for the interested: [1] https://www.forbes.com/sites/georgeleef/2016/08/05/who-will-bail-out-insolvent-union-pension-funds/#59bccdbf4354 https://www.forbes.com/sites/georgeleef/2016/08/05/who-will-... [2] https://www.ft.com/content/f6be12b2-f3ae-11e6-8758-6876151821a6 https://www.ft.com/content/f6be12b2-f3ae-11e6-8758-687615182... There has not been any state I know of that has always kept it's pension promises, even in the short time they have existed (mostly since WWII). The US hasn't. No European state has (I checked 5 northern European ones, the Netherlands hasn't, France hasn't, Belgium hasn't, the UK (let's just shut up about the UK, it's just sad), Germany hasn't. Now just so we're clear: what I mean by this is that, for instance, they retroactively changed (lowered) the pensions they originally promised to public sector workers in their contract (happened to my father). If any private employer did this is would be fraud and theft, but of course governments see no issues. If you are <40 today, I would say the odds of you actually seeing your pension are about 50/50 at best, less if you're in Europe. And I'm talking about that 1/4th inflated away amount of the amount you were promised, not more.

dajohnson89 9y ago
The odds of BTC yielding anything in 20 years are hard to quantify, but I think 50/50 sounds about right.