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I reckon I'll need a couple million to retire in the next several decades. As I'm still pretty young I have a personal pension liability of a couple million dol
by jdavis703 8y ago
I reckon I'll need a couple million to retire in the next several decades. As I'm still pretty young I have a personal pension liability of a couple million dollars.
My point here, what's the practical impact of this number? It's a scary number that's thrown out a lot, but is this number going to break the budget, or will pension spending as a fraction of the total budget be fairly stable?
- defen 8y agoI don't think anyone really knows. A lot of it depends on the stock market - if it keeps going up, things will probably be fine. But if there's a big downturn it could wipe out a lot of money in the fund. At that point you could be looking at benefit cuts and/or tax increases.
- HillaryBriss 8y agoIn Los Angeles, the percentage of the city budget going toward funding of pensions is about 20%. Fifteen years ago, it was around 5%. Will it keep rising? What other spending is crowded out? etc...
- twblalock 8y agoThe CalPERS money is invested. In recessions, the pension fund shrinks and tax revenues shrink at the same time. The fraction of government spending needed to cover pensions increases as a result.
- refurb 8y agoYou forgot to mention that Calpers also assumed an 8% annualized return for their funding purposes. Slightly optimistic.