2 ms·
Not sure why you were downvoted as technically you're not that far from the truth. Most pensions do work this way, next one pays the previous ones. For example
by burmanm 7y ago
Not sure why you were downvoted as technically you're not that far from the truth. Most pensions do work this way, next one pays the previous ones.
For example in Finland the pension funds were started with the employees back then paying 1,5% of their salary to get pension. These days the rate is ~24% from salary, yet the gains are the same as those with 1,5%.
The risk is that current payers won't get their pension if there's no one in the future funding the system. Personally, I think it's very likely that the current payers are getting screwed in the end (by getting their pension cut and those who never payed will keep receiving theirs until they die).
- walshemj 7y agowhich one a state pension or a private pension provided by your employer.
- ThrustVectoring 7y agoUnless you're burying canned food, there's very little time-transfer of real goods and services involved in pension schemes. Current production is current consumption. If current retirees didn't pay "enough" into the pension system, the people getting screwed by that are past pensioners, who did not get the level of consumption that economic conditions warranted.