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Those with pensions tend to be union members; the pension being a benefit insisted upon in negotiations between unions and their (government) employers. If a st

Those with pensions tend to be union members; the pension being a benefit insisted upon in negotiations between unions and their (government) employers. If a state declares bankruptcy, lists pensions as a debt, and the federal discharges the pension debt, the GOP can thumb their noses at unions in a very big way.

chrisseaton 7y ago
> Those with pensions tend to be union members I still don't understand. Surely almost every professional has a pension, but few people are in unions.
- Loughla 7y ago
  Very few people in the United States have pensions. Mainly pensions are available for state employees, or union members. And for that matter, state employees tend to be part of a union. Unions are responsible for pensions, and the only people who have held onto them as the 401k has taken over. Edit: Because I apparently can't reply to chriseaton below - 401k is defined contribution, you contribute $x which is a set amount and non-taxable. Pension is defined benefit; you receive $x, guaranteed, after x,y,z parameters are met (age, years experience, etc). They are not even slightly the same thing. Not even close.
  - chrisseaton 7y ago
    I think a 401(k) is a pension? Almost all companies offer a 401(k) for full-time employees.
    - deleted 7y ago
      [deleted]
    - danso 7y ago
      A 401(K) is not a pension. The latter is funded entirely by the employer.
      - deleted 7y ago
        [deleted]
      - chrisseaton 7y ago
        Why does Wikipedia say it's a pension then?
        james-mcelwain 7y ago
        You're being willfully obtuse here. No one in the US would call their 401k a pension.
        chrisseaton 7y ago
        Obviously someone who wrote this Wikipedia article would!
        james-mcelwain 7y ago
        Pension is being used as a term of art here not how anyone uses it in standard parlance.
        akiselev 7y ago
        Because language is imprecise and depends on context - you and the GP are talking past each other. They are using the word in a conversational context and you are using it in an academic/technical sense. From https://en.wikipedia.org/wiki/Pension https://en.wikipedia.org/wiki/Pension: "A pension is a fund into which a sum of money is added during an employee's employment years and from which payments are drawn to support the person's retirement from work in the form of periodic payments. A pension may be a "defined benefit plan", where a fixed sum is paid regularly to a person, or a "defined contribution plan", under which a fixed sum is invested that then becomes available at retirement age. The common use of the term pension is to describe the payments a person receives upon retirement, usually under pre-determined legal or contractual terms. A recipient of a retirement pension is known as a pensioner or retiree." A 401k is a savings account, not a contractual obligation, so that's why it's not a pension in common usage.
    - mbrameld 7y ago
      Not within the context of this discussion. Using your context clues > childish pedantry.
- kennymeyers 7y ago
  Very few professionals in the United States have pensions.
- wonderwonder 7y ago
  There are very few companies that offer pensions. A 401k is not a pension. A pension is recurring money that is given to you upon retirement in perpetuity. A 401k is just a means of investing your salary into the stock market pre-tax. Your employer does not even have to contribute to it although many if they offer a 401k plan offer some form of match up to x%. My last employer offered to match my contributions up to 6% my current employer offers no match. 401k and pension are very different.
  - deleted 7y ago
    [deleted]
  - chrisseaton 7y ago
    > A 401k is just a means of investing your salary into the stock market pre-tax. If you plan to spend it when you're retired then it's a pension!
    - wonderwonder 7y ago
      ok... Then I guess my savings account is a pension too as well as the jar of small change I keep on the kitchen counter.
    - mbrameld 7y ago
      @chrisseaton I'll just go ahead and spoon feed it to you: pension in the context of this discussion means a defined-benefit plan contributed to solely by your employer. I'm surprised a Senior Staff Engineer at Shopify is struggling so hard to grasp the concept of context.
      - chrisseaton 7y ago
        Well I went to look it up on Wikipedia and that's what I read. Not sure why there's such a big disconnect between what people expect you to think it means and what references tell you it means!
        7y ago
- bcrosby95 7y ago
  When talking about pensions in the USA, people are usually referring to retirement plans where the employer says something roughly like "when you retire, we will pay 80% of your salary". or "when you retire, we will pay you X/month". The responsibility is on the employer to ensure that money is around when you retire. Companies used to have things like this - when my dad retired he had several pensions from multiple companies that worked like this. Nowadays government usually uses them to put off paying the full cost of employees.
- mbrameld 7y ago
  Do you agree that context matters? If you use context clues you can figure out that we're talking about one particular definition of pension, and that is the employer-funded definition. What's the point of your pedantry?
- notyourday 7y ago
  Pension is broadly understood to be a defined benefit. Workers contribute to the pool a certain amount every months, government/company contributes a certain amount every months for every worker and when a worker retires the worker draws a specific amount until he or she dies or in some cases until his or her heirs die. The government (via PBGC) is on the hook for the amount until the time of death. The issue with defined benefit plans is that they are as they are being "negotiated" not self-sustainable with the unrealistic return expectations and having costs not adjusted for the reality of increased life expactancy. Currently most of non-union ( and mostly non-government union ) employees have a defined contribution plan. A worker contributes a specific amount every year, a company matches some amount of workers' contribution. At the retirement worker's draw down is limited to the amount in that account. If the account did well. the maximum amount is that can be drawn is large and if it has not done well, it is not large.

chrisseaton 7y ago

> Those with pensions tend to be union members I still don't understand. Surely almost every professional has a pension, but few people are in unions.

Loughla 7y ago
Very few people in the United States have pensions. Mainly pensions are available for state employees, or union members. And for that matter, state employees tend to be part of a union. Unions are responsible for pensions, and the only people who have held onto them as the 401k has taken over. Edit: Because I apparently can't reply to chriseaton below - 401k is defined contribution, you contribute $x which is a set amount and non-taxable. Pension is defined benefit; you receive $x, guaranteed, after x,y,z parameters are met (age, years experience, etc). They are not even slightly the same thing. Not even close.
- chrisseaton 7y ago
  I think a 401(k) is a pension? Almost all companies offer a 401(k) for full-time employees.
  - deleted 7y ago
    [deleted]
  - danso 7y ago
    A 401(K) is not a pension. The latter is funded entirely by the employer.
    - deleted 7y ago
      [deleted]
    - chrisseaton 7y ago
      Why does Wikipedia say it's a pension then?
      - james-mcelwain 7y ago
        You're being willfully obtuse here. No one in the US would call their 401k a pension.
        chrisseaton 7y ago
        Obviously someone who wrote this Wikipedia article would!
        james-mcelwain 7y ago
        Pension is being used as a term of art here not how anyone uses it in standard parlance.
      - akiselev 7y ago
        Because language is imprecise and depends on context - you and the GP are talking past each other. They are using the word in a conversational context and you are using it in an academic/technical sense. From https://en.wikipedia.org/wiki/Pension https://en.wikipedia.org/wiki/Pension: "A pension is a fund into which a sum of money is added during an employee's employment years and from which payments are drawn to support the person's retirement from work in the form of periodic payments. A pension may be a "defined benefit plan", where a fixed sum is paid regularly to a person, or a "defined contribution plan", under which a fixed sum is invested that then becomes available at retirement age. The common use of the term pension is to describe the payments a person receives upon retirement, usually under pre-determined legal or contractual terms. A recipient of a retirement pension is known as a pensioner or retiree." A 401k is a savings account, not a contractual obligation, so that's why it's not a pension in common usage.
  - mbrameld 7y ago
    Not within the context of this discussion. Using your context clues > childish pedantry.
kennymeyers 7y ago
Very few professionals in the United States have pensions.
wonderwonder 7y ago
There are very few companies that offer pensions. A 401k is not a pension. A pension is recurring money that is given to you upon retirement in perpetuity. A 401k is just a means of investing your salary into the stock market pre-tax. Your employer does not even have to contribute to it although many if they offer a 401k plan offer some form of match up to x%. My last employer offered to match my contributions up to 6% my current employer offers no match. 401k and pension are very different.
- deleted 7y ago
  [deleted]
- chrisseaton 7y ago
  > A 401k is just a means of investing your salary into the stock market pre-tax. If you plan to spend it when you're retired then it's a pension!
  - wonderwonder 7y ago
    ok... Then I guess my savings account is a pension too as well as the jar of small change I keep on the kitchen counter.
  - mbrameld 7y ago
    @chrisseaton I'll just go ahead and spoon feed it to you: pension in the context of this discussion means a defined-benefit plan contributed to solely by your employer. I'm surprised a Senior Staff Engineer at Shopify is struggling so hard to grasp the concept of context.
    - chrisseaton 7y ago
      Well I went to look it up on Wikipedia and that's what I read. Not sure why there's such a big disconnect between what people expect you to think it means and what references tell you it means!
      - 7y ago
bcrosby95 7y ago
When talking about pensions in the USA, people are usually referring to retirement plans where the employer says something roughly like "when you retire, we will pay 80% of your salary". or "when you retire, we will pay you X/month". The responsibility is on the employer to ensure that money is around when you retire. Companies used to have things like this - when my dad retired he had several pensions from multiple companies that worked like this. Nowadays government usually uses them to put off paying the full cost of employees.
mbrameld 7y ago
Do you agree that context matters? If you use context clues you can figure out that we're talking about one particular definition of pension, and that is the employer-funded definition. What's the point of your pedantry?
notyourday 7y ago
Pension is broadly understood to be a defined benefit. Workers contribute to the pool a certain amount every months, government/company contributes a certain amount every months for every worker and when a worker retires the worker draws a specific amount until he or she dies or in some cases until his or her heirs die. The government (via PBGC) is on the hook for the amount until the time of death. The issue with defined benefit plans is that they are as they are being "negotiated" not self-sustainable with the unrealistic return expectations and having costs not adjusted for the reality of increased life expactancy. Currently most of non-union ( and mostly non-government union ) employees have a defined contribution plan. A worker contributes a specific amount every year, a company matches some amount of workers' contribution. At the retirement worker's draw down is limited to the amount in that account. If the account did well. the maximum amount is that can be drawn is large and if it has not done well, it is not large.