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They include retirement income as income, but do they exclude retirement savings? In US there’s a huge burden to save for your own retirement, and modern retir

They include retirement income as income, but do they exclude retirement savings? In US there’s a huge burden to save for your own retirement, and modern retirement vehicles (e.g. 401k and IRA) pay out in full even if you die young (no longevity risk pooling), so they’re a lot more expensive to fund.

bhupy 6y ago
It's PPP adjusted disposable income after all taxes and transfers, so that includes Social Security, welfare, etc. It's debatable if this is able to adequately capture all forms of non-cash transfers (like food stamps). To get around this, the World Bank uses consumption as a metric for well-being. By that metric, the poorest 20% consume more than the average person in most OECD countries[1][2], including Canada, the UK, Sweden, Australia, Japan, Denmark, New Zealand, and Iceland. [1] https://www.nber.org/chapters/c12831.pdf https://www.nber.org/chapters/c12831.pdf [2] https://fee.org/articles/the-poorest-20-of-americans-are-richer-than-most-nations-of-europe/ https://fee.org/articles/the-poorest-20-of-americans-are-ric...
- mortehu 6y ago
  I was referring to money set away for retirement. Since moving from Norway to US, I can’t really spend all my disposable income, given that maximum social security benefits are so low.
  - refurb 6y ago
    Using my google skills it looks like the maximum supplemental pension in Norway is NOK 293 583 or $32,216 USD.[1] The maximum US social security pension is $49,680 USD.[2] Obviously it scales based on income, but at least for US tech workers, you're likely to get close to the maximum amount since you'd be earning over $110,000 for a significant chunk of your career. The US has a much higher maximum pension amount than Canada, where it's $1,176 CAD or $889 USD. You do get an old age benefit on top of $613 CAD, which bring it up to $1,351 USD or $16,212 USD per year. [1]https://ec.europa.eu/social/main.jsp?catId=1123&intPageId=4713&langId=en https://ec.europa.eu/social/main.jsp?catId=1123&intPageId=47... [2]https://www.ssa.gov/policy/docs/progdesc/ssptw/2010-2011/americas/united_states.html https://www.ssa.gov/policy/docs/progdesc/ssptw/2010-2011/ame...
    - mortehu 6y ago
      You shouldn't look only at supplementary pension for Norway. Everyone gets the basic pension as well, and if you're employed your employer must also contribute on your behalf.
      - refurb 6y ago
        So what is the maximum for someone with a high income? I'm not that familiar with Norway's pension system, so definitely open to being educated on it. It's complex, but if you have a high salary it looks like the basic pension is NOK 89 872, so another $9,889 USD, for a total of $42,105 USD?
        mortehu 6y ago
        Disclaimer: this is awfully complicated, and I’m not an expert What’s most relevant for this discussion is the system for people who are earning now for retirement in the future. The amounts are adjusted yearly, but the current maximum rate is about $14300. This is tax funded, and so doesn’t come out of your disposable income. Gaps from illness, unemployment, military service and caregiving are covered. When you start withdrawal, the accrued amount is adjusted for changes in the average national income and your life expectancy based on your age. I.e. the money is paid back to you at a rate that draws your balance to zero at the expected date of your death. If you live longer, it keeps going of course, funded by the people who die earlier. The maximum rate is therefore achieved by retiring at the oldest age (74), or roughly $97000/year with today’s numbers. This would require making well above the national average salary starting at age 13. If you max out your income based pension described above, the base pension gets reduced substantially. Looks like it can go as low as $4300/year of benefits currently. On top of these two pension types, your employer must save at least 2% of your income up to $134000, and pay for insurance that covers contributions if you become disabled. The employer must cover all associated costs. These plans vary a lot and have no maximum. I will add that you need substantially less income in retirement in Norway since you won’t be paying for healthcare, and property taxes are extremely low.

bhupy 6y ago

It's PPP adjusted disposable income after all taxes and transfers, so that includes Social Security, welfare, etc. It's debatable if this is able to adequately capture all forms of non-cash transfers (like food stamps). To get around this, the World Bank uses consumption as a metric for well-being. By that metric, the poorest 20% consume more than the average person in most OECD countries[1][2], including Canada, the UK, Sweden, Australia, Japan, Denmark, New Zealand, and Iceland. [1] https://www.nber.org/chapters/c12831.pdf https://www.nber.org/chapters/c12831.pdf [2] https://fee.org/articles/the-poorest-20-of-americans-are-richer-than-most-nations-of-europe/ https://fee.org/articles/the-poorest-20-of-americans-are-ric...

mortehu 6y ago
I was referring to money set away for retirement. Since moving from Norway to US, I can’t really spend all my disposable income, given that maximum social security benefits are so low.
- refurb 6y ago
  Using my google skills it looks like the maximum supplemental pension in Norway is NOK 293 583 or $32,216 USD.[1] The maximum US social security pension is $49,680 USD.[2] Obviously it scales based on income, but at least for US tech workers, you're likely to get close to the maximum amount since you'd be earning over $110,000 for a significant chunk of your career. The US has a much higher maximum pension amount than Canada, where it's $1,176 CAD or $889 USD. You do get an old age benefit on top of $613 CAD, which bring it up to $1,351 USD or $16,212 USD per year. [1]https://ec.europa.eu/social/main.jsp?catId=1123&intPageId=4713&langId=en https://ec.europa.eu/social/main.jsp?catId=1123&intPageId=47... [2]https://www.ssa.gov/policy/docs/progdesc/ssptw/2010-2011/americas/united_states.html https://www.ssa.gov/policy/docs/progdesc/ssptw/2010-2011/ame...
  - mortehu 6y ago
    You shouldn't look only at supplementary pension for Norway. Everyone gets the basic pension as well, and if you're employed your employer must also contribute on your behalf.
    - refurb 6y ago
      So what is the maximum for someone with a high income? I'm not that familiar with Norway's pension system, so definitely open to being educated on it. It's complex, but if you have a high salary it looks like the basic pension is NOK 89 872, so another $9,889 USD, for a total of $42,105 USD?
      - mortehu 6y ago
        Disclaimer: this is awfully complicated, and I’m not an expert What’s most relevant for this discussion is the system for people who are earning now for retirement in the future. The amounts are adjusted yearly, but the current maximum rate is about $14300. This is tax funded, and so doesn’t come out of your disposable income. Gaps from illness, unemployment, military service and caregiving are covered. When you start withdrawal, the accrued amount is adjusted for changes in the average national income and your life expectancy based on your age. I.e. the money is paid back to you at a rate that draws your balance to zero at the expected date of your death. If you live longer, it keeps going of course, funded by the people who die earlier. The maximum rate is therefore achieved by retiring at the oldest age (74), or roughly $97000/year with today’s numbers. This would require making well above the national average salary starting at age 13. If you max out your income based pension described above, the base pension gets reduced substantially. Looks like it can go as low as $4300/year of benefits currently. On top of these two pension types, your employer must save at least 2% of your income up to $134000, and pay for insurance that covers contributions if you become disabled. The employer must cover all associated costs. These plans vary a lot and have no maximum. I will add that you need substantially less income in retirement in Norway since you won’t be paying for healthcare, and property taxes are extremely low.