3 ms·
It depends on which type of pension fund and is generally more complicated than a single reason. One big general cause of failure was that companies were allow
by shkkmo 6y ago
It depends on which type of pension fund and is generally more complicated than a single reason.
One big general cause of failure was that companies were allowed to stop paying into the funds without paying enough into the fund to cover their employees who would receive.
However, the particulars don't actually matter here. No matter the reason, it will have been the responsibility of the employer, fund manager or government regulators. The average Joe, who will lose his retirement if the pension is allowed to go bankrupt, didn't have enough control of the fund to be held responsible. As such, punishing him will do nothing to de-incentivize this from happening again.
- lotsofpulp 6y ago> As such, punishing him will do nothing to de-incentivize this from happening again. It can, if word spreads that defined benefit pensions aren’t worth the paper they’re printed on. My friends and I place zero value on DB pensions, as should anyone else unless they’re promised by the federal government (who can print dollars so they can never be unfunded). If I am evaluating two jobs offers and one gives me a DB pension (not from government) and one gives me a 401k, I’m going to value the DB pension at zero and go with the 401k.