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In much of the western world, people set aside ~10% of their paycheck to a pension fund, which then invests it in relatively solid options (stocks, real estate,
by underdeserver 5y ago
In much of the western world, people set aside ~10% of their paycheck to a pension fund, which then invests it in relatively solid options (stocks, real estate, bonds, with a risk profile that adjusts over time as the worker ages).
If you do that throughout a career - keeping the same fund between employers - you have an independent source of income for retirement. By giving significant tax benefits to not withdrawing this money early, most people who worked most of their careers will be set for retirement.
- nly 5y agoHere in the UK: > After a lifetime of saving, the average UK pension pot stands at £61,897. With current annuity rates, this would buy you an average retirement income of only around £3,000 extra per year from 67, which added to the maximum State Pension, makes just over £12,000 a year, just enough for a basic retirement lifestyle. Source[0]. £12K is $16K USD/yr There are also some sobering statistics on PensionBee[1] [0] https://www.telegraph.co.uk/financial-services/pensions-advice-service/what-is-a-good-pension-pot/ https://www.telegraph.co.uk/financial-services/pensions-advi... [1] https://www.pensionbee.com/next-generation-of-retirees-report https://www.pensionbee.com/next-generation-of-retirees-repor...