Talk:Pension/Archives/2013

Organization of material
Having created several articles to help round out the retirement plan genre, I've moved significant (and very good quality) content from the following articles around: Although I tried to integrate everything logically, there is still considerable smoothing to be done with respect to standardization of terminology, voice, and style. Please consider these pages as a whole when making edits and modifications and let's try to get all the content arranged in the logical spots. Thanks! Chris 02:52, 30 Sep 2004 (UTC)
 * Retirement plan
 * Tax advantage
 * Individual retirement account
 * 401(k)
 * 403(b)
 * Pension

Mainly about American superannuation
This page is really about American superannuation. It should either be renamed or heavily editted to include international content.Dankru 22:19, 25 October 2005 (UTC)

Agreed - I've trimmed some of the US specific stuff out, as it was much better covered in other articles, such as Retirement plans in the United States. In fact, as far as I can see there's not much at all in this article that isn't better covered elsewhere; for example, most of it is duplicating the Retirement plan article. Perhaps there needs to be another rethink of what this article needs to cover. Enchanter 21:24, 28 October 2005 (UTC)

Separate state, occupational and individual/private articles
I think there is a good case for separating out state pension provision form the defined benefit/contribution division. There are many ways of dividing up types of pension including:
 * defined benefit/contribution
 * funded/unfunded
 * state/occupational/private
 * contributory/non-contributory
 * self-invested (directed)/ prescribed  etc.

I feel it would be better to have a separate 'state pension' article; an 'occupational pension' article and a 'private pension' article. The 'pension' article should give an overview and include more obscure pension related articles (eg. political pensions). Simon West 01:06, 20 December 2005 (UTC)


 * Agreed. Would state pensions best be covered as part of a new-and-improved social security article? Gary 13:21, 20 December 2005 (UTC)

Throw in a section on the recent ( a few years ago ) Supreme Court case about the pension being a company asset. Airlines, ENRON, etc would be good pegs about a story on how your pension really works - this article looks like it was written by a salesman.

Some external links

 * Pension News
 * Pension Publications


 * the views expressed in should be included. he claims that "pension funds have $2.5 trillion in assets, are enormous industrial lenders, and own 40 percent of American common stock--enough for a controlling interest in most companies." notable, if true.--  ExpImp talk con 04:03, 21 October 2006 (UTC)

Request to globalise article
A request has just been put to globalise this article which means massive editting. But the US stuff is good as many people don't have as good a resource as this article so I set up Pension law (US) as a stub for the US stuff to be placed. John wesley 13:04, 10 March 2006 (UTC)


 * There is an existing article called Pension (United States) that redirects here that might be a better choice. -- Barrylb 21:59, 10 March 2006 (UTC)


 * Thanks, how do I now delete the stub I introduced? John wesley 22:05, 10 March 2006 (UTC)


 * You just need to edit the article and put in this tag anywhere: db-author and an admin will delete it soon after. -- Barrylb 22:16, 10 March 2006 (UTC)

Political pensions
The encyclopedic list of Indian political pensions didn't really seem to fit in - I've re-removed to its own political pension page. Gary 14:17, 15 March 2006 (UTC)
 * I don't have a problem with that outsourcing in principle. However when I realized the solo Political Pensions wasunsourced and went looking, besides the website I got the princely states from, I discovered the 1911 Enc. Brit. covered a domestic variant, and a serious of other specific British pension systems in sectors of public life, such as military and established church. So I put them in pension as a new section, including the referal for political pensions (now two senses). As most of these still are relevant, the experts on pensions may want to give these a work-over, they probably need some updating. Õne might perhaps also consider another structuring, possibly outsource some of those under a common heading. Any thoughts? Fastifex 08:42, 16 March 2006 (UTC)
 * I suppose if we could disentangle the various Pension, 401k, 403b, Retirement Plans in the US, Pension Law, Social Security, etc., articles (a worthy project but more than I have time for) that the Pension overview would want to include "pensions" of all sorts. I'll stop messing until I can offer a better structure. Gary 13:49, 16 March 2006 (UTC)

Paying benefits from future earnings
Have there ever been defined benefit plans whose payments are to come from the company's future earnings? If so, this needs to be clarified in the section on defined benefit plans. From what I've read, GM's pensions were designed this way, but that doesn't seem right. Anyone know? MrVoluntarist 16:59, 21 June 2006 (UTC)


 * That would be an unfunded pension, as described in the funded status section of this article. GM's pension plan was not designed this way - it was designed to be funded by market investments both in and outside the company. I suppose you could have, in theory, at least, and prior to ERISA, a "funded" plan that invested solely in the debt & equity of the plan sponsor. This would be, in effect, a DB plan whose payments come from the company's future earnings (as the sponsor's debt & equity represent primary & residual claims on those earnings). This is not substantially different from an unfunded plan. For a particularly vivid example, see Social Security (United States).


 * One other thought: in the United States, most retiree health plans - where there is no tax advantage for funding - are promises where the payments come from future earnings. As a result, the net liabilities on these plans are huge. But that's also because the benefit isn't defined in financial terms as a rule - so they have exploded with increasing life expectancies and higher medical costs. But that makes them not pensions, so out of scope here. --Gary 17:36, 21 June 2006 (UTC)


 * I understand the funded/unfunded distinction. What I meant was, in the article, it only describes plans that are both unfunded AND defined benefit as being the province of government's and the public sector, rather than private corporations. If there are private corporations that do this, I want to edit the article to make that clear(er). Sorry I wasn't precise in the above question.
 * Now, since part of the reason I'm asking this is to improve the General Motors article, I'm trying to clarify the nature of their problem (no one's answering my quesitons on the talk page.) Now, if GM was funding their plan with investments made at the time of wage payments, then the only reason this would be a burden to GM (and thus cause problems for their creditworthiness) would be if they had an open-ended promise to cover anything their investments didn't cover, from those future earnings.  So it would still be offering payment (potentially) from future earnings.  (Okay, earnings or liquidation of assets.)  Also, if they're having newcomers "pay" retirees, that would too be an unfunded, defined benefit plan like the US's SS.
 * About the retiree health plans you mention: are you saying that those benefits are not paid from an insurance plan bought coincident with wage payments, but from an open-ended promise to claims on the company's future earnings? That too would be relevant to include. (not necessarily in this article) MrVoluntarist 17:51, 21 June 2006 (UTC)


 * OK, I see the original question. The other major unfunded pension liability is executive pensions - see today's (23 June 2006) Wall Street Journal article. These typically are unfunded since there are tax implications for funding nonqualified plans.


 * Re: retiree health - yes, that's precisely what I am saying. These are uninsured and (largely) unfunded promises. In GM's case, that net obligation is far bigger than the pension net obligation. Take a look at their 10-K, you'll see -- look for "FAS 106" or "other postemployment/postretirement benefit" liability on the balance sheet. --Gary 16:31, 23 June 2006 (UTC)


 * So, unions demanded, and GM agreed to, essentially an unbounded committment to care for their health? And they agreed to pay the difference between the investments they made for their pensions, and whatever they promised to pay?  And all of this was to come out of future sales?
 * The reason I have a hard time believing this explanation is that, it essentially means that for GM to be capable of honoring all of these promises, its profits (here, difference between revenues and wages + costs at a given time) would have to continue to increase. But since other firms entering could expect similar revenues and wages + costs, yet not have to pay for these past promises, GM would be at a competitive disadvantage to all those other entrants.  So, the workers are betting their entire health care, and some fraction of their pension, on GM's being able to achieve ever-increasing profits, while it is at an ever-increasing disadvantage to competitors.
 * People actually made that bet? That's not only putting your eggs in one basket, it's putting your eggs in a basket that will get weaker over time.  If that's true, I want to spell it out on the GM article (and any other article to which this would apply), but I've been hesitant to tell this story (which I have heard elsewhere) since it's so hard to believe and I want to be careful not to perpetuate a misconception, especially on Wikipedia. MrVoluntarist 17:41, 23 June 2006 (UTC)
 * Re Post-retirement Health Benefits - The unions' demands and GM's agreement were made long ago. At the time, there were no accounting rules in place to measure the value of these benefits other than on a pay-as-you-go (or acount-as-you-go) basis, so the looked cheap at the time.  Later when SFAS 106 was introduced, the size of the past giveaway became clear.  Even though not properly measuerd or even fully considred at the time, the members in effect were trusting thst this would come from future profits.  They are facing the downside now b/c if (should I say when?) GM goes bankrupt, they will lose these promised benefits.
 * This has happened at many copanies, but GM is an extreme example. The same also has happened at governmental employers where they are just having to account for these benefits now under GASB45, and at union welfare funds where benefts are promised to active and retired members, but typical funding falls well short of the benefits who have already retired members, so by definiton no pre-funding is in place for the active members. acm_acm 06:10, 29 June 2006 (UTC)
 * MrVoluntarist- yes, that's exactly what I'm saying. Retiree medical plans are a big bond issued to employees. The liability has exotic optionality and coupon characteristics (indexed to medical inflation, high call premium in a collective bargaining context, mortality risk). Your description of this legacy liability and the competitive disadvantage it puts GM under in is correct. On the other hand, companies issue bonds (though not medical-inflation-indexed ones!) all the time ... the question is what they use the funds for. Did GM in this case get productivity gains, labor peace, workforce managementetc., that gave the investment a positive value? At the time, probably so - but medical inflation trends and labor market changes have made the promise (liability) more expensive and its value (return on investment) lower than intended long ago. Companies have tried to control this (capping company contributions to retiree plans, notably) but for a company like GM, that incurs the call premium (see the costs of the GM and Delphi buyouts, e.g.) --Gary 12:19, 29 June 2006 (UTC)

Public Employee Pension Plans (United States)
There is a new stub page for Public Employee Pension Plans (United States). Take a look. Help if you want to. Mvialt 07:46, 17 November 2006 (UTC)

1911 Britannica
I can't see why we have a big section on pensions lifted from the 1911 Britannica. Surely we can get rid of this?

Also - nothing on State Pensions (eg Social Security in the USA). Exile 17:22, 15 February 2007 (UTC)

Too US Centric
I hope this article can be improved so that a wider view of the definition of a pension can be included Pigeonshouse 18:43, 6 June 2007 (UTC)

The claim that America's population is outgrowing Australia's is incorrect. Australia is in fact growing around twice as quickly due to relatively higher immigration and moreover the difference in birthrates and consequent aging is rather less than implied (a large part of any greater aging in Australia is due to the fact Australians live longer than Americans!). the US census bureau routinely understates the size and growth of the Australian population the latter of which has in relative terms exceeded that of the US in all but two decades since the 19th century! This is despite generally lower birthrates since around 1900 which are and continue to be compensated for by lower deathrates. In fact the US census bureau seems to have a bias towards portraying their nation as more dynamic demographically than other "western" nations than in fact it is. Much of what i have her argued is to a lesser extent true of Canada as well, and in any event assuming current demographic trends continue indefinitely is always unwise, as the postwar babyboom or the routine overestimates of global fertility over the past few decades should make clear. — Preceding unsigned comment added by 114.77.26.174 (talk) 04:26, 16 May 2012 (UTC)

Pension fund
I am removing the redirect from Pension funds to this article as that subject is quite vast and specialised.Anwar 17:11, 3 July 2007 (UTC)

Too much UK info
It appears that most and all of the "Peculiar pension systems in the United Kingdom" sections is taken wholesale from the Encyclopædia Britannica Eleventh Edition. It should be footnoted that way, if this is the case. -- Orange Mike  &#x007C;   Talk  13:58, 28 May 2008 (UTC)

And shouldn't it be moved into the UK specific article (Pension provision in the United Kingdom) ? Dhollm (talk) 15:23, 22 December 2008 (UTC)

What is f12oo?
From "Civil List Pensions": A sum of f12oo is allotted each year from the civil list, in addition to the pensions already in force. From a Return issued in 1908, the total of civil list pensions payable in that year amounted to 24,665. What is f12oo? I've searched the past revisions and it doesn't appear to be vandalism - the section was originally added with that text. 216.36.188.184 (talk) 11:30, 28 May 2008 (UTC)
 * That's from the 1911 Britannica; it should be £1200 (1200 UK pounds). -- Orange Mike  &#x007C;   Talk  13:55, 28 May 2008 (UTC)
 * Should we check for a copyvio then? It seems likely it was cut and pasted in from some text-recognition software.--Yeti Hunter (talk) 13:49, 29 July 2008 (UTC)
 * The 1911 Britannica is public domain and widely used in Wikipedia. -- Orange Mike  &#x007C;   Talk  16:56, 24 November 2008 (UTC)

Request for more on history of pensions
Comment left on article by User:Bennettjprice

History of Pensions: Unfortunately, I don't know anything about this topic and came here to learn something. When and where did pensions start? Were there differences in time/place/manner in countries, states (or other political subdivisions)/ businesses (corporations, non-profits, mom & pops, etc.) —Preceding unsigned comment added by User:Bennettjprice (talk • contribs)

Odd Assumptions
I've found a few instances that suggest some kind of malfeasance is happening without any citations to back up these assertions.

Example: Under Defined Benefits, I find this sentence: "This assumes, of course, that the employer or other provider is willing and able to top up any shortfalls arising from such risks." Technically this is true, but this is a safe assumption considering the PBGC backs the fund, the numerous IRS and DOL regs surrounding pension funding, and the disastrous penalties associated with failure to follow the aforementioned regs. (I imagine similar protections exist in the UK, but please correct me if I'm wrong.)

I intend to delete any similar wording that is not backed up with a proper citation. -- Enharmonix (talk) 17:04, 11 November 2008 (UTC)

Another example: "Trust deeds also normally make it clear that the pensions are not absolutely guaranteed: the rules of the scheme can always be changed." In the US, pension trusts are guaranteed by the PBGC, and changes to plan rules cannot diminish an already accrued benefit ("once vested, always vested"). The term "trust deeds" makes me think this might be UK specific, but in the absense of any kind of qualification, this is definitely not true. -- Enharmonix (talk) 17:23, 11 November 2008 (UTC)

Is defined benefit a US term?
In the US, the term "pension" typically only refers to defined benefit plans. I was wondering, is the term pension used more broadly in other countries? Do other countries even use the terms defined benefit and defined contribution, or is does language come specifically from the IRS? If it is US-specific, we can probably redirect to the appropriate sections in Retirement Plans in the United States. Thanks for your input. Enharmonix (talk) 15:18, 25 November 2008 (UTC)

I am not sure if those terms are US-specific or not, but I don't believe that that the ideas they describe are, even if a more general description may be needed. Certainly some of the material is US centric and perhaps should be moved, but it seems like an important distinction is being made and is appropriate for this article. Just for example, in the UK many people can have a pension (in the US sense - a defined benefit) or an account like an ISA which is defined-contribution and could be used for retirement. I think employers in the UK use something similar to a 401K as well. Dhollm (talk) 00:46, 25 December 2008 (UTC)

Inflation and defined benefit pensions
Many defined benefit pensions are based on averaging salary over a number of years. 3 years for some U.S. defence pensions, 5 years for Canadian Government employees pensions including the military and RCMP. Inflation during these salary averaging years decreases the cost (% of salary) and purchasing power of the pension. This is an example of inflation transferring wealth. This feature can easily be corrected, making pension plans, and pensions unaffected directly by inflation. During periods of high inflation, the effect is very significant, increasing with the increase of number of years used for averaging. Note this is not indexing. It is the effect of inflation during the salary averaging years. In 5 year averaging, six different dollars are involved. The dollar in the first year of averaging is different than the dollar in the second year, etc, and of course the dollar in the first year of retirement is another dollar. If all salaries are converted to dollars of the same value, say first year of retirement dollars, then they can be averaged meaningfully, and the transfer of wealth by inflation eliminated.Art Campbell (talk) 02:22, 6 January 2009 (UTC)Art Campbell (talk) 21:48, 5 January 2009 (UTC)Art Campbell (talk) 03:46, 6 January 2009 (UTC)

What belongs in the history section?
The following material was recently removed from the history section. Personally I thought it was generally fitting information. The edit comment when it was deleted was "this information is irrelevant to the definition of pension". However IMO the article does more than just define a word, it gives context which history is an important part of. Also I don't see why the US history section is (which was not removed) was any more relevant. Thoughts?

Deleted text was:

Muslim World
The concepts of welfare and pension were introduced in early Islamic law as forms of Zakat (charity), one of the Five Pillars of Islam, since the time of the Abbasid caliph Al-Mansur in the 8th century. The taxes (including Zakat and Jizya) collected in the treasury of an Islamic government was used to provide income for the needy, including the poor, elderly, orphans, widows, and the disabled. According to the Islamic jurist Al-Ghazali (Algazel, 1058-1111), the government was also expected to store up food supplies in every region in case a disaster or famine occurs. The Caliphate was thus one of the earliest welfare states. From the 9th century, funds from the treasury were also used towards the Waqf (charitable trusts), often for the purpose of building of Madrassahs and Bimaristan hospitals. Dhollm (talk) 16:15, 2 March 2009 (UTC)

Structure
As there pages relating to specific countries and their pension plans. Would it be better to change the examples of each of the different pension plans into links so that I person could find infomation that was relevent to thier country.

Furthermore this would allow a more focused approach on issues related to that country such as population aging or low national savings.

It would stop a lot of the talk saying that the article is too nation centric and provide more relvent infomation. Digmores (talk) 07:12, 1 April 2009 (UTC)

Merger proposal
I have a question and a favor to ask of people Thanks, I dream of horses (T) @ 23:11, 20 October 2009 (UTC)
 * 1) Does anybody have any opinion about merging Pension Administration and Pension law (US) into this article?
 * 2) If a discussion ensues before a week is out, can somebody please inform me of such on my talk page?

I personally think it's not a good idea. The current segregated form with links is better preferred. This article is to only provide an insight to the topic of Pension. If you want the US article to be merged, why don't you also merge every other country's pension articles. It won't be balanced and would be misleading for one to only get the jyst of the US Pension system. Slix 88 (talk) 12:33, 30 November 2009 (UTC)

History of Pensions
The history should be the first entry after our modern use and definition. Explain the history of Pensions as a form of patronage to important people in ancient governments, armies, intellectuals, such as musicians, scientists or professors. A good example is pensions or tributes to Roman soldiers of merit and distinction. We need a timeline of this once discretionary tool, to the modern “pension as a right” feeling and how this is effecting current events, such as Greece, UK and US. If I remember right, Greece was one of the first to establish the notion of a pension. —Preceding unsigned comment added by Mcurtin (talk • contribs) 02:00, 16 April 2010 (UTC)

Hi, In the German history section there is a sentence that states "It is sometimes claimed that at the time life expectancy for the average Prussian was 45 years; in fact this figure ignores the very high infant mortality and high maternal death rate from childbirth of this era." Given the sentence that follows (i.e. people who survived infancy often did live to 70), it appears that the 2nd clause is incorrect. Assuming that the 45-year claim is for life expectancy at birth, this figure most definitely takes account of a very high infant mortality rate - that high rate goes a long way to explaining why life expectancy at birth was only 45 years. A better way to make the point that many people entering work would live to 70 is to state the life expenctancy at, say, 16 years of age, or 21. Any arbitrary point in adulthood would do - assuming of course that the figures are available and that, indeed, e16 was at least 54 years, to make the point correct. 92.18.34.144 (talk) 14:22, 30 November 2011 (UTC)Steve

Further Reading resource
Ellen E. Schultz's Retirement Heist: How Companies Plunder and Profit from the Nest Eggs of American Workers ISBN-13: 978-1591843337 Publisher: Portfolio Hardcover (September 15, 2011) 97.87.29.188 (talk) 22:04, 25 October 2011 (UTC)
 * Why? Relevance questionable.  — Arthur Rubin  (talk) 14:37, 26 October 2011 (UTC)


 * Agree with Arthur on this.Statoman71 (talk) 16:58, 17 November 2011 (UTC)

Pension buyout
wanting to add a pension buyout section to the page and talk about the pension buyouts of ford and gm. ideas? help? questions? lets get this going. — Preceding unsigned comment added by Ljprllc (talk • contribs) 19:03, 6 June 2012 (UTC)


 * You may find Retirement plans in the United States a more appropriate article. But please read WP:NOTNEWSPAPER and WP:RECENTISM. — Malik Shabazz Talk/Stalk 01:34, 7 June 2012 (UTC)