Angels stop pensions

[Guest]

A pension is a retirement account that an employer maintains to give you a fixed payout when you retire. It's a kind of defined benefit plan.

Your payout typically depends on how long you worked for your employer and on your salary. When you retire, you can choose between a lump-sum payout or a monthly "annuity" payment

What I want to know is where I can get 6.5% stable return on investment. That' almost as lucrative as what the Mets gave Bobby Bonilla for 25 years because they were making so much more than that from Madoff.

[Stradling]

It's not stable but as YK pointed out Fortune 500 companies have averaged about 11% over the last 30 years. A 401k starts as a long term investment then the closer you get to retirement, you pick less risky investments if we are in a down economy.

[yk9001]

It's not stable but as YK pointed out Fortune 500 companies have averaged about 11% over the last 30 years. A 401k starts as a long term investment then the closer you get to retirement, you pick less risky investments if we are in a down economy.

 

For the record, the S&P 500 index (not the Fortune 500 companies) has averaged that return.  Nobody has put 100% of their retirement money in that index fund over the last 30 years.  Not positive it was even offered 30 years ago.  Hindsight is wonderful.... the major stock indices were pretty much flat from the late 1960's to early 1980's.  Flat for 15 years.... that is a long time.

[yk9001]

What I want to know is where I can get 6.5% stable return on investment. That' almost as lucrative as what the Mets gave Bobby Bonilla for 25 years because they were making so much more than that from Madoff.

 

You guarantee me 6.5% return and I am the happiest man on earth.

[Stradling]

For the record, the S&P 500 index (not the Fortune 500 companies) has averaged that return. Nobody has put 100% of their retirement money in that index fund over the last 30 years. Not positive it was even offered 30 years ago. Hindsight is wonderful.... the major stock indices were pretty much flat from the late 1960's to early 1980's. Flat for 15 years.... that is a long time.

Yea I misspoke, sorry bout that.

[Tank]

Okay, I'm 22.

 

The f*ck are you people talking about?

 

bottom line is this: once you start working full time, start putting away money into some kind of retirement fund. the sooner you start, the better, whether it's provided by your company or something you do on your own.

[tdawg87]

I contribute 1% because im poor as ****

[Catwhoshatinthehat]

For the record, the S&P 500 index (not the Fortune 500 companies) has averaged that return.  Nobody has put 100% of their retirement money in that index fund over the last 30 years.  Not positive it was even offered 30 years ago.  Hindsight is wonderful.... the major stock indices were pretty much flat from the late 1960's to early 1980's.  Flat for 15 years.... that is a long time.

 

Despite being flat from 1966-1981 the S&P500 still returned almost 11% over a 30 year span including those flat 15 years.  For the majority you're on your own for retirement without a pension and your options are to stick your money in your mattress and watch it lose value because of inflation or you can find your risk tolerance and invest accordingly.  There are no guaranteed investments and while past performance isn't an indicator of future results historically the major US indexes have performed pretty well over the long run.  These days it's even easier to diversify by investing in foreign markets which can increase return and reduce risk. 

[IEAngelsfan]

bottom line is this: once you start working full time, start putting away money into some kind of retirement fund. the sooner you start, the better, whether it's provided by your company or something you do on your own.

Yup, the "time value of money" principal of finance is very powerful.  Save as early as possible over a longer period of time will reap you so much more than waiting to invest.  Heck, waiting 5 years to start saving can be enormous.

 

As far what to invest in your 401k, I would venture to guess most people have no clue what to do.  If your plan offers some financial guidance/advise, take it.  If not, take some time to do some research.  Some plans have some funds that will do the investing for you based on your retirement date.

 

Unfortunately, I've seen some 401k plans that have very little options and offer no guidance.

[Schildog]

You guarantee me 6.5% return and I am the happiest man on earth.

 

you've got to think treasury rates will be around that return in the future. not sure when you retire but rates aren't going to stay like this forever. 

[Mark68]

I contribute 1% because im poor as ****

At least you live in NH, so your poor as **** ass is not forking out extra money for your groceries.

 

Or your liquor. At least not as much as Massholes who don't go north pay.

[eligrba]

For investment purposes only, consider the lottery.