America's reluctant septuagenarian workforce

[LongTomH]

The Week Magazine: America's reluctant septuagenarian workforce:

Tom Coomer has retired twice: once when he was 65, and then several years ago. Each time he realized that with just a Social Security check, "you can hardly make it these days."

So here he is at 79, working full-time at Walmart. During each eight-hour shift, he stands at the store entrance greeting customers, telling a joke and fetching a "buggy." Or he is stationed at the exit, checking receipts and the shoppers that trip the theft alarm.

"As long as I sit down for about 10 minutes every hour or two, I'm fine," he said during a break. Diagnosed with spinal stenosis in his back, he recently forwarded a doctor's note to managers. "They got me a stool."

The way major U.S. companies provide for retiring workers has been shifting for about three decades, with more dropping traditional pensions every year. The first full generation of workers to retire since this turn offers a sobering preview of a labor force more and more dependent on their own savings for retirement.

Years ago, Coomer and his co-workers at the Tulsa plant of McDonnell-Douglas, the famed airplane maker, were enrolled in the company pension, but in 1994, with an eye toward cutting retirement costs, the company closed the plant. Even though most of them found new jobs, they could never replace their lost pension benefits, and many are facing financial struggles in their old age. A review of those 998 workers found that 1 in 7 has in their retirement years filed for bankruptcy, faced liens for delinquent bills, or both, according to public records.

[MichMan]

1. Don't understand this situation fully

Article states that the workers enjoyed a generous 30 & out pension, but I am confused why people who have worked there over 25 years have such small pensions just because they didn't reach the entire 30 years? What a terrible pension if that is the case.

Of course, I don't understand how the pensions were configured, but it was a unionized plant represented by United Aerospace Workers Local 1093. Why would they have agreed to something like that?

[PoindexterOglethorpe]

4. That's often the case, that if you didn't work the full 30 years

your pension is tiny. Which is why the myth of great pensions is a myth. Yes, there were people that got them, but not anywhere near as many or as high a percentage of the population as people think.

It was those very unions that negotiated the generous pension for those who worked 30 years, much lesser one for those who didn't hang in that long.

[yurbud]

8. a company union or outsourcing blackmail negotiations.

[Scarsdale]

2. Meanwhile, the slackers

in government retire with almost full pay, generous medical benefits, and raises yearly. On top of the millions (in most cases) they have stashed away from their owners. Time to re-evaluate their pensions and benefits. Even presidential benefits are way over the top. Why do they need offices after retirement, plus generous allowances for supplies?

[Ferrets are Cool]

5. When the criminals run our Government, it is impossible to change

the way things are run.
It will never happen, but until private financing is taken out of politics, nothing will ever change.

[bucolic_frolic]

3. Retirement funds ought to be in the name of the employee

That is one reason FDR gave for the permanence of Social Security. People paid into it, and it was theirs.

There is even talk of annuities being allowed to cut benefits if their investments don't pan out. What kind of contract do you have when the other party can adjust the deal?

It is common for pensions to be lost. And for new workers to have reduced benefits. Better to live small and keep as much of your retirement funds as you can in your own name. Trouble is most people don't have the expertise to manage the funds. They wind up in indexed mutual funds or with an investment adviser. Some are good, a few are bad, a few are crooks. But indexing is vulnerable when markets crash periodically.

[BobTheSubgenius]

6. Defined benefit penions are rapidly becoming a memory.

The defined contribution model, or nothing at all, is the new normal. And neither of them don't always work out as the worker, or the public, might expect.

My wife had a good job - $70,000 and benefits - but her pension took a huge hit in 2007-2008, as did so many. It lost 80% of its value, and she's had to cash in early on some of what remains...so she would be looking at SS only, except that I will leave her in not-awful (but nowhere near wealthy) shape.

[raven mad]

7. Retire?