Quick bites – Karl on pensions

That’s very much like our so-called “pension plans” that promise 8% returns in their portfolios, all of which are scams because there is no possibility of ever earning that return except by stealing it over very long periods of time.

A person’s work-life is about 45 years (20-65), and thus if we were to assume such a pension plan had a ~40 year time horizon the first dollar put in would have to have expanded by 21.7x over that 40 years.

For that to be sustainable the economy would have to expand by 21.7x over the same 40 year period.

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2 responses to “Quick bites – Karl on pensions

  1. Nothing like seeing in cold print what all of us who have taken our private pensions out don’t already know.
    And that of course is without the outrageous fees and charges (far bigger here than anywhere else in the western world I believe) and Mr Browns plundering of the funds.
    It is and has been proven to be a giant ponzi scheme, not for those who make the rules and there “friends in the civil service” of course.

  2. If inflation averages 5%p.a, and you get 3%p.a. over inflation, bingo 8%p.a. Easy peasy.