Any guesses on what % of big corps offered employees a solid defined pension in 1998 and now?

[JanMichael]

no looking it up either. was it most of them in 1998 and most now? was it not many in 1998 and many now? was it not many in 1998 and not many now?

when i say "big" i mean that silly fortune 500.

what happened between 1998 and today? and how do you feel about your retirement now and 30 years into the future? caviar or cat food?

401k's...ouch.

[tonyt53]

1. Most. Bush happened to defined benefit plans. He started with the USPS and made an example.

The USPS has to keep their defined benefit retirement funded for 75 years in advance. To do that, the PO has had to cut costs and raise the price of stamps. Congress wanted to put up a bit of a roadblock, so they forced the USPS to lower the cost of tamps last year. Can you say "privatization"? ALL defined benefit plans were forced to do a self-audit to determine just how well they were funded for future benefits. Any below a certain level had to take steps to get it back up to minimum standards, and that usually meant a much larger contribution by the participants. This move allowed those defined benefit plans to either fully fund their plans almost immediately, or shut them down, which meant a move to a 401 plan. The auto companies ALL had future benefit funding problems. Now those plans are dinosaurs and while the funds could fail with bad investments, most were held in relatively safe funds. To catch up after the shutdown of the defined benefit plans, many people chose to go aggressive with their new 401 plan, then 2008 hit.

This is the same scenario that will happen with any money that people to do have to put into the SS system. They say they can do better, but those people are full of shit.

[PoindexterOglethorpe]

2. Starting in the late 1970's

big companies started pulling back on pensions.

Often it took ten or more years to be vested, or if you left the company before say age 65, you left with no pension.

There's this charming myth that most Americans got good pensions in the past, but the reality is quite different. My recollection of earlier internet searches is that at best less than half of workers ever got a defined benefit pension. And many companies that have declared bankruptcy often used that bankruptcy to get out from under any pension obligations. I know more than one person that's happened to.

Usual government jobs at any level had decent pensions, but they are going to disappear just like the others. I recall reading decades ago that municipal and state pensions were a time bomb because they simply weren't being funded sufficiently. Just like corporations didn't fund theirs.

[ILFightinDem]

3. Two other things helping to kill them are 'cash balance' plans and expected future rates of return

The few companies that still have them have largely gone to cash balance plans, which automatically cash out vested employees who separate from service short of the (usually) 20 year service requirement. That, plus closing off existing plans to 'new' employees are a death knell for defined benefit plans.

The other thing is that stocks and bonds are expected to yield about 2% lower in the future than the historical average from 1929 until now. Reduced yield equals increased contributions from the company, and / or increased risk to the investment portfolio.

If you're lucky enough to work for a company who still offers a pension plan (especially if it also offers a 401k) - count your blessings. They are quickly going the way of the dinosaur.

Adding further insult to all of this is companies that dissolve their plans and leave the PBGC to pay out benefits. Retired truck drivers are feeling the pain of this now, with 75% benefit cuts imposed upon them - some have had to go back to work.

One of the worst deals workers have been stuck with the last 30 or so years was the introduction of defined contribution (401k) plans. It was a double windfall for the companies, who not only didn't have to fund pension plans any longer, they *also* got to deduct the cost of the 'matching contributions' to the 401k accounts from their own taxes. Meanwhile, between exorbitant fees and a financially unsavvy public assuming all of the investment risk, people on average have a pittance waiting for them at retirement, compared to what they would've had with the traditional defined benefit plan.

Factor in Social Security shortfalls (which could be easily fixed by eliminating the salary cap on contributions), and it's no wonder older workers are depressed.

[pansypoo53219]

4. 401k is a rip off.

wall street needed NEW BLOOD & congress gave them workers.

[duffyduff]

5. During the Reagan years is when it happened.

401(k)s were liberalized in the early 1980s (they were originally designed for high-paid executives and never intended as pseudo-pensions and NOT intended to replace pensions), and then the insurance premiums for ERISA went way up for corporations, so companies began to ditch the superior defined benefit pensions in favor of the crap defined contribution plans.

[sinkingfeeling]

6. Most large corporations had already dumped their pension plans

for 401Ks by the mid-1990s.

[TacoD]

7. My fortune 500 employer just announced that they are freezing pension plan 1/1/2017 (nt)