Financial Insecurity

Last week, I discussed the primary issue that has led to the ‘Unavoidable Pension Crisis’ in America. To wit:
‘Using faulty assumptions is the lynchpin to the inability to meet future obligations. By over-estimating returns, it has artificially inflated future pension values and reduced the required contribution amounts by individuals and governments paying into the pension system.’
This is a critically important point to understand. Why? Because you may well be in the same ‘quicksand’ as pension funds and just don’t realize it.
For years, Wall Street has continued to espouse the ‘myth of compounded average returns.’ This is the same myth which has not only infected pension funds, but has led to the same false sense of future financial security in personal retirement planning nationwide. An article from IBD last week further perpetuates this myth:
‘What determines how much savings is enough by a certain age, with a particular income?

This post was published at Zero Hedge on Apr 10, 2017.