November 2020

23Nov

There’s a way to fix the $4.6 trillion U.S. public pensions mess — Canada shows us how

In Ernest Hemingway’s “The Sun Also Rises,” Mike is asked how he went bankrupt. His reply: “Two ways. Gradually, then suddenly.” He might as well be describing the prognosis for many of the nation’s 5,300 public pension funds, which hold $4.4 trillion in assets against what the Federal Reserve estimates to be $9 trillion in liabilities. Most U.S. public pensions plans were in surplus in 2000. Today, based on their own accounting – which differs from that of the...

November 23, 2020
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20Nov

US. Nearly 30 Million Baby Boomers Forced Into Unwanted Retirement

In the third quarter of 2020, roughly 28.6 million Baby Boomers have left the job market and retired, according to the Pew Research Center. The study shows that Covid-19 has contributed to the rapid increase of Boomers—born between 1946 and 1964—being forced out of the labor market. Since the onset of the outbreak, the number of Boomer-aged retirees has increased by about 1.1 million. Over 65 million Americans have filed for unemployment benefits since March...

November 20, 2020
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12Nov

Factors Associated with the Ownership of Individual Retirement Accounts (IRAs): Applying the Theory of Planned Behavior

By Frank Magwegwe Despite the importance of retirement savings, many individuals retire with lack of adequate retirement savings. Applying the Theory of Planned Behavior, we developed a model in which psychological factors influence the calculation of retirement savings needs, which in turn influences the ownership of independent retirement accounts. The results showed that favorable attitudes, strong social norms, and perceived behavioral control are associated with calculating retirement savings needs. Also, calculating retirement savings needs as well as perceived behavioral...

November 12, 2020
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12Nov

US. California’s state pension fund pushes companies to cut their carbon pollution

Almost 2 million Californians receive a pension from CalPERS, the California Public Employees Retirement System. “Because we’re a pension fund, we rely on companies thriving in the economy to generate the returns, and we pay pensions out of that,” says Anne Simpson of CalPERS. She says climate change may put those investments at risk because extreme weather can hurt company profits. And if governments require cuts to carbon pollution, companies reliant on fossil fuels may lose money. “We need...

November 12, 2020
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11Nov

Funded Status of US Corporate Pensions Rises $21 Billion in October

The funded ratio of the 100 largest US corporate pension plans rose to 85.1% from 84.4% in October thanks to a third straight monthly increase in the discount rate, which helped boost the funded status of the plans by $21 billion, according to actuarial and consulting firm Milliman. The aggregate deficit of the plans, as tracked by the Milliman 100 Pension Funding Index (PFI), fell to $285 billion, which is its lowest level since March when it was $243...

November 11, 2020
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09Nov

US. 5 Ways President Biden May Make Lasting Changes To Retirement

While President-elect Biden and a nation wait for President Trump to concede the election, focus turns to how a Biden administration will lead. Biden has put forth many policy initiatives, including significant changes to retirement savings and Social Security. His ability to implement his vision depends in large part on Georgia. Two Senate races are headed to run-off elections in January. It seems likely that at least one race will go to a Republican, giving the GOP a razor-thin...

November 9, 2020
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06Nov

US. 10 Ways to Close Public Pension Funding Gaps

The best way to close public pension funding gaps, according to the National Conference on Public Employee Retirement Systems (NCPERS), is to reform state and local revenue systems and close tax loopholes. “But that is a long road, and it is beyond the scope of responsibilities of pension trustees and administrators,” NCPERS said in a recent research paper called “Ten Ways to Close Public Pension Funding Gaps.” “However, we can help ensure that state and local governments are looking...

November 6, 2020
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03Nov

Retirement Saving Is Hard Even For Those Who Can Afford It

Covid-19 has thrown a wrench in retirement planning. Rising unemployment, a volatile stock market and economic uncertainty are jeopardizing the ability of many families to plan for the future. However, even before the pandemic, saving for retirement was not easy. According to a U.S. Federal Reserve report from 2018, one in four non-retired households had no retirement savings at all, and more than 40% of non-retired adults said their retirement savings were not on track. Even for those households...

November 3, 2020
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October 2020

29Oct

The Changing Nature of Work and Public Pension Coverage: Evidence from the US and Europe

By Axel H. Börsch-Supan, Courtney Coile, Jonathan Cribb, Carl Emmerson and Yuri Pettinicchi We examine non-standard work and its impact on pension coverage via a case study of the US, the UK, and Germany. We find that the share of workers engaged in non-standard work has changed only modestly over time in these three countries, despite the popular perception that a more significant transformation in the nature of work may be underway. We discuss how non-standard work may affect...

October 29, 2020
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29Oct

Pension fund of S.Africa’s Eskom to invest $170 mln in U.S. projects

The pension fund of South Africa's indebted power utility Eskom plans to invest $170 million in private equity, infrastructure and real estate projects in the United States, the U.S. embassy in South Africa said on Wednesday. Eskom Pension and Provident Fund (EPPF) will invest $100 million in private equity managed by AlpInvest and $30 million in real estate managed by Metropolitan. The two companies are owned by U.S. private equity firm Carlyle Group. The remaining $40 million infrastructure investment will be...

October 29, 2020
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