March 5, 2013
Video: Pension Problems Can Be Fixed
The Ontario Teachers’ Pension Plan has produced a terrific video that spells out how pension systems got into the trouble they’re in and proposes the outlines of what’s required to repair them.
The strength of this video is its broad sweep and perspective. It is worth watching for anyone interested in their children’s and grandchildren’s future financial security – as well as their own.
“Pension Plan Evolution” explains that U.S., Canadian, and other western retirement systems were built on the faulty assumptions that the future would keep producing enough younger workers to support retirees, 8 percent annual returns on investments, and economic growth that matched what the baby boom generation enjoyed in its prime.
Watch the entire video below. But if you only have time for the 1.5-minute trailer, click here.
To fix these systems’ finances will require shared sacrifices, the video concludes. The young should not pay for all of the mistakes of earlier generations who have resisted reforms to current pension systems – in other words, fairness matters. Solutions also require creativity in the design of systems that are able to adapt to future changes in the economy or circumstances.