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Japan Is So Desperate to Increase Its Birth Rate That Tokyo Is Trying Out a New Idea: Free Daycare (www.xatakaon.com)

submitted 1 day ago by [email protected] to c/[email protected]

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[–] [email protected] 1 points 5 hours ago (1 children)

This is a fundamental misunderstanding of how these funds work.

This misunderstanding is on your side. There is a method of funding pensions refered to as pay as you go (PAYG).

The goal is not to pay people with the money from new people paying into the pot.

This is exactly how many unfunded, state sponsored pension schemes function. No pot of money exists. Only the ability to collect taxes.

They invest the money and then the pot grows and that money is used to pay out.

This is true for private pension schemes run by companies and individual pension schemes. Funded pension schemes are (usually) not ponzis.

[–] [email protected] 1 points 1 hour ago* (last edited 1 hour ago) (1 children)

State pension plans are primarily funded (in order of what comprises the most) by 1) the government 2) investments and 3) employee contributions.

Pay as you go is about employee contributions, which is typically the smallest pot being contributed. I don’t think you know what you’re talking about.

[–] [email protected] 1 points 36 minutes ago

I don’t think you know what you’re talking about.

The UK State Pension is unfunded, which means that its obligations are not underpinned by an actual fund or funds. Such schemes are often referred to as “Pay As You Go” (PAYG). The pension payments made by the government for unfunded pensions are financed on an ongoing basis from National Insurance contributions and general taxation.