The idea that the average person should be wholly/predominately responsible to save for his/her retirement is laughable. It may appeal to doctrinaire free market advocates and it certainly appeals to the providers of the many 'products' that are supposed to provide for a care-free retirement.
But much better for the state to provide a
sufficient pension. Longevity and investment risks are truly shared,
between all citizens and all generations. Costs are very low - no pass
the parcel investment games, no expensive admin (everyone gets the same
pension, higher rate taxpayers give back more than those in a low tax
bracket or not liable to any income tax). This is to some extent akin to
the currently debated 'Guaranteed basic income', but only applied to
those already retired.
Anyone who has tried to manage
his own investment portfolio will understand how difficult investing is.
Even so-called professionals time and again mess up, highly acclaimed
'Masters of the Universe' in the Hedge Fund industry often produce
lamentable investment returns. So pushing the masses into the investment
game means they are supposed to do the equivalent of Brain Surgery on
By all means encourage people to save, but
this part of their retirement provision should not benefit from overly
generous tax benefits (that mostly flow to those already enjoying high
incomes) and also be free from all other regulatory and bureaucratic
restrictions. These additional nest-eggs can help to provide a more
comfortable old age than the universal state pension will be able to
48% of Americans saving for retirement are pretty sure they have no idea what they are doing (Business Insider)
Report on the Economic Well-Being of U.S. Households in 2015
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