How the Ballooning “Pension Crisis” Will Impact the Economy…”It’s not just the Dallas Police & Fire Pension Fund”

Monday, October 24, 2016
By Paul Martin

by James Murray
WolfStreet.com
October 24, 2016

In the very simplest terms, the Dallas Police & Fire Pension Fund is going broke, and the police who are counting on it for their retirement are beginning to panic. Police involved are retiring as early as possible and taking cash payouts because they fear that the fund will run dry and future checks may not be forthcoming. The whole thing is beginning to look like a run on a bank and it is just making matters worse.

It’s not that the DPFP is all that different from most of the public and private retirement funds; it’s just that what is happening has been noticed and made the headlines.

When you consider the number of people involved and the amount of money involved, the Dallas Police Retirement Fund is pretty insignificant considering that retirement funds in places like Chicago and the State of Illinois are probably in as bad a shape. Then there is the big daddy of all retirement funds, the Social Security Trust Fund.

Exactly why these funds are in trouble varies but the general view is that not enough contributions were collected, expected investment gains failed to materialize, and benefits were overpromised. Many of these funds also have a retiree health care component, and health care costs have risen dramatically. The bottom line is that these funds are having to pay out more than expected and they are not going to be able to deliver what they have promised without major changes of some kind.

The Rest…HERE

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