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Carla
Joined: 21 Nov 2008
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 Posted: Sat Aug 15, 2009 1:05 am Post subject: Pension vs. 401(k) |
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| Is there any major difference between pension in Korea and the 401(k) in America? |
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isitts
Joined: 25 Dec 2008
Location: Korea
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| Posted: Sat Aug 15, 2009 5:01 am Post subject: |
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The pension isn't invested in the stock market. So the major difference is your money won't get flushed down the toilet with a pension.
Last edited by isitts on Sat Aug 15, 2009 5:05 am; edited 1 time in total |
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isitts
Joined: 25 Dec 2008
Location: Korea
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| Posted: Sat Aug 15, 2009 5:03 am Post subject: |
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| The only similarity is that your employer matches your contribution. |
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bassexpander
Joined: 13 Sep 2007
Location: Someplace you'd rather be.
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| Posted: Sat Aug 15, 2009 12:54 pm Post subject: |
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| One should save, at minimum, at least 15 percent of their monthly wage in some form of savings/retirement account to prepare for the future. This is in addiition to any pension or 401k account. This should not be touched until retirement. |
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isitts
Joined: 25 Dec 2008
Location: Korea
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| Posted: Sat Aug 15, 2009 6:11 pm Post subject: |
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In addition to being a matter of preference, you suggestion to put that much aside in addition to your pension contribution is very difficult if not impossible for most people. And even if they could, where do you suggest they invest it, since the point is to stay ahead of inflation? Simply setting it aside is no different than putting it under your mattress. 15% is not a cure-all. Whether it�s enough or not depends on rate of inflation.
Your pension contribution is 9% of your paycheck, and the school matches it. Whether that�s enough or not, it�s still a better (and safer) return than people are getting back home.
Anyway, none of this has any relevance since the OP was only asking about the difference between pensions and 401ks. Most EFL teachers don�t plan to retire here and will be taking their pension back to their home country. |
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TheUrbanMyth
Joined: 28 Jan 2003
Location: Retired
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| Posted: Sat Aug 15, 2009 8:45 pm Post subject: |
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| isitts wrote: |
In addition to being a matter of preference, you suggestion to put that much aside in addition to your pension contribution is very difficult if not impossible for most people. And even if they could, where do you suggest they invest it, since the point is to stay ahead of inflation? Simply setting it aside is no different than putting it under your mattress. 15% is not a cure-all. Whether it�s enough or not depends on rate of inflation.
Your pension contribution is 9% of your paycheck, and the school matches it. . |
Not exactly. The pension contribution is 9% but half is paid by you and half by the school. So you pay 4.5% of paycheck and the school chips in a matching amount |
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