THE NEW RULES OF RETIREMENT SAVING • 17
didn’t have to worry about that, because each of his legs were strong. Now, think about your own personal savings stool. Probably, the personal savings leg is doing okay. You know you should be saving and are putting something away each month (right?). How about the other two legs? Employer and government? Maybe not as strong. Let’s look at why. Leg No. 1: Employer Savings Pensions are on the endangered species list. There was a time in America that you could land a good job with a big corporation, spend thirty or forty years there, work hard, earn raises and pro- motions, and then retire with a gold watch and a guaranteed life- time paycheck. That leg of the stool started to wobble in the 1960s when corporations found it difficult to keep their pension prom- ises. Defined benefit pension programs were part of the perks and benefits of nearly every employer of any size. It was one way they sought to attract loyal, long-staying employees. As the 1970s moved into the 80s, long-staying employees began to stop matter- ing so much to corporate America. Fringe benefits became too ex- pensive and administratively burdensome to maintain, so they just began dropping them. How did things change? Maybe you’ve heard about the Studebaker automobile. The Studebaker was ahead of its time. It was the first to come out with innovations like curved windshields, disc brakes, seat belts, and mechanical power steering. For some reason, the fickle American car-buying public just didn’t go for them like they did Fords and General Motors cars. So the last Studebaker rolled off the line in 1966. The United Auto Workers (UAW) had worked hard at the ne- gotiating table. Studebaker workers had excellent pension plans
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