Wow, that’s great. We only get like 3-4% on average, and that requires us to put in 6-8%

I mean even a lot of pension funds are kept in investments rather than some scrooge mcduck money tower. Unless you’re just entirely opposed to managed investments as a whole, a 401k is no less risky than a pension in terms of potential for loss, but it does come with the added benefit of being able to personally direct how it’s invested rather than just sitting back and praying that someone else doesn’t mismanage it. Your 401k is yours, and yours alone.

Surely actual pension contributions would be better than having your employer partially fund what is essentially a big financial gamble?

FWIW: pensions do carry similar risk factors. Most pensions are only financially sustainable because they’re invested into the public market and it’s entirely possible for a pension fund to go belly-up due to mismanagement as a result.

You are essentially correct in identifying that 401ks are much riskier, however. Most working adults would probably rather have the security of a pension instead of being given a rope to potentially hang themselves by.

Or… Is that the idea? Another way for US employers to screw their fellow citizens over and give them as little as possible in return for their lives of labour?

In a sense? I doubt most employers actively scheme to do evil to their employees, but the outcome is fairly sinister nonetheless. Pensions used to be much more common in the U.S. until getting largely replaced by the 401k during the 70s. These days, the only jobs that tend to offer pensions are government/unioned… which I think says all that needs to be said about which option is more pro-worker.

The one place where 401ks really shine is (legal) tax evasion and high-spend retirement. If you make six figures, you can max out your 401k contributions and thereby avoid paying $1000s in income taxes each year. People who are able to contribute that much also tend to get way more money back in retirement compared to a pension because – when properly funded – a 401k is technically more efficient in the long-term for those who already have the requisite resources to weather a medium-term financial hardship.

The world just makes me sadder and sadder. There’s just no real good news any more, only bad :-(

Well, if it’s any consolation… this particular bad idea has been around long enough that it’s no longer newsworthy