A few years ago I went to the county fair in my hometown--Bath, NY. It's a small town in central New York. Anyway, the fairgrounds contain something that I rarely see in a fairgrounds. A small, one room, schoolhouse that has long since been retired from service.

The schoolhouse had been restored and kept in pretty good shape. All of the original desks had been restored and even the blackboard was intact! There was even the iconic black wood stove (or maybe it was coal?). Of all of the interesting bits of history in the schoolhouse, none was as interesting as a small, almost insignificant, document pinned to the east wall of the schoolhouse.

I asked the people working there if the document was authentic, and they told me that it was. The document listed rules for the schoolhouse. But, these rules were not rules for the students. Instead, these were rules for the teacher to follow in order to remain employed at the schoolhouse. Among them were rules setting forth when the teacher was to arrive at work and when the teacher was allowed to leave for the day.

What I found most amazing was a rule that the teacher had to save a portion of his pay each week and invest it conservatively for his future retirement. I kid you not, the document specified a percentage of income (I believe it was 10 percent, but do not quote me) that was to be saved and invested.

As I looked over the list, I wondered whatever happened to the idea that one is responsible for his own retirement? There was a time when teachers, and indeed everyone, was responsible for their own future. Now, we have Social Security which takes money from future retirees and gives it to current ones, state-run pension systems funded by taxpayers, and there are even some private pensions still kicking around which are funded entirely by employers.

Will we ever return to a time of personal responsibility?

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1. Arbitrary Retirement Plan Rules, Part 1: 401k Plans
2. Arbitrary Retirement Plan Rules, Part 4: Employer Pension Plans
3. Arbitrary Retirement Plan Rules, Part 3: Annuities
4. Arbitrary Retirement Plan Rules, Part 5: A Solution

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This entry was posted on April 17th, 2011 by David C Lewis, RFC. Edits may have been made to keep this entry current. · No Comments · Philosophy In Financial Planning, Retirement Planning