保险英语Unit 3 How pensions work in the United States
How pensions work in the United States
[00:02.77]A pension is an income payable after a worker retires,usually at the age of 60 or above,
[00:09.90]depending on the provisions of the particular retirement plan.
[00:13.35]Pensions can also be paid out earlier if a worker becomes disabled,or to the survivors of a worker who dies.
[00:20.51]About 90 percent of all U.S. workers are covered for retirement and disability under SOCIAL SECURITY.
[00:28.32]Most of the others are members of some public-employee retirement system.
[00:33.18]Perhaps half of all workers in the private sector are covered by some form of private pension or PROFIT-SHARING plan.
[00:41.27]Modern retirement plans come in two general forms.
[00:45.19]In a defined-benefit plan the amount of the pension is specified by some formula recognizing the worker's length of service and earning history;
[00:54.49]then the contributions(from employer and employee) needed to provide the pension are determined.
[01:01.13]A defined-contribution plan indicates how the contributions are to be determined on behalf of each employee
[01:08.62]and accumulates these contributions in an interest-earning fund;then,at retirement age,
[01:14.55]the accumulated fund is applied to provide whatever pension it will.
[01:19.12]A typical pension plan,of either type,will be a written document of some complexity.
[01:25.32]Among the detailed provisions that will be found are:
[01:28.95]1.The rules that determine which workers are eligible to become plan members;
[01:34.96]2.The age or ages at which workers can retire,and any choices they may have with respect to retirement age or to the form of the retirement income;
[01:46.21]3.The details of the pension formula(if a defined-benefit plan) or of the contribution formula(if a defined-contribution plan);
[01:55.91]4.The rules with respect to the disposition of a worker's pension if he or she leaves employment before retirement age or dies;
[02:04.63]5.The arrangements by which the employer and employee contribute to the cost of the benefits provided.
[02:11.79]Retirement plans can be classified in terms of the entity that sponsors the plan.
[02:17.30]When the sponsoring agency is some part of government,the plan is considered to be in the public sector.
[02:23.57]When the plan is sponsored by an employer,when it arises out of the collective-bargaining process,
[02:29.39]or when it is arranged on an individual basis by the worker,it is said to be in the private sector.
[02:35.32]Private pension plans and state or local government accumulate substantial amounts of money awaiting distribution in the form of pensions.
[02:44.65]These dollars are invested in virtually every kind of income-producing resource,
[02:49.59]including stocks,bonds,mortgages,and real estate.
[02:55.33]As pension funds have increased,they have become an increasingly important factor in the nation's economy.
[03:01.97]The actual management of pension-fund assets is often the responsibility of some institutional investor-
[03:09.13]typically the trust departments of major banks or the investment departments of life insurance companies.
[03:15.79]The aging of the American population(there were 25 million people age 65 and over in 1980; an estimated 29.2 million in 1986;
[03:26.39]and a projected 64.5 million by the year 2030)has given increased economic importance to pension fund
[03:34.15]In the United States,public and private funds totaled $1.4 trillion in 1986,representing an enormous force in financial markets.
[03:44.63]Nevertheless,only slightly more than 40 percent of civilian workers were covered by company-provided pensions in the late 1980s.
[03:53.35]Control of pension fund investments
[03:55.86]It is perfectly possible,although not necessarily wise,for an employer to set up a pension scheme where the benefits,
[04:03.30]are paid out of moneies solely provided by the employer out of revenues.
[04:07.98]Such a scheme would,of course,be heavily dependent upon the consistency of profits of the employer
[04:13.99]and in most circumstances would not give much security to the pensioner or prospective pensioner.
[04:20.65]This type of scheme is to be found on the Continent and is generally known as a "Book Reserve Scheme".
[04:27.70]Nearly all employers(and the government by virtue of the tax exemptions on investment activities which it gives).
[04:34.96]recognise that a more secure base for the payment of pensions can be achieved by setting aside monies in a trust fund and investing them in a variety of Stock Exchange and other securities.
[04:47.43]Such a trust fund will consist of the contributions of the employer,the contributions of the employee,
[04:53.80](in the case of a contributory fund),and the investment income from previously acquired investments and those assets themselves.
[05:02.45]The management of the trust fund will be carried out by the trustees who are normally appointed by the employer.
[05:09.13](but increasingly from names put forward for appointment by an elective process carried out in conjunction with trade unions and other employee representative bodies
[05:19.35]While all the duties of the trustees are extremely important(and they are dealt with elsewhere in this book),among the most onerous is the investment of the trust property.
[05:29.51]The manner in which the trustees carry out their investment responsibilities will be governed by the trust deed,
[05:35.73]or other instrument under which the pension scheme is constituted.
[05:39.25]Most,if not all,modern trust deeds will have a specific investment clause which will permit the trustees to invest over a wide range
[05:48.40]which enables them to take full advantage of the various investment outlets available to them.
[05:53.96]No matter whether the funds are self-administered,internally or externally managed or wholly managed by an insurance company,
[06:02.37]the trustees cannot abrogate their responsibility for the investments of the scheme.
[06:07.46]It is,therefore,important that the essentials of policy-making are fully understood.
[06:12.98]Investment policy will be a function of the requirements of the scheme.
[06:17.39]The vast majority of present-day pension schemes are what are known as "finalsalary" or "defined-benefit" schemes.
[06:25.70]In this type of scheme,the pension payable is linked to the salary of the pensioner before retirement.
[06:31.89](perhaps the average of the last five years,three years or,more commonly these days,the salary in the final year).
[06:40.22]Final-salary schemes have the merit of at least making sure that the pension,when first paid,
[06:45.92]has taken account of inflationary movements in salaries up to the point of retirement.
[06:51.30]Such a link is an important factor in the type of investment policy followed.
[06:56.10]While final-salary schemes are now the most common,the money purchase or defined-contribution schemes cannot be totally ignored.
[07:05.01](and they have come back into the limelight following the recent decline in the rate of inflation.)
[07:09.87]Clearly,an investment policy designed to cater for inflation,at least to the point of retirement,
[07:16.69]will be quite different from one which does not attempt to do this.
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