rainy days
short term
long term
compound interest
what will be? social security (AHV)

We are going to have a problem, actually quite a big one, a problem with paying for AHV.

Unlike pensions schemes, where the money you receive after retirement is actually money you have put aside yourself during countless years of toil on the workplace, AHV is paid directly be the working masses in favour of the retired people, trusting that the same will apply in the future once you are retired.

When the AHV was set up, there were maybe 10 working people per retired person, and the average retiree had to live maybe another 5 years after retirement.

Shifts in the way we live, improvements in medicine and nutrition, and so on have greatly increased the average life expectation, allowing the average retiree to live between 10 and 15 years after quitting work.

New family structures with far fewer children, better birth control and the spiritual freedom to choose whether you actually want children at all have lead to a massive decline in new children being born.

So, all over sudden, there are maybe only 2 working people per retiree, which tends to be quite a problem…. as there a literally no more working masses around to pay for the masses of retirees….

One thing astonishes time and again: no one saw it coming, still isn’t, as no one wants to hold this hot potato, so no discussion is being held as what might be done…

Most folks will not face the situation, and will not vote for politicians who do, more sticking ones head into the sand.

The conclusions are very simple, whether we like them or not:

AHV will become one of the two mayor tax burdens for the whole population; the other one being health care.
People will stay in the work force for longer; retirement age will increase.
Retirees will keep on doing part time work.
AHV benefits will decrease, probably by not adjusting payments for inflation; reduction to the standard of living for retirees.
More responsibility for the individual worker/employee to put aside funds to complement AHV payments.

But then again, they might be all wrong…