[mrmetanoia]

Hedging your bets some will die before they get it/all of it? Keeping your employees sustained while also not giving them enough immediate overhead for creating any kind of wealth?

I'm not serious, these are just the first cynical thoughts that came to mind, but I feel like this question should be one we can actually answer? We've had both pensions and time to see varying degrees of successes and failures regarding them.

[johnnyanmac]

No, you're right about the death thing. That's how all life insurance works. They bet on the statistics that most people will die by Y, so the retirement age of X means they will make money if (Y-X) is positive. Pensions are basically just "rest of your life" insurance before the real life insuarance kicks in for your family.

And you see why they died out. Y-X consistently became negative as people lived longer, especially when we moved to a service industry. So they ended it and front-loaded the money. There's probably a lieu of tax codes and other benefit they get from matching 401ks as well that I do not know of without researching.