Social Security: Going Private: Lessons from Overseas

Countries with private retirement accounts show the high risks and problemic rewards of such programs

Look to countries that have private accounts, and the risks appear as real as the promise. High fees overwhelm excellent returns in Chile. Shady claims about returns plagued Britain's scheme. Singapore's plan leaves many asset-rich and cash-poor. Even Sweden, with its relatively sound system, is considering changes to encourage greater active participation in private accounts. Overall, the experience abroad seems to serve up this lesson: no one gets it right on the first try. --By Jyoti Thottam

CHILE

How It Works Wage earners must contribute 10% of their pay to one of several government-approved private funds. Those accounts replaced the old...

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