I think the "private" option is a good one. Social Security sops up 12.4% of workers' income. Even at a very modest income with modest returns, the average worker would do much better with a privately owned account than Social Security.
did. and failed.
your parents can tell you stories about how companies swindled their workers pensions when it's almost time for them to cash out.
You are confusing defined benefit plans with defined contribution plans. Defined benefit plans are terrible and are not controlled by the employee/retiree. Defined contribution plans are controlled by the employee, so there is no one to swindle you except yourself.
You probably forget about inflation that would eat up ("swindle away") all what you might have contributed by the time you retire.
defined contribution plans invest what an employer and employee puts into it mostly in stocks and other investments that aim to have returns that are in excess of inflation.
But this makes these investments vulnerable to all market risks, right? If so, what is the difference then between defined benefit plans and defined contribution plans if you invest, say, in U.S. bonds (treasuries) as a means to avoid the risks and market crashes?
There is no reason to limit your risks to treasuries. Over time you will "participate" in many crashes if you own stocks in a defined contribution plan, however if you are still contributing (you should be and they are designed so that you do) then you will be able to purchase stocks "cheaply" after a crash. A defined benefit plan will likely not invest in super safe investments like treasuries because they have an infinite time horizon while treasuries and bonds are meant for people who have a shorter time horizon.
When comparing job offers, defined contribution plans are much more transparent then defined benefit plans because it is difficult to determine the NPV of a defined benefit plan while the amounts that a company will put into a defined contribution plan is black and white.
