Veruka Salt,
please let us know the fund that gives you 18%. Especially if it is guaranteed over 20-30 years. I suspect you have enjoyed some short term success. Good luck to you and enjoy it.
Unfortunately what I have learnt is that the top quartile performers of this five years are invariably the bottom quartile performers of the next five years. Regression to the mean!
18% -hmmmm. Well the DJIA has gone up on average about 11.0% pa since 1983. It has gone up about 6.3% pa since 1966.
So what? Ok, one more statistic. From 1966 to 1983(17years) the DJIA went up on average 0% pa(thats right, was 1000 in 1966 and then 1000 in 1983).
ANd by the way, none of the figures above take into account inflation. I would take out at least 3% a year to get 'real' returns.
My point; don't compare 15.5% PF contributions combined with 18% returns with a defined benefit scheme. Not really a fair comparison especially when your assumptions are so blatantly unsupportable.
What would be relevant to compare is the new QF PF scheme that someone said exists?