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# Smashing the Piggy Bank
- URL: https://www.thelivelihood.org/smashing-the-piggy-bank/
- Published: 2026-09-16T10:09:10.000Z
- Updated: 2026-09-16T10:09:10.000Z
- Author: Catherine Pope
- Tags: Money

In the depths of yet another a mid-life crisis, I’m experimenting with a financial planning app. Having rummaged for pension statements and tangled with the government website, I’m rewarded with a prediction: my life expectancy is 87\. At first, I am pleased — that’s almost four decades away. Then I notice a more disturbing prediction: my money will run out when I’m 79\. I anxiously tweak a few variables that nudge it up to 83\. Surely, I could eke out my savings a bit longer? Then my monkey brain wakes up: “But what if you’re spared? What happens when you’re 90?” Like the rapidly growing majority, I don’t have a guaranteed pension. I’m forced to confront my mortality *and* worry about financial death.

Perhaps the stock market will soar, and I’ll assume future riches (“But what if there’s a big crash?” shrieks the monkey.) Perhaps I can live frugally? The monkey solemnly points to a pile of new books and the energy bill that could be mistaken for a mortgage payment. Perhaps the cost of living will stabilise and it’ll be easier to plan? The monkey flips on the radio, as the newsreader lists the current conflicts, trade wars, and climate catastrophes.

To make adequate provision for old age, I need to know just three things: the age at which I’ll die, how the stock market will behave over the rest of my life, and how much everything will cost. Although there’s no lack of data to help me, it’s all based on averages. On average, Simone Biles and I have 3.5 Olympic gold medals, but it’s fair to say I’ve not been keeping my end up. My projected expiry date is based on the mean: the Government added together everyone’s life expectancies and divided by the population. Some will live much longer; others will die sooner. This crude calculation ignores differences in class, ethnicity, and health.1 While it’s enough to help governments plan, how does it benefit individuals? Are conventional strategies setting me up to fail?

Even if the stock market remains stable, I only benefit from average returns if I remain solvent and alive. In the 2008 financial crash, 50 million US workers collectively lost $1 trillion from their pensions, forcing many to abandon retirement plans.2 The concurrence of the Covid pandemic and Ukraine war also decimated many funds.3 Those of us with health issues can’t simply delay retirement and hope those funds recover. While few would end up with nothing, the stress of an impoverished retirement or being forced to work is likely to shorten life expectancy. Then I discover this is a feature, not a bug.

## **You Only Die Twice**

There's a term to articulate my predicament: ergodicity. Although there’s a precise mathematical definition, in this context it just means *reversibility*. In ergodic situations, we can make repeated unsuccessful attempts without being worse off, like in a computer game. Once I’ve spent all my money, it’s game over for me, regardless of how well the stock market performs. Other people’s successes won’t sustain me. Theoretically, it’s possible to get more money, but who’s going to employ a resentful 79-year-old? And, given colossal government debts, can I expect a meaningful state safety net in 30 years’ time?

What other assumptions have I been making? Well, my calculations also assume I'll make consistent pension contributions over the next 20 years. This is a big long-term bet on my health and luck. What does "luck" mean here? Just the absence of things that could kill me, literally or financially? As we age, our health becomes less ergodic: we lose our ability to bounce back. Somehow, though, these plans suggest I could *decide* to be healthy. This feels absurd. Meritocratic societies insist that bad luck results from poor decisions, but what happens when bad luck reaches pandemic proportions? Or when climate change displaces entire nations?

There's a big difference between me and a pension scheme. These schemes are ergodic: they can recover from shocks and setbacks precisely because I am mortal. I keep paying in for 40 years, then obligingly hop the twig before I've withdrawn too much. The Leviathan comprising the state and large corporations provides stability based on averages. But it doesn’t care about me individually. If the system fails for one person, that doesn’t matter at state level. But it matters enormously if I'm that one person.4 If I exceed my predicted lifespan, I'm actually a nuisance. 

I'm trapped in a scheme that profits from my death. Can I somehow become more ergodic by giving myself extra financial lives? If retirement planning just means betting everything on a pension and not living too long, there must be alternative games to play. Can I find some other, frankly more interesting, places to invest my time, energy, and money? What story have I been sold?

## **Bananas Tomorrow**

The financial advisor's pitch is seductive: "Start making these convenient monthly payments aged 30, then we promise you never have to think about this boring stuff ever again. PS - Don't get ill." Behave predictably, and you’ll enjoy predictable results. This "set-it-and-forget-it" approach assumes average conditions. But these are not average times. To actually predict investment performance, we'd need 500 years of data, spanning the Reformation, pandemics, wars, and revolutions.5 And that's without even thinking about the upheaval of climate change. My pension provider's website offers me a neat graph of the last 20 years. Admittedly, those decades were bumpy, but they don't compare with the bloody tumult of the Tudor period, for instance. And the next twenty years will be very, very different. No current economic model factors in polycrises, when several disasters collide. The only thing that's predictable, I realise, is the monthly payment leaving my bank account.

Pensions and mortgages are supposedly designed to protect our monkey brains from short-term gratification: bananas tomorrow. For this reason, they're often referred to as "commitment devices".6 Commitment to what, exactly? And to whom? The more I look at the data on which they're relying — past performance based on unrepeatable conditions — the more I realise that I'm committing to something other than my own future. By quietly shifting the timeframe, pension providers can tell us more palatable stories. Those once-in-a-decade disasters become aberrations rather than what they actually are: features of an inherently unstable system.

💡

"Well-being is not measured merely in terms of the abundance of goods and services. It requires a sustainable balance between the present and the future." (**The Challenge of Affluence* by Avner Offer, p.3)

Long-term plans might feel comforting, but they rely on trust. A colleague told me about receiving a piggy bank for her sixth birthday. For ten years, she diligently saved her pocket money, along with any birthday or Christmas windfalls. When she triumphantly smashed the piggy, instead of a pile of treasure, she found a few coins and a lot of IOUs. Her parents had routinely filched the notes and replaced them with an empty promise to repay her. Incidentally, trust isn’t ergodic either: once lost, it’s hard to regain.

Is my trust in my pension provider misplaced? Should I be sneaking up on them to check whether they've squandered my money on cocaine, yachts, and bonuses? This commitment device commits me to their company, rather than to my future. Indeed, those “commitment devices” that supposedly protect us often impose penalties for switching. As I nerdily digest the small print of some popular pension schemes, I discover five-figure exit fees that could hasten a financial death. What happens when I'm 67 and the piggy bank is empty? Assuming I can even figure out how to operate whatever biometric scanner or neural interface they're using by then.

## **Muddling Through**

How can I avoid the set-it-and-forget-it trap? I temporarily disappear down a rabbit hole of Bayesian thinking, a formula-based approach to reasoning favoured by some statisticians (inevitably, there are also arch anti-Bayesians). Happily, in this context, it needn’t be any more complicated than frequently checking my original plan still makes sense, considering what’s happened to me and the world since I devised it. I should constantly update my assumptions and actively seek more accurate evidence. Frequently, confronting reality in this way makes it less likely I'll be sharing a tin of Whiskas with the cat when I'm 87.

This approach forces me to ask myself difficult questions. Not "which pension provider charges the lowest fees?" But "will I be healthy enough to work until I'm 67?" Not "what's the most attractive mortgate rate?" but "where will I want to live when I'm in my seventies, and with whom?" Philosopher Agnes Callard calls these "untimely questions": fundamental problems that feel inconvenient because they disrupt the flow of daily life.7 They're uncomfortable questions, easily muffled by Netflix and cat memes. Socrates insisted that when we abandon enquiry prematurely, we condemn ourselves to wavering. That anxiety I feel about my financial choices? It's the price of these postponed questions. I'm prioritising comfort now, which might mean discomfort later.

💡

"Your answers to untimely questions stem from savage commands. Suppose you want to replace them with better answers. What should you do? Simple: keep an open mind and inquire, moving toward what's true and away from what's false. Can that really be all there is to it? Yes. That is the Socratic method." (**Open Socrates* by Agnes Callard, p.143)

Given the complexity and non-ergodicity of our lives, creating a fixed long-term plan for anything seems daft. I need an inductive, or Bayesian, approach, where I can respond, experiment, and adapt. States are more resilient — they can print money or raise taxes — but non-ergodic individuals are financially mortal. Yet we’re encouraged to pursue plans that assume everything is predictable. When the situation is so complicated, we should proceed cautiously, rather than hurtling towards a murky future. Economist Charles Lindblom proposed a science of “muddling through,”8 which makes more sense. Not only does this make sense, it's obvious! Why didn't I start muddling much earlier?

Well, in my twenties I bought life insurance even though I didn't have any dependents. I was 'buying security' by ensuring my mortgage got paid off if I died. Except I'd be dead. The only beneficiary was the mortgage company, who'd get their money faster. I squirreled money in my ISA rather than overpaying my mortgage, plumping up my savings account while my lender collected more interest. These seemingly sensible choices, I discover, are 'intransitive preferences': inconsistent choices, such as preferring red to blue, blue to yellow, then choosing a yellow hat over a red one. We trade something we value more for something we value less. Intransitive preferences create a 'money pump' where wealth is efficiently extracted by exploiting those contradictions. That insurance policy was helping the bank, not me. In the absence of reliable and objective advice, it's tough to avoid the money pump.

While the financial services industry is heralded as the economy’s wealth creator, its business is often value *extraction*.9 Once a utility designed to facilitate our vital transactions, the finance industry has, like many other utilities, become a means of generating profits for somebody else. Pension funds are packaged assets to be traded, plundered, and liquidated. Rather than customers to be served, we become resources that are mined for profit. Those who question the schemes are denounced as greedy, pampered, and ungrateful. 

Many people I speak to don’t realise their pension is invested in the stock market, meaning they might receive less than they invested. Others assume their auto-enrolment scheme or 401(k) plan will sustain them, despite homeopathic and sporadic contributions. Thanks to persistent deregulation in the US, it’s increasingly easy for both workers and employers to treat pensions like a tax-efficient cashpoint. Ignorance abounds, even among the highly educated and mathematically inclined. Low earners, often members of the precariat, don’t even qualify for basic plans.10

💡

"Today, even low-income workers must make financial decisions that are far more complex than in the past. ... It is all very well for specialist academics to call for more 'financial literacy education'. The precariat does not have the time for that, or the means to pay for it. (**The Politics of Time* by Guy Standing, p.166)"

Most guidance comes from the media, a sector dependent on advertising revenue from purveyors of financial products. Even *The Guardian* seldom suggests credit unions or not-for-profit alternatives. In the US, influential money gurus promote their own products, often with unfavourable terms. Others advocate paying off credit cards with the lowest interest rate first: an obviously intransitive preference. Personalised and objective financial advice remains prohibitively expensive for most of us.

And even if we wanted to diversify — to muddle smarter — the experts are also baffled. The *Financial Times* compares pension planning with "nailing jelly to a wall". 11 The UK pension review acknowledges Covid disrupted all their assumptions but concludes it's "too complicated to fix".12 In the meantime: stay healthy and hope for average circumstances. Or be just poor enough to qualify for state support. Will they retrieve data from my abandoned Fitbit to prove I'm the "undeserving poor"? Will others be punished for Candy Crush instead of learning Python?

While pension schemes become more vulnerable, social safety nets are unravelling. Beguiled by the simplicity of investment schemes with superstar fund managers, we’re encouraged, as Dorothy Parker might say, to put all our eggs in one bastard. Instead of diversifying, we stick doggedly to what’s worked in the past. We seek evidence that confirms our hopes, rather than information that exposes our assumptions. Thanks to clever marketing and abundant distractions, we’re no more likely to consider a 25-year timeframe than a 500-year one. 

## **The Invisible Foot**

Lynda Gratton and Andrew J. Scott’s *The 100-Year Life* gave many of us a much-needed kick up the bum. If we’re living longer, we need to work longer. The authors’ excitement is palpable: as academics, they can imagine nothing better than working till they’re 97\. As a recovering academic, I recognise this tendency; as someone finally emerging from long Covid, I feel exhausted. How many times do I need to reinvent myself to stay in the game? I notice a book called *Death: The End of Self-Improvement* and feel calmer.

Despite the apparent flexibility of the 21st-century workplace, practices remain largely based on factory hours. Factoring in “crip time” — an approach that acknowledges the lived experience of people with disabilities — is seen as an unaffordable luxury. Yet the pandemic has exposed the fragility of our mental and physical health. If I'm still healthy enough to keep working beyond state pension age, who's hiring 67-year-olds? Occasionally, Gratton and Scott allow that for some, longevity might be a curse rather than an opportunity. In these cases, they say, the government should step in with some measures. It is unclear how this Invisible Foot would work or who would pay for it.

Smouldering from burnout, I make radical changes, leaving my well-paid Silicon Valley job for part-time work. With time and headspace, I pursue new skills, build different connections, and experiment with ways to sustain myself through whatever's coming. I'm preparing, not predicting. And I notice something: I'm not doing this alone. I'm talking to friends about pensions and sharing what I'm learning. When I help someone else muddle through their own financial mess, it clarifies my thinking, too. By sharing my own vulnerability, they're less likely to change the subject or slither away. People are realising that conventional ideas of retirement are a myth and that the 100-year life means working much longer. Gratton and Scott acknowledge that 50- or 60-year careers require "respectful employers",13 but where do we find these paragons? And how do we compete with both younger colleagues and AI?

💡

"A long life requires resources, skills, flexibility, self-knowledge, planning and respectful employers." (**The 100-Year Life* by Lynda Gratton & Andrew J. Scott, p.16)

Retirement planning is presented as an individual problem requiring individual solutions. But that's nonsense. Even if I "win" this game, I'll be supporting the "losers", whether that's subsidising loved ones directly or paying taxes for safety nets. We're all in this together, whether we admit it or not. So why aren't we confronting it together?

## **The Winner Takes it All**

Nobody wants a pension. What we want is a way of providing for ourselves in later life, a means of obtaining the goods and services that aren't available for free. In meritocratic societies, we’re encouraged to believe we have a good chance of winning the pension game because we’ve worked hard and improved ourselves.14 But retirement security has become a “positional good”, where one person’s gain means another’s loss.15 The game itself remains ergodic because only a small number of people can win. We don’t find out whether we’ve won until it’s too late to play other games. To succeed, we need to survive both financially and biologically.

💡

"If everyone stands on tiptoe, no one sees better." **The Social Limits to Growth* by Fred Hirsch, p. 1.

While data makes everything countable, what we need is *re*counting:16 stories that inspire diverse ways of living. Real change comes from narratives, not numbers. Instead of risking everything on one high-stakes game, we experiment, adapt, and sometimes fail. In short, we become more ergodic. Rather than sacrificing our future to an economy based on the myth of infinite growth, we decide the limits within which we want to live17 and what constitutes “enough”.18

I can’t know what will happen over the next few decades. But I do feel more positive about the prospect of playing other games. I’m keen to pursue alternative approaches based on community and reciprocity, rather than on individual competition and accumulation. Above all, I’m not anxiously waiting to discover whether my piggy bank is full of IOUs. Instead of catastrophising, my monkey brain is excited by the possibilities of being part of a supportive network, not a Hobbesian machine where life is solitary, poor, nasty, brutish, and long. 

### Sources

1. Camilla Cavendish, *Extra Time: 10 Lessons for Living Longer Better* (HarperCollins, 2020), p. 94
2. Ellen E. Schultz, *Retirement Heist: How Companies Plunder and Profit from the Nest Eggs of American Workers* (Portfolio, 2011), p. 210.
3. Edosa Getachew Taera and others, ‘The Impact of Covid-19 and Russia–Ukraine War on the Financial Asset Volatility: Evidence from Equity, Cryptocurrency and Alternative Assets’, *Journal of Open Innovation: Technology, Market, and Complexity*, 9.3 (2023), pp. 100–116.
4. Richard Bookstaber, *The End of Theory: Financial Crises, the Failure of Economics, and the Sweep of Human Interaction* (Princeton University Press, 2017), p. 11.
5. Victor DeMiguel, Lorenzo Garlappi, Raman Uppal, Optimal Versus Naive Diversification: How Inefficient is the 1/N Portfolio Strategy?, *The Review of Financial Studies*, Volume 22, Issue 5, May 2009, pp. 1915–1953, [https://doi.org/10.1093/rfs/hhm075](https://doi.org/10.1093/rfs/hhm075?ref=thelivelihood.org)
6. Avner Offer, *The Challenge of Affluence: Self-Control and Well-Being in the United States and Britain Since 1950* (Oxford University Press, 2006), p. 3.
7. Agnes Callard, *Open Socrates: The Case for a Philosophical Life* (Allen Lane, 2025).
8. James C. Scott, *Seeing Like a State: How Certain Schemes to Improve the Human Condition Have Failed* (Yale University Press, 2020), p. 327.
9. Mariana Mazzucato, *The Value of Everything: Making and Taking in the Global Economy* (Penguin, 2019), p. xv.
10. Guy Standing, *Politics of Time: Gaining Control in the Age of Uncertainty* (Pelican, 2024), p. 171.
11. Moira O’Neill, ‘Why Pensions Planning Can Feel like Trying to Nail Jelly to a Wall’, *Financial Times*, 14 December 2024, section Insight & Comment [https://www.ft.com/content/221a62a0-e073-4744-a113-2081f4e2ee58](https://www.ft.com/content/221a62a0-e073-4744-a113-2081f4e2ee58?ref=thelivelihood.org) \[accessed 19 January 2025\].
12. ‘State Pension Age Review 2023’, GOV.UK [https://www.gov.uk/government/publications/state-pension-age-review-2023-government-report/state-pension-age-review-2023](https://www.gov.uk/government/publications/state-pension-age-review-2023-government-report/state-pension-age-review-2023?ref=thelivelihood.org) \[accessed 19 January 2025\].
13. Lynda Gratton and Andrew Scott, *The 100-Year Life: Living and Working in an Age of Longevity* (Bloomsbury, 2020), p. 16.
14. Michael J. Sandel, *The Tyranny of Merit: What’s Become of the Common Good?* (Penguin, 2021), p. 1.
15. Fred Hirsch, *Social Limits to Growth* (Routledge & Kegan Paul, 1977), p. 66.
16. Byung-Chul Han, *Vita Contemplativa: In Praise of Inactivity*, trans. by Daniel Steuer, 1st edition (Polity, 2023), p. 96.
17. Donella Meadows, *Thinking in Systems* (Chelsea Green Publishing, 2017), p. 102.
18. Kate Raworth, *Doughnut Economics* (Random House Business, 2018), p. 35.

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