What is the principle of "fixed income by expenditure, slight balance and partial accumulation"? This principle actually refers to the principle of raising endowment insurance funds in the form of low accumulation of some funds. "Living within our means" is also called "living within our means".

This is the principle usually adopted in China where the cost of employee retirement fund is co-ordinated. The implementation of this principle is in line with the fact that China has a large population and a weak foundation.

At present, the country needs to spend a lot of money every year to pay for the retirement benefits of retirees. If the welfare of existing employees is paid on the one hand, and the funds needed for future endowment insurance are reserved for new employees on the other hand, that is, a complete fund type is established, which is difficult for enterprises and state finance to bear. Moreover, the accumulated funds will also face the threat of currency depreciation brought about by rising prices.

But if we don't leave any accumulation, the country will bear a huge endowment insurance fund when the retirement peak comes, which will affect the social and economic development. So from now on, we should pay attention to the accumulation of some points, that is, to implement the partial surplus formula of low accumulation.

Further reading: How to buy insurance, which is good, and teach you how to avoid these "pits" of insurance.