I don’t understand why 401ks are even tied to a job. Anyone and everyone should be able to open a retirement account and put the same limit in. I believe Australia does this and even rolls your max contributions limits over if you don’t use them so you can play catch up later if you want.
The institutional investors running the 401k plans you contribute to are the same people pressuring your employers to reduce payroll by eliminating your job. How does any of that make sense? It’s unsustainable.
Yes.
When they shifted the risk from the employer to the employee by going from pensions to 401ks the employee’s got screwed.
My father worked for 35 yrs for the Federal government and retired in 2000. He started on the old government pension plan. In the mid-1980s, Reagan pushed a plan offering government workers a way to move from the Fed Pension to a 401k-type plan. Dad being a Reaganite, he went for it.
Got screwed in retirement. His co-workers who stayed with the Fed pension did much better. Pissed him off. He passed last year at 88 and my mom wasn’t left with much of a nest egg. Would have had a better benefit from the Fed pension.
“Make America Great Again” my ass.
Absolutely
It’s entertaining watching The NY Times ping-pong between explaining how great the economy because of the President and Bidenomics and Build Back Better and then at the same time, how terrible the economy is because of (oh, just pick any reason) 401(k)s.
Thanks for the article. Didn’t realize reagan tried to gut the 401k!!! He really was a piece of work! The last middle class tax break along with mortgage interest rates!
All defined benefit pension plans were bullshit and deserved every bad actor problem they got. Defined contribution plans are based, but people should be forced to pay in.
401ks I believe were designed so more money would go into the stock market.
No it was not. As someone that has been in a pension for 2 decades I can say a 401k is better for most. Most folks don’t stay at a job long enough for a pension to be worth anything. Without 15-20 years in a pension it is worth peanuts.
Wait I don’t get what’s so bad about a 401k? Can’t you just rollover your 401k when you leave employers? I have a 401k with my current employer and they match me 5%. Which is equal to a lot of money some how since if I invest $500, they would put around $150 or so (rough math). So it’s well worth it to me
If you are self employed / 1099, you can open a SEP IRA as well.
This whole debate sort of ignores the underlying issues of the economy in general being worse than 40 years ago. So, some investment metric changed. Doesn’t matter as much as the wages in general. You don’t get the system back of 40 years ago, without going back to 1945 and telling the United States “Don’t rebuild the rest of the world, they’ll just replace you with cheaper labor in a couple of generations.” Then you get all the moral quandaries of that sort of world. The quiet generation and the boomers are just the last to feast at that table. If you don’t fix the underlying economy, the rest doesn’t matter.
Contributing to mine 20 years has made me a millionaire on easy mode. So, no.
13 comments
I don’t understand why 401ks are even tied to a job. Anyone and everyone should be able to open a retirement account and put the same limit in. I believe Australia does this and even rolls your max contributions limits over if you don’t use them so you can play catch up later if you want.
The institutional investors running the 401k plans you contribute to are the same people pressuring your employers to reduce payroll by eliminating your job.
How does any of that make sense? It’s unsustainable.
Yes.
When they shifted the risk from the employer to the employee by going from pensions to 401ks the employee’s got screwed.
My father worked for 35 yrs for the Federal government and retired in 2000. He started on the old government pension plan. In the mid-1980s, Reagan pushed a plan offering government workers a way to move from the Fed Pension to a 401k-type plan. Dad being a Reaganite, he went for it.
Got screwed in retirement. His co-workers who stayed with the Fed pension did much better. Pissed him off. He passed last year at 88 and my mom wasn’t left with much of a nest egg. Would have had a better benefit from the Fed pension.
“Make America Great Again” my ass.
Absolutely
It’s entertaining watching The NY Times ping-pong between explaining how great the economy because of the President and Bidenomics and Build Back Better and then at the same time, how terrible the economy is because of (oh, just pick any reason) 401(k)s.
Thanks for the article. Didn’t realize reagan tried to gut the 401k!!! He really was a piece of work! The last middle class tax break along with mortgage interest rates!
All defined benefit pension plans were bullshit and deserved every bad actor problem they got. Defined contribution plans are based, but people should be forced to pay in.
401ks I believe were designed so more money would go into the stock market.
No it was not. As someone that has been in a pension for 2 decades I can say a 401k is better for most. Most folks don’t stay at a job long enough for a pension to be worth anything. Without 15-20 years in a pension it is worth peanuts.
Wait I don’t get what’s so bad about a 401k? Can’t you just rollover your 401k when you leave employers? I have a 401k with my current employer and they match me 5%. Which is equal to a lot of money some how since if I invest $500, they would put around $150 or so (rough math). So it’s well worth it to me
If you are self employed / 1099, you can open a SEP IRA as well.
This whole debate sort of ignores the underlying issues of the economy in general being worse than 40 years ago. So, some investment metric changed. Doesn’t matter as much as the wages in general. You don’t get the system back of 40 years ago, without going back to 1945 and telling the United States “Don’t rebuild the rest of the world, they’ll just replace you with cheaper labor in a couple of generations.” Then you get all the moral quandaries of that sort of world. The quiet generation and the boomers are just the last to feast at that table. If you don’t fix the underlying economy, the rest doesn’t matter.
Contributing to mine 20 years has made me a millionaire on easy mode. So, no.