Posted on 11/15/2008 7:39:37 PM PST by randita
Calls grow to overhaul 401(k) retirement plans
The financial crisis, which has caused a dramatic decline in the value of the average worker's account, has undermined confidence in the system.
By Jim Puzzanghera, Los Angeles Times Staff Writer
7:03 PM PST, November 15, 2008
Reporting from Washington -- For nearly three decades, working Americans have been part of a huge experiment with their future well-being: Old-fashioned pensions that guaranteed specific retirement benefits have given way to old-age benefitsthat depend on personal investing in the financial markets.
But now, with those markets in crisis and the value of workers' investments plunging, a bundle of ideas for modifying the system or replacing it entirely -- ideas shunted aside when the stock market was soaring -- are about to get a careful new look.
For one thing, Democrats have campaigned on the promise of a better deal for middle-class Americans. Also, many workers are aghast at the sudden discovery that their retirement years may be a lot less golden than they expected.
Even for people who have faithfully participated in the new retirement plans, which depend on annual savings and investment in 401(k) and similar accounts, much if not all of what they gained in the stock market over the last 10 years has been wiped out.
So far this year, the average worker's 401(k) account balance has dropped between 21% and 27%, depending on the worker's age and time with his or her employer, according to the Employee Benefit Research Institute.
That's a potentially disastrous turn of events, because the key to making the savings plans work is the hoped-for gains from long-term investing, not just the amount workers set aside.
(Excerpt) Read more at latimes.com ...
this was proposed
before
the election.
i can’t understand why anyone would vote for the democrats for this reason alone.
How many of those pension "guarantees" actually delivered without a government bailout? I know my father's pension "guarantees" were watered down at least twice.
Just days ago we were told the dems were backing down from this, that it was just one of many proposals, blah, blah, blah. But then it hits the mainstream.
Don't waste neurons trying to figure that one. They're morons. Marlboro smokin', Budweiser drinkin', mullet wearin', WalMart shoppin' morons.
They can't figure out what kind of number 401k is anyway. Ain't s'posed to be no damned 'k' in a proper number anyway.
Ill take the early withdrawal penalty, the capital loss in the current market, and head for Costa Rica. They will not get mine either.
Not proposed but reported. 401Ks allow safe investments now. Try ING direct. Can you imagine after a few Obama spending bills we ask where the SS IOUS payment will come from when they pitch this?
I think things like this are our best hope. In fact, I find it hard to believe after then killed GWB SS savings plan.
Because most people can’t see past the end of their nose. These are the same paople who voted for “change”. They’ll get either chump change or short change now.
Because the masses think “government” is going to compensate them - give them something for free. It doesn’t matter to them that government doesn’t have anything to “give”, it only takes from those who do have something to redistribute as they see fit.
We have a govt going bankrupt and they dare to question our judgement about our 401ks
This has gotten my husband so riled up, he says it would be a revolution if they did this.
There is an arrogance about it that astounds me.
We are grownups, we make decisions, my self directed 401k is down about 25 percent but I will take that,,,they lay a hand on my money and my ability to control it,,I will be radicalized beyond what I thought I could be.
The arrogance is astounding.
These nanny state a$$hole are smothering us with their pathetic plans.
People support this for the same reason they voted for other Democrat programs. They think it’s in their economic self-interest. Essentially following the same path that got us into this mess, pursuit of instant gratification vs. a life based on principles.
But...
"Should there be a serious reassessment? Absolutely," he said.
Ah, that's it. They are coming to save our hard-earned 401K money, by confiscating it and doling it out to us, like a good nanny.
cant take losses on 401ks.
We thought about withdrawing it all but the tax penalty would be huge. They tax like income tax and we would be hit like crazy.
There is talk of getting rid of the minimum distribution rules and they could give us a break with taxes.
We are retired, just did, and I cannot believe they would take retired people’s funds,,usually they exempt us.
They might lure young ones,,dumb young ones.
If I had it to do over, I would not invest in a k,,I would invest with after tax money. People I knew were doing this in the early 80’s.
Ummm...not my employer. They just recently upped the contribution amount...for the third time in 2 years.
This whole article by the LA Times is pure bull crap. The whole idea for these new plans targeting the 401k section of the tax code is the $80 billion dollar 'tax break' figure these Dems keep floating out there.
It absolutely GALLS them that such a number exists and they'll do whatever they can to get their hands on it.
Martinez says he wants a Gubmint funded plan that will yeild me an annual 3% ???!!! Screw that! My 401k yielded me 18% last calendar year. This kind of shiite from the Dems really p!$$3$ me off. I'll withdraw the lot, pay the penalty and burn the cash on the Capitol Hill steps before I let them get a dime. If this goes through and they get what they want....there will be blood in the streets.
Uh, we haven’t lost any money in our 401Ks. We moved the money to a stable fund about 5 months ago, and we’re doing just fine, thank you...don’t need the gubmint to tell me what to do with our money.
We’ll cash out and take the penalties and tax before we’d let them be administered by the SS Administration.
First the ‘Rats crashed the stock market and now they want to confiscate what’s left of our retirement savings.
I'd like to say that it's because people are incredibly stupid. But I think that its more that people are incredibly uninformed. They knew not what they were voting for.
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