Posted on 11/19/2020 7:43:27 AM PST by SeekAndFind
I doubt it, because the state government workers, teachers, etc. all feel that they have SACRIFICED to be in PUBLIC SERVICE for all those years, and are entitled to their huge retirement benefits. They believe they would be so much better off, had they opted to work in the private sector for their careers.
So, no. They will be the last to be considered for any penalties. In fact, it is more likely that OUR money is taken, to prop up their public pensions.
JMHO
Well, they might not like me if I have nothing left to lose.
If you worked in the private sector, you’re bad, and we need to take your money.
How much is a government pension worth? With healthcare? An awful lot more. A new retiree in California (CalPers) gets more than $40k a year. Over twenty years (60-80), that’s $800k, which doesn’t include healthcare benefits and coverage. By the way, there are 1.6 million receiving CalPers benefits. Add the other 49 states, Federal government, etc. Who outnumbers who?
All the government pensions are underfunded. The game is to take private retirement accounts, and use them to fund the government pensions. Denigrating the private sector employees who don’t receive pensions is the start of the game.
You are probably correct. That is way the government operates and it is selective socialism at it worst. And they will have a lot of advocates in the government considering State employees work for the government. They are beholding to each other.
Folks...the most obvious thing that is missing from this discussion is how can this be accomplished?
If government decides to confiscate 401k’s, then it will be worthless for both them an us...The majority is stock based, so someone has to sell stocks to get some value. If government all of sudden “owns” our stocks, then stock market would crash immediately.
The fear alone of govt take-over ahead of time (they wouldn’t be able to do this immediately - got go through Senate, House, etc...) would cause the general population to start selling (even at a penalty), which would also cause a crash.
I think, the process will be very gradual....like including a 1% buy, 1% sell tax just like Mutual Fund Managers do, so that it doesn’t have such an impact to the stock market. Stinks, but much more tolerated by everyone. The question will be how much is the fee? Existing, grandfathered Balances, could also be taxed at a small annual rate so as to not affect stockmarket….
Sure. In most 3rd world countries that would be considered lower middle class.
RE: 260,000 millionaires... Out of a US population of 328,000,000
Note the article: Fidelity said client balances of more than one million dollars for 401(k) accounts increased to 262,000, up 17% from the previous quarter.
That’s just Fidelity. What about the other hundreds of 401(k) trustees like Vanguard, T. Rowe Price, TD Ameritrade, etc.
They have already floated confiscation with a new goobermint means tested replacement
Ok - let’s multiply that by 4 - one million millionaires out of 328,000,000
That’s proof of income inequality?
That's my story too. While our associates were going on cruises and Disney trips, we were taking modest driving vacations. While they were buying mcmansions, we were buying a modest home. We still have a few years to go before using the 401k, but are nearly a millionaire, and it just pisses me off that the government is going to claim it is unfair.
Screw them. If you take my 401k I want a yearly cruise or trip to Europe, or whatever.
And if you "forgive" student loans, I want a refund on what I paid (and missed other vacations and toys because).
Multiply that by the hundreds of the other number of asset management companies. I just mentioned 4 of them, the etc. at the end are for hundreds of others.
It’s STILL a microscopic amount. It’s not proof of income inequality at all.
And note the article doesn’t make the assertion based on “all of them” it bases it just on Fidelity’s numbers.
“Hey! If you put that in amount 30 year Treasuries (after paying income taxes on the principal leaving maybe $700K) @ 1.62% you could get 11 or 12 thousand dollars a year for doing nothing!”
I remember when i was in Jr. High you could get 12-15% via a CD. Now, after saving a lifetime to accumulate some $$, you get 1.62%!!!!
“A million in a 401k isn’t wealthy.”
______________________________
That’s the truth. I know from experience it *sounds* like a lot.
Folks are living off those 401Ks. They set monies aside their entire working lives, to prevent themselves from having to rely on any welfare system in their older years. These people knew from the beginning that the Social Security System was set up as a part of retirement, not the entire retirement amount.
I believe that as the Welfare System grew, it caused the older folks or middle-aged working class to assume the Social Security System would also give them the funds to live as they lived during their working years.
Hope that makes sense.....
Oui are on the same page.
Using the 4% rule, which is the maximum amount you should draw from a 401(k) to ensure it lasts over your lifetime, that will amount to $40,000/year.
Added to the average Social Security benefit of $1,514/mo (or about $18,000/year), the average 401(k) millionaire might have around $60,000/year to live on the rest of their lives. Maybe $100K on the upper side of things (with the maximum Social Security benefits)
Now that's not too shabby for most but hardly the lifestyle of a millionaire that most of us picture with the carefree lifestyle on golf courses, yachts, chauffeured limos, munching on cold shrimp from an iced bowl, etc.
With $2.5 million, now you can easily draw $100,000 a year and your Social Security checks can be used as play money. That's what most of us should be aiming for.
They’ll make a move on 401k plans soon. They’ve been talking about doing it for years.
You didn’t really think they were going to leave all that money just sitting there, did you?
L
“ This article is nothing more than setting up the 401k steal.”
Yep. This plan goes back more than a decade. Google up Teresa Ghilarducci sometime.
L
Lot of grasshoppers out there.
Not exactly. It took 70 years for that dollar to become today's 9 cents. Anybody retiring today with a million dollars will be long dead before they need to worry about that.
Also, you are not taking into consideration the earnings on that million dollars (if invested wisely).
A million dollars is actually not terrible for a typical new retiree collecting social security at age 67. Taking 4% of that in the first year of retirement is about $40,000. If the person is making about $2,000/mo in social security (conservative), the total income is now $64,000. Not counting any extra money a retiree can pull in doing side work. That is more than adequate for most people. Especially if you retire debt free (which you should).
That brings the balance down to $960,000 after the first year but even if invested conservatively, you will likely get at least a 3-5% return, putting you right back to about where you started.
If you stick to the 4% rule, you will not run out of money for at least 30 years, but which time you will be 95 and probably content to just sit in your rocking chair and collect what's left of social security. Most retirees will never see 90, never mind 95.
But I just described worse case scenario (for one with a million dollars in retirement savings). If the past 30 years are any guide, and you stick to the 4% rule, you will see much better than 3-5% annual returns. In that case, your nest egg will continue to grow as you age and you'll be leaving your kids with a million bucks or more.
I think people worry too much about retirement. Work as long as you can, save as much as you can, and you will find a way. But a million dollars in a 401k makes a comfortable retirement very doable (despite many saying it's not enough).
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