stephanie
11-15-2008, 06:03 PM
they are coming after our money..what this has to do with Rush, ya got me...
Posted by Justin Fox | Comments (9) | Permalink | Trackbacks (0) | Email This
The American system of retirement saving is in big trouble. Not so much Social Security: That has some long-term funding issues, but they are--actuarily, if not politically--easily fixable. The big problems are with workplace pensions and retirement accounts.
As everybody knows, the corporate pension system that evolved after World War II is on its last legs. Its replacement, the 401(k), just isn't very good. It has improved some over the past couple of years, as many companies have taken the lessons of behavioral economics to heart and rejiggered their 401(k)s to encourage more saving and more rational asset allocation. Congress passed legislation in 2006, sponsored by noted leftist agitator John Boehner, encouraging them to do just that. But 401(k)s still leave individuals extremely exposed to market swings--as we've relearned over the past couple months--and huge segments of the American workforce either don't take full advantage of 401(k)s or don't even have access to them.
So there's the been lots of talk in the retirement wonkosphere over the past few years about the need to do something more. One suggestion I've heard repeatedly is that we should create some sort of new retirement savings account--a universal IRA, you might call it. You could choose to opt out of, but if you don't opt out it siphons a portion of your wages every year and tops it off with a government subsidy. Barack Obama included such accounts in his campaign platform, but I first heard the idea from Republican economist Marty Feldstein, so it has pretty broad bipartisan support.
These accounts would insure that all American workers have some sort of retirement savings, but they'd still suffer from the existing flaw of 401ks and IRAs in that they would subject individuals to an awful lot of market risk. They'd also cost a bunch of money, which would have to come from somewhere.
read it all and comments.
http://curiouscapitalist.blogs.time.com/2008/11/14/the-plot-to-keep-us-from-fixing-retirement/?xid=rss-topstories
Posted by Justin Fox | Comments (9) | Permalink | Trackbacks (0) | Email This
The American system of retirement saving is in big trouble. Not so much Social Security: That has some long-term funding issues, but they are--actuarily, if not politically--easily fixable. The big problems are with workplace pensions and retirement accounts.
As everybody knows, the corporate pension system that evolved after World War II is on its last legs. Its replacement, the 401(k), just isn't very good. It has improved some over the past couple of years, as many companies have taken the lessons of behavioral economics to heart and rejiggered their 401(k)s to encourage more saving and more rational asset allocation. Congress passed legislation in 2006, sponsored by noted leftist agitator John Boehner, encouraging them to do just that. But 401(k)s still leave individuals extremely exposed to market swings--as we've relearned over the past couple months--and huge segments of the American workforce either don't take full advantage of 401(k)s or don't even have access to them.
So there's the been lots of talk in the retirement wonkosphere over the past few years about the need to do something more. One suggestion I've heard repeatedly is that we should create some sort of new retirement savings account--a universal IRA, you might call it. You could choose to opt out of, but if you don't opt out it siphons a portion of your wages every year and tops it off with a government subsidy. Barack Obama included such accounts in his campaign platform, but I first heard the idea from Republican economist Marty Feldstein, so it has pretty broad bipartisan support.
These accounts would insure that all American workers have some sort of retirement savings, but they'd still suffer from the existing flaw of 401ks and IRAs in that they would subject individuals to an awful lot of market risk. They'd also cost a bunch of money, which would have to come from somewhere.
read it all and comments.
http://curiouscapitalist.blogs.time.com/2008/11/14/the-plot-to-keep-us-from-fixing-retirement/?xid=rss-topstories