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Study: 401(k) Retirement Plans Failing Most Workers
CBS MoneyWatch ^ | Sep 6, 2013 | Constantine von Hoffman

Posted on 09/07/2013 6:39:30 PM PDT by Toddsterpatriot

According to a new study, the 401(k) savings account isn't adequately providing for people's retirement and is adding to the nation's growing wealth inequality.

The report from the Economic Policy Institute, a liberal-leaning public policy think-tank, illustrates how the shift from pensions to individual savings accounts has affected retirees. The authors find that it is the wealthiest workers who are benefiting the most because they can actually contribute enough to make 401(k) plans work for retirement.

"401(k)s were never designed to replace pensions for most workers. They serve primarily as a tax shelter for high earners," said economist Monique Morrissey, the report's co-author, in a statement. "The 401(k) revolution has been a disaster, yet some policymakers are calling for cuts to Social Security, which will be the only significant source of retirement income for most Americans--if they are able to retire in the first place."

Snip...

According to the report:

Retirement-income inequality has grown in part because most 401(k) participants are required to contribute to these plans in order to participate, whereas workers are automatically enrolled in defined-benefit pensions and, in the private sector, are not required to contribute to these plans. Thus, higher-income workers are much more likely to participate in defined-contribution plans. In addition, higher-income workers have more disposable income and a higher investment-risk tolerance, receive larger tax breaks, and are more likely to work for employers that provide generous matches.

(Excerpt) Read more at finance.yahoo.com ...


TOPICS: Business/Economy; Humor
KEYWORDS: epi
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Imagine how much better they'd work if you could put your 12.4% Social Security "contribution" into your 401k.
1 posted on 09/07/2013 6:39:30 PM PDT by Toddsterpatriot
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To: 1rudeboy; Mase; expat_panama; Rusty0604; Jim 0216; xjcsa; VegasCowboy; 10Ring; Bishop_Malachi

EPI......Ping!


2 posted on 09/07/2013 6:40:26 PM PDT by Toddsterpatriot (Science is hard. Harder if you're stupid.)
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To: Toddsterpatriot

I think the goal is to do the reverse, steal all the 401K money and prop up social security.


3 posted on 09/07/2013 6:41:07 PM PDT by Vince Ferrer
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To: Toddsterpatriot

Time to confiscate those evil 401(k)s.


4 posted on 09/07/2013 6:41:28 PM PDT by E. Pluribus Unum (When your policy is to rob Peter to pay Paul, you can count on enthusiastic support from Paul.)
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To: Toddsterpatriot
...wealth inequality.

I know exactly where this is going.

5 posted on 09/07/2013 6:42:23 PM PDT by BitWielder1 (Corporate Profits are better than Government Waste)
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To: Toddsterpatriot

BS

Most workers failing the 401k plans.


6 posted on 09/07/2013 6:42:26 PM PDT by CincyRichieRich (“Life is hard, but it’s harder when you’re stupid.” John Wayne)
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To: Toddsterpatriot

Just because higher earners are able to leverage more benefits from 401K’s does not mean pensions are better investment instruments than 401k’s for the average worker.


7 posted on 09/07/2013 6:44:04 PM PDT by Fzob (In matters of style, swim with the current; in matters of principle, stand like a rock. Jefferson)
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To: Vince Ferrer
Of course. Can't have a private solution that works much, much, much, much, much better than the government one.

I may have left out a much or ten.

8 posted on 09/07/2013 6:44:11 PM PDT by Toddsterpatriot (Science is hard. Harder if you're stupid.)
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To: Fzob

How’d those Delphi pensions do for the average worker?


9 posted on 09/07/2013 6:45:56 PM PDT by Toddsterpatriot (Science is hard. Harder if you're stupid.)
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To: Toddsterpatriot

contradictory.

if the accounts are causing a measurable “wealth disparity,” then people are certainly saving enough money to help their retirements

since the article does not make any other sense, our “propaganda alarm” is emitting a high pitched warble /..


10 posted on 09/07/2013 6:49:35 PM PDT by faithhopecharity (E)
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To: Toddsterpatriot
Great. First we get the scare tactics of how our 401(k)s are failing us. Next, we will be told how the government will do a much better job running our 401(k) investments than our current private investors. And next thing you know, our 401(k) funds will hold the same value as our current Social Security Trust Fund.

No thanks, keep your damn hands off my money. I'll decide what's best for me.

11 posted on 09/07/2013 6:50:02 PM PDT by Hoodat (BENGHAZI - 4 KILLED, 2 MIA)
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To: Toddsterpatriot

Are we being setup for the grab?


12 posted on 09/07/2013 6:53:32 PM PDT by rockinqsranch (Dems, Libs, Socialists, call 'em what you will. They ALL have fairies livin' in their trees.)
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To: Toddsterpatriot
Imagine how much better they'd work if you could put your 12.4% Social Security "contribution" into your 401k.

What the hell are you trying to do? End the cycle of poverty in this country? Have people actually build up an inheritance that they can pass down to their family when they die? Don't be such a hater. Big Brother knows what's best.

13 posted on 09/07/2013 6:54:20 PM PDT by Hoodat (BENGHAZI - 4 KILLED, 2 MIA)
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To: Toddsterpatriot

Poland Confiscates Half Of Private Pension Funds To “Cut” Sovereign Debt Load...

http://www.zerohedge.com/news/2013-09-06/poland-confiscates-half-private-pension-funds-cut-sovereign-debt-load

(I left mine at it’s peak, several years ago, and took the penalty. No regrets. No worries.)


14 posted on 09/07/2013 6:57:20 PM PDT by PGalt
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To: Toddsterpatriot

They should allow 401k plans, both employer provided and individual, the option of converting all funds to a regular savings account every 5 years. Remove the 10% early retirement penalty and offer a flat 15% tax rate and you’d see over 6 trillion in 401k balances convert providing a tax windfall for the government and a huge savings for retirees.


15 posted on 09/07/2013 6:57:50 PM PDT by RockyMtnMan
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To: Vince Ferrer

Exactly. These are the arguments they use to nationalize private retirement accounts. Low income people can’t save so it’s not “fair” and possible stock losses are not as safe as letting the gov’t keep it for you and doling it out to you when they deem fit.


16 posted on 09/07/2013 6:58:11 PM PDT by Rusty0604
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To: Toddsterpatriot

401s not making it? No kidding. NO growth in the economy, no return on investments.

Rate of return on stocks = inflation + dividend yield + GDP


17 posted on 09/07/2013 6:58:40 PM PDT by Sequoyah101
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To: Toddsterpatriot

Here it comes

We now are going to start hearing a lot more of these type of stories and “studies” in the coming months


18 posted on 09/07/2013 6:59:02 PM PDT by qam1 (There's been a huge party. All plates and the bottles are empty, all that's left is the bill to pay)
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To: Toddsterpatriot

The 401k was a great thing. The problem is convincing younger workers to utilize it to the max and not borrow against it.


19 posted on 09/07/2013 7:06:31 PM PDT by Lurkina.n.Learnin (If global warming exists I hope it is strong enough to reverse the Big Government snowball)
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To: Hoodat

Exactly this is the setup to seize these accounts for a broke gov.


20 posted on 09/07/2013 7:08:45 PM PDT by sarge83
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