Posted on 03/07/2014 7:00:22 AM PST by SeekAndFind
OK...Got it. Now somebody explain to me why this is my or any other American's problem?
This will be totally ignored because:
Low income and minorities don’t save as much and everything needs to be equal;
And the gov’t needs retirement accounts that must invest in U.S. Treasuries as the Fed tapers QE
Because the government will MAKE it your problem.
I dont understand this. CPS did a study on income in retirement but left out people’s 401K distributions? That’s like studying how many calories people eat in a day and leaving out dinner and snacks.
Probably because most don’t save a significant amount in 401k to matter.
“Probably because most don’t save a significant amount in 401k to matter.”
I thought the point of the story was that they did but CPS ignored it. That’s was why their income was greatly underestimated.
“Schieber noted that in its statistics, the CPS does not account for at least 95 percent of IRA distributions and at least half of pension and annuity income.”
save for later
I think the real issue is that a very small percentage of the population have substantial IRA accounts. The ones who do, raise the average by a very large amount, but it might be less than 25% of the retired population. The other 75% don't have much.
I am not going to fall into the Obama trap of calling these the "lucky few". Luck has very little to do with having a meaningful IRA. Those who don't have one, think it is all luck and that the government has a duty to even it all out. But those who do have significant savings know that it comes from a lifetime of paying attention, listening to advice about retirement, and actually choosing to defer consumption to a later time.
And, the socialists who look at IRAs and say the top few percent should be taxed more never seem to realize that for most, a larger IRA represents the result of 40 years of doing without new cars, vacations, and lots of things their neighbors considered "necessities".
You said it. My wife and I forgo many luxuries and little pleasures, trying to save for retirement. We should not be punished later, because we're making sacrifices now.
A socialist has never seen a substantial bank account he didn't want to take away and spread around for the "common good".
RE: I think the real issue is that a very small percentage of the population have substantial IRA accounts.
OK, here’s a question -— what does “substantial” mean when it comes to IRA?
How much must one have in one’s IRA for it to be considered “substantial”?
I'll take a stab at it. $100K is low end substantial and $3.2M is high end substantial. The administration is proposing doing away with RMD for accounts under $100K and capping accounts at $3.2M.
They also have a proposal to require RMD for Roth accounts..
Which brings to mind the quote attributed to Leon Trotsky, "You may not be interested in war, but war is interested in you".
That's the point, isn't it?
Until the money is used up.
Then social upheaval and dictatorship.
This is interesting. I’ve heard from several liberal democrat sources that the reason so many people are retiring is because the economy is going so well that the baby boomers can retire with their new found wealth.
Now it’s a crisis.
Democrats, is there anything they can’t Fluke up?
I would go a little higher and say that about $250k is the beginning of substantial. There is no higher limit on substantial, but due to the limits of 401(k) contributions an individual with $3+ M is either very highly paid, or a very good portfolio manager.
While there is no towering giant in the field of portfolio management in distribution, like there are in the portfolio management in accumulation field, the very best advice I have seen is that ~5% of the current value of a portfolio can be withdrawn every year without too great a risk of depletion. I am hoping to live with 4% annual withdrawals, which would be much more safe. But then I am a conservative and that is what we do. But, the portfolio must be almost entirely in stocks for that to work. The 40% fixed income - 60% stocks I see from most advisors does not allow that kind of withdrawal.
Even a meager income from a pension or SS allows variable portfolio withdrawals to be a very viable strategy in distribution.
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