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antigop Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jan-15-09 10:12 AM
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56. Here's how it could be worse: 2008 shows risks of privatizing Social Security
Edited on Thu Jan-15-09 10:12 AM by antigop
http://money.cnn.com/2009/01/13/news/economy/sloan_reti...


If your year-end 401(k) statement made you feel like barfing, I have one consolation for you: it could be worse. How's that possible, given how horrible last year was for investors? Simple: If you're not close to retirement, you've got time to recover.

If you're in the retirement-age zone, as I am (I'm 64), at least you've got the option of hanging on until things get better. If you're in the mandatory-withdrawal part of life (more than 70 years old) or just need some retirement cash, you can take a minimal distribution this year and hope for the best.

If, however, you were forced to buy a lifetime annuity with your current balance - when you buy such an annuity, you trade your cash for a series of guaranteed payments for the rest of your life - you'd be making your loss permanent. That's how things could be worse.

That scenario is what could have happened to many people under President Bush's proposed Social Security privatization program. It would have required people of modest and very modest means who invested their Social Security taxes in the market to turn some or all of those accounts into annuities when they hit retirement age. (Yes, Bush never proposed a specific plan - but annuitizing private accounts for some people is what his 2001 Social Security privatization commission proposed.)

Alan Sloan, editor-at-large, is the author of the article.
Note to Alan: Alan, take a look around-- how many 64 year-olds do you see working at Fortune Magazine? While YOU may have the "option of hanging on until things get better", how many people have that option? How many older workers do you see at Fortune 500 companies?
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  -STOCK MARKET WATCH, Thursday January 15 ozymandius  Jan-15-09 04:46 AM   #0 
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  - Market WrapUp  ozymandius   Jan-15-09 04:52 AM   #2 
  - I'm Thinking "Pancake"  Demeter   Jan-15-09 05:21 AM   #11 
     - Yeah. We don't have a letter in our alphabet that looks like.. . .  Tansy_Gold   Jan-15-09 06:08 AM   #16 
        - Morning, Tansy! 5 More Days!  Demeter   Jan-15-09 06:12 AM   #17 
        - That's it. I said t a while ago:  Ghost Dog   Jan-15-09 08:25 AM   #30 
           - Exactly.  Tansy_Gold   Jan-15-09 08:46 AM   #38 
              - "They don't have superhuman powers" -- but they do have gold-plated health plans, retirement, and  antigop   Jan-15-09 10:00 AM   #52 
              - On that note, I have to recommend Max Keiser & Co. on the BBC!  Ghost Dog   Jan-15-09 10:14 AM   #57 
              - I am a fan of Jeopardy  DemReadingDU   Jan-15-09 11:06 AM   #70 
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        - Om  Ghost Dog   Jan-15-09 01:11 PM   #86 
           - Nice mandela....  AnneD   Jan-15-09 03:39 PM   #101 
              - Tibetan Great Wheel, I believe, yes.  Ghost Dog   Jan-15-09 05:24 PM   #108 
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  - Here's how it could be worse: 2008 shows risks of privatizing Social Security  antigop   Jan-15-09 10:12 AM   #56 
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     - What's that you say, CitiMorgue? Yea, has a nice ring to it. nt  nc4bo   Jan-15-09 12:41 PM   #82 
        - Or how 'bout  Tansy_Gold   Jan-15-09 02:12 PM   #94 
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  - That'll larn 'em for refusing me a credit card and then bombarding me with  KCabotDullesMarxIII   Jan-15-09 06:24 PM   #109 
  - Volcker group recommends regulation of financial markets  antigop   Jan-15-09 10:30 AM   #62 
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     - yeah, me, too. n/t  antigop   Jan-15-09 02:33 PM   #97 
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  - Black Angus Steakhouse Operator Files Bankruptcy  RamboLiberal   Jan-15-09 01:12 PM   #87 
  - Darn, I wanted a big ass steak to go along with my $20,000 TV set  specimenfred1984   Jan-15-09 01:27 PM   #90 
     - Can't do much about the steak, but  Dr.Phool   Jan-15-09 02:53 PM   #98 
  - Oh look! Faeries!  Roland99   Jan-15-09 01:36 PM   #91 
  - Somebody is pumping some big $$$ into Financials...  Prag   Jan-15-09 01:43 PM   #92 
  - Dem stim. package being used as excuse  specimenfred1984   Jan-15-09 02:01 PM   #93 
  - Faeries left for Happy Hour.  Dr.Phool   Jan-15-09 02:29 PM   #96 
     - I am leaving now myself...  AnneD   Jan-15-09 03:57 PM   #104 
  - "The Messiah Rally", and a Nation Of Blind, Drooling Sheep.  TheWatcher   Jan-15-09 06:28 PM   #110 
  - That's an amazing screed there, TheWatcher.  ozymandius   Jan-15-09 06:59 PM   #112 
  - Nice rant!  DemReadingDU   Jan-15-09 07:32 PM   #114 
  - I Feel For You==Take Care of Yourself  Demeter   Jan-15-09 08:54 PM   #115 
  - you are way too lucid  UpInArms   Jan-15-09 09:13 PM   #116 
  - You know as well as I that this was all decided at Gbekli Tepe 11,000 years ago.  Prag   Jan-15-09 10:19 PM   #119 
  - Here's your baked ending.  ozymandius   Jan-15-09 07:03 PM   #113 
  - lovely alliteration  UpInArms   Jan-15-09 09:15 PM   #117 
  - Minneapolis StarTribune newspaper files for Chapter 11  CatholicEdHead   Jan-15-09 09:36 PM   #118 
 

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