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Showing Original Post only (View all)401(k)s are a sham: Duped by a DIY retirement dream, elderly face staggeringly low living standards [View all]
For retirement, the answer is 4-0-1-k, proclaimed Tyler Mathisen, then editor of Money magazine in 1996. I feel sure that someday, like a financial Little-Engine-That-Could, it will pull me over the million-dollar mountain all by itself.
For this sentiment, and others like it, Mathisen was soon rewarded with an on-air position at financial news network CNBC, where he remains to this day. As for the rest of us? We were had.
The United States is on the verge of a retirement crisis. For the first time in living memory, it seems likely that living standards for those over the age of 65 will begin to decline as compared to those who came before themand thats without taking into account the possibility that Social Security benefits will be cut at some point in the future.
The culprit? That same thing Mathisen celebrated: the 401(k), along with the other instruments of do-it-yourself retirement. Not only did they not make us millionaires as self-appointed pundits like Mathisen promised, they left very many of us with very little at all...
According to a recent report issued by the National Institute on Retirement Security, the median amount a family nearing retirement has saved for their post-work lives is $12,000. As for the magical 401(k)? If a household where the earners are between the ages of 55 and 64 does have a retirement account, they barely hit the six-figure mark at $100,000a far cry from $1 million were told we need.
Yet whether the stock market goes up, down or sideways, the financial services sector makes out when it comes to your retirement accounts. How much do they earn? Astonishingly, we dont know the answer. In 2008, Bloomberg magazine polled a group of pension consultants and came to the conclusion that 401(k) fees alone totaled $89.1 billion annually...
http://www.salon.com/2013/08/06/big_finance_lied_401ks_will_not_save_aging_americans_partner/?utm_source=facebook&utm_medium=socialflow
The IRS recently changed the rules for IRA rollovers, which means that now you can only rollover one IRA a year, once a year. Does anyone understand the ramifications of this?
It ticks me off because I feel like it's designed to get you to put all the money in one IRA so it's easier to steal.