"Your " Nest Egg safe in the Government's Hands

A very scary scenario indeed:

401k/IRA Screw Job Coming? - The Market Ticker

 

Well as I see it the 401(k) system is already a government deal, the government giveth, they can take away. Here is another article about the same issue,

Goto:

6 Ways Employers Will Change 401(k)s in 2010 - Planning to Retire (usnews.com)

I rolled over my 401 when I left the farm/ranch way back when and put it into the one with the trucking company I was driving for. When I needed the money for medical charges after I had stopped driving and didin't have any other than Medicare I cashed it out and used it to pay my bills the Medicare didn't cover.

Not something I have to worry about any more, for all of you who still have a retirement account, I envy you. I don't have squat.

 

I'm with ya Clint, live day to day but always have, the safest bet indeed, financial institutions could close for a matter of reasons screwing everyone

 

I have only been contributing to 401(k) for about four years now. The company contributions far outweigh what I've been able to put it, which is only about 1% per week. I lost some money last year like everyone else, but nothing compared to some of my co-workers who have been putting in for a long time. I don't want to keep trusting my retirement funds to the 401(k) but don't know what else to do. I have been thinking of going to talk to a professional but with what little I have to put away right now I don't know if anybody will be willing to deal with me. It's pretty damned scary.

 

if you feel compelled Luke then do so, what the hey, if you have nerve a strong will then just go for it, went in my own business's back in 1980 tired of being driven by the task master, taking work home and stewing with stress pressures beyond reason my family life sucked due to it ............ be free man !

 

Made an appointment to go talk to a financial planner...I'll see what he has to say, I told him what I make, what I can afford to put away. He didn't hang up on me anyways.

 

I suppose its a good thing that I won't have need for retirement money for another good 50 years or so.

 

The best thing I can suggest is to invest money in some good stock-like what im doing and are going to do. When I quit working for th State-I HAD to take my money out of my 401 and got penalized 1/4th of the total amount fordoing so. I got screwed out of alot of money that was rightfully mine-so ever since then-investing in Stock is the way to go.

 

I got whacked with a 40% hit (taxes, charges, whatnot), but the really interesting thing was that the investment folks were claiming a profit every time, and yet there was still less money in my account than I put in (before the hit). How could there be less in the plan than I put in if they were making money every quarter?

 

because they are ALWAYS going to make money. Being in financials today is like the new black magic.

 

I suppose I should be taking notes for future reference.

 

Another retirement type to look into is the Roth type, this takes the government out of the picture at the end (when you retire) when you start to withdraw from the account. You pay taxes on it "upfront", and for the next two years there is a "break" on how you pay. But the upside is that when you retire you DO NOT pay taxes on the withdrawals, and they DO NOT count against your income which might be taxable. Say you have "x" investments which pay you on top of your Social Security income, that can put you SS payment into a taxable income bracket. The income from a Roth account won't. Simple as that, you pay no tax on the money coming from a Roth account in your retirement years, and it doesn't count as income in addition to your Social Security checks. Leaves them neutral.

Or at least that is the way they used to be set up when I last looked into putting some increments of my 401 into a Roth when they first showed up in 98. However my medical expenses put the end to that consideration. On the 401 your income tax is put off until the end, but it is taxed when you withdraw it, or like Carl and myself you pay a penalty for early withdrawal. That penalty is to offset the "tax break" you got when you put money inot the 401 and didn't pay tax. They aren't taking "your money" in the whole amount, they are taking "their tax" you didn't pay and a 10% penalty. That was set up to keep you from taking the money out until it's maturity and your retirement. A 401 set up by a state may be somewhat different than one set up by a private employer, but the state and federal tax was not collected on the deposits in the private ones.