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Signed into law the end of Sept 2016. Just curious what you all think about this so far.
It allows typical Californians whose employers have5+ employees -and- DO NOT offer a typical retirement plan, to participate in this State Retirement Plan called Secure Choice. From what I gather, you can opt out.
Otherwise they will likely take 3% of each paycheck to deposit to a ROTH IRA Account. Penalty free withdraws after age 65 with a few exceptions beginning at age 59 1/2 for certain expenses.
I have a 401k I'd like to roll over from my second employer (still employed) later on... to get tax free distributions in my Senior years
You didn't vote for it. It went to committee, passed, to house, then passed, then to senate, so passed house and senate then to governors desk. Governor Brown signed into law. Something akin to that
The first three years not so good because they will be working it out.
They will invest in safe bank securities like treasury bonds which yield 1% or less.
1% would be high to manage this so the fees plus little interest accrued will likely come out as a wash.
Thus inflation will make the "investment" a loser. The investments can not be in instruments that will not grow as they approach retirement. Seems very misleading to tell these wage earners that they have a good government retirement plan when they could do better in a ROTH or regular IRA.
In short they have to save more than a dollar to day to pay for there expense in retirement. Thus they might need to set aside 30 years of living expenses. If they are low wage earners how can they afford to save this much?
They have problem investing for CALPERS so why take in more.
Quite likely the whole idea behind it is to help bail out CALPers.
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