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But apparently I don't make enough money to invest.
Of course you do...start with a small percentage, up to the company match if possible. You seem to be too worried about some chart which didn't go down to $20k income. Don't let that keep you from investing. I've had jobs like that much of my working life and always signed up for the 401k at each and every company. Even rolled the 401k over into a new employer's 401k when changing jobs. Also started a Roth IRA four years ago when I turned 50. I started slow at first. At 29, you have 35+ years to save. The key is to just start. I've also worked two jobs at different times during the past 30 years which can certainly help. No, it won't be easy and you may feel frustrated at times making a low wage. But a lot of your success will depend on your outlook on life. Make friends, find a hobby you enjoy or can possibly turn into an income source, enjoy your time off doing things you like whether it be reading or going to a (free) museum or something in your city you had not done. You sound depressed and I do wish you the best. Your situation is not rare.
Of course you do...start with a small percentage, up to the company match if possible. You seem to be too worried about some chart which didn't go down to $20k income. Don't let that keep you from investing. I've had jobs like that much of my working life and always signed up for the 401k at each and every company. Even rolled the 401k over into a new employer's 401k when changing jobs. Also started a Roth IRA four years ago when I turned 50. I started slow at first. At 29, you have 35+ years to save. The key is to just start. I've also worked two jobs at different times during the past 30 years which can certainly help. No, it won't be easy and you may feel frustrated at times making a low wage. But a lot of your success will depend on your outlook on life. Make friends, find a hobby you enjoy or can possibly turn into an income source, enjoy your time off doing things you like whether it be reading or going to a (free) museum or something in your city you had not done. You sound depressed and I do wish you the best. Your situation is not rare.
In other words, the employer/highest earners NEED the lower income bodies to smooth out/GET the tax credit that the US TAXPAYER is loaning the company’s 401k plan! Coincidently, the employer benefits the most, since he’s probably the highest wage earner. Bernie Madoff would be proud!
Also, & this is very important: an animosity arises when the employer has to dish out his own money to get his tax benefit that he feels the non-participating employee should be contributing to! With a little dubious imagination, the employer can construe that the employee is benefiting from a claw-forward salary increase.
This is classic crony-coercion by the employer & the higher paid employees. As I mentioned in this thread already; there’s a lot of middle/upper income welfare going on in the USA!
And if there weren't rules against "top heavy" retirement plans, you (or someone else) would be screaming about how no one cares about the poor and the high income folks keep the plan all to themselves. It seems to be a no win situation.
Quote:
Originally Posted by DSOs
In other words, to mitigate risk, 401ks will produce returns to that of CD rates of 2005.
Say what??? 401ks don't have guaranteed returns. No one knows what stocks and bonds will return over the long run. All we have is a historical evidence of what they've returned in the past.
Since 1929 through 2011, the year the Great Depression started, large company stocks have returned 11.11%. Inflation adjusted, they returned 9.1%. No one knows if that will continue in the future.
^^Do you understand what “top heavy” means? It means your plan is not eligible for a tax credit because the middle/upper income participants’ are well off already.
So to mitigate this situation, you need some lower income bodies to smooth out the richness; which now makes the middle/upper income eligible for tax deferred welfare! Bernie Madoff would be proud.
Last edited by DSOs; 06-14-2012 at 11:32 AM..
Reason: one paragraph
I visited the Dave Ramsey website, under the getting started > budgeting section, and the lowest monthly income is $3,000
At work, Vanguard had one of their representatives come out and give a retirement class. In the pamphlet they handed there was a chart giving examples of how much money one could theoretically earn over the years (401k), and the lowest wage they had on the chart was $30,000.
I could continue with Suze Orman, this forum itself ("Business, Finance, and Investing"), and on...
I get it, i'm a looser. I try but my whole childehood was abusive, I have SAD, and latter I ended up with combat PTSD. I'm gathered and doing better, but at the age of 29 years and only making $11.86 an hour at a warehouse - with no direction in life, I just want to die
People who make good money do so through giving their life direction. They have a plan. No plan? No money! It's not like anyone is going to do it for you.
I visited the Dave Ramsey website, under the getting started > budgeting section, and the lowest monthly income is $3,000
At work, Vanguard had one of their representatives come out and give a retirement class. In the pamphlet they handed there was a chart giving examples of how much money one could theoretically earn over the years (401k), and the lowest wage they had on the chart was $30,000.
I could continue with Suze Orman, this forum itself ("Business, Finance, and Investing"), and on...
I get it, i'm a looser. I try but my whole childehood was abusive, I have SAD, and latter I ended up with combat PTSD. I'm gathered and doing better, but at the age of 29 years and only making $11.86 an hour at a warehouse - with no direction in life, I just want to die
Its almost a taboo subject to discuss the millions out there on poverty wages or the working poor, or the amount you earn after tax, high property prices, the millions in insecure jobs, the people who will retire with no pension - a minimum wage rise is looked on with horror, politicians avoid the issue, and those that do talk about are not elected.
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401ks don't have guaranteed returns. No one knows what stocks and bonds will return over the long run. All we have is a historical evidence of what they've returned in the past.
