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I am assuming that you mean me. Well, we have been retired for about 15 years. We get Social Security, we have IRAs, which we paid for our selves and we have some CDs that we can draw one when we need them. The house and two cars are all paid for and we pay off our credit cards each month.
The CDs are from money that we saved each month. Savings grow slowly, but they are safe.
I see. I am in my early 30s, I'll never see a penny of SS, I have a Roth IRA I fund each year, I have a trust fund inheritance ($70K), my car is also paid off, and I also pay off my credit card in full each month. And I fund my 401K up to my company's match (7%) on top of the 10% profit sharing contribution. I live WAAAY below my means (I sleep on my couch, my TV is nine years old, I spend under $100/month on groceries, etc.) especially now while I'm saving for a home.
It sounds as if you feel contributing to a 401K or even working for a company that offers a 401K is unethical or immoral. As if you resent this scam perpetrated on honest folks (by the 440,000+ companies that offer 401Ks) who have to "pay for it." I have to say I feel a similar resentment toward SS.
But I also believe that in a capitalist system, prosperity and wealth can be created out of thin air: Eject! Eject! Eject!: TRINITY (part 1) . I don't feel that my employment benefit is screwing people over. Either way, would you have me forego investment in my 401K? As far as I can tell, it's the strongest wealth-accumulation vehicle available to me by a huge margin.
I've just never encountered the theory that the 401K is the root of all evil as in this thread, so I find it a curious viewpoint.
I'm sorry!! I think I did not make it clear what I was trying to explain. When a company contributes to a 401K for it's employees, it's a good thing....BUT it does increase the cost of doing business. It is an expense. If the company did not increase it prices of product/service, to offset the contribution, they would operate with less profit. There's no way that they would reduce salaries, or cut dividends to fund this 401 contribution. The funds must be generated at the point of sale. Therefore, all customers pay for your retirement plan.
Sooooo, depending on what the product/service is, the customer or client pays the additional cost of the 401K contributions. On a regular 100% company funded retirement plan, the entire cost would be paid by the customer. So in that way, the 401K is the better plan. It's just very unfortunate that some plans invested unwisely.
Please don't get me wrong. The 401K retirement is a good savings plan, but since Companies don't pull money out of thin air, it has to come from somewhere.
It's the same with Social Security. The Company has to contribute an equal amount as the employee. The expense is added to the cost of goods/services. You help pay for my Social Security check, other people help fund your 401K plan.
I put in 7% of my salary, my company adds 17% of my salary, where's the conspiracy?
Wow that's a very generous company. On a hypothetical $100k a year salary, you put $7,000 and your company contributes $17,000. Wow that return is over 200%. Mutual managers would kill for this kind of return. Heck, Warren Buffet would kill for this kind of return. Would you mind telling us what company you work for?
Wow that's a very generous company. On a hypothetical $100k a year salary, you put $7,000 and your company contributes $17,000. Wow that return is over 200%. Mutual managers would kill for this kind of return. Heck, Warren Buffet would kill for this kind of return. Would you mind telling us what company you work for?
I'm in operations/engineering for a large financial firm. The company match was increased from 5% to 7% when the pension program was liquidated and distributed last year. The other 10% is a profit-sharing contribution that includes overtime if non-exempt but excludes bonuses if exempt.
I agree it is a strong program. The medical benefit is also very generous (I pay $35/month). In return, the salaries are about 15% lower than they would be at a competitor firm.
And where exactly does the money your company adds come from? It's comes from increasing the price of products or services that the rest of us use. So in a sense, Mr. and Mrs. Everybody Else pays the biggest part of your 401K.
Is this fair?
its beyond fair
nobody makes them by whatever products his company is selling
any compensation he makes (be it salary health insurance 401k contributions from his company) come from company profits which come from customers
following your logic he should get no compensation and his company should give everything away for free
I'm sorry!! I think I did not make it clear what I was trying to explain. When a company contributes to a 401K for it's employees, it's a good thing....BUT it does increase the cost of doing business. It is an expense. If the company did not increase it prices of product/service, to offset the contribution, they would operate with less profit. There's no way that they would reduce salaries, or cut dividends to fund this 401 contribution. The funds must be generated at the point of sale. Therefore, all customers pay for your retirement plan.
Sooooo, depending on what the product/service is, the customer or client pays the additional cost of the 401K contributions. On a regular 100% company funded retirement plan, the entire cost would be paid by the customer. So in that way, the 401K is the better plan. It's just very unfortunate that some plans invested unwisely.
Please don't get me wrong. The 401K retirement is a good savings plan, but since Companies don't pull money out of thin air, it has to come from somewhere.
It's the same with Social Security. The Company has to contribute an equal amount as the employee. The expense is added to the cost of goods/services. You help pay for my Social Security check, other people help fund your 401K plan.
social security is a ponzi scheme and total theft. It is not remotely similar to a 401k.
to start with a 401k is volentary social security is forced
it is a ponzi scheme because the people at the bottom are paying for the people who got in first- except as people are finally realizing, what eventually happens is there isnt enough to pay for the new people at the top, so eventually people who bought into it will get exactly nothing
even with the bad stock market of late, anyone who has more than 2 brain cells would have a far greater return on their money if they had invested it than they will thru social security. The govt does nothing but waste your money and provide you with paltry if any returns. At worst SS should be privatized and at best it should be abolished.
Social Security could become an actual pension plan in addition to being minimal income insurance if we simply applied the tax to all income from all sources, possibly in a progressive manner by setting some minimum income exemption, and tapped into the executive compensation racket. I am quite pleased that my SS contributions have been kept away from the gamblers on Wall Street. Just look at what is going to happen to that casino over the next couple of years.
In a few years I will be living on my retirement, including reasonable health care, Social Security and what ever is left of my IRA. I barely trust government to provide for some of my retirement but I am certain that the private sector will eventually lose much anything I invest. My only recourse at this point id to leave the IRA alone and eventually use it for my funeral expenses.
I happened to catch a bit from CNN and Rick Sanchez last night on the lifestyle of some of the power people on Wall Street and their top advisors. It was kind of sad just how much the theme within that group was of "keeping up with the Joneses." I knew that there was a lot amount of competitiveness in people that driven to make money, but what seemed lacking in this examination was any indication of their creativity, personal expression, or greater goals. (Buying a couple of multi-million dollar mansions and hiring a decorator is not an indication of creativity, but an indication of trying to one-up one's peers.)
For all the money and possibilities that money brings, I came away from the program feeling unimpressed and even a bit sorry for some of the gamers. The world they live in seems to be a high-pressure geekdom or casino life, with goals that relate more to trappings than substance.
I wonder how much of the excesses of the market can be laid directly to that disconnect with the rest of society, and the valuing of the game more than any set of greater values? I expected to be irritated by the unvarnished greed of some of these people, but instead found myself shaking my head and thinking that many of them were nothing but a bunch of losers who were lost in the game.
For those of us with at least a passing interest in the philosophies that guide people, I think the situation provides an instruction on the pitfalls of ethical egoism. Ethical egoism - Wikipedia, the free encyclopedia
The Greeks evolved various other philosophies clustered around the relationships of people and the material world. A quick study of these can perhaps help us begin to peg just what flaws have been important in the whole mortgage, Wall Street, and banking debacles. Here are just a couple more to start such an exploration: Hedonism - Wikipedia, the free encyclopedia Epicureanism - Wikipedia, the free encyclopedia
Perhaps one concept to be explored might be that the extreme need to accumulate material wealth is more of an addiction than a healthy trait. The sidebar to this is "what happens when we give over our economies, political systems, and lawmaking abilities to people who are so hopelessly addicted to power and the trappings of power?"
Wall Street lifestyle you say? Its all about cocaine and escorts!!!
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