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As a mechanism to make it more attractive for employees to contribute savings towards their own retirement, while also helping those Americans later on have solvency , while also helping them today take courses of action which will help them reduce their own tax burden by deferring more income
And by not doing these things, a penalty tax will be an additional source of Govt revenue to pay the national debt. It probably would be hated but actually very constructive especially that it forces Americans to take retirement more seriously
What could be done is any American with a job offering a 401k benefit who contributes less than 7% of pretax income to the 401k, maybe make it 25% of the amount of the pretax money retained by thwarting those contributions must be paid to IRS annually using After-tax dollars …. So more like a 50% of savings pinch
Not going to solve anything and why penalize people who perhpas need the cash now vs stashing it in a 201k????
With problem solvers like this we are doomed!
Biden destroyed the economic foundation of our country. Now we get band-aids to place over spurting arteries?????
As a mechanism to make it more attractive for employees to contribute savings towards their own retirement, while also helping those Americans later on have solvency , while also helping them today take courses of action which will help them reduce their own tax burden by deferring more income
And by not doing these things, a penalty tax will be an additional source of Govt revenue to pay the national debt. It probably would be hated but actually very constructive especially that it forces Americans to take retirement more seriously
What could be done is any American with a job offering a 401k benefit who contributes less than 7% of pretax income to the 401k, maybe make it 25% of the amount of the pretax money retained by thwarting those contributions must be paid to IRS annually using After-tax dollars …. So more like a 50% of savings pinch
If government touches it, they'll mis/over manage it. Period. They have a proven record. No matter how good it looks on paper, or how well-intentioned it might be, it'll turn to s**t.
Assuming that a worker has joined Social Security, then their employer is already contributing over 6% of wages into the worker's retirement benefit package.
As a mechanism to make it more attractive for employees to contribute savings towards their own retirement, while also helping those Americans later on have solvency , while also helping them today take courses of action which will help them reduce their own tax burden by deferring more income
And by not doing these things, a penalty tax will be an additional source of Govt revenue to pay the national debt. It probably would be hated but actually very constructive especially that it forces Americans to take retirement more seriously
What could be done is any American with a job offering a 401k benefit who contributes less than 7% of pretax income to the 401k, maybe make it 25% of the amount of the pretax money retained by thwarting those contributions must be paid to IRS annually using After-tax dollars …. So more like a 50% of savings pinch
Why do you want authoritative control over what people do with their own money ?
A penalty tax is not making something "more attractive"....it's coercion, blackmail, etc.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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No, because some of us have a fixed pension, in addition to a 401 and a 457. The 401 is the smallest of my retirement savings accounts, because the 457 contribution gets matched by my employer and the pension is the largest part of my future retirement.
As a mechanism to make it more attractive for employees to contribute savings towards their own retirement, while also helping those Americans later on have solvency , while also helping them today take courses of action which will help them reduce their own tax burden by deferring more income
And by not doing these things, a penalty tax will be an additional source of Govt revenue to pay the national debt. It probably would be hated but actually very constructive especially that it forces Americans to take retirement more seriously
What could be done is any American with a job offering a 401k benefit who contributes less than 7% of pretax income to the 401k, maybe make it 25% of the amount of the pretax money retained by thwarting those contributions must be paid to IRS annually using After-tax dollars …. So more like a 50% of savings pinch
If my company matched that much, I would be putting the max in every year. But they only match around $12K a year, so that is all I contribute.
I prefer investing in assets that earn income, and by income, I dont mean measly dividends. So the OP's plan is a terrible idea.
But matching is another story. I don't leave money on the table.
Isn't that over the max? Or does the matching funds not count towards the yearly cap?
I hit the yearly cap, only because it's my way of keeping my IBR student loan payments as low as possible. Once the loans are gone, I'll rearrange where the retirement money goes.
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