Obama Plans to Takeover 401K to Bail Out Union Pension Funds

[boedicca]

Invest and manage pooled savings = stuffed in a lockbox of Treasury IOUs

 

[boedicca]

In all honesty, they lost me at "Agenda for Shared Prosperity"......

It's absolutely Orwellian.

 

[CrusaderFrank]

I wonder why Americans bought 14 million additional guns last year?

 

[Flopper]

Read the description of the GRA. If you want to spin the Wall Street roulette wheel, IRA's and 401K's make sense, but if you are looking for security in retirement, then the GRA makes sense. Personally, I think 401K's and IRA's aren't all they are cracked up to be.
Of course Wall Street would hate the GRA and it would be DOA.

Guaranteed Retirement Accounts: Toward retirement income security | Agenda for Shared Prosperity

GRA is just another SS ponzi scheme - with even more of our money.

The amount a person can contribute to a 401K is more than double what their annual SS contribution is. Do you really think the government is going to invest that in an account for your benefit? No. It will be used to fund current spending, and we will then have to rely on future tax receipts.

It's a scam.

The GRA would be managed by Social Security. 401K's would disappear because there would be no tax advantage. They would for most part be replaced by employer sponsored defined benefit pension plans. An employee would only be required to contribute to the GRA, if the employer does not offer a better defined benefit plan. The plan is funded by 5% employee contributions. There is also a $600 tax credit which partially offsets the 401K tax savings. At retirement the GRA is invested in an inflation adjusted annuity. This is the way I understand the plan.

It's a way to keep Social Security afloat and does offer some advantages.

 

[boedicca]

All we need to know is that the GRA would be managed by SS.

They've done a really good job managing the Trust Fund.

 

[Thinman]

If it is a plan from the left and it involves money, I hate it!!

 

[Thinman]

We finally get a decent way to save for retirement (401k) and Democrats want to take it away.

 

[Flopper]

We finally get a decent way to save for retirement (401k) and Democrats want to take it away.

Not really. The idea of a government sponsored retirement plan to supplement social security has been around a long time. The stock debacle of 2008 seriously damaged tax sheltered retirement savings and in some cases wiped them out. People began to look at these plans as a bad bet instead of an investment. To add insult to injury, plan holders were still obligated to pay taxes on the balance in the plan when they retired even if their plan showed a loss. Thus a lot of people became disenchanted with these plans. A plain old pension plan with guaranteed return was looking pretty good.

Now the market has recovered about half what it lost, people are beginning to see the light at the end of the tunnel. When markets fully recovers in a few years, you will hear no more about guaranteed retirement plans. Those pushing the GRA are now saying maybe we should keep the IRA and just dump the 401K.