How will 401ks be affected?

Yay they’re usually tied to things like the S&P 500 or the NASDAQ. Which in the last 70 years or so has a historical average return of 10% profit per year.

Which is why defined benefit plans are not inherently "bad", if properly funded from the get go and can supply blue color workers with something very important in retirement and that is a secure lifetime income.

But such plans (a) should not be administered by the parent company, and (b) should include a balance in stocks, bonds, and real estate. True the return rates will be slightly lower, but would provide more consistent returns.

I'm at the age where my management profile is beginning to shift from moderately aggressive to moderately conservative to protect principle.

WW
 
I'm at the age where my management profile is beginning to shift from moderately aggressive to moderately conservative to protect principle.
What is your suggested mix for a moderately conservative portfolio?

Mine is (was) 50% money market (conservative to very conservative), but boredom got the better of me and it currently is 42% cash.
 
Any experts here offer any insights into this?
Depends on how the stock market reacts. Today, not so well.

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If the tariffs have a more structural effect then the affect will last longer as prices increase and GDP falls. The only one that benefits from tariffs are the uncompetitive U.S. firms that are desperately trying to save their failing companies. Tariffs ALWAYS drive up the price of ALL the products in the markets. They move consumer money into the tax coffers of the Federal Government AND into the pockets of U.S. corporations that are either already making a profit or selling an uncompetitive product. There are RARE instances when a specific product market might be targeted for limited tariffs but incentivizing the domestic market is nearly always better.
 
Which is why defined benefit plans are not inherently "bad", if properly funded from the get go and can supply blue color workers with something very important in retirement and that is a secure lifetime income.

But such plans (a) should not be administered by the parent company, and (b) should include a balance in stocks, bonds, and real estate. True the return rates will be slightly lower, but would provide more consistent returns.

I'm at the age where my management profile is beginning to shift from moderately aggressive to moderately conservative to protect principle.

WW
Which is why defined benefit plans are not inherently "bad", if properly funded from the get go and can supply blue color workers with something very important in retirement and that is a secure lifetime income.

But such plans (a) should not be administered by the parent company, and (b) should include a balance in stocks, bonds, and real estate. True the return rates will be slightly lower, but would provide more consistent returns.

I'm at the age where my management profile is beginning to shift from moderately aggressive to moderately conservative to protect principle.

WW
Makes sense. You don’t want your whole portfolio to lose 25% if the S&P 500 has a bad year.

But historically for example, the S&P 500 has done much much much better than Social Security. That’s why overtime if American workers had their money invested in the S&P 500 or the NASDAQ it will be a much better situation for them. Not saying get rid of Social Security now but just making a point here. SS could be phased out to eventually become a situation where a portion of an Americans paycheck has to go be invested into the S&P 500 the NASDAQ or a similar ETF. And there are ETFs less volatile than the S&P 500, but that do have a better historical return than Social Security
 
What is your suggested mix for a moderately conservative portfolio?

Mine is (was) 50% money market (conservative to very conservative), but boredom got the better of me and it currently is 42% cash.

Sorry I didn't see this earlier. I work in Human Resources, but I'm more a database/systems information guy. I'm not a money guy. Our provider has Time Horizon Accounts where you tell them when you plan to retire, then they change investments over time. Considering a normal 45 year working career you will be more aggresive when younger, moderate/moderate aggressive mid-life, moving you moderate conservative/conservative about 10 years out to change the focus from growth to protection of principle. I'm just entering the phase where they will start reseting things.

But I'm a weird bugger. I'll have 3 revenue streams (defined benefit) in retirement not counting my 401K. So I've set my time horizon to 2035, even though I'll be retiring this year. That's artificially kept me mroe aggressive. Once I get ready to retire, I'll reset my time horizon to change the focus to moderate conservative/conservative.

WW
 
Makes sense. You don’t want your whole portfolio to lose 25% if the S&P 500 has a bad year.

But historically for example, the S&P 500 has done much much much better than Social Security. That’s why overtime if American workers had their money invested in the S&P 500 or the NASDAQ it will be a much better situation for them. Not saying get rid of Social Security now but just making a point here. SS could be phased out to eventually become a situation where a portion of an Americans paycheck has to go be invested into the S&P 500 the NASDAQ or a similar ETF. And there are ETFs less volatile than the S&P 500, but that do have a better historical return than Social Security

I don't disagree. But the problem has been how to transition to such an investment side system and still cover commitments to current benefits that are already committed.

If younger folks are moved to a mandatory locked investment account, then that means there aren't revenues to pay current benefits.

Even a phased in system will take decades as you will have to have transition periods with different age groups in different ratios unless there is a "clean slate" where young workers would no longer pay into the current SS model and the government was then covering liabilities from general revenue since there would not be dedicated FICA taxes paying into SS.

It's not that the idea isn't a good one, it's problem with how to transition.

WW
 
But I'm a weird bugger. I'll have 3 revenue streams (defined benefit) in retirement not counting my 401K. So I've set my time horizon to 2035, even though I'll be retiring this year. That's artificially kept me mroe aggressive. Once I get ready to retire, I'll reset my time horizon to change the focus to moderate conservative/conservative.
I dumped the mix portfolio that was offered by the plan manager, it is good and it is safe but I worked with a guy who lived and breathed the stock market and once I started listening to his strategies he was in my ear every day, I listened to him and invested in many choices he suggested and it was 80% wins versus 20% losses, and a couple of the wins were ten fold. I fattened up my plan considerably in the Covid rebound and now my spending is keeping pace with my gains (or vice versa, same result).

I never planned for any of this quite honestly, but being aggressive wins the day, I learned that much.
 
Any experts here offer any insights into this?
No effect. The market bloodbath was on the wall before the bell opened and Trump caved. He expected Canada and Mexico to roll just like members of his party do and it didn't happen.
 
Would LOVE it if Trump disposed of taxes on 401's, Roths, Rollovers, Bonds, stocks, etc.......
 
Any experts here offer any insights into this?

President Donald Trump is not only an alarmingly conscience depraved President, but he is also the dumbest by a hundredfold U.S. President in at least the last ninety-two years and I only say this time period because this writer is not really familiar with the Presidents before Franklin Delano Roosevelt. In his address to Congress this past Tuesday President Trump said the effectiveness of my administration's efforts to secure the border and deport people that have illegally emigrated to America shows that the country never needed the Democrat border bill that was the subject of much fanfare last year! The reason why illegal immigration is so dramatically down is because President Trump has shutdown the asylum claim process system and Mr. Trump fails to recognize this state of affairs will be short lived! America's laws provide foreigners a civil right to make an asylum claim here and the United States Supreme Court will not let the Trump administration deny people this right indefinitely and when they act America will be right back in the mess we have been in for years. Any really competent analysis of America's illegal immigration problem knows specifically that it is largely a broken asylum system problem because the law does not sufficiently separate the meritless claims from the claims that may have some merit and that the law does not allow for quick review of claims for this screening and does not provide the resources needed to fully and fairly review these claims in a timely manner so what America gets is most illegal immigrants gaming the system and just making an asylum claim even though their situation does not warrant it. This Democrat bill that in truth was a bipartisan bill that was negotiated by a fully conservative Republican Senator, Senator James Lankford and who the Congress' most skilled legislator, Senator Mitch McConnell once remarked about the bill that the Republicans would be lucky to get such a bill if we controlled both Chambers of Congress, this Democrat bill would have made outstanding headway in solving these problems! Trump if he was smart as soon as he got into office on January 20 would have begun negotiating the asylum provisions in this Democrat bill into another bill he would pass and sign into law, but again Trump's stupidity ends up hurting America!

President Trump has boasted that we don't need the Chips Act, a bi-partisan bill, we don't need the Chip acts provisions giving grants and tax credits for companies to build chip manufacturing plants in the United States we just tell the Chip manufacturers they make their chips in the U.S. no tax, make it outside the U.S. and ship it into the U.S. they get a tax/tariff! Let's take the world's leading chip manufacturer and see how President Trumps master plan will work to return domestic chip manufacturing to America on a large scale and create a lot of middle class jobs. This corporation TSMC (a Taiwanese company) after the Chips Act enactment said it would invest $65 billion in chip plants (three plants - foundries) in the U.S. and after President Trump was sworn in for his current term they announced another an additional investment of $100 billion in America (three more chip foundries and two packaging plants). Before President Trump was sworn in on January 20th TSMC had built one chip plant in Phoeniz Arizona it opened in 2024 at a cost of $20 billion per CNBC where they received a Chip Acts grant of $6.6 billion and low interest loans in the amount of $5 billion so TSMC spent $8.4 billion of its own cash in building the plant. The second plant was scheduled to be built by 2028 and the third plant by 2030; now besides the fact that of the 3000 workers at the first plant 600 of them are engineers which begs the question with our leaders letting manufacturing die a slow death in America over the last thirty years does the country have another six hundred engineers for each of these two future planned plants, probably not amongst native born Americans. On the plant construction cost side of the equation TSMC total capital budget for this year is $42 billion dollars (Chip Pulse) with at least a third of it is going to things like advanced chip research and with DOGE having layed-off the Chips Acts implementation staff so that now TSMC is going to have to shoulder the entire twenty billion dollar cost tab to build each of these two additional plants can anyone seriously believe this 2030 timetable for these two additional plants will be met? A responsible and good government policy position would be that America should be producing in America at least sixty percent of the chips America domestically needs ( frankly this percentage should lie for all the domestic manufacturing industries in America where the price point of the product involved would readily support middle class manufacturing jobs) and America's chip manufacturers have a long way to go to meet that sixty percent target and without the Chip's money honesty dictates practically it ain't happening!

President Trump has recently cut off the balance of monies the last Administration and Congress appropriated for Ukraine for it to fight the Russian army and has also cut off intelligence sharing as well as satellite imagery viewing so that Ukraine's military command no longer can have the satellite's capability of providing accurate real time pictures of the battlefield. Now mostly everyone knows what President Trump is trying to achieve by this move because of the other statements President Trump has made on the Ukraine War like his public lecturing to President Zelensky that his country has no cards in this negotiation with Russia with America it has cards, alone no cards; what President Trump is trying to do is to get President Zelensky to submit his will to President Trump's will so that whatever deal Trump negotiates with Putin President Zelensky will sign on to. This is why President Trump is acting extremely dumb in this matter because President Zelensky is limited in what he can accept because he can only accept what his people will accept and his people are adamant they don't want to be Russian and they don't want to permanently relinquish any of their sovereign territory to Russia so the most the Ukrainian people will accept is to freeze the front lines and let the question of redrawing territorial lines be subject to negotiations many years down the road and the use of force to resolve the issue permanently taken off the table. A smart President would understand that these terms will be hard for Vladimir Putin to swallow because he wants Crimea and the regions of Donetsk and Luhansk to become Russian sovereign territory - Putin wants his win! A smart U.S. leader would not be weakening the Ukrainian position going into the negotiations by doing this cut-off move but strengthening it because Vladimir Putin has one extreme weakness in regards to the Ukrainian war he is losing too many young Russian soldiers at some point this will become politically untenable for Putin so a smart President would want to strengthen the Ukrainian military's hand to empower them to kill as many Russian soldiers as possible to make this wound as painful as possible for Vladimir Putin. Further, President Trump is dumb because he is overplaying his hand he acts like without America's help Ukraine will lose the war and its demise will be dramatic. Not the case the country of Ukraine produces two million 155mm (howitzer) and mortar shells per year and Europe (including the UK) gives Ukraine one million such shells per year, Ukraine can live without the one and a half million such shells the United states gives Ukraine per year and one should consider that Europe and Ukraine's other allies can probably make up a significant number of this loss of U.S. shells for Ukraine. Common sense says artillery shells keep Ukraine surviving and in the fight well because with these munitions Ukraine can make the Russian army pay dearly with their soldiers lives for basically every small piece of territory Russia takes from Ukraine!




President Trump has been really dumb about the reconciliation bill to extend the 2017 tax cuts and cut a trillion and a half dollars over ten years which needs to be done so sovereign debt investors don't lose confidence in the government's control of its finances and demand higher interest rates on Treasuries for two reason he has made representation he isn't going to touch the entitlement programs Medicare and Medicaid where a lot of savings lie and he has thrown his support with the extreme cutters and not with the moderate cutters where I suspect he is not going to get the Republican House bill over the finish line the gap between these two factions is too large and cannot be bridged and when he turns to the Democrats to extend the tax cuts he won't have a moderate policy plan on cutting that at least moderates can sign on to! Again, the only thing Trump had to do is address the glaring problems that ordinary Americans hear about and believe are not responsible. The extremist Medicaid plan is too harsh funding state programs at a per capita rate that relates to pre-covid program costs and a yearly rise on this per capita fee based on inflation will cause states to have to limit the number of people on the Medicaid rolls, won't fly politically. However, addressing how the states game the system to bleed money out of the Federal government is an abuse that needs to be stopped; the way Medicaid works is that the Federal government picks up like fifty percent of the cost to cover Medicaid recipients and the individual states pay the balance and what corrupt states do is in order to cover their cost they tax various elements of their state health care system to raise the money to pay that expense and since they really aren't paying the cost they have no incentive to hold down the cost and use of the system by Medicaid recipients. What Congress and the President should do is pass a law saying that the most a state can raise to pay their Medicaid bill by taxes on elements of their health care system is twenty-five percent of the state's tab now for states that turn their Medicaid program into a managed care program the states are permitted to raise sixty-five percent of their cost through these taxes. The break for managed care is because that system does not open itself to the level of abuse that traditional Medicaid allows because in traditional Medicaid recipients go to whatever Doctors they want as often as they want and these individual Doctors send the state Medicaid program a bill and the Federal government pays its portion and the state pays its portion in managed care an insurance company gets paid a yearly stipend for each Medicaid recipient and the recipients have to go to a primary care physician in the insurance company's system and get referrals for specialist Doctors the system has HMO like spending controls so it is not open to these drive up of claim costs on the Federal Government! One other Medicaid reform suggestion, with one of the Biden Administration's pandemic era laws the Federal Government expanded the eligibility of the Affordable Care Act for the ACA individual insurance exchanges; it use to be something like that your income had to be over one-hundred and thirty-three percent of the poverty rate for eligibility to participate in the exchange otherwise you had to go into the Medicaid program. The ACA individual insurance exchanges are more expensive for the Federal government to cover someone because of the government subsidies for the ACA exchange participants and the fact that in the Medicaid system the state picks up part of the tab to cover an enrollee. Congress should change the law and void the new system and return to the old system it will save the Federal government money!

In Medicare, the Federal government is now trying to bring fraud claims against Medicare advantage programs that game the system in the following manner but they should change the provisions of the program don't even open the to the mischief seen. In Medicare advantage an Insurance company gets paid additional money for enrollees that have certain serious medical conditions so the game for these insurance companies is to find these conditions for their enrollees and declare them and the key is that some of these conditions are not that serious if there was no financial incentive for the insurers patients wouldn't be diagnosed with these conditions. Congress should mandate Insurance companies should not be claiming conditions that doctors don't treat the enrollee for, further nurses and physician assistants should not be diagnosing these claimed conditions only doctors should and insurance companies should not be training and/or promoting the nurses, doctors and physician assistants to be looking for not-major medical conditions for their enrollee patients so the insurance company can increase their reimbursements from Medicare especially the unusual conditions reported in the Wall Street Journal when they did an expose on this abuse! In the Inflation Reduction Act (IRA) there was a program established which allowed Medicare to negotiate with the pharmaceutical companies for like a half dozen pharmaceuticals a year but actually the program amounts to price fixing by Medicare because if a pharmaceutical company doesn't accepts they get walloped with taxes and Medicare is largely given complete discretion is setting the price. As expected Medicare is crushing the Drug companies whose drugs are captured by this program; the truth of the matter is the mandated price is so low that there will be availability problems with some of these drugs - so the program is unsustainable. Why doesn't Congress change the program where Medicare is required to follow reasonable guidance in setting the price like what is the price in nine developed countries -France, Germany, United Kingdom, Japan, etc. compute the average add thirty percent and the mandated price cannot be below that. This is the money saver for the American people mandate the pharmaceutical companies use this set price not only in Medicare but in the non-Medicare system that is for all Americans; pharmaceutical companies should acquiesce because if Democrats get control of Washington for an extended period of time they will implement this across the board pricing for the negotiated price drugs because pharmaceutical pricing is killing the American people! Another bone that could be offered here to the Drug Industry is the IRA mandated that for pharmaceuticals and Medicare, drug prices can only be increased on a yearly basis with the inflation rate which has caused pharmaceutical to jack up prices for "new" drugs significantly higher than they would ordinarily be because the drug companies know they will be stuck with this price range because of the inflation rate ceiling! Congress should change the law so that the IRA inflation ceiling doesn't kick in until the new drug has been on the market for five years.


Congress should enact provisions that prohibit Pharmaceutical Benefit Managers (PBM"s) from requiring or steering enrollees to drug retailers they own especially on-line ones; there has been many instances where such drugstores charge more for the drugs they sell to enrollees than non-PBM owned drug stores. In addition, PBMs should be prohibited by law from reimbursing drug retailers they own more for drugs purchased by their enrollees than drug retailers they do not own. It behooves Congress to begin the process of having drugs sold at various prices across the Medicare and non-Medicare system literally you have over a thousand different price points a specific drug is sold at across America. Moreover, you have this opaque system in America where pharmaceutical companies pay big rebates to PBMs and what is exactly involved in the determination of a respective rebate and what happens to the rebate, does the American consumer benefit optimally from this opaque system. Why doesn't Congress mandate that the list price for a drug, the price Drug companies announce to the American people cannot be higher than one hundred and forty-five percent of the lower rebated price; what this would mean is that the maximum rebate would be thirty percent off the list price. This would be fair because of course when a pharmaceutical company sells a drug at a rebated price it is still making a profit so why should people be paying more for a drug than a hundred and forty-five percent more that other Americans these aren't luxury items these are medicines that people need for the well being of their health. Currently, the list price of drugs means almost nothing because the vast majority of people don't pay that list price and the discount system is incredibly complicated but the government should get that list price to mean something so the American consumer is a knowledgeable consumer and can make a prudent decision on their pharmaceutical purchases. In addition, pharmaceutical companies should be prohibited from entering into deals with PBMs where they will provide a sizable rebate if the PBM takes a competing drug off is formulary meaning drug list the PBM covers for enrollees. This would drive the drug industry to take the gamesmanship out of the industry and just make the list price a competitive price thereby making the system transparent for the American consumer!
It's teh Great Depression again cuz Trump! Oh! :eek2yum:
Do windows ever lick you back?
 
The S&P hasn't dropped below the 200 DMA yet. So don't cry...(6% left to drop)
If it does...I'll buy somewhere around 47**

The P/E ratios of most stocks are bloated IMHO. But you go along with it just the same.

But for real the market has spiked and spikes cause corrections. Slow steady climbs are best.
 
LOL....I hope nobody is tech heavy and close to retirement.
You don't sell everything at retirement....that's just dumb.

So is playing stock market wizard and trading a bunch yourself with daily/weekly trades. That's a quick way to lose your life savings.

All of first quarter gains are now losses. Not a big deal. Actually more of a buying opportunity when the knife stops falling.

That knife might stop around 4700 for the S&P. Dunno yet.
But the lights in Walmart are still burning and people are still in there buying groceries and junk.
Albertsons hasn't closed yet either or Kroger. Home Depot is still selling supplies and materials. Cargo ships are still lining up at the ports and trains are running cargo. Same with 18wheelers.

Buy low, sell high. But not necessarily in that order. That's how money is made on wall street.
 
401K's invest mostly in the stock market.

When the market tanks because of tariffs that is going to be a major hit on 401K's and reduced income for retirees that rely on 401K's to pay for food, energy, and housing. Each will be more expensive as prices rise, coupled with lower income.

Glad to help.

WW

That's poor planning. If you're invested in volatile stocks at retirement age, you're taking WAY too much risk. That's just dumb.
 
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