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I’m always amazed that people think 401(k)s are a great idea. Yeah, that’s exactly what I want, the government telling me how I can spend my money, until I’m al

I’m always amazed that people think 401(k)s are a great idea. Yeah, that’s exactly what I want, the government telling me how I can spend my money, until I’m almost ready to die, with no guarantee the laws governing 401(k)s won’t change along the way, or that some moron politician won’t siphon from my retirement.

lukevp 5y ago
401(k)s are privately managed. They were originally designed as a technique to replace pensions, and are separate from government-mandated savings like Social Security. How would a politician siphon from your retirement? A 401(k) is basically just an IRA that a company manages for you and pays someone to administer so that the deferred tax burden can happen. Or do you mean that in the future, taxes may go up? If that’s your belief, nothing prevents you from using a Roth 401(k) if your company offers it (my previous 2 employers both offered this).
- andrewmcwatters 5y ago
  There's actually nothing in the United States Code that specifies whether or not "Cash or deferred arrangements" (U.S. Code § 401, subsection (k), or "401(k)"), is privately managed. A 401(k) can be a publicly managed pension! A 401(k) is a type of pension. A 401(k) agreement can straight up be cash payments! > (A) [...] a covered employee may elect to have the employer make payments as contributions to a trust under the plan on behalf of the employee, or to the employee directly in cash; It's just that no one does that. That trust that is mentioned is the stock portfolio approach that nearly every organization uses. > How would a politician siphon from your retirement? I guess you weren't listening to political discourse for the last 8 years, you know, where politicians repeatedly suggested that we add additional taxes specifically to 401(k) trusts, annually, as another form of expense ratio.

lukevp 5y ago

401(k)s are privately managed. They were originally designed as a technique to replace pensions, and are separate from government-mandated savings like Social Security. How would a politician siphon from your retirement? A 401(k) is basically just an IRA that a company manages for you and pays someone to administer so that the deferred tax burden can happen. Or do you mean that in the future, taxes may go up? If that’s your belief, nothing prevents you from using a Roth 401(k) if your company offers it (my previous 2 employers both offered this).

andrewmcwatters 5y ago
There's actually nothing in the United States Code that specifies whether or not "Cash or deferred arrangements" (U.S. Code § 401, subsection (k), or "401(k)"), is privately managed. A 401(k) can be a publicly managed pension! A 401(k) is a type of pension. A 401(k) agreement can straight up be cash payments! > (A) [...] a covered employee may elect to have the employer make payments as contributions to a trust under the plan on behalf of the employee, or to the employee directly in cash; It's just that no one does that. That trust that is mentioned is the stock portfolio approach that nearly every organization uses. > How would a politician siphon from your retirement? I guess you weren't listening to political discourse for the last 8 years, you know, where politicians repeatedly suggested that we add additional taxes specifically to 401(k) trusts, annually, as another form of expense ratio.