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401k and IRA were created in a system that included pensions. Now without them, we have a huge shift towards a volatile market with a lot less guarantees, and l
by azinman2 3y ago
401k and IRA were created in a system that included pensions. Now without them, we have a huge shift towards a volatile market with a lot less guarantees, and lower limits. This isn’t a good system we have. Most are ill prepared.
- nradov 3y agoThe guarantees provided by the PBGC are very limited and create a terrible moral hazard. Defined contribution plans such as 401(k) are much safer because the assets are in individual named accounts which aren't at risk if the employer or plan sponsor goes bankrupt. Most such plans allow employees to invest in risk-free assets such as Treasuries if they desire.