4 ms·
The thing that makes 401ks magical compared to social security is decades of compound interest. The average social security payment is only $1700 a month. Not e
by missedthecue 2y ago
The thing that makes 401ks magical compared to social security is decades of compound interest. The average social security payment is only $1700 a month. Not enough to live on, yet the program is almost unaffordable.
- ghaff 2y agoBut that hasn't historically made 401ks magical relative to personal savings more broadly. Yes, many companies match up to a point and there are some tax benefits relative to just making an automatic contribution to an index fund, but most of the benefit is just saving on a relative basis. I agree that SS by itself isn't really enough to live on for most people. But that's also just about what I get from my defined benefit pension--albeit for just about a third of my career. A nice bonus but just that.