Every once in a while the Wall Street Journal tells it like it is. Such is E.S. Browning’s “Boomers Find 401(k) Plans Fall Short†in the February 19, 2011 issue. If you want to read it through this link, do it soon as it will be closed to non subscribers in seven days.
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401(k) Open and Hidden Fees
Management fees, commissions, and profits severely compromise what can be accumulated in 401(k) and other defined contribution retirement plan accounts. Defined contribution participants typically lose from 20 to 30 percent and more of their accumulations to investment management fees charged by the financial services industry. The administrative overhead costs for defined benefit plans are muchContinue reading “401(k) Open and Hidden Fees”
How 401(k)s Discriminate Against Women
401(k)s are set up so that participants will accumulate funds during their working lives and then purchase annuities with those funds to finance their retirement. They could also actively manage their portfolios during retirement, but most experts agree that annuitizing produces more stable income security. The annuity business is based on calculating life spans. SinceContinue reading “How 401(k)s Discriminate Against Women”
Q&A: Funding of State Pension Funds
Question:Â When you say the prior to the 1980’s, public pensions were funded in a traditional way, do you mean that the state governments simply put most of the funding in a fund as they went along, but then they started to put more and more of it into Wall St., so that after theContinue reading “Q&A: Funding of State Pension Funds”
Social Security and Obama’s 2011 State of the Union Address
There was considerable fear among supporter of Social Security that President Obama would cave in to powerful financial elites that want to see the program privatized or at least cut back in order to divert more retirement savings dollars to Wall Street. The signs were everywhere. He had dangerously reduced employee contributions from 6.2 toContinue reading “Social Security and Obama’s 2011 State of the Union Address”
The Fiscal Health of State Pension Funds by Iris J. Lav and Elizabeth McNichol (Center on Budget and Policy Priorities)
 The Fiscal Health of State Pension Funds: Misunderstandings Regarding State Debt, Pensions, and Retiree Health Costs Create Unnecessary Alarm Misconceptions and Also Divert Attention from Needed Structural Reforms (excerpts)  By Iris J. Lav and Elizabeth McNichol Center on Budget and Policy Priorities January 20, 2011 http://http://www.cbpp.org/cms/index.cfm?fa=view&id=3372 [moderator: This report provides substantive documented informationContinue reading “The Fiscal Health of State Pension Funds by Iris J. Lav and Elizabeth McNichol (Center on Budget and Policy Priorities)”
State Bankruptcy: A Right Wing Fantasy to Enable Confiscation of Employee Pensions
States currently cannot declare bankruptcy. If the right has its way, that would change, according to an article, (“A Path is Sought for States to Escape Their Debt Burdens,â€)  by Mary Williams Walsh in the January 20, 2011 New York Times. Walsh cites such right-wing politicians as Newt Gingrich and conservative media as The WeeklyContinue reading “State Bankruptcy: A Right Wing Fantasy to Enable Confiscation of Employee Pensions”
Actually, The Retirement Age is Too High, by James K. Galbraith
Published on Wednesday, January 19, 2011 by Foreign Policy http://www.commondreams.org/view/2011/01/19-8 The most dangerous conventional wisdom in the world today is the idea that with an older population, people must work longer and retire with less. This idea is being used to rationalize cuts in old-age benefits in numerous advanced countries — most recently in France,Continue reading “Actually, The Retirement Age is Too High, by James K. Galbraith”
Threat to Social Security: Can Harry Be a Hero? By Dean Baker, Center for Economic and Policy Research
That is the question that supporters of Social Security should be asking as we brace for President Obama’s State of the Union address next week. Specifically, the question is whether Senate Majority Leader Harry Reid will keep up his spirited defense of Social Security or whether he will buckle to the pressure from the financialContinue reading “Threat to Social Security: Can Harry Be a Hero? By Dean Baker, Center for Economic and Policy Research”
Are 401(k) Participants Being Swindled?
Some readers may find the word swindle too strong of a term to describe what took and is taking place in the conversion from traditional pensions to 401(k) and other defined contribution plans. A swindle suggests illegality and what took place was perfectly legal. Or was it? Upon closer examination, where the financial services industryContinue reading “Are 401(k) Participants Being Swindled?”