The same year I became eligible to opt in to my current employer’s 401k plan they decided to stop making matching contributions. So, I looked at the options and decided that I could do better...
The same year I became eligible to opt in to my current employer’s 401k plan they decided to stop making matching contributions. So, I looked at the options and decided that I could do better investing my money myself (with only broker fees). The idea that I would let an entity passively take a percent of what I earn with no guarantee on returns sounded like a bad idea. It’s encouraging to see that my gut reaction was not a bad one, but it’s also discouraging to think about how much is being stolen from working people. If you want to wonder why earnings are stagnating, it’s because more and more of those earnings are being funneled away by industries with no regulation. How can an honest worker plan to retire when there are huge institutions spending all their time figuring out how to skim as much as they can and fighting the Department of Labor from regulating them?
But as the documentary argues, there isn’t any evidence that they’ll do better than an index fund over the time you have your money with them. So, why pay fees to have it managed when you could...
The bank does the research/thinking for you
But as the documentary argues, there isn’t any evidence that they’ll do better than an index fund over the time you have your money with them. So, why pay fees to have it managed when you could not have fees and do the same or better? Also, this idea of companies doing 401k matching, I wonder how much of this is part of the “legal kickback” scheme mentioned? It always struck me as odd why companies would do 401k matching rather than use that capital to create a pension fund. It seems like the same end goal: provide financial security as an incentive for employees to stick with the company. But, instead of gifting business to the 401k providers, it would be the company and its employees would reap all the benefits.
Yeah, that’s a macroeconomic problems itself which is tied up in the same issues. I wouldn’t trust either a mutual fund management company nor a random company to necessarily last as long as a...
Yeah, that’s a macroeconomic problems itself which is tied up in the same issues. I wouldn’t trust either a mutual fund management company nor a random company to necessarily last as long as a human lifetime. I’d assume that if a company with a pension fund dissolved at some point that those who contributed to it would get their equity paid out to them.
Was that always the case in the U.S.? What about government pensions? I have the impression that pensions, historically, were more common and safer than they are now.
In another country, your corporate pension may be protected but in America, that is not the case.
Was that always the case in the U.S.? What about government pensions? I have the impression that pensions, historically, were more common and safer than they are now.
The same year I became eligible to opt in to my current employer’s 401k plan they decided to stop making matching contributions. So, I looked at the options and decided that I could do better investing my money myself (with only broker fees). The idea that I would let an entity passively take a percent of what I earn with no guarantee on returns sounded like a bad idea. It’s encouraging to see that my gut reaction was not a bad one, but it’s also discouraging to think about how much is being stolen from working people. If you want to wonder why earnings are stagnating, it’s because more and more of those earnings are being funneled away by industries with no regulation. How can an honest worker plan to retire when there are huge institutions spending all their time figuring out how to skim as much as they can and fighting the Department of Labor from regulating them?
But as the documentary argues, there isn’t any evidence that they’ll do better than an index fund over the time you have your money with them. So, why pay fees to have it managed when you could not have fees and do the same or better? Also, this idea of companies doing 401k matching, I wonder how much of this is part of the “legal kickback” scheme mentioned? It always struck me as odd why companies would do 401k matching rather than use that capital to create a pension fund. It seems like the same end goal: provide financial security as an incentive for employees to stick with the company. But, instead of gifting business to the 401k providers, it would be the company and its employees would reap all the benefits.
Yeah, that’s a macroeconomic problems itself which is tied up in the same issues. I wouldn’t trust either a mutual fund management company nor a random company to necessarily last as long as a human lifetime. I’d assume that if a company with a pension fund dissolved at some point that those who contributed to it would get their equity paid out to them.
Was that always the case in the U.S.? What about government pensions? I have the impression that pensions, historically, were more common and safer than they are now.