It’s October 30th, Do You Know Where Your 401K Is?

Your 401k is in immediate danger if the democrat party takes control of the House, the Senate, and the Presidency.  There was an article in The Online Wall Street Journal on October 23 about a hearing of the House Education and Labor Committee held earlier this month.  The article links to an article in Workforce Management detailing plans to end tax breaks for people contributing to their private 401k accounts and to take over those accounts (similar to the way Social Security accounts are managed (managed?)).  The plan would introduce ‘security’ into 401k accounts, but would limit their positive growth (and prevent negative events like the recent market crash). 

Since the Social Security money has essentially been stolen since Congress opted out of it in the 60’s, I think we would have to be totally insane to give the government the money we have personally put aside for retirement.  If you run the numbers for Social Security out about fifteen years (look at the number of retirees versus the number of workers), you realize that the plan in its current form cannot survive.  The ratio of workers versus retirees will be such that the system will collapse under its own weight.  Since the money in the Social Security ‘lockbox’  was stolen long ago, there is nothing there to make up the difference in income and outgo.  When the system was designed in the 1940’s, the average lifespan was not much more than 65, and the system only had to support people for a year or two.  We live longer now, and therein lies the problem.  It is possible that today’s retirees will still be alive to collect Social Security in forty years.  The system was not designed for that.  Congress is not under Social Security, so they have no incentive to fix it, and there are hoping to be out of office by the time it collapses.

  Again, it matters how you vote.

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