401(k) Programs: Methadone for the Middle Class
Gary North – February 06, 2015
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Methadone is a legal drug that is taken by former heroin addicts. It eliminates the “rush” that heroin offers, but it also eliminates withdrawal symptoms. It lets heroin addicts escape the need to buy the expensive illegal drug.
Methadone is for heroin addicts who just cannot bring themselves to go cold turkey from an addictive drug that distorts their perception.
That is what a 401(k) retirement plan is for middle-class workers.
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Even a gold bug, such myself, understands the concern that the 401k may not be enough.
And, the younger the person, the more they are at risk.
Clearly SocSec isn’t enough retirement savings, especially when the Gooferment cheats on inflation, COLA, Medicare rates, and — of course — the ULTIMATE cheat making SocSec ½ taxable income!!!
A similar concern exists with 401ks and IRAs. The “rules” can be changed. And, when you think of the 18T$ “debt” and 17T$ in tax deferred savings accounts under the control of about 2100 “custodians”, it’s not hard to imagine the political mischief that could emerge. There was a “trial balloon” about “saving” “We, The Sheeple” from “market risk” by swapping the 401k/IRA money for an “enhanced social security benefit”. It died a quiet death, but bad ideas are like Dracula rising from the grave.
So while I think folks “must” participate in the 401k / IRA system, they must also realize that there is a “counter party risk” and you better have other assets.
For once I’m glad I’m old.
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