Why the 401k Doesn't Work

As the default retirement plan of the United States, the 401(k) falls short, argues CBS MoneyWatch.com editor-in-chief Eric Schurenberg. He tells Jill Schlesinger why the plans don't work.

Category:

News & Politics

Tags:

• 401(k) Plan
• MoneyWatch
• 401(k)
• Retirement Plans
• Personal Finance
• Investment
• Human Resources
• Benefits
• Finance
• video

[JohnnyUltra305]

The reality is you get raped on fees you dont about, and your employers contribution plus what you put away in addition too, should be a good supplemnet to a pension and social security. Not that SS and a pension are even going to be there when you do retire. The 401k is the better of the 3. Or better yet , learn to invest on your own and stop relying on someone to do everything exactly the way you think things should go.

[MX3516]

This looks like a paid commercial for Guaranteed Retirement Account (GRA) Plans that are being discussed in Congress, they would require everyone to contribute to a Social Security administered retirement fund that invests in Treasuries. Another tax hidden as a benefit.

[Visda58]

Am I the only one who thinks retirement is overrated? Just because you're old doesn't mean you're useless... do something! If you are useless, die and pass the torch already! I am expecting nothing at all from government or anyone to help sustain me when I'm old and want to stop supporting myself. If I'm rich, I might retire, if I'm poor, I'll work like I always have. It's not a tragedy. Losing your savings in the gambling industry IS.

[hailehshemondy123]

He makes some good points/ but he is only giving a warning about some down falls. But if you start investing early/ learn how to spread your funds/ you will be better off.

Look up Dave Ramsey smart guy

[SlapstickCoyote]

what an idiot woman: Fair Fair why is it not fair? Isn't choice a good option! i wanna smack her

[SilverDude7890]

@joshfrmn Good point, BUT, my 401k is invested in loaded funds so it costs $ to move money around. The best strategy I can do is to add my paycheck withdrawals into the cash fund, then wait for a market crash and purchase other mutual funds. That's timing the market which is hard to do. Problem is mutual funds make money no matter what, then the govt gets their cut no matter what. Essentially a 401k is a tax liability.

[joshfrmn]

@SilverDude7890 If you are not making money in your 401k because you are using a buy and hold strategy, consider putting your money into the mutual funds that are performing the best in your 401k account, and moving them back and forth as the market changes. There is a software program that can help you do that and increase your profits/avoid market dips. Go to 401koutlook (DOT) mutualfundmarketalert (DOT) com you might find it interesting.

[Bobbydsmith101]

Wow this couldn't be less helpful - The problem with 401K's is the the fact that 1 it limits your investments. Why can I invest in anything I want outside of the 401K but inside it I'm limited to a handful of mutual funds - Also why can't I earn money when the market is down - I do this outside of the 401K but not inside (short puts) - Bottom line is the individual HAS to take control of their own retirement and educate themselves on how investments work

[Bobbydsmith101]

Oh my lord she is pitiful at acting surprised

[rohara07]

This lady is unbearable...