“It’s time for all workers to have access to the same low-cost, well-protected retirement products that some employers and unions provide today,” she said. The benefits to workers would be obvious, she said, but employers would also benefit by unloading the responsibility for retirement planning on others.
Elizabeth Warren Wants To Rescue Your Stranded 401(k) Plan
June 21, 2016
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I believe we should have a comprehensive retirement solution as follows: 1) Allow workers to have their 401k contributions directly deposited with a low-cost mutual fund provider. This would provide employees access to low-cost diversified funds rather than be held captive to an expensive 401k plan through the employer. 2) Allow workers without 401k plans to invest in personal traditional IRAs and/or Roth IRAs up to the same maximum as 401k plans 3) Provide the same legal protection from creditors for all 401k Plans and IRAs at the federal level rather than having different protection rights based on the state where the employee resides.
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While I agree a 401(k) "Lost and Found" could be beneficial, its the first step in having 401(k) monies run by the government. Given the government track record with Social Security, the worst threat to retirement accounts is government control. The government reallocated every dime from segregated money into the general budget and spent it all. Read your own Social Security benefit statement. It reads "The law governing benefit amounts may change because, by 2033, the payroll taxes collected will be enough to pay only about 77 percent of scheduled benefits." No one needs Elizabeth Warren or her colleague's control retirement account balances.