Ira's, 401K's, etc.

[rocknK]

Maybe my tin-foil hat is a little tight.......but I've been hearing rumours of govt. confiscation of private retirement accounts. Anyone else heard anything??? Maybe I need to add another layer of foil to my hat.

[WashingtonBay]

Take a big bite of it? Yes. Take the whole thing? I don't think so.

[missdixie]

No, that sounds a little far fetched. They wouldn't have much to take away from me anyway.... I lost 33 percent in my 401k :eek:

[westmanfarrier]

I hear our president elect would like to take away the tax advantages of those programs.

[JackieB]

Confiscate? You mean as in "take away from the current owner" like we think of the definition of confiscate? Not in a million years. The nation would completely fall apart. I've been diligently adding to those accounts for over 20 years rather than spending the money so that I can fund my own retirement.

[Hobo]

you mean this:

http://www.carolinajournal.com/exclusives/display_exclusive.html?id=5081

Read the rest of the info at the link:

November 04, 2008

RALEIGH — Democrats in the U.S. House have been conducting hearings on proposals to confiscate workers’ personal retirement accounts — including 401(k)s and IRAs — and convert them to accounts managed by the Social Security Administration.

Triggered by the financial crisis the past two months, the hearings reportedly were meant to stem losses incurred by many workers and retirees whose 401(k) and IRA balances have been shrinking rapidly.

The testimony of Teresa Ghilarducci, professor of economic policy analysis at the New School for Social Research in New York, in hearings Oct. 7 drew the most attention and criticism. Testifying for the House Committee on Education and Labor, Ghilarducci proposed that the government eliminate tax breaks for 401(k) and similar retirement accounts, such as IRAs, and confiscate workers’ retirement plan accounts and convert them to universal Guaranteed Retirement Accounts (GRAs) managed by the Social Security Administration.

Rep. George Miller, D-Calif., chairman of the House Committee on Education and Labor, in prepared remarks for the hearing on “The Impact of the Financial Crisis on Workers’ Retirement Security,” blamed Wall Street for the financial crisis and said his committee will “strengthen and protect Americans’ 401(k)s, pensions, and other retirement plans” and the “Democratic Congress will continue to conduct this much-needed oversight on behalf of the American people.”

Currently, 401(k) plans allow Americans to invest pretax money and their employers match up to a defined percentage, which not only increases workers’ retirement savings but also reduces their annual income tax. The balances are fully inheritable, subject to income tax, meaning workers pass on their wealth to their heirs, unlike Social Security. Even when they leave an employer and go to one that doesn’t offer a 401(k) or pension, workers can transfer their balances to a qualified IRA.

[missdixie]

Hmmm, that actually sounds like it might not be a bad idea.....

[Gliderider]

OMG !! :mad: I heard about this....If this happens it will be a disaster just like SS. OMG !! We the middle class are doomed if they do this...We might as well kiss it goodbye :mad:

[Miracle Whip]

Well legally I would not think they could take my IRA - because it is in MY name only. I don't care if they try to save the 401K, but if I loan them my money they should be paying ME interest and fees.

If people would quit spending money they don't have, learn to live frugally, and pool their resources we could get out of this mess, but no one trusts anyone and no one wants to cut back spending. WE want it all, and we will drive ourselves into the ground nose first.

[Hobo]

Really? Social Security isn't very secure at the moment. At the rate it's going NONE of what I put in will be there when I retire. I have an alternate retirement and an IRA and I think this is a HORRIBLE idea. Take AWAY my money and put it in an account that gets redistributed with all the others and limits what I can earn and limits what I can be paid back. BAD IDEA!!!

Seriously the government hasn't done a good job with it's money so why would I want it do anything with MY money?

Hmmm, that actually sounds like it might not be a bad idea.....

[Miracle Whip]

Put your money in your mattress....:innocent:

[Gliderider]

oops

[Gliderider]

Well legally I would not think they could take my IRA - because it is in MY name only. I don't care if they try to save the 401K, but if I loan them my money they should be paying ME interest and fees.

If people would quit spending money they don't have, learn to live frugally, and pool their resources we could get out of this mess, but no one trusts anyone and no one wants to cut back spending. WE want it all, and we will drive ourselves into the ground nose first.


'A government big enough to give you everything you want,

is strong enough to take everything you have.'
-Thomas Jefferson

[missdixie]

Honestly I think this might not be a bad idea. It would certainly give more stability to retirement funds, I can't believe I lost 33 percent in my 401k, what if you were 70 and lost 33 percent? That's devastating! I hope they at least make it an option because I would do it.
http://www.sharedprosperity.org/bp204.html

[Hobo]

more links watch the videos also:

http://edlabor.house.gov/hearings/fc-2008-10-07.shtml


If you invest right you won't loose that much. I didn't loose very much at all. My retirement plan is very stable. Additionally with a government owned plan you cannot will or bequeath your left overs to your family members. So if you die before your government run account is used up, then your family won't get to inherit it. Would you punish your family like that?


With a GRA, workers could bequeath only half of their account balances to their heirs, unlike full balances from existing 401(k) and IRA accounts.

You do realise that Argentina did EXACTLY the same thing and It added even more to the crash in their markets.

http://marketplace.publicradio.org/display/web/2008/10/22/argentina_pensions



Honestly I think this might not be a bad idea. It would certainly give more stability to retirement funds, I can't believe I lost 33 percent in my 401k, what if you were 70 and lost 33 percent? That's devastating! I hope they at least make it an option because I would do it.
http://www.sharedprosperity.org/bp204.html

[rocknK]

MD, go ahead & give them YOUR money. I worked very hard for mine & I'd like to keep it, thank you. All politicans do when you give them money is SPEND it. I'm wondering if its not worth cashing out, paying the taxes & penalties to keep their grubby mitts of my cash.:nono:

[JackieB]

The confiscation part is an urban legend.

[rocknK]

JB, read the link, it said "confiscation". You really want anything managed by the Social Security Admin.?????? IMHO Rep. George Miller could'nt manage a popsicle stand.

[Hobo]

Urban legend? Did you not look at the links?
Note the .GOV ending to the website.


http://edlabor.house.gov/hearings/fc-2008-10-07.shtml
http://edlabor.house.gov/statements/2008-10-07-GMHearingStatement.pdf

If it were really an urban legend, then why is there an official government website link?
and if they were never going to consider confiscation then why exactly did they have that Professor present her paper and Ideas?



The confiscation part is an urban legend.

[JackieB]

JB, read the link, it said "confiscation". You really want anything managed by the Social Security Admin.?????? IMHO Rep. George Miller could'nt manage a popsicle stand.

It's not true, though. I did a bit more research.

No, I don't want Social Security to manage a plan for me, but then again, I don't need them to, either. Thanks mostly to my wife, I learned the importance of saving early on and have been diligent and relatively conservative (in terms of investment allocation) about it for well over 20 years now.

The problem that they are trying to consider is the fact that the majority of Americans don't save much at all. I think there is a role for government to help encourage us to do so (although the federal government itself offers a remarkably poor example of fiscal prudence), but I don't want Social Security to do it for me.

I'm not sure what's the answer. If people want to spend their money, that's their business. But I don't appreciate the fact that poor financial management has led us to this massive bailout problem we are facing. And that's not Barney Frank's fault anymore than it is Phil Gramm's.

[Miracle Whip]

Jackie B - there you have it. So few of us save money, its pitiful. The rainy day doesn't exist anymore. I see excessive spending everywhere from the top of the line gooseneck trailers to the SUV's that still chase me down highway 13. There are more neighborhoods with $300,000+ homes in my county than there are for the average person. Or so it seems. Are they all doctors?

I think cashing out our retirements might be a good idea. What did people do during the last depression? They might have bought war bonds but they surely didn't give them their retirement funds. They stuck money in their mattress. And they survived.

And its not like our parents didn't try to teach us. My parents were frugal. My mom recycles ziplock bags and I think she is nuts. I really don't think I would bother to pay my charge card in full, if not for what they taught me at the supper table.

[moka]

And its not like our parents didn't try to teach us. My parents were frugal. My mom recycles ziplock bags and I think she is nuts. I really don't think I would bother to pay my charge card in full, if not for what they taught me at the supper table.

Oh, my mom did too.

[Tiz]

The definition of insanity is to keep doing things that don't work, while expecting a different result. The thought of social security funds being wasted, as they have been, makes my stomach hurt, but to each their own. If you don't think you're competent enough to take care of yourself, then by all means, turn it over to government. You'll be disappointed, but at least you can pretend it's not your fault.

[JackieB]

I'm wondering if its not worth cashing out, paying the taxes & penalties to keep their grubby mitts of my cash.:nono:

No, don't do that. First off, there is no way, no way that a plan involving money you personally set aside in your own IRA or 401(k), or your employer's match, could gain any political traction in terms of taking that away from you. It's not going to happen.

Secondly, and perhaps more importantly, I've seen pictures of you, rocknK. You're obviously older than dirt and can begin to withdraw shortly without a penalty. Bwahahahaha!!!! :hysterical::hysterical::hysterical::hysterical:

[JackieB]

Urban legend? Did you not look at the links?
Note the .GOV ending to the website.


http://edlabor.house.gov/hearings/fc-2008-10-07.shtml
http://edlabor.house.gov/statements/2008-10-07-GMHearingStatement.pdf

If it were really an urban legend, then why is there an official government website link?
and if they were never going to consider confiscation then why exactly did they have that Professor present her paper and Ideas?

I read all 10 pages of her paper Hobo, but I can't see where she is suggesting confiscating retirement plans. She did say that workers should be allowed to turn over their 401(k) plans in exchange for a guaranteed annuity in retirement. But there wasn't a word about it being mandatory as far as I can see.

The part that did appear to be mandatory was the workers would have to save 5% their entire lives and the government would add $600 a year and then guarantee 3% interest.

I would prefer to have this plan worked out in the private sector, but she's got a point about people not saving. We're in an era now where defined pension plans are being eliminated, Social Security is in trouble of being insolvent, and people aren't saving enough for their retirements. That may not be the government's problem to address, but it is a problem.

Anyway, if you can find something that suggests that my IRA and 401(k) that I've been contributing toward for over two decades now would be in jeopardy of being confiscated in favor of a guaranteed annuity, I'd like to read that. I'd fight such a measure with all of my strength, and I just don't see that it could gain any traction anyway.

[rocknK]

Jb, I may be older than dirt but I can still sit a horse!:cowboy: I've been saving in retirement funds in IRAS, SEPIRAS, ROTHIRAS, 457 accounts, etc. since they were first invented. It was my hedge against the Social Security that might not be there for me when I needed it most. Now they want to grab that! B@st!ds!

[JackieB]

Jb, I may be older than dirt but I can still sit a horse!:cowboy:

A lot better than me, I'm sure.:)

My wife saw me crawling out of bed yesterday and said I looked like a turtle that had been flipped over on its back. :p I have a lot of arthritis and it takes me awhile to get things moving again after I've been in one position for awhile.

[rocknK]

Sounds like the new Sly Stallone movie, he'll be battling arthritis or alzhiemers, he just can't remember which!:p

[gaited07]

MD, go ahead & give them YOUR money. I worked very hard for mine & I'd like to keep it, thank you. All politicans do when you give them money is SPEND it. I'm wondering if its not worth cashing out, paying the taxes & penalties to keep their grubby mitts of my cash.:nono:


I'm with you on this one!!!
I worked very hard for mine and don't want any damn government taking it and giving it to someone who did NOT CONTRIBUTE to any retirement funds!!!
Those of you who think this is a good idea, why don't you just sign your paycheck over to them and let them decide what you can spend your money on or if there is any money to spend is left???!!!!
What's next, how much TP I use????? GOVERNMENT NEEDS TO STAY OUT OF MY HARD EARNED MONEY, PERIOD!

[gaited07]

Jackie B - there you have it. So few of us save money, its pitiful. The rainy day doesn't exist anymore. I see excessive spending everywhere from the top of the line gooseneck trailers to the SUV's that still chase me down highway 13. There are more neighborhoods with $300,000+ homes in my county than there are for the average person. Or so it seems. Are they all doctors?

I think cashing out our retirements might be a good idea. What did people do during the last depression? They might have bought war bonds but they surely didn't give them their retirement funds. They stuck money in their mattress. And they survived.

And its not like our parents didn't try to teach us. My parents were frugal. My mom recycles ziplock bags and I think she is nuts. I really don't think I would bother to pay my charge card in full, if not for what they taught me at the supper table.

Your kidding, right???

I don't know about your area but here, I could careless that my neighbor drives a Ford or a BMW or if their house is 200,000 or 2.5 million. These are AMERICAN CHOICES. My husband and I WORK our a$$es off for many years and SAVED for our retirement with careful planning and busting butt!

As for the last depression, most people JUMPED OFF BUILDINGS because there was NOTHING ELSE, they lost ALL their money in. I do believe the SSI was created after the depression because of all the ciaos of the financial mess.

[westmanfarrier]

So, lets say government takes an IRA that has $10,000 and guarantees me 3% interest. In 30 years, with interest compounding monthly and no other additions I would end up with $24, 568.

If I invest that $10,000 in a diversified portfolio of mutual funds that historically, with all the market ups and downs, has returned an average 8% I would have $109, 357. Big difference.

I saw earlier someone said they 'lost' 33% of their retirement. Was that 33% of the principle invested, or the highest balance with all of the gains of the past 10 years? My total balance may be down in my investment portfolio, but I still have more money than I put in over all. I am betting that as the economy recovers my investments will do better than 3%.

Maybe people don't save because they figure already that government will be there to bail them out in the end.

[Tiz]

"It is true that democracy undermines freedom when voters believe they can live off of others' productivity, when they modify the commandment: "Thou shalt not steal, except by majority vote." The politics of plunder is no doubt destructive of both morality and the division of labor. But there is no law of historical decline that says that people cannot change their minds.
http://www.lewrockwell.com/north/gary.jpgChanging minds is what education is all about. So is evangelism. Neither progress nor decline is guaranteed by some internal logic of society. Logic is what people use to interpret and then change society. There is no such thing as social logic."
Gary North
October 21, 2006

[JackieB]

So, lets say government takes an IRA that has $10,000 and guarantees me 3% interest. In 30 years, with interest compounding monthly and no other additions I would end up with $24, 568.

If I invest that $10,000 in a diversified portfolio of mutual funds that historically, with all the market ups and downs, has returned an average 8% I would have $109, 357. Big difference.

I saw earlier someone said they 'lost' 33% of their retirement. Was that 33% of the principle invested, or the highest balance with all of the gains of the past 10 years? My total balance may be down in my investment portfolio, but I still have more money than I put in over all. I am betting that as the economy recovers my investments will do better than 3%.

Maybe people don't save because they figure already that government will be there to bail them out in the end.

You're absolutely right. I was a bit bummed because our portfolio took a big hit. But, if I take the new, much lower balance, and look at it from where I started along with interest and all, it's still much better than a 3% return.

One problem though is that many (most?) don't know how to invest. I can't blame these people; it's confusing and boring. But in this latest crisis for example, hundreds of thousands who are near retirement and about ready to need that money still had it 100% in stocks. They just didn't know that they should do anything different.

[Tiz]

"But in this latest crisis for example, hundreds of thousands who are near retirement and about ready to need that money still had it 100% in stocks. They just didn't know that they should do anything different."

Or they did know, and chose the risk for bigger gains.

[JackieB]

[quote=Tiz;35914Or they did know, and chose the risk for bigger gains.[/quote]

That's possible. Probably just thought that something of this magnitude couldn't happen. Even Alan Greenspan said that he couldn't imagine that the crisis could ever get this big.

[Miracle Whip]

Yes it does bother me that others have more expensive houses and whatnot. I am sure they have to work SOMEPLACE to get that much cash, but it just seems excessive - who needs 3000 sq foot of living space? I am so ticked at the stuck up ladies at the stable I have vowed to beat the pants off of them this next show season. The trainer does not even talk to me, I am beneath her. This is such a change from 3 years ago when Carla would WAVE at me when she was in the line up in a Western Pleasure class - asking me why I wasn't out there with her!! And I had no Western Pleasure horse to speak of! I had a horse, and I did ride at the Equestrian Center, TWO full years later and I never forgot her encouragement. Big difference. If you treat me decent I don't care what you have, but treat me like dirt its another story.

Ah well. Doesn't have much to do with IRA's does it?

[HoustonFarrier]

Yes it does bother me that others have more expensive houses and whatnot.I am sure they have to work SOMEPLACE to get that much cash, but it just seems excessive - who needs 3000 sq foot of living space?
And, exactly what DEFINES excessive??? WHO should define it?? Government???

Yikes!

Steve

[gaited07]

And, exactly what DEFINES excessive??? WHO should define it?? Government???

Yikes!

Steve


That is what I'm saying.
MW, how do you know what these people do for a living and what their expenses are, not to mention, what business is it of yours or anyone elses what someone else makes, drives, lives in and etc., etc. Next you will say that it is not fair that your neighbor has 100 acres and you have only 1/2.
It almost sounds like a jealousy thing with you. And as for your fellow boarders/trainer not waving at you or talking to you, sorry, that goes on no matter what income level you are in. People can be snobs in all classes. Its the better person to turn away and ignore the ignorance of poor social skills.

[Miracle Whip]

Maybe. Maybe not. Generally the poor don't use people or step on them quite like the rich divas do. I am probably jealous yes. It has been pointed out to me before. I guess I keep wondering what it is that they have that I don't. Why they succeeded financially and I struggle. I know a rich lady and she has tons of stress in her life, and migraines a couple times a week. She listens to whomever bugs her the most, or as she told me once - he who barks the loudest.

Guess I just ain't obnoxious enough to get ahead in this world.

And no, I don't board. I own my own property, thank God for that.

[Tiz]

MW, have you ever heard of The Science of Success, or The Secret? I think you would find these, and other positive thinking books interesting.

[42many]

I'm with you on this one!!!
I worked very hard for mine and don't want any damn government taking it and giving it to someone who did NOT CONTRIBUTE to any retirement funds!!!
Those of you who think this is a good idea, why don't you just sign your paycheck over to them and let them decide what you can spend your money on or if there is any money to spend is left???!!!!
What's next, how much TP I use????? GOVERNMENT NEEDS TO STAY OUT OF MY HARD EARNED MONEY, PERIOD!

I think a major part of the problem is that people spend entirely too much time being concerned with what higher-income people spend their money on and not nearly enough time paying attention to what people sucking down money on things like welfare and food stamps are spending their money on.

1) People spending their money on luxury items is what RUNS this economy. Every excessively sized house or overly nice car/boat/RV/whatever employs large numbers of people to make and upkeep these things. If people stopped buying luxuries and everyone lived in a modest little house or rented with the very basics, a LOT of people would be out of jobs.

2) I actually saw a conversation between 2 people talking about FOOD STAMPS, where one was complaining that the food stamps her family gets aren't enough to pay for all of the organic foods that she mail-orders from out of town. The other agrees that her food stamps also aren't always enough. BOTH of these people are talking on the internet, on computers, in their own homes, owning cars, staying at home with their kids. ???

[mtnmollie]

Big O just wants America to be a little more like Canada;
and
we need to help fund the Grasshopper program. :cowboy:


The ant and the grasshopper


* CLASSIC VERSION: *
The ant works hard in the withering heat all summer long, building his house and laying up supplies for the winter. The grasshopper thinks he's a fool, and laughs and dances and plays the summer away. Come winter, the ant is warm and well fed. The shivering grasshopper has no food or shelter, so he dies out in the cold.

* THE CANADIAN VERSION: *
The ant works hard in the withering heat all summer long, building his house and laying up supplies for the winter. The grasshopper thinks he's a fool, and laughs and dances and plays the summer away. Come winter, the ant is warm and well fed. So far, so good, eh?

The shivering grasshopper calls a press conference and demands to know why the ant should be allowed to be warm and well fed while others less fortunate, like him, are cold and starving. The CBC shows up to provide live coverage of the shivering grasshopper, with cuts to a video of the ant in his comfortable warm home with a table laden with food. Canadians are stunned that in a country of such wealth, this poor grasshopper is allowed to suffer so while others have plenty.
The NDP, the CAW and the Coalition Against Poverty demonstrate in front of the ant's house. The CBC, interrupting an Inuit cultural festival special from Nunavut with breaking news, broadcasts them singing 'We Shall Overcome.'
Jack Layton rants in an interview with Mike Duffy that the ant has gotten rich off the backs of grasshoppers, and calls for an immediate tax hike on the ant to make him pay his 'fair share'. In response to polls, the Conservative Government drafts the Economic Equity and Grasshopper Anti-Discrimination Act, retroactive to the beginning of the summer. The ant's taxes are reassessed, and he is also fined for failing to hire grasshoppers as helpers.
Without enough money to pay both the fine and his newly imposed retroactive taxes, his home is confiscated by the government.

The ant moves to the US , and starts a successful agribiz company.

The CBC later shows the now fat grasshopper finishing up the last of the ant's food, though spring is still months away, while the government house he is in, which just happens to be the ant's old house, crumbles around him because he hasn't bothered to maintain it.
Inadequate government funding is blamed, Bob Rae is appointed to head a commission of enquiry that will cost $10,000,000. The grasshopper is soon dead of a drug overdose, the Toronto Star blames it on the obvious failure of government to address the root causes of despair arising from social inequity.
The abandoned house is taken over by a gang of immigrant spiders, praised by the government for enriching Canada's multicultural diversity, who pomptly set up a marijuana grow op and terrorize the community.

THE CANADIAN VERSION...from this Canadian D Board-

http://www.outdoorsmenforum.ca/showthread.php?t=22181

[gaited07]

I think a major part of the problem is that people spend entirely too much time being concerned with what higher-income people spend their money on and not nearly enough time paying attention to what people sucking down money on things like welfare and food stamps are spending their money on.

1) People spending their money on luxury items is what RUNS this economy. Every excessively sized house or overly nice car/boat/RV/whatever employs large numbers of people to make and upkeep these things. If people stopped buying luxuries and everyone lived in a modest little house or rented with the very basics, a LOT of people would be out of jobs.

2) I actually saw a conversation between 2 people talking about FOOD STAMPS, where one was complaining that the food stamps her family gets aren't enough to pay for all of the organic foods that she mail-orders from out of town. The other agrees that her food stamps also aren't always enough. BOTH of these people are talking on the internet, on computers, in their own homes, owning cars, staying at home with their kids. ???

Now thats what I'm talkin about!!!:clap:

If we did not have all those "SNOBS" buying all those big expensive houses, cars, clothes, horse trailers and etc., We would be in a country without desire,goals, strengths, and ambition.
What we need to think about is the class that abuses the government funds of welfare, health care and living assistance programs (HUD). This is the class of people we need to worry about not the "SNOBS". Snobs support/build the economy, welfare people (abusers) take that support away. Not to mention, a good portion of my pay check pays for these ABUSERS that are buying organic foods or worse yet, selling the food stamps or health care to pay for DRUGS!
Here's an idea, legalize drugs (marijuana) and TAX the SHITZ out of it to help pay for welfare. People are using this stuff, so why not legalize it and make it a revenue from it!