Comments for The Retirement Savings Challenge http://www.theretirementsavingschallenge.com A world of investing for retirement™ Tue, 23 Aug 2011 15:08:47 +0000 hourly 1 Comment on Don’t let fear be your guide: Prepare for volatility and stay invested by Paul S http://www.theretirementsavingschallenge.com/2011/08/dont-let-fear-be-your-guide-prepare-for-volatility-and-stay-invested/comment-page-1/#comment-14592 Paul S Tue, 23 Aug 2011 15:08:47 +0000 http://www.theretirementsavingschallenge.com/?p=1240#comment-14592 As a former customer service rep with major 401(k) plan administrators, the one thing I could not understand was when people who were 20+ years away from retirements wanted to take their money out of a 401(k) when the market was on a downturn. The one thing people have to remember is a 401(k) is not the same as your bank account. If you look at your account today and it has a value of $10,000 and the next day it's worth $10,500 there isn't going to be an extra $500 in your bank account. Vice versa if it was down in value $500. Although we can't predict the market, we can look back at its history, and as long as you can weather the storm you should be OK. As a former customer service rep with major 401(k) plan administrators, the one thing I could not understand was when people who were 20+ years away from retirements wanted to take their money out of a 401(k) when the market was on a downturn. The one thing people have to remember is a 401(k) is not the same as your bank account. If you look at your account today and it has a value of $10,000 and the next day it’s worth $10,500 there isn’t going to be an extra $500 in your bank account. Vice versa if it was down in value $500. Although we can’t predict the market, we can look back at its history, and as long as you can weather the storm you should be OK.

]]> Comment on Time for change in the Social Security model by Adam Langton http://www.theretirementsavingschallenge.com/2010/08/time-for-change-in-the-social-security-model/comment-page-1/#comment-726 Adam Langton Sat, 18 Sep 2010 16:31:29 +0000 http://www.theretirementsavingschallenge.com/?p=876#comment-726 This article seems to equate the current net Social Security outlays with bad management or government largesse. In truth, the current negative outlays are the result of prudent planning and saving, the same characteristics this organization recognizes as virtues when practiced by its clients. When the Social Security program was modified in the 1980s, it was understood that the program would be running a deficit during the the first half of the 21st century. The program deliberately ran up a surplus during the 1990s so that it could support future outlays associated with the baby boomer retirement. Changes to the retirement age and other program rules helped ensure that the program would be solvent for an additional 50 years. It is probably necessary to consider minor rule changes (changes to the minimum retirement age, for example) to reflect workplace realities, similar in scope to what was done in the 1980s. Comparing Social Security to a business isn't helpful. The program simply redistributes income across generations, and should not generate any net financial profits. All the benefits from the program can be measured in the improvements in the lives of the elderly in our country. For hundreds of years, the elderly experienced the highest poverty rates of any age group in any community or country. After Social Security was introduced, the elder poverty rates dropped to lowest of any age group in the US. Any business that could claim this kind of success would be reluctant to push for sweeping, dramatic changes simply to make its short-term financial perspective a little rosier. This article seems to equate the current net Social Security outlays with bad management or government largesse. In truth, the current negative outlays are the result of prudent planning and saving, the same characteristics this organization recognizes as virtues when practiced by its clients.

When the Social Security program was modified in the 1980s, it was understood that the program would be running a deficit during the the first half of the 21st century. The program deliberately ran up a surplus during the 1990s so that it could support future outlays associated with the baby boomer retirement. Changes to the retirement age and other program rules helped ensure that the program would be solvent for an additional 50 years.

It is probably necessary to consider minor rule changes (changes to the minimum retirement age, for example) to reflect workplace realities, similar in scope to what was done in the 1980s. Comparing Social Security to a business isn’t helpful. The program simply redistributes income across generations, and should not generate any net financial profits. All the benefits from the program can be measured in the improvements in the lives of the elderly in our country. For hundreds of years, the elderly experienced the highest poverty rates of any age group in any community or country. After Social Security was introduced, the elder poverty rates dropped to lowest of any age group in the US. Any business that could claim this kind of success would be reluctant to push for sweeping, dramatic changes simply to make its short-term financial perspective a little rosier.

]]> Comment on Automatic IRAs will get America saving by shirley http://www.theretirementsavingschallenge.com/2010/08/automatic-iras-will-get-america-saving/comment-page-1/#comment-603 shirley Wed, 15 Sep 2010 13:17:39 +0000 http://www.theretirementsavingschallenge.com/?p=931#comment-603 people should carry insurance instead of trying to put 3% of their income for retirement We have so many unfunded pensions now. Will that be another bailout later. If we lower the retirement age and require people to work 40 hrs a week for 40 years and they know they will be able to draw social security at an early age they will manage their money so they have some to enjoy their dreams after work. people should carry insurance instead of trying to put 3% of their income for retirement We have so many unfunded pensions now. Will that be another bailout later. If we lower the retirement age and require people to work 40 hrs a week for 40 years and they know they will be able to draw social security at an early age they will manage their money so they have some to enjoy their dreams after work.

]]> Comment on Time for change in the Social Security model by Ann Dalkey http://www.theretirementsavingschallenge.com/2010/08/time-for-change-in-the-social-security-model/comment-page-1/#comment-313 Ann Dalkey Sun, 05 Sep 2010 22:38:42 +0000 http://www.theretirementsavingschallenge.com/?p=876#comment-313 I disagree with your advice to extend retirement age and limiting benefits as a fix for Social Security. Instead, we should follow the suggestions of Senator Bernie Sanders, by making all income subject to Social Security taxes. It will not harm those of us making more than $106,000 and will significantly help Social Security. It is in society's interests for all people to have a dignified retirement. I disagree with your advice to extend retirement age and limiting benefits as a fix for Social Security. Instead, we should follow the suggestions of Senator Bernie Sanders, by making all income subject to Social Security taxes. It will not harm those of us making more than $106,000 and will significantly help Social Security. It is in society’s interests for all people to have a dignified retirement.

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