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"Nobody at the time envisioned the 401(k) as something on which people would rely for their retirement. But in the years that followed, more and more employers began to look for ways to get out of funding the pension and health plans that, up to then, had been regarded as part of the responsible capitalist social contract. ...
"Nobody bothered to ask employees whether they wanted to swap their pensions for choice or ownership, nor did anybody stop to notice that very few people are suited by background, ability or temperament to actively manage investments."
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Ever since last October or so, when it seemed inevitable to me the election was going to continue unabated aided by in in-the-O'bamatank media, I started warning my friends and families to consider doing something with their 401(k)and IRA retirement accounts.
Most people listened intently, yet failed to take any actions. Some of the ones I spoke to have rather substantial accounts they are seeing writhing, with the gasping last breaths not dissimilar to a dying fish floundering on the table next to the fish bowl.
I read some mutterings about the government considering seizing these accounts, and the more I think on it, the more convinced I am that this may be the next gasper in the how the government works.
With this article, it re-affirms my worries, especially considering the state of the porkulous stimulus gigantimus.
If you think I am blowing steam, take a gander. The Dims have held hearings over this since *before* the election. Since 2007, in fact. A briefing paper was submitted on how this could be done, and how to pull it off as "necessary" to save the economy.
The paper was submitted to the hearings, in which the writer participated.
"On November 20, 2007, Dr. Ghilarducci participated in the Economic Policy Institute's latest "Agenda for Shared Prosperity" event in Washington, DC. At the event, she unveiled a briefing paper, Guaranteed Retirement Accounts, which outlines her vision for combining the best features of traditional defined-benefit pensions and 401(k)-style defined-contribution plans."
When the government was fretting over losing "billions, even trillions!", a lot of what they were speaking about was *our* money, that we watched disappearing from our 401 and IRA statements.
As of October, November, and December of 2008, they were talking about how seizing the accounts would net them nearly four trillion easily. Could this be the provocation behind the stimulus?
The claim is, it costs the government $80 billion a year in unpaid taxes on these accounts. How is it costing the government $80 billion in unpaid taxes, then on the other hand people are saying, "That money in your 401 wasn't really there, it was assumed income based on your earnings at retirement, and only your real dollars were there."
Huh? Is it digital dollars, or is it really a loss? The real answer comes after retirement as the funds are withdrawn, where they still get taxed. Sure, at a lesser rate, but that's the benefits *earned* by saving in these accounts.
I call it a percieved loss for the government, as it isn't tangible. They want your accounts, because when they seize them, it becomes tangible nearly $4 trillion payout.
I say, chase down all the Democrats who forgot to pay their taxes and make them! That ought to even it out some...considering they feel they are above silly things like, oh, I don't know... taxes?
This statement, alone, under her proposed plan - should chill your blood.
"Death benefits. Participants who die before retiring can bequeath half their account balances to heirs; those who die after retiring can bequeath half their final account balance minus benefits received."
You can download the PDF of her plan here.
After your 401 or IRA is seized, they would open an account for every American, and start it with $500.00. Spread the wealth, remember?
Every American, even those not working, because, that's only fair, right? The government will then automagically deduct %5 of your pay after tax to go to the account, and meet your deposit with only %3 annually. This is mandatory, too, by the way. Not voluntary like retirement accounts are now.
Why mandatory? Because they say, "People are not intelligent enough to save on their own, we must do it for them."
When you die, your family inherits only half the balance, the other half goes into the government coffers.
Half. Half of *your* money. So anything they give as "interest", is taken back, not to mention part of your *real* income, which was already taxed to hell, because it will be taxed under their plan, not pre-tax, like it is now.
For instance, if you have a balance of $200,000 in your 401, if you die before you retire, your family gets half. So, $100,000. So you lose $97,000 if you consider their co-pay of %3 as going back to them.
If you die after you retire, they get less than half, which is still stealing your money because you paid %5, matched to their %3. This is misleading because it is less than half. It is half plus %3. Isn't that kind of a death tax or something?
So they get half the balance, minus the %3 they put in, *and* a portion of what you paid in. It's a win win for them! That is, after they seize them, they pay you a measly %3 government interest as opposed to up to 6% now.
So lets see. $200,000 minus %3 off the top at $6,000, then halved.
Leaves your family $97,000.
So that would be $103,000 back to the government.
It's only somewhat beneficial if you die before you retire, where they would get back $100,000 skipping the %3. Your family gets an extra $3,000. Woo. Hoo.
Here are some links to check out.
There are many sites the poo-poo this concern, but just as many that express what I consider to be a genuine worry.
Wealth redistribution at it's finest! Not so far fetched after the first weeks of the presidency, is it now?
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