Forcing people to save?
#1
Outnumbered at home
Thread Starter
Forcing people to save?
Not sure how I feel about this. On one point it would be great that more people are preparing for retirement but at the end of the day I don't like that they are trying to force people to do things with their own money
http://money.cnn.com/2005/12/01/reti...form/index.htm
NEW YORK (CNNMoney.com) – Along with all the other reforms debated or legislated this year - Social Security reform, bankruptcy reform, tax reform – add pension reform to the mix.
Among the major proposed changes by lawmakers are boosting employee participation rates and contributions to 401(k)s and imposing on companies tougher standards for the funding and transparency of their defined-benefit pension plans.
.......
Boosting 401(k) participation: Both the Senate and House bills call for employers to automatically enroll all eligible workers in the company's 401(k) plan. Studies show that of all workers eligible to participate in their 401(k) plan, only about 70 percent do on average. Automatic enrollment, which about a fifth of large companies offer already, is expected to boost the participation rate to over 90 percent.
Boosting 401(k) contributions: The House bill also provides an incentive for companies do three things:
• Automatically set the employee's contribution in the first year at 3 percent of pay and increase that amount by one percentage point a year until reaching 6 percent.
• Offer a 50 percent matching contribution or contribute 2 percent of pay for all employees whether they contribute or not.
• Allow the employer matches to vest after two years, well below the typical five-year period. If an employee leaves a company before his matches vest, he forfeits them.
And it would make permanent the increased annual contribution limits to 401(k)s and IRAs, including catch-up provisions, that are currently set to expire after 2010.
http://money.cnn.com/2005/12/01/reti...form/index.htm
NEW YORK (CNNMoney.com) – Along with all the other reforms debated or legislated this year - Social Security reform, bankruptcy reform, tax reform – add pension reform to the mix.
Among the major proposed changes by lawmakers are boosting employee participation rates and contributions to 401(k)s and imposing on companies tougher standards for the funding and transparency of their defined-benefit pension plans.
.......
Boosting 401(k) participation: Both the Senate and House bills call for employers to automatically enroll all eligible workers in the company's 401(k) plan. Studies show that of all workers eligible to participate in their 401(k) plan, only about 70 percent do on average. Automatic enrollment, which about a fifth of large companies offer already, is expected to boost the participation rate to over 90 percent.
Boosting 401(k) contributions: The House bill also provides an incentive for companies do three things:
• Automatically set the employee's contribution in the first year at 3 percent of pay and increase that amount by one percentage point a year until reaching 6 percent.
• Offer a 50 percent matching contribution or contribute 2 percent of pay for all employees whether they contribute or not.
• Allow the employer matches to vest after two years, well below the typical five-year period. If an employee leaves a company before his matches vest, he forfeits them.
And it would make permanent the increased annual contribution limits to 401(k)s and IRAs, including catch-up provisions, that are currently set to expire after 2010.
#2
Team Owner
I've heard about this. The way it is currently setup, employees have to op in to 401k. They want to make it so the employee has to op out if they don't want to contribute. I think the whole idea sucks.
#3
Just dial 1911
Join Date: May 2004
Location: San Diego, CA
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I think if your making a certian amount, this MIGHT be ok. I remember my first job with a 401k back when I was 21. Didnt pay a whole lot, so there was no way I wanted to contribute (yes, I know I gave up free money...oh well). A few years later I got a better job with much better pay and I've been contributing ever since. I think if I was forced into contributing back then, that would have seriously cut into my beer money funds
Not sure who would make that call of "if you make X dollars, you should contribute."
Not sure who would make that call of "if you make X dollars, you should contribute."
#5
This is the government's way of saying, "Yeah we know you're not going to see a dime of all that social security money you've given us over the years, so you'd better start saving for your retirement now."
Personally, I'd love to be "forced" to stick my entire socialist insecurity tax into a Roth IRA under my own management and control. I'd come out way ahead and wouldn't have to worry about politicians blowing it on stupid shit. Of course they'll never let me do that because they enjoy spending it on stupid shit.
Personally, I'd love to be "forced" to stick my entire socialist insecurity tax into a Roth IRA under my own management and control. I'd come out way ahead and wouldn't have to worry about politicians blowing it on stupid shit. Of course they'll never let me do that because they enjoy spending it on stupid shit.
#6
I have no concept of 401k as my company uses a SEPP. At the end of the year I get a check with the name of my financial advsior company on it and I drop it off to them for a contribution. This is usually 6-8% of my total pre-tax earnings.
#7
Suzuka Master
Join Date: Aug 2003
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Originally Posted by GTKrockeTT
i think it's a good idea. anyone who can't afford a 3% deduction pre-tax should get a new lifestyle .
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#8
This is a great idea, and is already done by the company I work for. I am one of those people that put in the max, but since alot of people don't I get money back at the end of the year.
It is also good, because most people don't notice that 2% of there salary is missing, and then they see they are getting a certain percentage match.
Michael
It is also good, because most people don't notice that 2% of there salary is missing, and then they see they are getting a certain percentage match.
Michael
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