There is an alternative.
I can’t believe a publication would put this out, even one like TONY, unless it was under a section for loons to have their say.
There was a guy at my workplace who died at his desk on his last day of work shortly after his farewell party. No shit.
This in no way justifies not saving for retirement. Even in this freakishly unlikely event his savings still were a good thing for his family.
As the Donovan song goes
"If you have to die,
Please do it during tea break. "
My wife works with a gal who doesn’t believe in 401ks. She honestly believes it’s some type of scam or something. She thinks her coworkers are a bunch of suckers and likes to use phrase like “You guys are really gulible if you think they’re going to give you free money.”
They’ve tried to explain it to her several times to no avail and she just closes her eyes, shakes her head, and thinks everyone else is crazy.
I’m pretty surprised too that TONY would even publish this. She must have some dirt on someone.
I’d bet $500 that in 15 years, she’s going to be kicking herself left and right for being such a stupid girl at 26.
I read the article. I didn’t read it as a satire, but the author is on the staff of this magazine and so is probably writer (such as it is). I certainly thought she was trying to be a little ironic, especially the last paragraph. She makes some interesting points, most of which regarding rules for 401(k)'s were factual as far as I can tell, but you would be a moron to take her advice literally.
It’s kind of a dangerous attitude. My mother didn’t start in a 401k until about 10 years ago and she’s had to play a big time catch up . It was like taking a pay cut when she did start contributing because of the amount she had to put in.
I’m in my late 20s and have been participating in my company’s 401k for about 4 years now. I’ve tried to get into the habit of increasing my contribution by 1% per year so I don’t ever feel like I’m missing the money. And still I worry that even with nearly 35 years to go I won’t have enough. This girl is a loon.
I’ll also add that mattress savings accounts don’t look so good if the house burns down or floods.
Is that $500 dollars invested today and compounded for 15 years, or $500 15 years from now?
If she’ll just save something. Maybe then, someday, she’ll be able to afford Fancy Feast instead of Cat Fud.
Then you would have had a return of -33% because of taxes.
Can you keep cash in a 401(k)? My somewhat equivalent RRSP allows it and I have a few thou in there, earning fairly miniscule interest but not depreciating, either.
If you have a really crappy 401k, perhaps not. But most plans have a Money Market account (although it’s uninsured, so it’s intermediate in safety between a Bond Fund and a government-insured bank “money market” account.) There might be choices that are even safer than a true Money Market account, but I’m not sure.
But most 401ks charge such high fees that you might just barely beat inflation with your MM account (but at least it’s tax-deferred.)
I own my own business so a 401K is too cumbersome to do, but I can do a SEP-IRA and put up to about $20K in to it each year. I don’t.
I live outside the US so I don’t pay federal tax anyway (of course I do on interest). But by putting money in Czech Crowns I am doing pretty well. In the last 2.5 years I have earned a bit over 50% because of the strengthening CZK and falling USD.
It has fallen from 1USD = 25.5 CZK to 16.8 CZK
I don’t know of a 401k or SEP-IRA that allows me to hold my funds in CZK.
In was in an article about making money. In all fairness it also included an insert including ‘prostitution’ and ‘defrauding retail stores’.
I thought I was, but perhaps not. Presently diversified between three large cap, one mid, one small, and one international. So far in my life as a future tycoon I’ve shown a rather uncanny knack for picking funds which were previously stellar, but which decide—after I invest—to embark on a much-deserved extended break from all that earning.
While I strongly disagree with the lady who thinks 401K’s are stupid there is a certain logic in living for today. I’m not advocating a world tour on every vacation but waiting until retirement to enjoy life is a false promise. My dad died 2 years after he retired and my mom was in poor health from that same time period until she died. Unfortunately they were depression era people who struggled through childhood only to struggle through WWII only to struggle to establish a good income.
While I intend to keep up with my 401k’s I also intend to smell the roses as best I can along the way.
I think this woman is foolish, but I can understand her thinking. She is 26 and that is hard to focus on your retirement that seems so far away. But she should be thinking of retiring at 55 and not 65.
That is my goal. I am 48 and my goal is 55, IF the market does what I want! But if not, I can go til 57 or 59.
I would recommend this author and this book for anyone interested in their retirement. I enjoyed the book, very straightforward and easy to follow approach.
http://www.gailmarksjarvis.com/index.html
After I read this book, all my friends described it as me finding religion 
You need both. I’ve never bought into the “bust my ass in high school so I can get into a good college and land a great job and work 100 hours a week until I die of a heart attack at 40” mentality. I’m more of a “work hard/play hard” kind of guy. I work a demanding job because it pays me very well, it’s in Manhattan and offers me various perks like moderate travel and lots of expensed dinners and fancy bar tabs. I still have time and money to go on vacations with my friends, do shore or ski houses (back in my 20s) and basically just enjoy life when I’m not working.
And I still save money in my 401k.
Yeah, but when she’s old and poor, I’ll bet she’ll be writing articles about “what kind of civilized nation allows its elderly to become the victims of poverty?”