PBS Frontline : The Retirement Gamble, sorta Must See (3 Viewers)

[wilked]

FUBAR, that is a bit elitist... my parents scraped to keep a roof over the head, food on the table. We were never poor but they also never took a vacation. Today my dad is collecting a pension and without it he would probably be working I would guess. The decision to save for retirement is not always so obvious or immediate.

It is not surprising at all to me that making that mindshift to choosing to set money aside rather than it being chosen for you is not foolproof

Some improvements they have made is to change the structure for many companies to 'default of 0% 401K contribution" to default of 6% (to maximize matching). The numbers bear out that this small thing has had a big improvement.

Another example of the same principle is organ donation (opt in vs opt out). http://wordpress.mrreid.org/2010/09/18/opt-in-or-opt-out/

 

[Sand]

Some improvements they have made is to change the structure for many companies to 'default of 0% 401K contribution" to default of 6% (to maximize matching). The numbers bear out that this small thing has had a big improvement.

Another example of the same principle is organ donation (opt in vs opt out). http://wordpress.mrreid.org/2010/09/18/opt-in-or-opt-out/

The shift to opt out is a huge plus. Because, let's face it, many many folks just won't change or look at these kind of things. And many will take that extra income and claim they can't live without it (but do successfully live without it when they are opted in automatically).

 

[Dentist]

Another example of the same principle is organ donation (opt in vs opt out). http://wordpress.mrreid.org/2010/09/18/opt-in-or-opt-out/

i'm not sure it's really fair to compare organ donation with retirement.

In the case of organ donation, there is no benefit to you personally as you'll be dead. It's the right thing to do, no question, but there's no real internal motivation to want to do it.

I'm glad they have the automatic opt-in and I realize people generally choose a path of least resistance.

BUT in the case of retirement theoretically it should be something people want. There's an incentive on a personal level to educate yourself on a proper investing platform, there is an incentive to yourself to opt-in.

Now, I know some people are of the mindset that they want the max money they can have when they are young and would rather spend the money on themselves now and eff their future crippled selves... and that's fine if they choose that, as long as I don't have to hear any boo-hoo stories of horribly poor golden years when they are sleeping in the bed they made.

I think it's sad that without the pension system that people care so little about themselves to be incentivized to learn the system, contribute to the system, and take advantage of the system.

 

[FUBAR]

FUBAR, that is a bit elitist... my parents scraped to keep a roof over the head, food on the table. We were never poor but they also never took a vacation. Today my dad is collecting a pension and without it he would probably be working I would guess. The decision to save for retirement is not always so obvious or immediate.

It is not surprising at all to me that making that mindshift to choosing to set money aside rather than it being chosen for you is not foolproof

Some improvements they have made is to change the structure for many companies to 'default of 0% 401K contribution" to default of 6% (to maximize matching). The numbers bear out that this small thing has had a big improvement.

Another example of the same principle is organ donation (opt in vs opt out). http://wordpress.mrreid.org/2010/09/18/opt-in-or-opt-out/

many decisions aren't obvious or immediate.

But (maybe I'm missing your point), someone is paying for that pension. If all things were equal (and they're probably not), would your dad rather have the money the company presumably paid to cover the pension or the pension? Not to mention if we get that extra pay now and control it, the risk of the company going bankrupt is alleviated.

Completely agree that it should be a default to X% contribution instead of having to opt-in.

FWIW, I'm somewhat talking out of both sides here as a key reason I work where I do is the pension.

 

[lod01]

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Great idea in the perfect scenario. Too bad that is not the case for the overwhelming majority.

I've been saying it is a failure for over a decade. I posted here 5 years ago the same thing. Companies sold workers a bunch of BS. It only works for those making enough to save AND have a near perfect career. Defenders of the plan like to show data for those making over 100k a year because if they included people making 1/2 that, the disaster would be obvious. There is no one who can take the max of $18k if they are making less than $75000. $50000 - yeah, right.

The BS of start when you are 20 or 25. Sure. I got fed that one. The number on paper was that I would have 2.5 million......if I was lucky to make x amount, with raises, over 35-40 years. Yeah, right again.

IBM even came out with a new way to screw employees in 2012. They now only pay you the company match if you are employed on Dec. 15. Why? So they don't have to match. Yeah, they set it up where the only way you get the match is if you retire before that date. Leave - you get no match for the year, laid off, ditto.

 

[FUBAR]

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Great idea in the perfect scenario. Too bad that is not the case for the overwhelming majority.

I've been saying it is a failure for over a decade. I posted here 5 years ago the same thing. Companies sold workers a bunch of BS. It only works for those making enough to save AND have a near perfect career. Defenders of the plan like to show data for those making over 100k a year because if they included people making 1/2 that, the disaster would be obvious. There is no one who can take the max of $18k if they are making less than $75000. $50000 - yeah, right.

The BS of start when you are 20 or 25. Sure. I got fed that one. The number on paper was that I would have 2.5 million......if I was lucky to make x amount, with raises, over 35-40 years. Yeah, right again.

IBM even came out with a new way to screw employees in 2012. They now only pay you the company match if you are employed on Dec. 15. Why? So they don't have to match. Yeah, they set it up where the only way you get the match is if you retire before that date. Leave - you get no match for the year, laid off, ditto.

the bolded is just false. It's tough no argument, but not impossible. Many have done it and do it.

I don't understand your second paragraph.

IBM - yeah, that's ####ty.

 

[Gawain]

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Great idea in the perfect scenario. Too bad that is not the case for the overwhelming majority.

I've been saying it is a failure for over a decade. I posted here 5 years ago the same thing. Companies sold workers a bunch of BS. It only works for those making enough to save AND have a near perfect career. Defenders of the plan like to show data for those making over 100k a year because if they included people making 1/2 that, the disaster would be obvious. There is no one who can take the max of $18k if they are making less than $75000. $50000 - yeah, right.

The BS of start when you are 20 or 25. Sure. I got fed that one. The number on paper was that I would have 2.5 million......if I was lucky to make x amount, with raises, over 35-40 years. Yeah, right again.

IBM even came out with a new way to screw employees in 2012. They now only pay you the company match if you are employed on Dec. 15. Why? So they don't have to match. Yeah, they set it up where the only way you get the match is if you retire before that date. Leave - you get no match for the year, laid off, ditto.

I'm not a fan of the Feds, but I think that there could be lot more done on the social security aspect than we currently do.

Remove the SS cap, increase to 10% and beef up OA insurance. Tie qualifying ages to life expectancy and have the state act as pensioner.

Alternatively or additionally, give student loan relief for enrollment in a qualified IRA/401K plan.

Knock 50 cents off of federal student loan debt for every dollar put into a qualified retirement account.

Gets folks saving younger, addresses student debt and will remove government obligations down the road as people have more retirement funds and don't have to rely on Medicare for housing.

 

[Sand]

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Great idea in the perfect scenario. Too bad that is not the case for the overwhelming majority.

I've been saying it is a failure for over a decade. I posted here 5 years ago the same thing. Companies sold workers a bunch of BS. It only works for those making enough to save AND have a near perfect career. Defenders of the plan like to show data for those making over 100k a year because if they included people making 1/2 that, the disaster would be obvious. There is no one who can take the max of $18k if they are making less than $75000. $50000 - yeah, right.

The BS of start when you are 20 or 25. Sure. I got fed that one. The number on paper was that I would have 2.5 million......if I was lucky to make x amount, with raises, over 35-40 years. Yeah, right again.

IBM even came out with a new way to screw employees in 2012. They now only pay you the company match if you are employed on Dec. 15. Why? So they don't have to match. Yeah, they set it up where the only way you get the match is if you retire before that date. Leave - you get no match for the year, laid off, ditto.

I'm not a fan of the Feds, but I think that there could be lot more done on the social security aspect than we currently do.

Remove the SS cap, increase to 10% and beef up OA insurance. Tie qualifying ages to life expectancy and have the state act as pensioner.

Alternatively or additionally, give student loan relief for enrollment in a qualified IRA/401K plan.

Knock 50 cents off of federal student loan debt for every dollar put into a qualified retirement account.

Gets folks saving younger, addresses student debt and will remove government obligations down the road as people have more retirement funds and don't have to rely on Medicare for housing.

Bleh - on SS at least allow for market investment. SS as an investment has a horrible rate of return.

For student loans the answer there is simple - means test borrowing. Cap what a student can borrow at 1.5x (or some reasonable multiple) of expected future salary by major. This will keep people from being fed huge amounts of student debt while getting social work or education degrees. Nip it in the bud on the front end rather than having the taxpayer bail out on the back end.

 

[lod01]

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Great idea in the perfect scenario. Too bad that is not the case for the overwhelming majority.

I've been saying it is a failure for over a decade. I posted here 5 years ago the same thing. Companies sold workers a bunch of BS. It only works for those making enough to save AND have a near perfect career. Defenders of the plan like to show data for those making over 100k a year because if they included people making 1/2 that, the disaster would be obvious. There is no one who can take the max of $18k if they are making less than $75000. $50000 - yeah, right.

The BS of start when you are 20 or 25. Sure. I got fed that one. The number on paper was that I would have 2.5 million......if I was lucky to make x amount, with raises, over 35-40 years. Yeah, right again.

IBM even came out with a new way to screw employees in 2012. They now only pay you the company match if you are employed on Dec. 15. Why? So they don't have to match. Yeah, they set it up where the only way you get the match is if you retire before that date. Leave - you get no match for the year, laid off, ditto.

the bolded is just false. It's tough no argument, but not impossible. Many have done it and do it.

I don't understand your second paragraph.

IBM - yeah, that's ####ty.

ok a hermit can.

 

[KCitons]

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Great idea in the perfect scenario. Too bad that is not the case for the overwhelming majority.

I've been saying it is a failure for over a decade. I posted here 5 years ago the same thing. Companies sold workers a bunch of BS. It only works for those making enough to save AND have a near perfect career. Defenders of the plan like to show data for those making over 100k a year because if they included people making 1/2 that, the disaster would be obvious. There is no one who can take the max of $18k if they are making less than $75000. $50000 - yeah, right.

The BS of start when you are 20 or 25. Sure. I got fed that one. The number on paper was that I would have 2.5 million......if I was lucky to make x amount, with raises, over 35-40 years. Yeah, right again.

IBM even came out with a new way to screw employees in 2012. They now only pay you the company match if you are employed on Dec. 15. Why? So they don't have to match. Yeah, they set it up where the only way you get the match is if you retire before that date. Leave - you get no match for the year, laid off, ditto.

the bolded is just false. It's tough no argument, but not impossible. Many have done it and do it.

I don't understand your second paragraph.

IBM - yeah, that's ####ty.

ok a hermit can.

 

[stubby]

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Great idea in the perfect scenario. Too bad that is not the case for the overwhelming majority.I've been saying it is a failure for over a decade. I posted here 5 years ago the same thing. Companies sold workers a bunch of BS. It only works for those making enough to save AND have a near perfect career. Defenders of the plan like to show data for those making over 100k a year because if they included people making 1/2 that, the disaster would be obvious. There is no one who can take the max of $18k if they are making less than $75000. $50000 - yeah, right.

The BS of start when you are 20 or 25. Sure. I got fed that one. The number on paper was that I would have 2.5 million......if I was lucky to make x amount, with raises, over 35-40 years. Yeah, right again.

IBM even came out with a new way to screw employees in 2012. They now only pay you the company match if you are employed on Dec. 15. Why? So they don't have to match. Yeah, they set it up where the only way you get the match is if you retire before that date. Leave - you get no match for the year, laid off, ditto.

I'm not a fan of the Feds, but I think that there could be lot more done on the social security aspect than we currently do.

Remove the SS cap, increase to 10% and beef up OA insurance. Tie qualifying ages to life expectancy and have the state act as pensioner.

Alternatively or additionally, give student loan relief for enrollment in a qualified IRA/401K plan.

Knock 50 cents off of federal student loan debt for every dollar put into a qualified retirement account.

Gets folks saving younger, addresses student debt and will remove government obligations down the road as people have more retirement funds and don't have to rely on Medicare for housing.

Bleh - on SS at least allow for market investment. SS as an investment has a horrible rate of return.

For student loans the answer there is simple - means test borrowing. Cap what a student can borrow at 1.5x (or some reasonable multiple) of expected future salary by major. This will keep people from being fed huge amounts of student debt while getting social work or education degrees. Nip it in the bud on the front end rather than having the taxpayer bail out on the back end.

That's a horrible idea, in my opinion. At the same university, I'd much rather fund the education of a teacher, rather than another banker or lawyer, despite the disparity in income earning potential. Talk about an extension of elitism.

 

[Sand]

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Great idea in the perfect scenario. Too bad that is not the case for the overwhelming majority.I've been saying it is a failure for over a decade. I posted here 5 years ago the same thing. Companies sold workers a bunch of BS. It only works for those making enough to save AND have a near perfect career. Defenders of the plan like to show data for those making over 100k a year because if they included people making 1/2 that, the disaster would be obvious. There is no one who can take the max of $18k if they are making less than $75000. $50000 - yeah, right.

The BS of start when you are 20 or 25. Sure. I got fed that one. The number on paper was that I would have 2.5 million......if I was lucky to make x amount, with raises, over 35-40 years. Yeah, right again.

IBM even came out with a new way to screw employees in 2012. They now only pay you the company match if you are employed on Dec. 15. Why? So they don't have to match. Yeah, they set it up where the only way you get the match is if you retire before that date. Leave - you get no match for the year, laid off, ditto.

I'm not a fan of the Feds, but I think that there could be lot more done on the social security aspect than we currently do.

Remove the SS cap, increase to 10% and beef up OA insurance. Tie qualifying ages to life expectancy and have the state act as pensioner.

Alternatively or additionally, give student loan relief for enrollment in a qualified IRA/401K plan.

Knock 50 cents off of federal student loan debt for every dollar put into a qualified retirement account.

Gets folks saving younger, addresses student debt and will remove government obligations down the road as people have more retirement funds and don't have to rely on Medicare for housing.

Bleh - on SS at least allow for market investment. SS as an investment has a horrible rate of return.

For student loans the answer there is simple - means test borrowing. Cap what a student can borrow at 1.5x (or some reasonable multiple) of expected future salary by major. This will keep people from being fed huge amounts of student debt while getting social work or education degrees. Nip it in the bud on the front end rather than having the taxpayer bail out on the back end.

That's a horrible idea, in my opinion. At the same university, I'd much rather fund the education of a teacher, rather than another banker or lawyer, despite the disparity in income earning potential. Talk about an extension of elitism.

I'd rather people take out loans they have a hope of repaying. Taking out 150k for an education degree makes no sense.

 

[Doctor Detroit]

Lessons from 401k millionaires

Surprised the article didn't mention getting out of or avoiding debt.

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Yeah, kind of goes to the spirit of the original thread idea.

I think I'm gonna go back and watch that Frontline again.

 

[MCguidance]

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Great idea in the perfect scenario. Too bad that is not the case for the overwhelming majority.I've been saying it is a failure for over a decade. I posted here 5 years ago the same thing. Companies sold workers a bunch of BS. It only works for those making enough to save AND have a near perfect career. Defenders of the plan like to show data for those making over 100k a year because if they included people making 1/2 that, the disaster would be obvious. There is no one who can take the max of $18k if they are making less than $75000. $50000 - yeah, right.

The BS of start when you are 20 or 25. Sure. I got fed that one. The number on paper was that I would have 2.5 million......if I was lucky to make x amount, with raises, over 35-40 years. Yeah, right again.

IBM even came out with a new way to screw employees in 2012. They now only pay you the company match if you are employed on Dec. 15. Why? So they don't have to match. Yeah, they set it up where the only way you get the match is if you retire before that date. Leave - you get no match for the year, laid off, ditto.

I'm not a fan of the Feds, but I think that there could be lot more done on the social security aspect than we currently do.

Remove the SS cap, increase to 10% and beef up OA insurance. Tie qualifying ages to life expectancy and have the state act as pensioner.

Alternatively or additionally, give student loan relief for enrollment in a qualified IRA/401K plan.

Knock 50 cents off of federal student loan debt for every dollar put into a qualified retirement account.

Gets folks saving younger, addresses student debt and will remove government obligations down the road as people have more retirement funds and don't have to rely on Medicare for housing.

Bleh - on SS at least allow for market investment. SS as an investment has a horrible rate of return.

For student loans the answer there is simple - means test borrowing. Cap what a student can borrow at 1.5x (or some reasonable multiple) of expected future salary by major. This will keep people from being fed huge amounts of student debt while getting social work or education degrees. Nip it in the bud on the front end rather than having the taxpayer bail out on the back end.

That's a horrible idea, in my opinion. At the same university, I'd much rather fund the education of a teacher, rather than another banker or lawyer, despite the disparity in income earning potential. Talk about an extension of elitism.

I'd rather people take out loans they have a hope of repaying. Taking out 150k for an education degree makes no sense.

Unless you want well educated people teaching kids

 

[NutterButter]

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Great idea in the perfect scenario. Too bad that is not the case for the overwhelming majority.I've been saying it is a failure for over a decade. I posted here 5 years ago the same thing. Companies sold workers a bunch of BS. It only works for those making enough to save AND have a near perfect career. Defenders of the plan like to show data for those making over 100k a year because if they included people making 1/2 that, the disaster would be obvious. There is no one who can take the max of $18k if they are making less than $75000. $50000 - yeah, right.

The BS of start when you are 20 or 25. Sure. I got fed that one. The number on paper was that I would have 2.5 million......if I was lucky to make x amount, with raises, over 35-40 years. Yeah, right again.

IBM even came out with a new way to screw employees in 2012. They now only pay you the company match if you are employed on Dec. 15. Why? So they don't have to match. Yeah, they set it up where the only way you get the match is if you retire before that date. Leave - you get no match for the year, laid off, ditto.

I'm not a fan of the Feds, but I think that there could be lot more done on the social security aspect than we currently do.

Remove the SS cap, increase to 10% and beef up OA insurance. Tie qualifying ages to life expectancy and have the state act as pensioner.

Alternatively or additionally, give student loan relief for enrollment in a qualified IRA/401K plan.

Knock 50 cents off of federal student loan debt for every dollar put into a qualified retirement account.

Gets folks saving younger, addresses student debt and will remove government obligations down the road as people have more retirement funds and don't have to rely on Medicare for housing.

Bleh - on SS at least allow for market investment. SS as an investment has a horrible rate of return.

For student loans the answer there is simple - means test borrowing. Cap what a student can borrow at 1.5x (or some reasonable multiple) of expected future salary by major. This will keep people from being fed huge amounts of student debt while getting social work or education degrees. Nip it in the bud on the front end rather than having the taxpayer bail out on the back end.

That's a horrible idea, in my opinion. At the same university, I'd much rather fund the education of a teacher, rather than another banker or lawyer, despite the disparity in income earning potential. Talk about an extension of elitism.

I'd rather people take out loans they have a hope of repaying. Taking out 150k for an education degree makes no sense.

Unless you want well educated people teaching kids

Can't you go to a state school for a lot less to become well educated?

 

[Bull Dozier]

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Great idea in the perfect scenario. Too bad that is not the case for the overwhelming majority.I've been saying it is a failure for over a decade. I posted here 5 years ago the same thing. Companies sold workers a bunch of BS. It only works for those making enough to save AND have a near perfect career. Defenders of the plan like to show data for those making over 100k a year because if they included people making 1/2 that, the disaster would be obvious. There is no one who can take the max of $18k if they are making less than $75000. $50000 - yeah, right.

The BS of start when you are 20 or 25. Sure. I got fed that one. The number on paper was that I would have 2.5 million......if I was lucky to make x amount, with raises, over 35-40 years. Yeah, right again.

IBM even came out with a new way to screw employees in 2012. They now only pay you the company match if you are employed on Dec. 15. Why? So they don't have to match. Yeah, they set it up where the only way you get the match is if you retire before that date. Leave - you get no match for the year, laid off, ditto.

I'm not a fan of the Feds, but I think that there could be lot more done on the social security aspect than we currently do.

Remove the SS cap, increase to 10% and beef up OA insurance. Tie qualifying ages to life expectancy and have the state act as pensioner.

Alternatively or additionally, give student loan relief for enrollment in a qualified IRA/401K plan.

Knock 50 cents off of federal student loan debt for every dollar put into a qualified retirement account.

Gets folks saving younger, addresses student debt and will remove government obligations down the road as people have more retirement funds and don't have to rely on Medicare for housing.

Bleh - on SS at least allow for market investment. SS as an investment has a horrible rate of return.

For student loans the answer there is simple - means test borrowing. Cap what a student can borrow at 1.5x (or some reasonable multiple) of expected future salary by major. This will keep people from being fed huge amounts of student debt while getting social work or education degrees. Nip it in the bud on the front end rather than having the taxpayer bail out on the back end.

That's a horrible idea, in my opinion. At the same university, I'd much rather fund the education of a teacher, rather than another banker or lawyer, despite the disparity in income earning potential. Talk about an extension of elitism.

I'd rather people take out loans they have a hope of repaying. Taking out 150k for an education degree makes no sense.

Unless you want well educated people teaching kids

Can't you go to a state school for a lot less to become well educated?

State school tuition is no longer what I would call "reasonably priced." Sure, there are some cheaper options, but some will cost well over six figures over four years.

 

[FUBAR]

That's a horrible idea, in my opinion. At the same university, I'd much rather fund the education of a teacher, rather than another banker or lawyer, despite the disparity in income earning potential. Talk about an extension of elitism.

If only there was a way we could give money to a person going to school for a specific career field. They wouldn't even have to pay it back...

Maybe we can create a system where individuals or companies could provide money to a student pursuing their studies, we could call it a scholarship.

I'd rather people take out loans they have a hope of repaying. Taking out 150k for an education degree makes no sense.

Unless you want well educated people teaching kids

You know, we could pay them better.

 

[mquinnjr]

Lessons from 401k millionaires

Surprised the article didn't mention getting out of or avoiding debt.

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Yeah, kind of goes to the spirit of the original thread idea.

I think I'm gonna go back and watch that Frontline again.

Any time I find myself falling into the "That does seem like a great strategy, even though the expense fee is a touch high for my liking" mindset, I think of this thread. And generally go with the lower cost option if choosing an ETF. Think about the thread/piece when figuring out how to allocate annual COLA salary increases in a tax efficient manner, etc. Thread rules for mindset/perspective, with the Frontline piece the foundation.

 

[Sand]

State school tuition is no longer what I would call "reasonably priced." Sure, there are some cheaper options, but some will cost well over six figures over four years.

Well, the answer isn't to hit up the bank of the taxpayer to inject more money into that system. That's an easy call.

There's so much money sloshing around in higher education I bet if you limited these loan programs some adjustments would end up being made to tuitions so that these lower compensated degrees can be viable. Heck, I'd argue (and be right) that the reason these schools are so damn expensive now is due to the easy loan programs in the first place - this is just inflation filling up the space made by all the money flowing in through loans.

 

[wilked]

Sand, I completely agree

 

[NutterButter]

State school tuition is no longer what I would call "reasonably priced." Sure, there are some cheaper options, but some will cost well over six figures over four years.

You have an example? Well over six figures seems like a lot for a state school. In addition, I'd say, staying at home instead of on campus will significantly reduce the cost. That obviously takes away from the college experience, but it has nothing to do with getting well educated.

 

[Johnnymac]

State school tuition is no longer what I would call "reasonably priced." Sure, there are some cheaper options, but some will cost well over six figures over four years.

Well, the answer isn't to hit up the bank of the taxpayer to inject more money into that system. That's an easy call.

There's so much money sloshing around in higher education I bet if you limited these loan programs some adjustments would end up being made to tuitions so that these lower compensated degrees can be viable. Heck, I'd argue (and be right) that the reason these schools are so damn expensive now is due to the easy loan programs in the first place - this is just inflation filling up the space made by all the money flowing in through loans.

Bingo...so much this.

 

[elbowrm]

I believe state support for higher Ed is way down since the recession - contributing to higher in-state tuition as well.

 

[Slapdash]

State school tuition is no longer what I would call "reasonably priced." Sure, there are some cheaper options, but some will cost well over six figures over four years.

You have an example? Well over six figures seems like a lot for a state school. In addition, I'd say, staying at home instead of on campus will significantly reduce the cost. That obviously takes away from the college experience, but it has nothing to do with getting well educated.

Getting well educated isn't really why you go to college though. You go to get degrees, connections, and social experience that helps you obtain a job. Education is a distant fourth at best.

 

[Bull Dozier]

State school tuition is no longer what I would call "reasonably priced." Sure, there are some cheaper options, but some will cost well over six figures over four years.

You have an example? Well over six figures seems like a lot for a state school. In addition, I'd say, staying at home instead of on campus will significantly reduce the cost. That obviously takes away from the college experience, but it has nothing to do with getting well educated.

I don't have a wide breadth of knowledge to compare all schools. I do know that my step daughter (a current HS senior) was looking at schools. One she considered was Iowa State. Tuition, and room and board is 29k per year. Now, that's sticker price and no one pays sticker, but true cost to her would be close to that. I'm guessing she didn't look at the single most expensive state school in the country, but maybe she did. (She's not going there for the record).

 

[Bull Dozier]

State school tuition is no longer what I would call "reasonably priced." Sure, there are some cheaper options, but some will cost well over six figures over four years.

Well, the answer isn't to hit up the bank of the taxpayer to inject more money into that system. That's an easy call.

There's so much money sloshing around in higher education I bet if you limited these loan programs some adjustments would end up being made to tuitions so that these lower compensated degrees can be viable. Heck, I'd argue (and be right) that the reason these schools are so damn expensive now is due to the easy loan programs in the first place - this is just inflation filling up the space made by all the money flowing in through loans.

I'd agree that the tuition system needs to be fixed somehow, but I don't think the solution is to screw those seeking jobs that do a public good, but don't pay well.

 

[NutterButter]

State school tuition is no longer what I would call "reasonably priced." Sure, there are some cheaper options, but some will cost well over six figures over four years.

You have an example? Well over six figures seems like a lot for a state school. In addition, I'd say, staying at home instead of on campus will significantly reduce the cost. That obviously takes away from the college experience, but it has nothing to do with getting well educated.

Getting well educated isn't really why you go to college though. You go to get degrees, connections, and social experience that helps you obtain a job. Education is a distant fourth at best.

Sorry, i cut out a lot of the replies in my last reply which lost some valuable context. Someone suggested that having a 150k loan for a teacher makes sense if you want a well educated teacher. I was just making the point that you can go to a state school for a lot less and still become well educated. From my perspective, college is as you describe it which is why I'll most likely be dropped 200k per kid on college.

 

[NutterButter]

State school tuition is no longer what I would call "reasonably priced." Sure, there are some cheaper options, but some will cost well over six figures over four years.

You have an example? Well over six figures seems like a lot for a state school. In addition, I'd say, staying at home instead of on campus will significantly reduce the cost. That obviously takes away from the college experience, but it has nothing to do with getting well educated.

I don't have a wide breadth of knowledge to compare all schools. I do know that my step daughter (a current HS senior) was looking at schools. One she considered was Iowa State. Tuition, and room and board is 29k per year. Now, that's sticker price and no one pays sticker, but true cost to her would be close to that. I'm guessing she didn't look at the single most expensive state school in the country, but maybe she did. (She's not going there for the record).

For out of state I assume. When I mentioned going to a state school for a good education that costs way less than 150k, I should've said in state school.

 

[MCguidance]

State schools are not cheap, but certainly cheaper than private/liberal arts school.

 

[RUSF18]

I know Rutgers is just over $25K a year for in state with room and board (which is about $11K of that).

 

[Sand]

State school tuition is no longer what I would call "reasonably priced." Sure, there are some cheaper options, but some will cost well over six figures over four years.

Well, the answer isn't to hit up the bank of the taxpayer to inject more money into that system. That's an easy call.

There's so much money sloshing around in higher education I bet if you limited these loan programs some adjustments would end up being made to tuitions so that these lower compensated degrees can be viable. Heck, I'd argue (and be right) that the reason these schools are so damn expensive now is due to the easy loan programs in the first place - this is just inflation filling up the space made by all the money flowing in through loans.

I'd agree that the tuition system needs to be fixed somehow, but I don't think the solution is to screw those seeking jobs that do a public good, but don't pay well.

I don't think it is a case of trying to screw over education majors. I do think it does those students a major disfavor in life to saddle them with with a massive debt load at a time in life when they are legally able to but are practically at their dumbest point in life. (Lord knows I was).

 

[moleculo]

State school tuition is no longer what I would call "reasonably priced." Sure, there are some cheaper options, but some will cost well over six figures over four years.

You have an example? Well over six figures seems like a lot for a state school. In addition, I'd say, staying at home instead of on campus will significantly reduce the cost. That obviously takes away from the college experience, but it has nothing to do with getting well educated.

I don't have a wide breadth of knowledge to compare all schools. I do know that my step daughter (a current HS senior) was looking at schools. One she considered was Iowa State. Tuition, and room and board is 29k per year. Now, that's sticker price and no one pays sticker, but true cost to her would be close to that. I'm guessing she didn't look at the single most expensive state school in the country, but maybe she did. (She's not going there for the record).

AFAIK, most folks don't pay the school for room and board after their freshman year. You go find an off-campus apartment somewhere cheap, and you eat ramen noodles. Iowa States in-state tuition would be <$9k/year after that.

 

[NutterButter]

I know Rutgers is just over $25K a year for in state with room and board (which is about $11K of that).

The room and board is a big expense. Living at home and commuting would be a lot more affordable.

 

[BeTheMatch]

I know Rutgers is just over $25K a year for in state with room and board (which is about $11K of that).

The room and board is a big expense. Living at home and commuting would be a lot more affordable.

If you're going to do that, why bother going to college???

 

[NutterButter]

I know Rutgers is just over $25K a year for in state with room and board (which is about $11K of that).

The room and board is a big expense. Living at home and commuting would be a lot more affordable.

If you're going to do that, why bother going to college???

The degree I guess. You have to decide for yourself if 40k in loans is worth it and live with the financial consequences of that decision.

 

[Bull Dozier]

State school tuition is no longer what I would call "reasonably priced." Sure, there are some cheaper options, but some will cost well over six figures over four years.

You have an example? Well over six figures seems like a lot for a state school. In addition, I'd say, staying at home instead of on campus will significantly reduce the cost. That obviously takes away from the college experience, but it has nothing to do with getting well educated.

I don't have a wide breadth of knowledge to compare all schools. I do know that my step daughter (a current HS senior) was looking at schools. One she considered was Iowa State. Tuition, and room and board is 29k per year. Now, that's sticker price and no one pays sticker, but true cost to her would be close to that. I'm guessing she didn't look at the single most expensive state school in the country, but maybe she did. (She's not going there for the record).

AFAIK, most folks don't pay the school for room and board after their freshman year. You go find an off-campus apartment somewhere cheap, and you eat ramen noodles. Iowa States in-state tuition would be <$9k/year after that.

OK.

 

[FUBAR]

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Great idea in the perfect scenario. Too bad that is not the case for the overwhelming majority.I've been saying it is a failure for over a decade. I posted here 5 years ago the same thing. Companies sold workers a bunch of BS. It only works for those making enough to save AND have a near perfect career. Defenders of the plan like to show data for those making over 100k a year because if they included people making 1/2 that, the disaster would be obvious. There is no one who can take the max of $18k if they are making less than $75000. $50000 - yeah, right.

The BS of start when you are 20 or 25. Sure. I got fed that one. The number on paper was that I would have 2.5 million......if I was lucky to make x amount, with raises, over 35-40 years. Yeah, right again.

IBM even came out with a new way to screw employees in 2012. They now only pay you the company match if you are employed on Dec. 15. Why? So they don't have to match. Yeah, they set it up where the only way you get the match is if you retire before that date. Leave - you get no match for the year, laid off, ditto.

the bolded is just false. It's tough no argument, but not impossible. Many have done it and do it.

I don't understand your second paragraph.

IBM - yeah, that's ####ty.

ok a hermit can.

No. A person who doesn't need every new gadget and to go out on the town often can do it. We've done it. We make more now and spend more now but when we only had a couple young ones at home it wasn't hard to save.

 

[Doctor Detroit]

I can't even begin to estimate how much I've sunk into booze, drugs, and women in my lifetime, but it's staggering.

:noragrets:

 

[Dentist]

I can't even begin to estimate how much I've sunk into booze, drugs, and women in my lifetime, but it's staggering.

:noragrets:

my buddies and i were speculating just how much we'd spent at strip clubs alone during our early to mid twenties... several racks a piece.

I can't even begin to speculate on alcohol or dating

 

[mquinnjr]

I can't even begin to estimate how much I've sunk into booze, drugs, and women in my lifetime, but it's staggering.

:noragrets:

Movie deserves way more press/accolades. I feel like you just don't hear about it much.

 

[Gamma1210]

Need some thoughts on options for my wife's 403b plan. She's a teacher, and up to now we didn't put too much in it, but we want to start working on maxing it out. There seems to be generally two options: 5% load funds from american, or go to a fee based structure with the company who runs the 403b. It would be 0.9% per year and then any other expenses from the investments, but we aren't limited to one fund family and can include index funds also.

Is this a normal setup for a 403b? I'm at a fairly large company with a 401k and we just have the plan expenses rolled into the funds we choose from. To me it seems like fee based is the way to go, but I don't want to throw a lot of money at it if these are outrageous fees. My wife also has a 457 option through them with the same choices. Ideally, as our incomes go up we would be able to put aside 54k a year pretax if we wanted, or I have a roth 401k option as well. Does it seem worth dumping more into the 403b, or do the fees eat up so much that we should just put the money in a taxable account?

 

[wilked]

Teachers plans notoriously suck and that is no exception

I would do up to the match, then max Roths, then max yor 401k. Only as a last resort would I put money into hers

 

[Gamma1210]

Teachers plans notoriously suck and that is no exception

I would do up to the match, then max Roths, then max yor 401k. Only as a last resort would I put money into hers

That is where we are at. My 401k is maxed this year as is our Roths. The debate is the 403b as a way to lower AGI vs just a taxable account.

 

[Dentist]

Teachers plans notoriously suck and that is no exception

I would do up to the match, then max Roths, then max yor 401k. Only as a last resort would I put money into hers

my wife was a teacher and her 403b options were completely terrible also until they added Aspire which allowed me to get into Vanguard funds... aspire would tack on 0.25% onto Vanguard's rates... which sucks... but my total expense ratio was still under 0.6%... so that was a win.

previously all they had was life insurance companies with the 5% load and the 2% expense ratios

 

[Gamma1210]

Teachers plans notoriously suck and that is no exception

I would do up to the match, then max Roths, then max yor 401k. Only as a last resort would I put money into hers

my wife was a teacher and her 403b options were completely terrible also until they added Aspire which allowed me to get into Vanguard funds... aspire would tack on 0.25% onto Vanguard's rates... which sucks... but my total expense ratio was still under 0.6%... so that was a win.

previously all they had was life insurance companies with the 5% load and the 2% expense ratios

That sounds worse than my wife's. Best case I figure its 0.9% from the adviser (which drops as the balance increases), and then a bunch of Vandgard funds so a total expense in the low 1% range.

 

[Random]

Teachers plans notoriously suck and that is no exception

I would do up to the match, then max Roths, then max yor 401k. Only as a last resort would I put money into hers

my wife was a teacher and her 403b options were completely terrible also until they added Aspire which allowed me to get into Vanguard funds... aspire would tack on 0.25% onto Vanguard's rates... which sucks... but my total expense ratio was still under 0.6%... so that was a win.

previously all they had was life insurance companies with the 5% load and the 2% expense ratios

That sounds worse than my wife's. Best case I figure its 0.9% from the adviser (which drops as the balance increases), and then a bunch of Vandgard funds so a total expense in the low 1% range.

My wife's school admin let us choose where we wanted to open ours. We chose Vanguard and have no fees except for the normal Vanguard exp.

 

[Sand]

Teachers plans notoriously suck and that is no exception

I would do up to the match, then max Roths, then max yor 401k. Only as a last resort would I put money into hers

my wife was a teacher and her 403b options were completely terrible also until they added Aspire which allowed me to get into Vanguard funds... aspire would tack on 0.25% onto Vanguard's rates... which sucks... but my total expense ratio was still under 0.6%... so that was a win.

previously all they had was life insurance companies with the 5% load and the 2% expense ratios

That sounds worse than my wife's. Best case I figure its 0.9% from the adviser (which drops as the balance increases), and then a bunch of Vandgard funds so a total expense in the low 1% range.

Wilked is right on. That plan blows chunks. I'd start an allocation plan with your 403b - just put in to the match and put it in the single lowest fee fund they have. Then build your other investments (which have lower fee structures) around that to get a good overall allocation.

 

[wilked]

She should also organize some people to try and change their plan... Take leadership

 

[jabarony]

Another article from the same source on the history behind the shift from Defined Benefit pension plans to Defined Contribution 401k plans, good read for historical perspective: http://www.nbcnews.com/business/retirement/great-401-k-experiment-has-failed-many-americans-n327321

Great idea in the perfect scenario. Too bad that is not the case for the overwhelming majority.I've been saying it is a failure for over a decade. I posted here 5 years ago the same thing. Companies sold workers a bunch of BS. It only works for those making enough to save AND have a near perfect career. Defenders of the plan like to show data for those making over 100k a year because if they included people making 1/2 that, the disaster would be obvious. There is no one who can take the max of $18k if they are making less than $75000. $50000 - yeah, right.

The BS of start when you are 20 or 25. Sure. I got fed that one. The number on paper was that I would have 2.5 million......if I was lucky to make x amount, with raises, over 35-40 years. Yeah, right again.

IBM even came out with a new way to screw employees in 2012. They now only pay you the company match if you are employed on Dec. 15. Why? So they don't have to match. Yeah, they set it up where the only way you get the match is if you retire before that date. Leave - you get no match for the year, laid off, ditto.

the bolded is just false. It's tough no argument, but not impossible. Many have done it and do it.

I don't understand your second paragraph.

IBM - yeah, that's ####ty.

ok a hermit can.

No. A person who doesn't need every new gadget and to go out on the town often can do it. We've done it. We make more now and spend more now but when we only had a couple young ones at home it wasn't hard to save.

Agreed. Out of school making about fifty. Maxed out fairly easily and got a house along the way. Non hermit but i alsoI didn't have expensive hobbies like jetskis or kids or maxing out my credit cards.

 

[Doctor Detroit]

Putting off retirement savings until you make bank is a big mistake

People in their 20s have a list of excuses for putting off saving for retirement: Their paychecks are too small. They don’t know how long they’ll stay with a company. Why worry now about something that feels a million years away?

But a report from the Employee Benefit Research Institute drives home the point that waiting until you’re older and making more money to start saving for retirement could be a bad call.

People who start early can get away with saving a tiny portion of their pay and still have a decent chance at having enough money in retirement (in other words, their money won’t run out before they die). But those who put it off need to save dramatically more to catch up.

Take a 25-year-old man making $40,000 who hasn’t saved a dime. Putting away just 3 percent of his pay each year, including any employer contribution, until he turns 65 would give him a 50 percent chance of having enough savings in retirement, according to calculations the institute made for The Washington Post. Bump that up to 6.4 percent, and his chances rise to 75 percent.

But if that man waits until he’s 40 to start saving for retirement, when he is earning $72,000, he needs to start off contributing 4.1 percent of his pay for that 50/50 chance of having enough money – or take a big step up to 14.5 percent of pay if he wants the 75 percent chance of success. If he puts it off until he’s 50 and making $130,000, he’ll need to start off saving 14.8 percent and more than 25 percent of his pay respectively to have those same chances.