Retirement balances of 401(k) faithfuls quadrupled in past decade

[teejayevans]

My 401K has lower cost funds (institutional) then I could get at VG and more than enough choices. Also 401Ks fall under ERISA protection, so they can provide more protection in some states.
TJ

 

[ziggy29]

My 401K has lower cost funds (institutional) then I could get at VG and more than enough choices. Also 401Ks fall under ERISA protection, so they can provide more protection in some states.
TJ

Ah, yes. I live in Texas which has some of the strongest asset protection laws anywhere, so I tend to forget that many states don't provide the same level of protection for IRAs as they do for 401Ks, since the latter is legally treated as a pension plan.

 

[Newventurer]

Starting to see lot's of discussion (fear) about the possibility of the Government swooping in and taking over 401K plans in an effort to address the problems with SS and underfunded retirees. Any thoughts as to whether an IRA is better protected against Government intrusion vs. 401k plans?

 

[REWahoo]

Unfounded fear. The real danger is from the sky above...

 

[martyb]

Currently, fees for TSP administration is .027. That has a lot to do with why I will most likely leave my 401k money in the TSP. I plan to take monthly withdrawals for regular income. The biggest drawback I see for leaving my money in the TSP is that oncebegin the monthly withdrawals, I have no way to withdraw a lump sum if I need/want one.

 

[ziggy29]

Starting to see lot's of discussion (fear) about the possibility of the Government swooping in and taking over 401K plans in an effort to address the problems with SS and underfunded retirees. Any thoughts as to whether an IRA is better protected against Government intrusion vs. 401k plans?

My personal feeling is that the government might change the rules with respect to *future* contributions but I doubt they'd retroactively change the rules on balances already in place. (Same goes for tax-free withdrawal of a Roth IRA.) Politically it's *much* easier to make changes to future situations than it is to retroactively change the rules on people, which is part of the reason why many of the proposed reforms to SS and Medicare specifically exempt anyone already receiving benefits (or are close to it). I think changing the rules on balances already in place would be political suicide.

 

[youbet]

I've said it before, but I'd rather have a GOOD 401k plan than a DB plan. Of course I'm a hands on control freak so it may not be for everybody

I think what some of us miss is having BOTH a GOOD 401k plan AND and a DB plan! That was fairly common at MegaCorps a couple of decades ago.

When the MegaCorp I toiled at, which had both a 401k plan with matching and profit sharing and a DB plan, froze the DB plan, the 401k remained but with no improvement. It wasn't a choice of one or the other, it was just the loss of the DB plan.

Edit: It's been many years so my memory may be failing me..... I'm having [-]hallucinations[/-] vague memory recall that perhaps the 401k plan did temporarily receive additional matching when the DB plan was frozen. I'll nose around in the filing cabinet when I get a chance. In any case, we employees were definitely much better off with both the 401k plan and the DB plan prior to the freezing of the DB plan. The matching level today is only typical of similar corps. The recent recession gave corps an opportunity to reset matching levels by first suspending matching altogether and then re-establishing matching at some new (and likely reduced) level.