Say Good-Bye to 401K and IRA
 

Looks like this might happen for the future. :shrug:

Clark Predicts Traditional 401(k)s, IRAs Will Cease To Exist Within a Decade

Saw that this morning. Govt has been casting an eye on those funds for years thinking of ways to spend it.

Yet, they recently raised the required minimum distribution (RMD) age, delaying the collection of millions of dollars in taxes.

Fishing to find ways to raise more revenue to pay the interest on all that debt. Feel bad for the younger generations, no easy way out.

Do people actually listen to this guy????


:1rotfl::1rotfl::1rotfl:

"Money in traditional 401(k) and IRA plans represent “tax time bombs” for people. Because the IRS ultimately taxes every dollar in there, including all investment earnings. So there’s no incentive for the federal government to seize those funds."

Not so sure that would be a bad thing for some younger people.

It's not unusual to end up paying more taxes on your RMD withdrawals than you would have payed in tax on on money earned 20-30 years ago.

The key word is ultimately, they want to get their hands on the money sooner.

that was surprising but in the long run with an extra few years to appreciate they should collect more in taxes. However doubt that was the thought behind the delay.

This doesn’t impact retirees. In fact, they have been raising the age to take rmd’s. It makes sense that the government would want all workers to use Roth’s so they get their taxes now, not decades down the road.
What’s more scary is the chatter of taxing unrealized gains. They have tried to enact this a decade ago and it failed but there is new chatter occurring now.

Never heard of him. I had to look up who he was. He’s an author and media personality. So he’s definitely someone who can predict what Congress will do over the next decade.

Doing away with IRAs and 401ks will literally take an act of Congress. That’s something that will certainly be popular and get politicians reelected.

One of the "local" news programs run him once-in-a-while.

His advice is for, "I have not brain, tell me something". :MOJE_whot:

Clark Howard is a very famous cheapskate who has provided advice about money on radio and TV shows and podcasts for many years. I don't know about his ability to predict what the Government will do, but I respect him as a cheapskate and for providing valuable consumer advice.

Firstly, the claim in his article about needing to make changes to increase the amount collected for Soc Sec is completely bogus. Money deferred into a 401K or IRA does not avoid FICA in the year it is earned.

Secondly, not clearly covered in the article. There are bipartisan efforts do to away with retirement plans that involve the workplace or at least make plans available to those not tied to an employer. A large number of small businesses and all gig workers have no option to save money other than the personal IRA which is limited.

So, there are those who want to make a 401K style option for individuals that you would open once and it would move with you from workplace to workplace. No more vesting and rolling over. You open it and you use it for employer and self earned income.

Nothing to worry about, most of us won't be around anyway.

No one is looking to get rid of IRAs. The government knows it will get more tax money down the road out of these programs.

The article is clickbait.