American workers are being ripped off by excessive retirement plan fees — which may force them to work longer or live less comfortably in their golden years, according to a recent study.
For the average US household, the high fees drain about $155,000 from their 401(k) accounts over their lifetimes, the study found.
In one example highlighted in the study, a two-wage-earner household with a median income for their age group contributed an average of 7 percent a year to their 401(k) plan over 40 years.
Portability, ownership and innovation are three key features of 401(k) plans that make them worth keeping. That was the case laid out by Paul Schott Stevens at a "town hall" meeting in Los Angeles this afternoon. The remarks lay out a defense of the mutual fund-heavy savings vehicle even as the plans have come under attack for the fees charged by mutual fund firms.
The movement has drawn some support from financial circles. Wallace C. Turbeville, a former Goldman Sachs banker who now is a senior fellow at Demos, a public policy research organization in New York,submitted testimony last month for the Senate Banking Committee in favor of more banking regulation.
We are seeing the results of a radical shift in employer-provided retirement benefits. In the past decade, the percentage of private-sector Connecticut workers whose employer offers a retirement plan has fallen from 68 percent in 2001 to 58 percent today, effectively shutting nearly 650,000 workers out of any workplace retirement plan to supplement Social Security.
And while the quantity of benefits was declining, the quality of those benefits was deteriorating as well.
The think tank Demos has been doing a really stellar job commemorating the anniversary of Michael Harrington’s “The Other America” — as mentioned in my poverty charts post yesterday — and their best item so far is this series of beautiful interactive charts illustrating the state of poverty in America:
Every day brings more reminders of the terrible unfairness that besets our country, the tragic reversal of fortune experienced by millions who once had good lives and steady jobs, now gone.
An article in the current issue of Rolling Stone chronicles “The Fallen: The Sharp, Sudden Decline of America’s Middle Class” and describes a handful of middle-class men and women made homeless, forced to live out of their cars in church parking lots in Southern California.
Fifty years ago, Michael Harrington wrote The Other America, documenting – among the many ravages of poverty – that millions of children in the richest country on earth went to bed hungry every night. His book inspired two Democratic presidents, John F. Kennedy and Lyndon B. Johnson, to launch a war on poverty, then estimated at more than 20 percent of the population.
If I were a top executive in the retail or restaurant industries, or one of their hired guns in Washington, I'd be very nervous right now.
Tomorrow will see what may be the first-ever national strike against restaurant and retail chains, with workers expected to walk off the jobs in 35 cities -- including at retail giants like Sears, Macy's, and Walmart.
Most research on rising economic inequality focuses on growing wage gaps between different groups of workers. But of course that is only part of the story. Just as important is the division of the national economic pie between profits going to capitalists and the “labor share” that includes all of the wages and benefits earned by workers.
We famously live an age of capital, where those who own businesses or other assets are prospering, while most people who rely on the value of their labor are doing terribly.
The standard rap against regulation is that government uses a meat cleaver to clean up problems in the private sector that are better tackled with more nuance.
Yet regulation—or the threat of it—often serves to spur smart self-regulation that wouldn't otherwise occur. You want to see a scalpel at work? Wave around a meat cleaver.
A case in point is how banks are getting more serious about addressing consumer complaints now that the Consumer Financial Protection Bureau has created a database of complaints about banks and other financial institutions.
Five years after the fall of Lehman Brothers and the worst financial crisis since 1929, one thing seems certain: another meltdown of the financial system will eventually happen. Why? Because we still haven't fixed many of the problems that led to the last crisis.
Earlier today I praised the Obama administration's move to extend labor protections, including overtime and the minimum wage, to some two million home aides. Now for the reality check: This step will surely increase the cost of caring for the aged and disabled at a time when millions of Baby Boomers are starting to retire, straining entitlement programs. What's more, hikes to the minimum wage—such as one recently enacted by California—will further boost home care costs.
New York, NY – 'Shadow Market' investment products have come under scrutiny following the banking meltdown, but they continue to be aggressively marketed to clients who can least afford the potentially catastrophic losses. Millions of American seniors could see their golden years turn bleak if the poorly regulated derivatives underpinning their investment plans implode, according to "How Safe Are Your Savings? How Complex Derivative Products Imperil Seniors' Retirement Security."
How Maine can use deposits of state tax revenue to tilt the economic playing field back toward Main Street businesses, our community banks, and long-term job growth.
Washington DC – In an important hearing today on the future of America’s middle class, Democrats on the Senate Health, Education, Labor and Pensions (HELP) Committee made the case for greater public investment, fairer tax policy, and better job creation to stimulate economic growth and support working Americans. Demos, a national public policy research and advocacy center, supports the effort, as families continue to reel from the recession and high unemployment.
