Is Your 401K a Good Investment in Todays Economy?
Is the 401k a good retirement strategy? Make the wrong decision in today’s economy, and it could kill the retirement of your dreams. It doesn’t matter if your 30 or 70, your nest egg is at risk and the money moves you make now are critical. In 1978, Congress decided that Americans needed a bit of encouragement to save more money for retirement. They thought that if they gave people a way to save for retirement while at the same time lowering their state and federal taxes, they might just take advantage of it. They passed the 401K. Even though the law requires that 401K deposits be held in a custodial account, to keep your money safe, what happens if your company files for bankruptcy? If you withdraw your money before you are 59.5 years old, you have to pay the tax on it, PLUS a 10% penalty fine to the IRS, and your retirement is gone. Eight months ago, even before filing for Chapter 11, General Motors stopped matching workers’ contributions to 401K retirement plans. Since then, one-fif
