401K

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-fifth of U.S. employers have done the same thing.

Most workers haven’t saved nearly enough to maintain their quality of life in retirement. A 2008 study found that 80% of employees would NOT be able to meet their needs in retirement.

What happens to everyone that was counting on their 401K to retire? Defiantly a scary thought. The solution I found is, get your own business with a residual income. You won’t need to worry about saving for retirement. You won’t have to worry about your employer filing for bankruptcy. Take a step forward, stop counting on the government or an employer. Start counting on the one that really matters, YOU!

Julianne Rowat, the author, has other articles and videos on motivational and self improvement. She also has videos on low cost and free internet advertising to help you with your online advertising business. She is an internet marketing consultant that enjoys helping others with different types of advertising to grow their business without all the expense. If you want to know more about her, visit her blog at: http://www.juliannerowatsblog.com or her website at: http://www.ultimatewealthfromhome.com

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Author: Julianne Rowat