401(k)s in for double whammy?

There are 20 comments on the Nov 10, 2008, The Morning Call story titled 401(k)s in for double whammy?. In it, The Morning Call reports that:

Retirement accounts already battered by a steep market decline may get hit again as several companies suspend or reduce their 401 match to save cash.

Join the discussion below, or Read more at The Morning Call.

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joe poli

AOL

#1 Nov 10, 2008
This bailout idea of the auto industry is a scheme to boost the 401ks of the unions and auto executives.
Mike

Williamstown, NJ

#2 Nov 10, 2008
I think there will be many more companies this time around suspending matches. Just got a memo from my company today that they will suspend starting in January. That, plus the 30%+ loss in the 401K over the past year. Thanks, Wall Street, for the potholes you've created on Main Street.
hope

Victoria, TX

#3 Nov 10, 2008
Wait until Obama and the Dems offer us "gifts" in return for our 401k's. They are talking about giving us the value of them back in August before the market downturn and put them into a government account at 3% interest per year; they will also limit the amount we can pay into them. How magnanimous!

No thank you, we worked for our 401k's. They are ours, not the Federal Government's!

They will make a mess of these as they have of Social Security and Meicare!
hope

Victoria, TX

#4 Nov 10, 2008
Do you have any idea what taking our 401k's out of the stock market would do to the stock market?(How many of us have been paying into the stock market for years by ourselves, not alone the matches made by corporations!) THINK!
jones

AOL

#5 Nov 10, 2008
If you took it out of your 401s and mutual fund before it melted I'd say you were a good manager.

If you tried to take it out buy dialing the multiple numbers and one hour later you still couldn't get through , you were screwed.

After it dropped about 40Gs you could get through and got a recording that mutual funds are not for day traders.

They got your money and don't want to part with it. Blame the fund company for jaming the lines with bullcrap.
cjc

Harrisburg, PA

#6 Nov 10, 2008
Proposed by Senator Jim McDermott/rep George Miller-AMERICAN TAX REFORM TAX CALCULATOR: Currant law - 15% capital gains,15% dividend rate, 35% Corp income tax. Obama tax plan 20% Capital gains, 20% 20% dividend rate, 35% corp income tax. Hill democrats plan 28% Capitol gains, 39.6% dividend rate, 35% corp income tax. JUST A PROPOSAL NOW!!!
Independent Thinker

Allentown, PA

#7 Nov 10, 2008
jones wrote:
If you took it out of your 401s and mutual fund before it melted I'd say you were a good manager.
If you tried to take it out buy dialing the multiple numbers and one hour later you still couldn't get through , you were screwed.
After it dropped about 40Gs you could get through and got a recording that mutual funds are not for day traders.
They got your money and don't want to part with it. Blame the fund company for jaming the lines with bullcrap.
The problem is, most people cannot get the $ out of their 401K's without taking a hardship withdrawal and then you have to jump through hoops. It's locked and they know it.

You can stop the deposits but what's there is there, there is no getting at it unless you change employees and roll the funds over.

All most can do is watch their balance go down down down....
jones

AOL

#8 Nov 10, 2008
gotcha, unless you're 59& one half or retired. Hang in there , the worst you can do is give the Gov 30% for an early withdrawal . It's already a little too late to get scared and transfer it. We're all in the same boat, some worse off and others waiting to be.
yes

Bangor, PA

#9 Nov 10, 2008
jones wrote:
They got your money and don't want to part with it.
You know it. This is how the game is rigged. Most of us have no access to the top investments. Those are available to wealthy people only. We get the mediocre funds and stocks, and once they have our money in 401ks they lock it up. Big penalties for early withdrawal to discourage you from taking control of your own money.
If not that, then credit card debt, or mortgage debt. The banks take your money one way or another, they own you, feed off of you like a parasitic bug. We should continue to live this way? No bailout for bloodsuckers! Live within your means, and control your own destiny!
yes

Bangor, PA

#10 Nov 10, 2008
Article from today: AIG getting $40B in new aid

What did they do with the other billions of bailout dollars they already received? Paid their bonuses to their failure executives? That's our money, our taxes, our plummeting 401k totals.

"401(k)s in for a double whammy" yeah right it ain't gonna be only a one two punch. It will be punch after punch after punch until you crumple to the canvas and are called out.
Choice

Emmaus, PA

#11 Nov 10, 2008
Until the housing market continues it's decline in which prices revert back to 2000 levels or prior, this economy will not recover. Everything we are experiencing is a direct problem because of the housing bubble. Prices doubled in too many markets, creating a national housing bubble

www.patrick.net
Chris S

New York, NY

#12 Nov 12, 2008
Independent Thinker wrote:
<quoted text>
The problem is, most people cannot get the $ out of their 401K's without taking a hardship withdrawal and then you have to jump through hoops. It's locked and they know it.
You can stop the deposits but what's there is there, there is no getting at it unless you change employees and roll the funds over.
All most can do is watch their balance go down down down....
You can move it into a cash equivalent fund. I did just this and haven't lost a dime of my principal. Went all cash over a year ago in anticipation of this mess.
Chris S

New York, NY

#13 Nov 12, 2008
yes wrote:
Article from today: AIG getting $40B in new aid
What did they do with the other billions of bailout dollars they already received? Paid their bonuses to their failure executives? That's our money, our taxes, our plummeting 401k totals.
"401(k)s in for a double whammy" yeah right it ain't gonna be only a one two punch. It will be punch after punch after punch until you crumple to the canvas and are called out.
What did you do about it? I wrote over 100 letters to Senators and Congressional leaders. Even spoke with Congressmen Dent a couple times and he still voted for this despite the fact that the constituency was 400 to 1 against it.

Needless to say, he didn't get my vote this time around, but he's still in office. Why don't you stop complaining and actually do something about it?
Mazikeen

Philadelphia, PA

#14 Nov 12, 2008
hope wrote:
Do you have any idea what taking our 401k's out of the stock market would do to the stock market?(How many of us have been paying into the stock market for years by ourselves, not alone the matches made by corporations!) THINK!
yeah, you are seeing it everyday.. the more people shift their funds the more effect we see. It is best right now to continue if not increase your contributions, for most stocks are at rock bottom prices.. it will yeild a great return in the future.. Unless you plan on retiring in the next few years.. and if that is the case you are most likely vested in 90% bonds anyway.

Has anyone heard of an attempt to pretax your 401K at an a tax rate today, instead of the much smaller tax bracket you would be in at retirement?? I heard this somewhere, but doubt its true.
Mazikeen

Philadelphia, PA

#15 Nov 12, 2008
Chris S wrote:
<quoted text>
You can move it into a cash equivalent fund. I did just this and haven't lost a dime of my principal. Went all cash over a year ago in anticipation of this mess.
not smart if you are a risk taker. The return could be worth your investment at todays low prices.. the fact that people are taking their cash our of their current investments at a loss further adds to the economic decline. Several of my fanancial analysts have suggested to continue your contributions if you do not plan on retiring int he next 3-4 years.
Chris S

Warren, NJ

#16 Nov 12, 2008
Mazikeen wrote:
<quoted text>
not smart if you are a risk taker. The return could be worth your investment at todays low prices.. the fact that people are taking their cash our of their current investments at a loss further adds to the economic decline. Several of my fanancial analysts have suggested to continue your contributions if you do not plan on retiring int he next 3-4 years.
That's if you think today's prices are low, I don't. I wouldn't be surprised to see 500 on the S&P in the near future. I work on Wall Street and I'm not even close to thinking we're at a bottom. You go ahead and keep throwing your money at a falling knife. I'll sit comfortably with my principal and get back in when the government stops changing the rules as they go. This isn't investing right now, it's gambling.
Mazikeen

Philadelphia, PA

#17 Nov 12, 2008
Chris S wrote:
<quoted text>
That's if you think today's prices are low, I don't. I wouldn't be surprised to see 500 on the S&P in the near future. I work on Wall Street and I'm not even close to thinking we're at a bottom. You go ahead and keep throwing your money at a falling knife. I'll sit comfortably with my principal and get back in when the government stops changing the rules as they go. This isn't investing right now, it's gambling.
No matter where you work, you have to see the logic in what I said.. i have spent countless hours on this very subject, and the bottom line is to pull you money out would be pretty stupid in the long run. Sure you save yourself money right now at this point, but most of us can take the risk and are looking out past 10 yrs. To buy then the price will be double what it is today.. Dont trust me.. just think about it.
Mazikeen

Philadelphia, PA

#18 Nov 12, 2008
Chris S wrote:
<quoted text>
That's if you think today's prices are low, I don't. I wouldn't be surprised to see 500 on the S&P in the near future. I work on Wall Street and I'm not even close to thinking we're at a bottom. You go ahead and keep throwing your money at a falling knife. I'll sit comfortably with my principal and get back in when the government stops changing the rules as they go. This isn't investing right now, it's gambling.
Oh and since when is wall street located in Philly.. and dont tell me the server you work from is located in philly..
Independent Thinker

Allentown, PA

#19 Nov 12, 2008
Chris S wrote:
<quoted text>
You can move it into a cash equivalent fund. I did just this and haven't lost a dime of my principal. Went all cash over a year ago in anticipation of this mess.
Not at my place of work, the only way you can get it is if you change jobs to another company.

I saw this happening last year already so I never signed back up for the 401K the company I now work for offers.

When I changed jobs last summer I took my old 401K and rolled over to a private IRA CD, ya' low interest, but I'm making money not losing it. If I left it in, I would probably have lost about 40K, instead I'm earning. Some think I'm stupid, my balance says otherwise. AND, if need be I can get at it, and pay the tax and penalty.

What I would be putting in the 401K I'm using to pay down what little debt I have (car loan) and applying it to the principal.

I guess only time will tell.
Independent Thinker

Allentown, PA

#20 Nov 12, 2008
Chris S wrote:
<quoted text>
What did you do about it? I wrote over 100 letters to Senators and Congressional leaders. Even spoke with Congressmen Dent a couple times and he still voted for this despite the fact that the constituency was 400 to 1 against it.
Needless to say, he didn't get my vote this time around, but he's still in office. Why don't you stop complaining and actually do something about it?
I called, emailed and continued to do so until the phone lines and emails were shut down. Didn't help, they did what they wanted and really don't care what the people have to say.

So much for Government for the People....

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