401K
Out of context: Reply #12
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- madirish0
Why would you not use it for retirement?
seed
(Jun 19 07, 05:41)because about 70% of the risk and investors in funds that comprise 401k's are not of employers that contribute 100%, if anything at all. they are self-contributing clients and in economic terms, bear the risk load for 'white collar investors', or those who do have employee matching. the large argument against the one i just illustrated are large corps that match on a 'group basis' such as union agreement funds for example. these however fall outside the risk model as their contributions are the result of dividends garnered from alternative investments, making them 1)sheltered from the 401k pool risk, and 2)a tax-break on their investment, as 401k in corporate tax structures when contributed as a payment-matching scenario, is deductable for that corp.
nice, eh?
hence, why, in my (and many economic theorists/advisors) opinion, they should not be used and stand-alone 'retirement' plan.