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Was the 401(k) a Mistake? How an obscure, 45-year old tax change transformed retirement and left so many Americans out in the cold. (www.nytimes.com)

submitted 6 months ago by Blaze@reddthat.com to c/personalfinance@lemmy.ml

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[–] Please_Do_Not@lemm.ee 7 points 6 months ago

No, the article is actually saying that people have not done this enough. Workers were better off when their employees did so for them and mandatorily (a pension system), and allowing folks to self manage how much they put away is what has led to 49% of folks within 10 years of retirement having nothing to retire on.

There are very safe ways to invest. Doing it poorly and a lot is a gamble; taking a little time to understand different investment vehicles and portfolios and the risks associated with each allows you to earn interest at literally any level of risk. An example, money market funds earned 5%-8% on 2023, and it is literally impossible for MMFs to go negative. Certified deposits offered up to 5.5% guaranteed returns. The benefit of pensions is that employees don't need to learn all that and make those choices in order to benefit from them.