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5 responses to “Should Plan Sponsors Fear? Is the 401k Merely a Ponzi Scheme?”

  1. Stephen Winks

    Chris,

    This assertion is so ridiculous, it is not worthy of a posting much lessa serious comment..

    SCW

  2. Roger Wohlner

    Great article Chris. Isn’t Kiyosaki the same guy who was running around telling everyone that real estate could never go down in ’07? The 401(k) has its issues in general and certainly many plans could be improved. But it is a solid, viable retirement saving vehicle.

  3. Joel

    The Defined Contribution plan has been the mandatory retirement savings plan in academia since TIAA-CREF was founded in 1918. The 401k is the new child on the block.

    New Jersey’s Defined Benefit plan is $53 billion in the hole. This constrasts with the fully funded DC Plan that has been the mandatory retirement plan for the public higher education crowd in NJ since 1968.

  4. Sean

    “In a 401k plan, any worried investor can leave the market at any time.” This statement is untrue. I challenge anybody with a 401K plan to try and take YOUR money out (before 59.5, leaving your company, or a hardship withdrawal). You will be very surprised to find out just how difficult it is.

  5. John

    You base your rebuttal of those theories on the assertion that younger workers will have the earning power to replace the earning power of the retiring generation. In fact, during the 1990’s the U.S.’ manufacturing sector died and was sent to China. It was replaced with low-paying service sector jobs. And the greatest paying jobs in the service sector are servicing debt. So sooner or later, this debt will have an explosive effect and it’s remains will splatter everything and leave a big gaping hole. I wish I could believe what you say but while globalization vitalized American industry, it is gone now. The stock market appears to be nothing but fake money and a ponzi scheme and it’s likely that you’re banking that you’ll get out before some unknown catastrophe occurs. You assume the international money order can withstand disruptions in the global political situation, and that the U.S. stock market can retain its competitiveness when the global financial market collapses completely. Most of the numbers from the U.S. stock market are from corporations who have only grown because they are global. The rich are getting richer and if you get out in time you will earn but if you do not you will be violently crushed and shut off from ascending the money ladder.

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FiduciaryNews provides essential information, blunt commentary and practical examples for ERISA/401k fiduciaries, individual trustees and professional fiduciaries. Our chief contributor is Chris Carosa.

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