Why It's Time To Retire The 401 (K)

690 Words3 Pages
Recently, the market is on an uptake with its improving stocks & bonds. The light in a year-plus-long tunnel is bringing both hope and realization. The market improvement is also shedding a truth on a troubling facet of the economy, the 401(K). The realization Stephen Gandel, of “Time Magazine”, has highlighted in his article “Why It’s Time to Retire the 401(k)” focuses on the sad truth that 401(K) is not effective and thus can not be relied on. 401(K) has become ineffective because of the corruption of big business, the misunderstanding of and as a result a mishandling of the 401(K) accounts, and its correlating dependency on the market’s success. Making profit is important to people. Most of all, improving the bottom line is the primary objective for major companies. “For Robert Shively, learned that his employer, Occidental Petroleum Corporation, or also-known-as Oxy Pete,” wanted to forgo the guaranteed-employer pension plans for the less demanding 401(K) system where it is based on contributions from employee’s pay rather than from the employer’s profit. This forces the employee to save without any effort but, due to this, workers began to neglect the social security and entirely dropped the use of the original pension plan. Initially in 1973, nearly 35 years ago, the government’s intention was to reduce extreme…show more content…
He achieves this by clearly illustrating that 401(k) is vulnerable to many aspects. He gave readers factual data to explain how the 401(k) correlates with the stock market. Near the conclusion he give the reader possible solutions for solving this issue. He suggests that we should invest in a business that strictly caters to employee’s retirement funds. It would behave exactly like insurance agencies with the exception that when workers retire they would start receiving money on a monthly
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