Interesting article about saving for retirement. It suggests that the nation’s poor should not be coaxed into retirement savings accounts. Not sure I agree without further analysis, but it does raise important questions about the priorities we all face in managing our personal finances.
I’d like to address one point not specifically mentioned in the article. Many states are considering so called auto-IRA’s or MyIRA’s that would be run by government agencies for the benefit of employees that do not have retirement accounts through their employer. I thought government, whether federal or state, was best at providing services to the public that were either unavailable from the private sector (e.g. public safety, environmental protections, and courts, etc.) or were not feasible in the private sector (e.g. public education, public works, certain infrastructure, etc.). For example, who has ever heard someone say: “hey, check out my new business plan. I’m deciding between a coffee shop and a new DMV location, which do you think is better?”
As a personal finance enthusiast, I believe very strongly in the importance of retirement saving. The referenced article makes good points about who best benefits from retirement savings accounts, and I know everyone’s situation is unique, but the idea of saving for the future should be important to all.
I also acknowledge that those who do not plan well could become dependent on government assistance. No doubt why states are trying to address the problem.
But with so much infrastructure already in place in the private sector retirement business, perhaps it would be more be effective to find ways to encourage people to participate in the system that already exists and is readily available to all, rather than inventing a whole new system of government plans.
Whether through your financial advisor, your mutual fund company, or your local bank branch, the opportunity to save is there, we just need to find ways to get more people to make use of it.
Comments welcome!
Proverbial Living 