401(k) plans have a great advantage for people who change employers several times during their working life. Having just one or two employers before retirement is becoming rare. When you move to the next employer, you can keep whatever is in the old 401(k), maybe rolling it over into your own IRA (which I would prefer) or into the next employer's 401(k). If you had a company-funded retirement plan, you probably lose it completely when you quit after "only" five, ten, or fifteen years employment. Even if you last long enough with the company to be vested in its retirement plan, leaving "early" means you lose out on the companies' preference to back-load retirement benefits. That back-loading helps the long-time employees, penalizes the people who change jobs, and reduces the companies' retirement costs.
I know whereof I speak. I worked for 33 years, but the basis of my (meager) corporate pension is only the last 15 of those years. The other 18 years contributed nothing to my pension since I didn't last long enough with those early employers to be vested. (That pattern of moving from company to company was common in the high tech and defense industries where I worked and is increasingly common in all industries.) Further, I was not eligible for an IRA in those early years because IRS said I was covered by a pension plan at work, which was true only in theory. So, that way I got no corporate pension benefits and no access to IRAs either.
Every generation has its problems. Since I enjoy managing money, I'd rather have this generation's problems than the ones we had in the "Silent Generation" -- the generation after the GI generation and ahead of the Baby Boomers. (It is not my nature to be silent. We
seem to be silent only by comparison with the noisy horde, er, articulate group right behind us.
)
Many people fritter away the great advantage of personal ownership of 401(k) assets by spending the money when they change jobs rather than rolling it over. Their slogan must be "Let tomorrow take care of tomorrow." I heard someone declare complete financial irresponsibility by saying "Some people are savers and some are spenders; I'm a spender." as if personal discipline was impossible. Sure glad I didn't marry that woman!
He who has lived obscurely and quietly has lived well. [Latin: Bene qui latuit, bene vixit.]
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