Bank On Yourself Round-Up for Week of June 3, 2011

roundupHere are summaries of four of the most interesting and thought-provoking items that have crossed my desk this week…

Forbes Magazine Shocker:  Why your 401(k) isn’t what it’s cracked up to be!

A stunning article appeared in this week’s Forbes.1 Here are a few of the revelations you absolutely must know about, if you participate in a 401(k):

  • On average, participants in small plans (which includes 90% of all employees) pay 1.9% in fees annually!
  • Even paying fees of just 1.5% could wipe out one-third of your nest-egg
  • In spite of all the noise about “fixing” the 401(k) through new disclosure rules that will be going into effect, they “could cause some 401(k) services to get even more costly.”

 

Why you need an 8-10% annual return just to break even in your 401(k)…

It’s all documented in this 401(k) exposé I co-wrote with Pulitzer Prize-nominated journalist Dean Rotbart. You owe it to yourself to have the facts!

Is repaying debt a “moral” issue?

Not long ago, it would have been unthinkable to many Americans to walk away from the debts they owe on their home mortgage and other obligations.  Today it’s commonplace.

This article explores whether our government’s attitude towards debt has encouraged that.2

Has your attitude about repaying debt changed in recent years?

If so, we’d like to hear how and why in the Comments box at the end of this post.

Why your retirement is much riskier than your parents’

More than half of Americans are now at risk of facing a significant retirement income shortfall, according to the latest National Retirement Risk Index.

This article gives four reasons today’s workers will be retiring in a substantially more challenging environment3

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Eight reasons a 30-year mortgage beats a 15-year one

Many people have learned the hard way that the idea of paying off your mortgage as quickly as possible may be a noble goal, but tying up such a large sum in a home can be devastating.

This article gives eight great reasons you would be better off with a 30-year mortgage.4

What do you think?  Tell us in the comments box below…

1. “Find The Fees” by Emily Lambert, Forbes Magazine, June 06, 2011
2. “Debt: A Moral Issue”, by Paul Johnson, Forbes Magazine, May 18, 2011
3. “4 Reasons Your Retirement Is Riskier Than Your Parents’”, by Alicia Munnell, SmartMoney.com, May 23, 2011
4. “The 15-year vs. 30-year mortgage debate”, MSN Money, by Len Penzo, May 25, 2011

Comments

  1. Bill Liebler says:

    Pamela – my thoughts on repaying debt have changed radically over the last few years. 15 years ago my wife and I lost money on the sale of house and paid the difference to the bank when we settled the mortgage. Today I would not do that. The big banks are sheltered by government bailouts when they make massive mistakes and are “too big too fail”, so I’ve adopted the philosophy that I’m too small to fail (tongue firmly in cheek), but in reality why should I make up the loss the bank made by taking a risk on loaning me money and then that asset that backs it up drops in value and thus is worth less. I loose in that I may not get back my down payment, so the bank should loose if I can’t cover the mortgage when I sell. This may not be moral high ground, but given the corrupt nature of the political relationship between big banks and Wall Street types and DC’s elites I see no reason to accept all the responsibility, especially when the governments programs and efforts greatly contributed to the mess we are in.

    Bill

  2. after reading the book : the web of debt by Ellen Brown . i have came to the conclusion that by design the federal reserve wants us to be in debt. if the monetary system had been choosen or remained as green back back by gold and silver and not a Fiat currency. taxes and health care and retirement would not be a issue today. the federal reserve is a ponzi scheme and the banks have a money laundry scheme in place . fractional banking by the banksters is criminal in my opinion. I could go on and on . but i hopei made my point. its time time to fix it .

  3. LeRoy Parker says:

    Several years ago I did an analysis for Bank On Yourself. I am 75 years along and had switched my IRA to an annuity from midland insurance and I receive payment once a year. What hep can I get now?

    Thank you,
    LeRoy Parker

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