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Standing Up for the 401k…They’re Not as Bad as Some Suggest
Many folks now in or soon to be in their retirement years have accumulated a substantial nest egg as a result of having access to tax-deferred savings plans, like 401ks. It’s probably fair to say that without the incentive of tax deferral, this accumulation might not have been possible for many. And although they’re often referred to as “tax torpedoes,” and as the much-maligned required minimum distribution mandates frustrate many recent retirees, MarketWatch contributor Edmund F. Murphy sees it differently.
In a morningstar.com post, Murphy describes the positive outcomes and pending improvements related to 401ks, many of which will broaden access and encourage greater savings, bringing financial security to more Americans. His post, in addition to presenting statistics on the popularity of 401ks, also dispels the allegation that the tax implications of this type of savings vehicle only benefits wealthy workers, and advocates for continued improvement to savings mechanisms of this type.
Read Mr. Murphy’s post here.