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401k; ok may be boring but have a ?
Topic Started: Oct 11 2008, 12:26 AM (323 Views)
temptresss
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ok, maybe y'all will just pass by this question. i'm not a politic-ing kinda gal but i do have a question. everyone's poor 401k's are suffering. and we feel helpless. WHY CAN'T THE GOVT. APPROVE WE CAN TAKE OUR MONEY OUT WITHOUT A PENALTY? why should we HAVE to leave our money in if we are under 59? why should we all go under? i wonder if there has been any consideration in this matter. if anyone knows, or has an answer as to why we can't take money out early, lemme know. thank you.
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JeffLynnesBeard
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What on earth are you talking about? :bemused:
...and in the end, the love you take is equal to the love you make.
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Bill
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Interesting question. I would say at a guess (and I really don't know about these things), it's to do with market confidence. I have no doubt that if it were allowed, many people would be trading their pension plans in for cash which would kind of be like a run on the banks and cause a whole other layer of meltdown.

It's just a guess.

Andy, here we call it superannuation - does that help?

The whole thing about this meltdown is that it's entirely imaginary money. People talk about hundreds of billions being wiped off in value, but GM isn't making less cars than it did last week, BHP doesn't have less assets than it did last week. All that's really happened is that this week, people are prepared to pay less imaginary money for a poorly defined product than they were last week. The problem comes about because people take this funny money seriously and that causes real losses of actual value.
Put a puppet on it.
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temptresss
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muahahahaha....i'll just BET bill knows.

it's a program that your employer sets up for your future retirement. you choose where you want your money to be invested/saved...but you can't take it out without severe penalties before 59.5 years old. my ? is WHY CAN'T WE TAKE IT OUT if we know it's going to go away forevah!
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temptresss
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i have to agree, bill, but i'd feel safer with my money under my mattress than in the market...eeek. one thing i will say...i DID work for the stock market for 15 years and it's true...whatever goes down does eventually come up. all the analysts i worked with learned to cope with down days because we knew it'd recover. HOWEVER...i do think we should have the choice to remove our money and re-invest it in the future if we so choose. i don't want to have $0 in la bank!
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Bill
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temptresss
Oct 11 2008, 12:35 AM
muahahahaha....i'll just BET bill knows.
Oh no! I'm way out of my league on this issue.

I look at the market like a child who says, "But that doesn't make sense." Eventually we grow up to learn that those kind of things do make a kind of sense in their own way, but sometimes the child is right.

To my simple mind, the market is a casino. That's bad enough, but beside the roulette table, there's another table of people betting on who is going to win at the roulette table. And then beside that, there's another table betting on who is going to win at the table betting on who is going to win the roulette. And that happens a few more times, then finally someone comes along who says, "Um, how does that work?" and before you know it, you've lost half a trillion dollars.

I have three super funds (it's not nearly as good as it sounds) and they all went backwards on investments last year, and that's without factoring in what happened over the last month. Fortunately, if I make an extra contribution to my super, the government will match it by 150%. It's one of the most forward-thinking things the Howard government ever did. Credit where due.
Put a puppet on it.
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temptresss
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150% !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

holy cow....my company matches our donations UP TO 4%. hahaha.

you described the market totally perfect and it's scary coz where are we on the rong of the ladder? here we have managers manage our funds and they lead us in the best direction according to age. if you are closer to retirement, you don't want risks, you go the safe/easy route. you might not make much but your money is 'safer'...(tell that to me when i open my next statement due any day now). the youngest ones are the risk-takers coz they have years of gaining it back. i ain't no spring chicken and i want it under my Sealy Posturpedic RIGHT NOW!!! (P.S. YOU ARE IN THE SAFE BRACKET...YOU YOUNG 'UN, YOU, and at 150% i wouldn't worry. too bad our govt. didn't do something like that...all we get is penalties...)
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Bill
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I should qualify that. The co-payment is up to $1500 a year. So I can put an extra $100 in and have it become $250, but I can't make $10,000 turn into $25,000. Still a good idea though.

But you're absolutely right. I'm young enough to tough it out whereas millions of others are very right to be very worried.
Put a puppet on it.
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maccascruff
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Tempty, I can't say I feel your pain as I am retired with one of the safest pensions in the world--a federal one.

I do get to listen to my boyfriend tell me that his 401 (k) is below what he has put in. He has a traditional IRA that is losing like crazy, too. He is 59 1/2 today. He is thinking of pulling the $ out of the IRA, but wants to ride out the 401 (k).

Good luck with yours. I do understand what you are saying. I just hope you don't have it all in your company's stock.
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beatlechick
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I don't have one so I can't complain.
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Queenbee
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It's very scary times! We're pulling all our cash out of the bank but not touching other investments. It's in there for the long term and hopefully it'll come back. We learned with 9/11 just to let itsit. The banks sold lots of loses and we could never recover those loses where we would have recovered most of it, if the bank left the portfolio alone. I trust no one with our money, with what little we have left. Stuff it in the mattress!!
Edited by Queenbee, Oct 12 2008, 08:20 PM.

PEACE and love to my friends, Judy

When the Power of Love over comes the Love of Power, the world will know Peace.
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Till me meet again ~ I Love you Mike! You were one of a kind.
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beatlechick
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In Paul's Arms!
Queenbee
Oct 12 2008, 08:20 PM
It's very scary times! We're pulling all our cash out of the bank but not touching other investments. It's in there for the long term and hopefully it'll come back. We learned with 9/11 just to let itsit. The banks sold lots of loses and we could never recover those loses where we would have recovered most of it, if the bank left the portfolio alone. I trust no one with our money, with what little we have left. Stuff it in the mattress!!
My boyfriend is pulling out his investments tomorrow. He says he lost a couple of thousand dollars of what he put in. He not only lost the value of his investments but also a good deal of the money he used to invest with. I kept telling him to let it ride but he is deadset against that.
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