Comments on: Retirement Dreams Disappear With 401(k)s

60 Minutes: Older Americans' 401(k)s Have Plummeted; Many Fear They Will Never Get To Retire

[ssmith2010]

I've been an iinvestment consultant for nearly 30 years, here are a few pieces of truth:
1. Three years ago, after dozens of years of watching too many Americans put too much
money into "guaranteed interest contracts" at insurance companies, the retirement
planning industry began promoting "allocation products" that "diversified" participants.
I don't think there is any question that over the long term, diversification and asset
allocation are good things.

2. Right after the industry started promoting "asset allocation" the sub prime meltdown
"melted down" the bond market (like we've never seen) which was followed by a two
year recession and equity market downturn of 50%. Never in the history of investing
we seen the bond market being so depressed at the exact same time as equity
markets, the confluence of those two huge issues created the extraordinary paper
losses in 401k participant accounts, and IRA accounts, and personal savings
accounts, and Roth accounts, not just 401k accounts.

This story attempted to do a hatchet job on David Wray who works for the Profit Sharing
Council of America, far from being a "lobby group." That was a complete mis-
charactorisation. The PSCA is an industry association that, for the years I've been familiar with them, have worked only to promote industry best practices like fee disclosure, participant education, plan service upgrades, but never have we seen this
group "lobby" on behalf of the mutual fund industry or for "Wall Street." The writers look foolish to anyone who knows anything about this industry. Represenative Miller creates a good and decent "sound bite" but his politician's view on the industry needs to be put into action. There are already moves afoot in Washington for "more" fee disclosure, and proposals for keeping advisors "non conflicted" and "independent" To charactorize this
industry as the scapegoat for America's economic woes is ignorant. Let's place some blame on corporate America who was able to terminate define benefit pension plans to reduce "benefit costs." Let's blame Americans who've maxed out credit card balances while spending money on "stuff," nearly bankrupting their families, saving the bare minimums in the 401k plans. The blame shouldn't be on the 401k industry, the blame goes to greedy corporate America and American consumers, both who've been going down the severely wrong path now for about 20 years.

[thurston2001]

I have been saying this for years, the idea that a 401K is the same as a pension is ridiculous. Like PT Barnum said "There's a sucker born every minute."

[spaceatoms]

The problem with the 401k is you can't just take it out or freeze it, so all of the money and its pseudo money due to inflation has been lost, but you still have inflation like shopping mall leases twice as much as 1990. I don't know why they are trying to get the economy going again by shoving down our throats and using bailouts, obviously economists and business majors aren't physics majors.

[ncslim2]

Steve Kroft and the CBS producers put on a weak display of investigative journalism. We are aware of the 401k and IRA losses. Steve let the lobbyist blame the small investor for not being diligent. Most companies offer pre-set plans of stocks, bonds and mutual funds. The employee has the choice of putting a percentage in each basket, so to speak. Workers trust employers not to invest in "dogs" since the firms are matching the investment funds. Kroft indicated the second interviewee was going to "blow the lid off" the thievery on Wall Street. What did he talk about? Fees! This report shed no light, was not informative or the least helpful to those of us who are hurting. It was a tepid, non-story. A total waste of good airtime!

[speakinup]

Is your 401k in the toilet ?

It doesn't really matter - Obama's spending is going to make the US dollar worth 10 cents anyway.

This is his way of giving to the poor and taking from the rich.

[cbsantispin]

I keep recalling former Pres. Bush trying to attach Social Security to the Stock Market with those so-called Personal Accounts, everyone would have a Personal Account attached to the Stock Market and put the existing Social Security Fund in the Stock Market too! Remember that? Had former President Bush succeeded in attaching Social Security to the Stock Market, the U.S. would have no hope of recovery, none. Republicans talk a good game, have excellent plans with Charts too, we saw the Republican Charts showing Saddams weapons of mass destruction at the U.N., pretty charts, not too accurate, but they looked nice! Republicans sell one thing and deliver something else, never forget that! Republicans always sound good on paper! It's the truth! Fool me once, shame on you, fool me twice, shame on me!

[Yadyee]

FOLLOW THE MONEY SEC!!!

[Yadyee]

By the way I got out of the market 100% in December 2007. Wake up people you were just taken for a RIDE!!!!

I have been a financial planner for over 20 years. The segment was interesting, but left out a major issue. The people in the interviews were never asked how they decided their investment strategy. Did they research their options? Did they pay for advice? Did they rely on luck or did they just ignore their statements and common sense. More time should have been spent on investor education than just trying to play the blame-game.

[Yadyee]

You have all been conned. This was the biggest scam in the history of the U.S. Wake up people.

[Diamond_Jim]

The real story (which was not reported) is:
Why are Americans (as a group) stupid about their own money?

"For want and old age, save while you may - No morning sun, lasts the whole day."
- POOR RICHARD'S ALMANAC (Ben Franklin) 1766

The relative prosperity of post-WW2 provided a false sense of security with respect to the growth and availability of financial resources; combined with the explosion in the "consumer society" - Welcome to the Real World.

1. accept responsibility for your life and actions
2. plan and take corrective action(s)
3. demand that our government (at all levels) also act responsibly (don't reelect the give away politicians, because its our future they are giving away)

Repent Today, and go forth in peace and security.

[supt5225]

I hope that there is a special place in hell for people like David Wray. For years we have been sold on the idea of 401k's as being a safe place to put our savings into. For years I put money into my plan at work and now I only watch it decrease every month. I was sold on safe bets with mutual funds representing top companies. No one ever told me that Wall St. types like David Wray would be playing loose and fast with the money. Sure I knew there was some risk, but Mr. Wray made it seem like it was my fault for putting my money in a plan. What was I going to do with it once it was there? Move it to another plan run by the same pack of thieves? This clueless fool is more of a terrorist than anyone in Afghanistan ever was. They are destroying our society from within. Al Quedda can just stay home. I hope Obamma regulates these fools out of business.

[z27ss]

This story has the most focus on my personal situation of any story you have reported on.
My employer has converted any younger pension over to 401K. So say goodbye to the pension leg of the stool. One can only hope social security will be there. The last leg.. well I've been trying to do the right thing for retirement for 20 yrs. Three years ago I felt my 401K was too risky invested in my company's stock so I switched over to a diversified core agressive fund as recommended since I am still in my 40's. Payoff for all of this hard work and planning is to lose 50% of my value. By the way...my company stock held its value but I lost value right along with the market. Strategy programs still state that I am doing the best I can do to retire, but they also state highest risk of loss around 14% nowhere near the losses incurred. I still have faith that things will catch back up but wish there was some help that could be given to the people who tried to do the RIGHT things!

[mjrhra]

The nature of 401 (k) plans were misrepresented in this account. FVBE was entirely correct in his/her criticism. Every 401(k) plan with which I have ever been associated has offered very straight-forward advice on the risks associated with each of the investment options within the plan. Furthermore, virtually every plan offers investment options which are low risk and relatively safe. The lobbist for the 401(k) industry did a miserable job of defending 401(k) plans.

The assertion that the 401(k) plan was never intended to be a retirement plan is incorrect. The assertion that the 401(k) plans were raided by Wall Street is flatly false. The assertion that there are excessive fees being deducted is simply not true. Do I know exactly what fees are being deducted from my accounts? No, and I don't look closely because they are miniscule.

It's a disgrace that CBS did a totally inadequate job in presenting a balanced view. Disgraceful.

[jjbologna]

I have no problem here. I saw this coming and move all my moeny around within the 401k account to a Money Market account that was an investment option. I did this around 16 months ago and have not lost any money. My advisor said I was nuts and told me not to do it, but his answer was industry standard to leave it alone. Boy I'm glad I did not listen to him and he even acknowledged that I did the correct thing. He's not my advisor anymore. You can select to have all your new contributions go to the MM fund if it's an available investment election within your portfolio of options to select.

Since we are at bottom, I now started buying into the funds again but I'm leaving all the money in the MM fund alone for now. Hope this helps....

[CoolMil]

For the honest average american who was let down by our government. My advice is to take your job skills and look for jobs overseas and reap the benefits that they have to offer. I've been working overseas on and off for 9 years..My credit cards have been at zero since...my car is paid for and I'm looking to retire in another country. I understand that some of you just can't pack up and leave like this because of family or other reasons. It will take sacrafice and determination for a decision like this, but in the long wrong you'll be glad that you did.

If you like to travel....why not work and travel!!

[cdegolier]

Her 401K will go down even farther, Pelosi wants to tax retirement funds. God I love Democrats.

[DMusicmaker]

Does anyone have contact information for Kathleen Coleman? My boss would like to review her resume and possibly offer her a job. If so, please email any information to [e-mail]. Thank you

[rednomo]

Do you ever get the feeling that this country is now more divided at anytime since the Civil War. That the left on listens to what they want to here and the right does the same. How did this become so rampant?

Why Cable News is Bad for America

News is supposed to be news. Having two different points of views, no matter how myopic and slanted one of those sides might be, is the networks' idea of presenting "balance". All it really does is set up antagonistic debate as entertainment, which they then try to justify by claiming that it is news or "truth??". Well, folks, that hurts the country.

From Crooks and Liars:

KURTZ: Well, we'll try not to make this interview torture, even though you're tolerant of it. Let's talk about cable news and the way the booking process works. This was just fascinating to me. You have e-mails in this book from a producer who works for Neil Cavuto and his Fox News program. And let me put it up on the screen and share this with our viewers.

The first e-mail, this was last April, just about a year ago.


"Wanted to see if you're available today at 4:05 for Neil's show today. The topic is on Obama and his cockiness. We're looking for someone who will say, yes, he's cocky and his cockiness will hurt him."


And I love your rather brief response. You wrote back, "Thanks for the clarity. I am not your man." OK. Then you get a second e-mail from this same Fox producer. And it says, "What about a debate off the top on the show on whether or not Hillary is trustworthy? We have someone who says she is and we're looking for someone who says she isn't." Now, how common is that in cable news, that you only get to appear if you're willing to take a predetermined, precooked, prepackaged position?


SMERCONISH: Well, I think it's very common. It's exactly what I was just describing. I mean, it's this mentality that says that only good television is television which pits one individual against another and there's a fight that ensues. I just don't believe that.


I mean, what's wrong with a host taking a contrarian point of view in a respectful way? I think the viewers get all that they need. But you're right, in that circumstance -- and I raised it just as one clear example -- my invitation was predicated on my willingness to say that Barack Obama was cocky or that Hillary was untrustworthy. And I was unwilling in that circumstance to say either.

[snvand]

How come this report did not fully cover the fact that the 401K was never intended to be the only retirement vehicle? Retirement funding was meant to happen with three players. Social Security, 401K, and your own individual planning! People need to take accountability for the fact that they did not save their own money. Yes, it sucks that the 401Ks took a beating, but if you were close to retirement, they should have re-evaluated where their funds were invested. Those who lost the most value in their 401Ks were very likely invested heavily in equities. People should not have invested in equities close to retirement. I think people are not taking accountability for their actions when they place the blame everywhere but on their own shoulders. They stayed in equities because that was where the most money was getting made. But where the most money is being made is also where the most risk is. I do agree that 401Ks fees need to be looked at. But if your company is not contributing matching funds, why not find your own financial planner and review his fees?