Reply to Unwise to Max Out Retirement Accounts?

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Reply to "Unwise to Max Out Retirement Accounts?"

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[quote=Anonymous][quote=Anonymous]The recent events and political instability over the past year have really shaken my confidence in the US system. At this point, I’m not sure if it is a safe assumption that the US will continue to exist or be stable place to hold assets for the next 30-40+ years. As such, I am reconsidering maxing out my retirement accounts going forward and just doing the bare minimum required to get the entire amount of my employer match. Is anyone having similar concerns right now or are you somehow more optimistic that the US is still a reliable place to invest for the next 30+ years. [/quote]

You should at least contribute enough to take full advantage of the employer match. After that, it's highly dependent on your personal financial situation.

Not to be a downer, but just think about how politics work in this country (or any "democracy" for that matter). Let's say you max out your retirement plans and scrimp and save and live frugally until retirement. Meanwhile, your spendthrift neighbor lives lavishly, doesn't save a penny for retirement.

What's going to happen?

I'll tell you what's going to happen -- when Social Security is underfunded as it inevitably will be, they will "means test" social security. They'll say "Hey look, you've got millions saved for retirement. You have enough in retirement assets that you can comfortably withdrawal $5K per month in retirement. No social security for you."

And they'll say to your neighbor "OK, since you have no assets and have contributed to social security all your life, social security will pay you $5K per month."

This is what's going to happen. It's inevitable. Most Americans haven't saved enough for retirement, and those Americans vote. So, there's a strong case to be made for not over-saving for retirement.[/quote]

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