Thursday, October 21, 2010
Deferred Compensation Plans
We discussed the benefits and inequities of deferred compensation plans including 401K, 403B and IRA plans. Current Social Security benefits seem inadequate as a retirement source and many individuals cannot afford to, are not offered or choose not to participate in deferred compensation plans. Defined Benefit Plans and "old style" pensions are disappearing from the workplace. How would you address this inequity?
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I'm really glad you brought up this issue in class. I have never discussed the benefits/inequities of compensation plans before, and when I came home that night from school my roommates and I talked about these issues. we all agreed that if congress does something like raise the tax rate on taxing withdrawls from the accounts, then the government would be abusing its powers. The government should act in the best interest of the people.
ReplyDeleteI understand that congress could argue it would be acting in the best interest of the people because it would use the taxed money for bettering schools, feeding the homeless...blah blah blah, but would that really better society? I don't think so because taking peoples' money from them just makes them bitter. What would society be like if people are bitter are all the time and can't trust anyone with their hard earned money? If money is going to be used to better schools or the homeless (either through donation, charity, or government) the money needs to freely given, not injustly taken.
i think a much better move from congress would be to do something like ask for donations from the people who have the most money saved, and to provide a specific plan on how that money will be spent. I know if I had a lot of money saved up I would be willing to give some of it away if I knew where it was going.