Jesse reflects on a Senate bill -- now signed into law as the Setting Every Community Up for Retirement Enhancement (SECURE) Act -- which will require a greater amount of employers to offer 401(k) plans to employees. The new law also makes it easier for annuities to be included in 401(k) offerings by easing the fiduciary rules around fees and expense ratios.
401k) plans are excellent vehicles for saving for retirement because they allow employees to put away a lot of money every year -- up to $19,500 in 2020. Some employers offer matching on 401(k) contributions, further boosting savings rates.
However, the inclusion of more annuities in 401(k) plans has a darker motivation. Annuities typically charge higher fees than mutual funds and index funds -- sometimes a percentage point or more -- making them an inefficient and expensive way to save for retirement for most people. On the other hand, they are very profitable for insurance companies! Not surprisingly, insurance companies lobbied hard for the relaxation of fiduciary rules in the SECURE Act.
Just like Jesse discussed in last week's episode #411, wherever there are incentives, there are people making money. The wise investor follows the money!
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You've Never Budgeted At A Time Like This
The Commander's Intent
Don't Be Average... You Can't Be Anyway
Budget. No, Budget!
Wait!
Doing Nothing Is Something
Budgeting for Lady Luck
Opting Out of Credit Cards (A Bit)
Scratching the Gambling... Er, "Investing" Itch
Optionality and Managing Your Fixed (or Growing) Expenses
Optionality & Why You Should Follow Rule Two Instead of Paying Down Debt
Opting Out of the Credit Card Game
January Burndown 2020
The YNAB Debt Bootcamp
Why I Hate Debt Pt. 4: The Corporations
Why I Hate Debt Pt. 3: Cost of Opportunity
Why I Hate Debt Pt. 2: Constraints & Creativity
Why I Hate Debt Pt. 1: Cash
Handling Wildly Variable Income
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