Monday, September 7, 2009
Obama Says Rule Changes Will Make Retirement Savings Easier
What is the role of the government in retirement savings? The governments goal is to make the process easier and more streamlined, but should the government get involved with personal retirement investment decisions?
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2 comments:
After reading the article, I think that President Obama's decision to create these new procedures, particularly those who have not been saving money for their retirement, is a great idea and one of Obama's best decisions thus far. The idea that employers will make newly hired employees automatically enrolls in savings programs and let the employers put payments for unused vacation time intro retirement savings is not only a great idea, but a veru crucial one as well. As mentioned in the article, with the unemployment rate standing at a remarkable 9.7%, it is critical for our parents generation to start saving and participate in a retirement plan at work.
Due to human nature, making something automatic usually makes it permanent. In general, people don't "opt-out" of things they are signed up for. This is why the plan would work, and why corporations make money from "free trial for 6 month" kind of deal.
I think the government's role is to encourage people to save and through law and scrutiny, protect those savings. However, the government should not dictate what kind of savings people should have. Saving for retirement is a very complicated process, and the government doesn't have the information to decide what is best for each person.
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