Outdoor portrait of retired couple enjoying a drink at the golf club.
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By Hal M. Bundrick

You're doing everything the experts recommend. Deferring a chunk of your salary to your 401(k) at work, at least up to the company match, attending the educational seminars, investing in a diversified portfolio -– what else can you do to secure your future retirement? The one thing more than a third of Americans with a 401(k) have never done: increase the amount they automatically contribute.

A new TIAA-CREF survey says that while many of us have never raised our deferral, 26 percent haven't kicked-up what they kick-in in over a year. With 44 percent of the U.S. workforce saving 10 percent or less of their annual income for retirement, that's a problem. Many financial advisers say we should be putting aside 10 percent to 15 percent -- even more as we age.

One of the best times to increase your contribution is when you get a raise. Most of us (57 percent) don't do that. More men (33 percent) than women (17 percent) are likely to be contributing the maximum amount allowed -- and thrifty millennials are most likely (52 percent) to jack up their contribution after a bump in pay.

Many of us set-it-and-forget-it when it comes to our 401(k) -- and that's a good thing if we're properly invested. One-quarter (25 percent) of workers have never made changes to their investments. If you're in that crowd, it might be a good idea to have an adviser check your allocation, just so you can ignore it with confidence.

But the workers really lagging behind are those who never got started. More than half (53 percent) of employees who work for a company offering a 401(k) retirement plan weren't automatically enrolled in their companies' plans, according to the survey.

Failing to sign up right out of the gate means time is not on your side. In fact, more than a third (37 percent) of respondents who weren't automatically enrolled in their at-work retirement plan said they waited six months or longer to enroll -- nearly one quarter (24 percent) waited a year or more.

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The vast majority of Americans will not have enough money to retire.............

August 21 2014 at 9:07 PM Report abuse rate up rate down Reply

anyone like to do math ?..... 30% taxes you say ?

$400,000 cashed in.... 30% of 400,000 is $120,000 to the IRS.... Now your $400,000 is $280,000

Oh no, the small minded monniche2 thinks this was a horrible idea.... The best advice is always to step over a dollar to pick up a dime she says.

But, what if you followed my advice and waited for the stock markets to bottom out ?

Well, in March of 2009, Caterpillar stock fell to $22... Now it sells for $108 a share for a 500% return... So let's do some more math, shall we....

- $120,000
$280,000 <- to buy Caterpillar stock with when the markets bottom out.
x 5

Ok so, after paying taxes.... a person takes their $280,000 and turns it into $1,150,000 in share value.... But, wait we forgot about dividends... Caterpillar has paid a consistent dividend since 1933 and that dividend is now $2.80/share annually...

So, if you bought Caterpillar stock at $22 per share and get $2.80 dividends... Then your $280,000 investment is now paying you an annual rate of roughly 12.5%.... or about $34,000 a year in dividend payouts.. taxed at 15% for capital gains.

Ok so, here is your choice.... do like super genius cynic monniche2 suggests and live off of your $400,000 because taking advice from an economist with a CPA wife is just too much to understand and the simple choice is best for the cowardly uneducated fool...

Or turn your $400,000 into $1,150,000 that pays you an annual dividend of around $34,000 a year.

In the end.... you people are scared and stupid. You haven't even bothered to look into historical stock prices to know what your options are.... You just listen to a million robots and bankers wanting fees tell you to constantly come to them with your money because it has been proven that the best way for them to make consistent cash is for you to be a dumbass.

You know what is great about being an economist ??.... the math and the facts back up your claims, while ignorant workers that rely on gossip and marketing suggestions are always wrong..

Have fun living off of that $400,000.... instead of turning it into $1,150,000 and get annual dividends of $34,000 to live off of.

Here is where the mind gets blown though.... recession #2... Where the $1,150,000 gets cashed in... 15% in cap gains taxes means that $1,150,000 is now about $950,000.... but then that gets multiplied by 5 and 12.5% dividends... So then share value is up to $4,950,000 and annual dividends are well over $100,000 a year !!

Yeah good luck with that 401k.... you worker bees have it all figured out. But, I am with you, don't pay taxes... Switch the money over to bonds till the recession hits and then switch back to stocks when the markets bottom out.

Always get financial advice from a realtor, mechanic, factory worker, office manager, secretary, cop, union worker, or a banker charging you fees... Never mind knowing what the business cycle is or trough planning.

August 21 2014 at 3:47 AM Report abuse +1 rate up rate down Reply
4 replies to socioeconomist1's comment

It floors me how you simple minded people can't read simple English..... Just because you cash in your stocks and switch over to bonds in 2017, doesn't mean that the money leaves the fund to get taxed...

It's called the business cycle.... Everyone who has ever taken a 600 Finance course knows about it. 18 months of recession, 5-7 years of expansion, repeat... All quite predictable. All available online to look up.

But, that is fine.... I am sure you all have a PHD in finance and worked on wall street. I am sure you all manage your own accounts and don't take your money to a financial planner.

Go ahead and buy up stocks at their all time highs instead of waiting for them to be well below their 52 week averages and have fun sitting through the best time in the world to be buying while you sit on your overpriced stocks... Go ahead and take out a home loan and wind up paying 65% more than the purchase price while you are at it to show off your financial disciplinary skills.

All I did was retire at age 25 from trading stocks.... As a matter of fact, most of the money I made came from knowing when fund managers were going to make their purchases during earnings season or by knowing their investing strategies.

So, I guess I am speaking with the cattle who work some lame job and turn their money over to a parasite to manage but think they are experts in everything.... My wife is a CPA and I am an economist that specialized in the stock markets... But, what do I know. The general public who works as office managers, construction workers, factory supervisors, concession stand attendants, etc are the real experts in stocks.

I mean, why spend 15 years getting an education when you can just repeat gossip and pretend you know what you are talking about because you handed over money for someone else to invest for you...

Hey I am an expert in engineering automobiles because I bought an automobile.... I am the average Joe... Someone told me a rumor and I repeat it because it sounded true.

Never mind all those historical charts and other facts... Gossip is all the average worker needs to get through life.

August 21 2014 at 3:01 AM Report abuse +1 rate up rate down Reply

Yes, cash in your 401k in 2017. Then that account that has been paying 1.5-4.5% will be taxed by the U.S. government at 30-40%. When you cash it in all at once it will be considered regular income if not invested in a Roth. Don't forget about the tax penalty you will have to pay if haven't reached the age of 591/2. This sound financial advice could also push you into an income bracket that forces you to pay more for Medicare if you are on Medicare at the time of cash in. You will have a ton of cash less a huge bite taken by Uncle Sam. Maybe a pound of cash remaining would be a more appropriate description.

August 21 2014 at 12:03 AM Report abuse -2 rate up rate down Reply
1 reply to monniche2's comment

don't cash it in... switch it over to bonds in 2017

Why can't you people read ?.... It is plain English.

August 21 2014 at 2:47 AM Report abuse rate up rate down Reply

The writer also assumes my company is matching my contributions....this has not been true in any company I have worked for since the Great Recession began and corporate greed escalated to the point that it is about increasing profits (they have never been higher) and screw anyone who works for you.

August 20 2014 at 6:20 PM Report abuse +3 rate up rate down Reply
1 reply to timlsurfer's comment

You don't need a match to personally max out annual contributions .

August 21 2014 at 8:53 AM Report abuse rate up rate down Reply

Another propaganda story to scare the masses into investing in our markets.... Everyone from China, Japan, Europe, and the middle east are starting to pull back on investing in America. For the first time in history, China puts more FDI into the US than the US puts into China. (FDI = Foreign Direct Investment)..... China and Japan ( #2 and #1 holders of US treasury bonds) are reducing their holdings of US debt too....

everyone knows the US is taking a crap and our money isn't going to be worth squat.

The government is pushing personal investing to prop up our markets. The usual recession only lasts 18 months, but the Great Recession lasted from Sept 2008 to March 2012 because Obama was not very expedient on the stimulus spending.... So, the usual 18 months of contraction lasted for over 40 months....

From 2012 to now is 2 years, a recovery in the business cycle will only last 5 to 7 years before another contraction.. That means our next recession will hit anywhere from 2017 to 2019... With a sitting president till Jan 2001, they will probably bandaid it like Clinton did. But, the stock markets will probably still sell off sometime between 2017 to 2019.

Now by this time in our business cycle... companies should be recording amazing profits and stocks should be flying high. But, they aren't.. Whenever you see the media or the government trying to hype up the general public to get involved, that means they are grasping at straws. American manufacturing still hasn't recovered. The lessons learned by all those people who lost their homes and had their credit card rates cut in half to force them to pay higher bills has the average consumer being a lot smarter about their cash. Since 75% of America's GDP is consumer spending, frugal spending is bad news... So, I am guess that the government is wanting to trick everyone into buying stocks and planning for their retirement as a way to push spending..

The truth is.... If you buy stocks now, you are an idiot.... At this point in the business cycle, you are better off sitting on your cash with a bond and waiting for the next recession to cause stock prices to fall well below their 52 week averages. Otherwise you are going to be sitting on stocks you paid way too much for and waiting for the recovery to break even instead of tripling your cash by purchasing at the bottom...

It's ok to keep working the 401k, just make sure to cash in right around 2017 so you have a ton of cash to buy stocks when the markets tank. If you have to keep the money invested in something, then in 2017 switch over to bonds and wait for the selloff, then switch back when the stock markets bottom out.

August 20 2014 at 5:15 PM Report abuse rate up rate down Reply
1 reply to socioeconomist1's comment

You are a fool for not investing in the stock market. I have invested for 34 years and have done very well. My wife invested 15% of each check into it plus have individual stock market accounts.

August 20 2014 at 5:25 PM Report abuse +4 rate up rate down Reply
4 replies to merstockgto's comment

I put the full amount 10% in my 401k and also had my IRA funded.

August 20 2014 at 5:00 PM Report abuse +5 rate up rate down Reply
1 reply to ak841's comment


August 20 2014 at 5:25 PM Report abuse +3 rate up rate down Reply

Thanks to the Democrats and the Obama Economy.

August 20 2014 at 4:05 PM Report abuse -8 rate up rate down Reply
3 replies to democrap2's comment
David Huntington

The writer assumes we are getting raises?

August 20 2014 at 3:33 PM Report abuse +5 rate up rate down Reply
1 reply to David Huntington's comment

You do not have to get a raise. Just do not live above your means and save, save and invest.

August 20 2014 at 5:26 PM Report abuse +6 rate up rate down Reply
1 reply to merstockgto's comment

Also pay off your debt and don't continue to get into debt. If you have no debts, especially credit card debt, or a monthly car payment, then you can live off of a lot less income.

August 21 2014 at 6:56 PM Report abuse rate up rate down


August 20 2014 at 3:10 PM Report abuse +1 rate up rate down Reply