Bankruptcies Soar For Seniors

[oregonpackfan]

Study: Bankruptcies soar for senior citizens
By MATT SEDENSKY, Associated Press Writer
8 HOURS AGO

ST. AUGUSTINE, Fla. - First came the health problems. Then, unable to work, Ada Noda watched the bills pile up. And then, suffocating in debt, the 80-year-old did something she never thought she'd be forced to do.

She declared bankruptcy.

While the bankruptcy filing rate for those under 55 has fallen, it has soared for older Americans, according to a new analysis from the Consumer Bankruptcy Project, which examined a sampling of noncommercial bankruptcies filed between 1991 and 2007.

The older the age group, the worse it got _ people 65 and up became more than twice as likely to file during that period, and the filing rate for those 75 and older more than quadrupled.

"Older Americans are hit by a one-two punch of jobs and medical problems and the two are often intertwined," said Elizabeth Warren, a Harvard Law School professor who was one of the authors of the study. "They discover that they must work to keep some form of economic balance and when they can't, they're lost."

That's precisely what happened to Noda. She worked all her life, on a hospital's housekeeping staff, and later selling boat tickets to tourists. She cut corners when she needed to but always paid the bills she neatly logged in a ledger.

"I was born during the Depression," she said. "I paid the bills whether I ate or didn't, whether I went to the doctor or not."

It all worked fine for Noda, a widow for 23 years, until she was forced to undergo double-bypass surgery and deal with respiratory problems. She started using two credit cards more frequently for food and bills. Before long, she was $8,000 in debt and behind on car payments.

"I'd go to bed and all I had on my mind was bankruptcy," she said. "I had nothing left."

Noda's car was repossessed, but her trailer home wasn't in jeopardy because her daughter owns it. While she's covered by Medicare and receives $968 in Social Security each month, she relied on her job for other expenses. She had no choice but to get help from Jacksonville Legal Aid and declare bankruptcy.

Most bankruptcies are still filed by people far younger than Noda, but the percentage the younger filers make up has fallen over the 16-year period, according to the Consumer Bankruptcy Project analysis, which will be published in the Harvard Law and Policy Review in January.

In 1991, the 55-plus age group accounted for about 8 percent of bankruptcy filers, according to the study, which looked at more than 6,000 cases filed in 1991, 2001 or 2007. By last year, filers 55 and over accounted for 22 percent.

Each age group under 55 saw double-digit percentage drops in their bankruptcy filing rates over the survey period, older Americans saw remarkable increases. The filing rate per thousand people ages 55-64 was up 40 percent; among 65- to 74-year-olds it increased 125 percent; and among the 75-to-84-year-old set, it was up 433 percent.

A number of factors are contributing to the increase. Higher prices for ordinary consumer goods have hit seniors on fixed budgets. For older Americans living below the poverty level, or not far above, a safety net likely doesn't exist for economic setbacks such as medical problems. And some fall prey to scams that cripple their finances.

Warren noted increasing numbers of Americans are entering their retirement years with significant debt and are still paying off mortgages. She said it was wrong to assume that lives of luxury are bankrupting seniors; rather, they're incurring debts to meet needs such as medical treatment.

"There's no evidence that the problem is consumerism," the professor said.

Nor is there a significant aging trend to blame. While the country is set to experience a notable age shift in the coming years, no major one took place between 1991, when the average age was 33, and 2007, when it was 36.

Frank and Hazel Peters lived frugally their entire 53-year marriage. They always rented a home but decided after the husband's retirement from a factory job that they would cash in his 401(k) and buy a manufactured home down a gravel road in tiny Hastings, a town of cornfields and potato farms.

But they fell victim to fraud when they tried to fix a plumbing problem that had black, sulphur-smelling water coming through the pipes of their new home without enough funds to fall back on. They declared bankruptcy.

"We knew we had no other option," 73-year-old Hazel Peters said. "We'd probably be out on the street."

Bankruptcy, tough no matter a person's age, is especially hard when you don't have many years left to recover. Warren said some seniors fear telling their families because they're afraid they'll be put in a nursing home if they're seen as unable to take care of their affairs.

Many who file also express a sense of relief.

Wilona Harris, 71, filed bankruptcy two years ago because of medical bills she and her husband accrued.

"This phone rang all the time. It made you not even want to pick up. Sometimes you think, 'Let me go jump off a bridge somewhere,'" Harris said at her Jacksonville home. "You have to cry and try and figure out what in the world could I do."

At least now, Harris says, she can fall asleep without crying.

[Scott Campbell]

http://www.cnn.com/2008/SHOWBIZ/TV/06/06/lkl.mcmahon/index.html

[Maxie the Taxi]

The title of the piece is: "Study: Bankruptcies soar for senior citizens."

Yet, halfway through the article, this appears: "Nor is there a significant aging trend to blame. While the country is set to experience a notable age shift in the coming years, no major one took place between 1991, when the average age was 33, and 2007, when it was 36."

If age isn't to blame, why imply it is by talking about "senior citizens?"

Maybe the title of the piece should have been: "Study: Bancruptcies soar for hardworking but stupid people whose entire retirement plan consists of investing their meager life savings in a single-wide trailer in rural Florida."

[The Leaper]

It is a sad situation...but in many cases, their plight is a result of poor planning on their part. These people lived during a time where their nation experienced the greatest wealth accumulation in the history of mankind.

I can understand that many were "unsure" of the stock market and were hesitant to invest in ways that would have secured their future. I also realize that there are some with unique situations where they really had no control over the circumstances that led them to where they currently are.

However, I can't completely absolve many seniors of their plight. Most of them did not do enough to prepare for their retirement...they had plenty of opportunity and availability to do so.

[mraynrand]

Interesting article. It will get a whole lot worse with Obama in office. Obama wants a 28% (McCain 0%) tax on home sale profit, which will help wipe out equity earnings for seniors. He wants 39.6% dividend tax (McCain 15%0, which will help wipe out gains in money invested in stock market, IRA, mutual funds, college funds, life insurance, retirement accounts, etc. Obama wants a 49% inheritance tax (McCain 0% up to 5mil) on everything a person wants to pass on to their family after they pass on. So if you own a home and want to give it to a child, they will have to sell it (and pay 28% on the profit) just to pay the 49% tax on the inheritance. Welcome to retirement, Obama style. You better hope you get a publisher's clearing house giveaway from Ed McMahon....

[HowardRoark]

Interesting article. It will get a whole lot worse with Obama in office. Obama wants a 28% (McCain 0%) tax on home sale profit, which will help wipe out equity earnings for seniors. He wants 39.6% dividend tax (McCain 15%0, which will help wipe out gains in money invested in stock market, IRA, mutual funds, college funds, life insurance, retirement accounts, etc. Obama wants a 49% inheritance tax (McCain 0% up to 5mil) on everything a person wants to pass on to their family after they pass on. So if you own a home and want to give it to a child, they will have to sell it (and pay 28% on the profit) just to pay the 49% tax on the inheritance. Welcome to retirement, Obama style. You better hope you get a publisher's clearing house giveaway from Ed McMahon....

You do get the stepped up cost basis as far as capital gains taxes when someone dies......I hope Obama doesn't wnat to take that away too.

Everything coming out of an IRA is taxed at Ordinary Income rates, so either way you look at it, they are going up.

EDIT: I see you are talking about Inheritence taxes......that's true. It especially hurts family farmers. With acerage the way it is now, when they die, they have to sell half the land just to pay the taxes.

I read McCain was at $10MM, and Obama was at $3.5MM.

[oregonpackfan]

Several things strike me about this article:

1. Americans can no longer rely on a company-based pension to provide their financial needs in retirement. Only a small percentage of companies provide pensions anyone. Most that do have a retirement plan are 401ks where the primary responsibility is placed on the employee rather than the employer.

2. All Americans, particularly the ones in their 20's, 30's, and 40's, need to become more educated in long-term investing and start contributing for their retirement be it in the form of 401ks, Roth Ira's, etc.

3. All Americans need to increase their savings, be it short-term or long-term. a recent study showed Americans had an average savings rate of -.5%! Yes, that is a negative savings rate. The average savings rate for Asians is a +10%.

[Scott Campbell]

It is a sad situation...but in many cases, their plight is a result of poor planning on their part. These people lived during a time where their nation experienced the greatest wealth accumulation in the history of mankind.

I can understand that many were "unsure" of the stock market and were hesitant to invest in ways that would have secured their future. I also realize that there are some with unique situations where they really had no control over the circumstances that led them to where they currently are.

However, I can't completely absolve many seniors of their plight. Most of them did not do enough to prepare for their retirement...they had plenty of opportunity and availability to do so.


This is a very good post. I agree, and would add that many of these folks were led down this path by the belief that their government and company would take care of them in their old age with Social Security and defined benefit pension plans. They didn't think they'd have to take care of themselves.

Were in an age of transition - back to the concept that you need to take care of yourself and not count on your government and/or employer to do it for you. Many in this age group are caught in the transition, and this is understandable. However, now people know. There shouldn't be any excuses for the next generation.

[Scott Campbell]

Interesting article. It will get a whole lot worse with Obama in office. Obama wants a 28% (McCain 0%) tax on home sale profit, which will help wipe out equity earnings for seniors. He wants 39.6% dividend tax (McCain 15%0, which will help wipe out gains in money invested in stock market, IRA, mutual funds, college funds, life insurance, retirement accounts, etc. Obama wants a 49% inheritance tax (McCain 0% up to 5mil) on everything a person wants to pass on to their family after they pass on. So if you own a home and want to give it to a child, they will have to sell it (and pay 28% on the profit) just to pay the 49% tax on the inheritance. Welcome to retirement, Obama style. You better hope you get a publisher's clearing house giveaway from Ed McMahon....



This is depressing as hell. Thank god I'm socking money away in a Roth. Please don't tell me Obama wants to take that away from me too.

[Scott Campbell]

Several things strike me about this article:

1. Americans can no longer rely on a company-based pension to provide their financial needs in retirement. Only a small percentage of companies provide pensions anyone. Most that do have a retirement plan are 401ks where the primary responsibility is placed on the employee rather than the employer.

2. All Americans, particularly the ones in their 20's, 30's, and 40's, need to become more educated in long-term investing and start contributing for their retirement be it in the form of 401ks, Roth Ira's, etc.

3. All Americans need to increase their savings, be it short-term or long-term. a recent study showed Americans had an average savings rate of -.5%! Yes, that is a negative savings rate. The average savings rate for Asians is a +10%.


I like your post OPF, but I'd tweak the order just a little bit. I think you've got 2 and 3 flipped around. There isn't much point for people becoming educated on investing unless they're first become savers. Zippy the chimp can buy mutual funds - it ain't that tough. And your investment return in early years of wealth building is no where near as impactful as your savings rate. In later years, once your nest egg is more substantial, then investment return becomes more important.

[Scott Campbell]

Everything coming out of an IRA is taxed at Ordinary Income rates, so either way you look at it, they are going up.



Not from a Roth IRA. :D

[retailguy]

Everything coming out of an IRA is taxed at Ordinary Income rates, so either way you look at it, they are going up.



Not from a Roth IRA. :D

Yet. You think a pot of money as large as Roth IRA's are becoming won't be of interest to politicians.... :roll:

[mraynrand]

Interesting article. It will get a whole lot worse with Obama in office. Obama wants a 28% (McCain 0%) tax on home sale profit, which will help wipe out equity earnings for seniors. He wants 39.6% dividend tax (McCain 15%0, which will help wipe out gains in money invested in stock market, IRA, mutual funds, college funds, life insurance, retirement accounts, etc. Obama wants a 49% inheritance tax (McCain 0% up to 5mil) on everything a person wants to pass on to their family after they pass on. So if you own a home and want to give it to a child, they will have to sell it (and pay 28% on the profit) just to pay the 49% tax on the inheritance. Welcome to retirement, Obama style. You better hope you get a publisher's clearing house giveaway from Ed McMahon....



This is depressing as hell. Thank god I'm socking money away in a Roth. Please don't tell me Obama wants to take that away from me too.

Relax, Scott. I got one thing wrong there. I think Obama only wants a 45% inheritance tax, not 49, as I first reported. But my understanding is that the limits on the Roth IRA are actually scheduled to change in the next year (to your benefit, right?). Don't be surprised if Obama would go after that as well.

Also, there is his 50 Billion stimulus package - 25 billion to help states pay off their debt, and another 25 Billion for 'infrastructure.' Given that 65% of state expeditures are on Medicare, Medicaid, and Education, and that much of the infrastructure he talks of is for schools, it essentially is another mechanism for entitlement payouts and a huge payout to the Teacher's unions and other unions. But to get the feds to pay off state debt - YIKES!

[MJZiggy]

The title of the piece is: "Study: Bankruptcies soar for senior citizens."

Yet, halfway through the article, this appears: "Nor is there a significant aging trend to blame. While the country is set to experience a notable age shift in the coming years, no major one took place between 1991, when the average age was 33, and 2007, when it was 36."

If age isn't to blame, why imply it is by talking about "senior citizens?"

Maybe the title of the piece should have been: "Study: Bancruptcies soar for hardworking but stupid people whose entire retirement plan consists of investing their meager life savings in a single-wide trailer in rural Florida."

Just recall that when these people were working, it was not so common to invest in stocks, and there weren't the investment options that there are today. Many people relied on company benefits and retirement plans that were pulled out from under them. Many also believed that they could count on Social Security to take care of them and they were, of course, wrong. The end result is that they've had to continue working long after the traditional retirement age and if the stock market takes a major dump when it's time for your retirement, you could experience some of the same issues if you're not diversified enough.

[MJZiggy]

Interesting article. It will get a whole lot worse with Obama in office. Obama wants a 28% (McCain 0%) tax on home sale profit, which will help wipe out equity earnings for seniors. He wants 39.6% dividend tax (McCain 15%0, which will help wipe out gains in money invested in stock market, IRA, mutual funds, college funds, life insurance, retirement accounts, etc. Obama wants a 49% inheritance tax (McCain 0% up to 5mil) on everything a person wants to pass on to their family after they pass on. So if you own a home and want to give it to a child, they will have to sell it (and pay 28% on the profit) just to pay the 49% tax on the inheritance. Welcome to retirement, Obama style. You better hope you get a publisher's clearing house giveaway from Ed McMahon....



This is depressing as hell. Thank god I'm socking money away in a Roth. Please don't tell me Obama wants to take that away from me too.

Relax, Scott. I got one thing wrong there. I think Obama only wants a 45% inheritance tax, not 49, as I first reported. But my understanding is that the limits on the Roth IRA are actually scheduled to change in the next year (to your benefit, right?). Don't be surprised if Obama would go after that as well.

Also, there is his 50 Billion stimulus package - 25 billion to help states pay off their debt, and another 25 Billion for 'infrastructure.' Given that 65% of state expeditures are on Medicare, Medicaid, and Education, and that much of the infrastructure he talks of is for schools, it essentially is another mechanism for entitlement payouts and a huge payout to the Teacher's unions and other unions. But to get the feds to pay off state debt - YIKES!

Actually, the infrastructure being discussed is a little bit for schools, but the payout for the states is mainly intended to repair crumbling roads and bridges--the need for which was highlighted in the I-35 bridge collapse and Congress is already acting on it according to the engineers' PAC.

[bobblehead]

Interesting article. It will get a whole lot worse with Obama in office. Obama wants a 28% (McCain 0%) tax on home sale profit, which will help wipe out equity earnings for seniors. He wants 39.6% dividend tax (McCain 15%0, which will help wipe out gains in money invested in stock market, IRA, mutual funds, college funds, life insurance, retirement accounts, etc. Obama wants a 49% inheritance tax (McCain 0% up to 5mil) on everything a person wants to pass on to their family after they pass on. So if you own a home and want to give it to a child, they will have to sell it (and pay 28% on the profit) just to pay the 49% tax on the inheritance. Welcome to retirement, Obama style. You better hope you get a publisher's clearing house giveaway from Ed McMahon....

2 notes, it won't evaporate earnings it will turn it over to gov't and "needy" people who manage to do such good things with wealth that they are always broke.

Second, I know some seniors who are very active in liquidating their assets and moving them overseas to avoid confiscation upon their death....good deal for sweden, our savings get to help prop their economy.

[Maxie the Taxi]

Just recall that when these people were working, it was not so common to invest in stocks, and there weren't the investment options that there are today. Many people relied on company benefits and retirement plans that were pulled out from under them. Many also believed that they could count on Social Security to take care of them and they were, of course, wrong. The end result is that they've had to continue working long after the traditional retirement age and if the stock market takes a major dump when it's time for your retirement, you could experience some of the same issues if you're not diversified enough.

It seems to me people have been investing in the stock market for years and way more people have profited from it than not. Sure you couldn't invest in derivatives years ago, but mutual funds and federal reserve notes have a long history. And I'd be willing to bet that the vast majority of companies' benefits and pensions paid off as promised.

The problem with the people cited is that they were probably living on the edge their entire life. A hospital housekeeper? Selling boat tickets to tourists? You're not going to accumulate a fortune doing that. And Frank and Hazel Peters don't seem like the brightest lights in Hastings.

And whose fault is it that they can't count on Social Security or that they value of any money they managed to save in 53 years has depreciated over 50% due to inflation?

I'll take my chances on stocks and bonds, at least I have a say on which stocks and bonds I will stake my future. The only say I have on social security, the value of the dollar and runaway taxes and spending is a single vote. And I'll bet Frank and Hazel Peters voted their whole lives...for the New Deal, The Fair Deal and every other deal those slick Washington politicians sold them.

And what did they get for all those votes? A raw deal as smelly as the black water coming through their pipes.

The moral of the story? It's obvious, keep trusting the politicians. Keep encouraging them to tax more and spend more and take more and more say away from individuals. Keep giving that say to them.

We will never learn.

[MJZiggy]

Who said anything about trusting politicians or taxing more? I was just commenting on your comment about stupid people whose retirement plan consists of investing their life savings in a single-wide.

And for the record, my folks live in a seniors trailer park in Madison and pay $163 a month in lot rental. That trailer is nicer than some apartments I've had in my day. We want them to move to assisted living but they're balking at the $800 a month (I couldn't get a studio in a bad neighborhood here for that).

[GBRulz]

An assisted living facility for $800 a month? I would be afraid. Very afraid.

[mraynrand]

Interesting article. It will get a whole lot worse with Obama in office. Obama wants a 28% (McCain 0%) tax on home sale profit, which will help wipe out equity earnings for seniors. He wants 39.6% dividend tax (McCain 15%0, which will help wipe out gains in money invested in stock market, IRA, mutual funds, college funds, life insurance, retirement accounts, etc. Obama wants a 49% inheritance tax (McCain 0% up to 5mil) on everything a person wants to pass on to their family after they pass on. So if you own a home and want to give it to a child, they will have to sell it (and pay 28% on the profit) just to pay the 49% tax on the inheritance. Welcome to retirement, Obama style. You better hope you get a publisher's clearing house giveaway from Ed McMahon....



This is depressing as hell. Thank god I'm socking money away in a Roth. Please don't tell me Obama wants to take that away from me too.

Relax, Scott. I got one thing wrong there. I think Obama only wants a 45% inheritance tax, not 49, as I first reported. But my understanding is that the limits on the Roth IRA are actually scheduled to change in the next year (to your benefit, right?). Don't be surprised if Obama would go after that as well.

Also, there is his 50 Billion stimulus package - 25 billion to help states pay off their debt, and another 25 Billion for 'infrastructure.' Given that 65% of state expeditures are on Medicare, Medicaid, and Education, and that much of the infrastructure he talks of is for schools, it essentially is another mechanism for entitlement payouts and a huge payout to the Teacher's unions and other unions. But to get the feds to pay off state debt - YIKES!

Actually, the infrastructure being discussed is a little bit for schools, but the payout for the states is mainly intended to repair crumbling roads and bridges--the need for which was highlighted in the I-35 bridge collapse and Congress is already acting on it according to the engineers' PAC.

That's in the second 25 Billion. And that's in addition to the pork-laden (over 6300 pork projects) - 280+ billion dollar transportation bill from 2005 (which may have been added to - I forgot). But that's OK, let's keep the pork and the federal (your) money rolling....

[Tyrone Bigguns]

An assisted living facility for $800 a month? I would be afraid. Very afraid.

Someone is turning a profit on 8 hundy. This i gotta see.

Ty has seen some rank places...they make the poorhouses and debtors prisons of Dicken's seem like the 4 seasons.

[MJZiggy]

I just go by what the folks tell me. I can't be there to oversee...Dad may be a little far gone, but if they try and mess with Mom, she'll be on the phone to whoever'll listen right up to the Governor!

[bobblehead]

Just recall that when these people were working, it was not so common to invest in stocks, and there weren't the investment options that there are today. Many people relied on company benefits and retirement plans that were pulled out from under them. Many also believed that they could count on Social Security to take care of them and they were, of course, wrong. The end result is that they've had to continue working long after the traditional retirement age and if the stock market takes a major dump when it's time for your retirement, you could experience some of the same issues if you're not diversified enough.

Also recall that was before supply siders decided that the fed constantly cutting rates to stimulate the economy drove down returns on "safe" investments and devalued the dollar. when i was very young getting 7-8% on a 3 year CD wasn't unheard of. Those very safe and solid returning investments WERE available to said people.....but they relied on all the things you mention to their demise. any financial planner worth a shit will have you out of stocks with the majority of your portfolio as you "near retirement" so the market dumping shouldn't affect you.

[Scott Campbell]

But my understanding is that the limits on the Roth IRA are actually scheduled to change in the next year (to your benefit, right?). Don't be surprised if Obama would go after that as well.


I was going to try and explain it, but opted for the cut and paste:



Roth IRA changes for 2010 - higher income limits to convert from a tradition to a Roth IRA
On May 17, 2006, President Bush signed a new tax bill into law that makes a number of changes to tax law - this included changes affecting who can participate in a Roth IRA.

With the new law more people can participate in a Roth IRA. A Roth IRA, unlike a traditional IRA, doesn't provide tax deduction when you invest your money, but your original deposits and the earnings on them are not taxed when you withdraw money in retirement.

Until this new tax law change - not everyone could participate in a Roth IRA — currently individuals with incomes of more than $110,000 and couples with more than $160,000 aren't allowed to put money into a Roth IRA, and households with income of more than $100,000 are not able to convert a traditional IRA into a Roth IRA.

With the new law that goes into affect in 2010 - people with incomes of more than $100,000 to convert a traditional IRA into a Roth IRA. People will have to pay taxes on the conversion, if you convert in 2010, you can split the taxes into two payments to be paid in 2011 and 2012. If you convert after 2010, you will have to pay the taxes in one year.

However - the income threshold for people who are starting a new Roth IRA doesn't change.

[Scott Campbell]

Here's why its a big deal. Those who have left jobs and rolled 401K savings into self directed IRAs will be allowed to convert them to Roths. And there is no ceiling on the income level of potential participants. And there's no limit on the amount you can convert. That constitutes a lot of people, with a lot of big accounts.

I'll convert as much as I can stomach. It triggers a massive tax bill that you can split over 2 years. As I understand it anyway.

[mraynrand]

But my understanding is that the limits on the Roth IRA are actually scheduled to change in the next year (to your benefit, right?). Don't be surprised if Obama would go after that as well.


I was going to try and explain it, but opted for the cut and paste:



Roth IRA changes for 2010 - higher income limits to convert from a tradition to a Roth IRA
On May 17, 2006, President Bush signed a new tax bill into law that makes a number of changes to tax law - this included changes affecting who can participate in a Roth IRA.

With the new law more people can participate in a Roth IRA. A Roth IRA, unlike a traditional IRA, doesn't provide tax deduction when you invest your money, but your original deposits and the earnings on them are not taxed when you withdraw money in retirement.

Until this new tax law change - not everyone could participate in a Roth IRA — currently individuals with incomes of more than $110,000 and couples with more than $160,000 aren't allowed to put money into a Roth IRA, and households with income of more than $100,000 are not able to convert a traditional IRA into a Roth IRA.

With the new law that goes into affect in 2010 - people with incomes of more than $100,000 to convert a traditional IRA into a Roth IRA. People will have to pay taxes on the conversion, if you convert in 2010, you can split the taxes into two payments to be paid in 2011 and 2012. If you convert after 2010, you will have to pay the taxes in one year.

However - the income threshold for people who are starting a new Roth IRA doesn't change.

That's pretty much what I read. I just couldn't remember it. Do you worry that they'll change the rules and eventually tax Roth IRAs as you withdraw?

[Scott Campbell]

Everything coming out of an IRA is taxed at Ordinary Income rates, so either way you look at it, they are going up.



Not from a Roth IRA. :D

Yet. You think a pot of money as large as Roth IRA's are becoming won't be of interest to politicians.... :roll:


I understand the interest. But promises have been made, and tax bills have been paid based on those promises. And the government wants us saving for our retirements. That's why they created the plans.

[Scott Campbell]

Do you worry that they'll change the rules and eventually tax Roth IRAs as you withdraw?


No.

I think the worst thing that could happen is that they set an expiration date, and from that point on you'd pay taxes on future earnings. And I think even that is unlikely. It'd be nearly as bad as the government defaulting on a Treasury bond - given the way the program was set up and promoted.

A far more likely scenario would be to eliminate future contributions. Then they wouldn't be damaging those who have already participated, and essentially pre-paid their taxes for life. So you better get in while you can.

[Maxie the Taxi]

Who said anything about trusting politicians or taxing more? I was just commenting on your comment about stupid people whose retirement plan consists of investing their life savings in a single-wide.

You got my dander up, sorry. I thought you were making the "there-but-for-the-grace-of-God-go-I" argument. I hate that argument. :)