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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Amy J who wrote (213532)12/18/2004 2:54:32 PM
From: neolib  Read Replies (3) | Respond to of 1575622
 
I may be confused but this is my understanding:

1) The amount is "up to" 4% of payroll so about 33% of SS tax. The wording in articles is terrible on this, with many making it sound like 4% of SS tax which is much smaller. Limits of $1000/year reduce it for many people.

2) They are "private" accounts in that the money is yours and accounted as such. Not privately directed like IRA's can be. View it more as a "company" plan without self direction. So there will be management fees that may eat a large chunk of the interest if the interest is only about 4% a year (conservative investments). A management fee of 1% of principle would be 25% of the increase at 4% interest a year.

Am I missing something?



To: Amy J who wrote (213532)12/18/2004 7:29:30 PM
From: RetiredNow  Read Replies (1) | Respond to of 1575622
 
Amy, they won't. You will get choices, just like you do in your 401K. However, they are likely to be very limited and relatively safer choice, like horizon funds or index funds. And the fees are going to be comparable to other mutual funds in the U.S.

There's no point in comparing our system to Chile's. It's a ridiculous comparison.


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