The race-based wealth gap

What happens with employees investing in 401(k)s? The investment behavior of  9,600 Alcoa workers was examined between 2003 and 2010 for racial differences.  Outcome:  Blacks and Hispanics invested differently than whites.

• Black and Hispanic employees were less likely to participate in the plans at all
• minority contributors to the plans chose safer, low-returning assets like money market accounts than riskier fare like stock or bond funds
• minority employees were more likely to make early withdrawals from their accounts, or take loans out against them
• black salaried employees were less likely to participate in the plans than Hispanic or White salaried employees

Yet, at the end of the article, despite showing investing behavior was different,  the author still concluded “it’s important to keep in mind that racial inequality can manifest itself in many different ways, including some with the potential to perpetuate the disparity in our retirement years.”

http://qz.com/343369/racial-disparities-can-be-found-even-in-our-401k-accounts/

Follow the money—or the votes

Seniors are not hurting.

"Sen. Tom Harkin (D., Iowa) has introduced legislation to increase Social Security benefits and build a government-run supplemental saving plan. Sen. Elizabeth Warren (D., Mass.) has so captivated progressives with her demands to raise Social Security payments that she is touted as a potential presidential candidate in 2016."

What this country needs is jobs for young people, not pandering to senior citizens. Today's retirees have been warned since their 30s that Social Security won't be there for them, and most of the couples I know have 5 or 6 streams of income, from a 403-b, or 401-k, or private investments, or annuities, or IRAs, or veterans' pension, or Social Security. There are divorced women living in “committed relationships” still getting financial support from the husband that ran off with his secretary 30 years ago. If they married, they’d lose that. 

Politicians know seniors vote. Especially Democrats.

How the government takes care of retirees

1) Don't reform Social Security.

2) Destroy the value of your 401-k and 403-b and any other investments you have through a subprime mortgage meltdown they could have stopped (or never started). Barney Frank, Chris Dodd and Barack Obama made sure no one would stop their pet projects and kick-backs from the GSEs.

3) Steal the value of the 401-k that's left.

Powerful House Democrats are eyeing proposals to overhaul the nation’s $3 trillion 401(k) system, including the elimination of most of the $80 billion in annual tax breaks that 401(k) investors receive. Workforce

Share the wealth, folks. Share the pain. You're next.