CNHI News Service


January 18, 2013

Americans are raiding their 401K accounts


Editor's Note: If you're not a weekly subscriber to Taylor Armerding's column, you can publish this one if you notify him at


There was a clear undercurrent of alarm this past week in a Washington Post story reporting that more than a quarter of American workers with 401(k) and other retirement savings accounts are using them to pay for current expenses.

This is draining nearly a quarter of the $293 billion deposited into those accounts every year. Matt Fellowes, a former researcher for the liberal-leaning Brookings Institution and now chief executive of the financial advisory firm HelloWallet, told the Post that employers who match their workers’ contributions, “are dramatically overpaying for retirement, but it is not benefitting the employee.”

To which I wonder, why is anybody, especially the left-leaning Post and other liberals, surprised?

I agree that, back in those long-ago days when personal responsibility was considered important, this would have been seen as a very big problem. But now? The ones raiding their retirement accounts are the smart ones. You can count the ways.

First, why shouldn’t they spend it? At least they’re spending, or borrowing against, money they actually have, unlike our benevolent federal government, which is spending trillions that it doesn’t have – borrowing it from China and leaving crippling debt for the coming generations to clean up.

Time and again in his first term, and now going into his second, President Obama has declared that true fiscal responsibility lies basically in just getting a bigger limit on your credit card.

His recent self-righteous declarations on raising the debt ceiling (which he spoke and voted against as a senator) are just the latest absurdity. Obama slams Republicans for resisting raising the debt ceiling, saying that the U.S. has always been a nation that pays its bills.

Text Only
  • taylor.armerding.jpg Warren's populist pitch on student loans is off key

    Sen. Elizabeth Warren's populist rhetoric pumps up students about their loan burdens, but she conveniently neglects to mention the real problem - the exorbitant cost of college - much less how she's benefitted from those high prices.

    April 18, 2014 1 Photo

  • taylor.armerding.jpg Obama's equal pay exaggeration leads us all into danger

    The president's claims of national shame over gender-based pay inequity spring from distorted calculations, as well as some convenient political math.

    April 11, 2014 1 Photo

  • taylor.armerding.jpg Voters beware of oligarchs and bogeymen

    Scaring voters to distract them from issues is a tired - and bipartisan - ploy sure to be in heavy rotation this campaign season.

    April 4, 2014 1 Photo

  • taylor.armerding.jpg Put teens to work by laying off minimum wage rhetoric

    Idle teen workers may be a national problem, but frugal private employers aren't the reason for it. Minimum wage hikes - like the one championed by President Obama - squeeze these marginal jobs out of the economy.

    March 28, 2014 1 Photo

  • taylor.armerding.jpg Legal marijuana can be government's new cash crop

    Officials holding out against legalized marijuana may "evolve" their thinking because of one number: Colorado says it gathered $2 million in taxes from pot shops in January, as business was just getting started.

    March 21, 2014 1 Photo

  • taylor.armerding.jpg Banning a 'B-word' teaches girls the wrong lesson

    Striking the word "bossy" from the language doesn't help young girls learn to speak up or become leaders. It teaches them how to be, well, bossy.

    March 14, 2014 1 Photo

  • taylor.armerding.jpg Giving businesses choice is not legalizing discrimination

    The owner of a California gay bar should be allowed to refuse service to legislators he considers "crazy, ignorant or stupid." The problem is the popular double-standard that supports his version of "discrimination" while raging against anyone who disagrees with him but wants the same freedom.

    March 7, 2014 1 Photo

  • taylor.armerding.jpg Obama twists Constitution to cut U.S. military

    President Obama's plan to slash the military to pre-World War II levels endangers the country, especially when our enemies don't know the war is over.

    February 28, 2014 1 Photo

  • taylor.armerding.jpg Benefits of hiking minimum wage are an illusion

    The president's latest economic fantasy says raising the minimum wage will incentivize work, lower unemployment, juice the economy and may even lower taxes. All while businesses swallow billions of dollars more in labor costs.

    February 21, 2014 1 Photo

  • taylor.armerding.jpg Coastal residents should pay true cost of flood insurance

    The environmental champions in Congress took a big break from their moral scolding this past month with a gigantic “Never mind!” after their constituents discovered the law requiring them to start paying the true cost of living in flood-prone areas.

    February 14, 2014 1 Photo