While people concentrate on the future value of money aspect, it should be noted that the inflationary aspect of goods or services is getting cast aside. That dollar invested today will ultimately lose purchasing power.
The COVID Era subsidies were poorly designed as to the captured group and rushed payments that created debt where the interest payments outlast the effectiveness of the program.
With Trump Accounts we still don't know the fee structures or who will ultimately manage them.
If this were such a good idea, Congress wouldn't have allowed it to sunset in 2028. Just another boondoggle using other people's money...
Yes - well put. And from what I understand, there will be fees collected by the fund managers - even though it's a small amount, it's still something that fund managers benefit from.
I'm dubious of every new tax loophole. They are inevitably exploited by the rich (remember Romney's $100 million IRA built from contributions valued at a penny on the dollar?) and ensnare everyone else in labyrinthine tax code. If we want to help people then provide either money or services, not contrivances of the financial and insurance industries. Accounts that can be invested in equities boost asset prices, at least for a while. Subsidize education, not student debt; subsidize housing, not mortgages; subsidize healthcare, not health insurance.
I fear these minor savings accounts are also a move to rationalize coming cuts to Social Security as we approach the bankruptcy forecast in only 6 years. Raising the eligibility age will barely move the needle on solvency, but billionaires are desperate to distract from the policy changes that will make a difference: lift the cap on income taxed, and widen the types of personal income that are taxed for Social Security.
We should aslo look at the macroeconomic effect. If the government borrows $1000 to put it into a person's saving account the net effect will be zero. If we want to increase saving (and we should) we need either to rasise taxes or reduce spending or some of both.
While people concentrate on the future value of money aspect, it should be noted that the inflationary aspect of goods or services is getting cast aside. That dollar invested today will ultimately lose purchasing power.
The COVID Era subsidies were poorly designed as to the captured group and rushed payments that created debt where the interest payments outlast the effectiveness of the program.
With Trump Accounts we still don't know the fee structures or who will ultimately manage them.
If this were such a good idea, Congress wouldn't have allowed it to sunset in 2028. Just another boondoggle using other people's money...
Yes - well put. And from what I understand, there will be fees collected by the fund managers - even though it's a small amount, it's still something that fund managers benefit from.
With no tax benefit for the account holder since withdrawals are taxed as normal income.
People should claim the funds, but they shouldn't add a dime of their own funds.
I'm dubious of every new tax loophole. They are inevitably exploited by the rich (remember Romney's $100 million IRA built from contributions valued at a penny on the dollar?) and ensnare everyone else in labyrinthine tax code. If we want to help people then provide either money or services, not contrivances of the financial and insurance industries. Accounts that can be invested in equities boost asset prices, at least for a while. Subsidize education, not student debt; subsidize housing, not mortgages; subsidize healthcare, not health insurance.
I fear these minor savings accounts are also a move to rationalize coming cuts to Social Security as we approach the bankruptcy forecast in only 6 years. Raising the eligibility age will barely move the needle on solvency, but billionaires are desperate to distract from the policy changes that will make a difference: lift the cap on income taxed, and widen the types of personal income that are taxed for Social Security.
We should aslo look at the macroeconomic effect. If the government borrows $1000 to put it into a person's saving account the net effect will be zero. If we want to increase saving (and we should) we need either to rasise taxes or reduce spending or some of both.
That's a good point - should have added this fact in the write-up, as it will ultimately be a wash.
I like the idea of a tax advantaged saving account for children, but trump accounts really don’t count. It should be more like a 401k for kids.