One in Five Americans Raiding Retirement Funds Early

As the GOP seeks to perpetuate tax breaks for the extremely wealthy and totally dismantle the social safety net for everyone else, a new report indicates that nearly one-fifth of full-time employed Americans have raided retirement accounts in the past year to cover financial emergencies. I know I had to take that step when I was forced from a law firm for being gay only to find myself penalized by the IRS and having it held against me in my divorce - even though it's what kept our home from heading towards foreclosure (the rest of my retirement was stripped from me by an anti-gay black judge who stated that sexual orientation was a choice). I suspect most Americans who have had to take this action were faced with either huge medical costs not covered by insurance or faced with job loss and plummeting income. The obvious question becomes WTF are people doing when they fall for the GOP lies and demagoguery? Here are some highlights from Bankrate.com:

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19 percent of Americans -- including 17 percent of full-time workers -- have been compelled to take money from their retirement savings in the last year to cover urgent financial needs, the Financial Security Index found.
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The potential consequences of tapping retirement funds include early withdrawal fees, taxes and the loss of compound earnings -- not to mention the prospect of being unable to retire.
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While workers might be able to replenish the funds pilfered from tax-advantaged accounts once they regain their financial footing, one of the main benefits of long-term savings is time and compound interest. An early withdrawal of $10,000 is not just $10,000. It's actually $10,000 plus whatever that money would have earned over the lifetime of the account. Furthermore, with penalties and taxes an early $10,000 withdrawal may only yield $6,500 if you're in a 25 percent tax bracket.
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While it's fortunate that people do have the retirement savings to fall back on when they absolutely have no alternatives, they may be just delaying the day when they truly have no more resources and working is no longer be an option.
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"That's the scary thing. People are turning to this as a last resort; they have exhausted their other resources. At that point there is very little in the way of alternatives," says Greg McBride, CFA, senior financial analyst at Bankrate.com.
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"Consumers are pessimistic on all five components of financial security. When you look at gasoline prices closing in on $4 a gallon and other events taking place around the globe, it can be unsettling."
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It's a sad commentary on where this country is headed and, if the GOP is successful, suggest that many more Americans will find themselves living in poverty in the elder years. Once again, the party of alleged Christian values is showing its utter disdain for the central Gospel message of love and care for one's neighbor.

Will Retirees Be Forced Back to Work??

The market forces so loved by John "Deregulation" McCain have surely not worked for millions of Americans who will be faced with shock and dismay when they open their next retirement account statement. According to the head of the Congressional Budget Office, Americans' retirement plans have lost as much as $2 trillion in the past 15 months. One heck of a job Johnny and Chimpy!! God help us all if these clowns do any more great work for us average Americans. Of course, with Cindy McCain's rumored $100 million net worth, even a horrific loss in vale would leave the McCains in a position most Americans will never know even in their dreams. Between my horrific divorce and the financial market melt down, as of now, I figure I will likely die at my office desk. Here are some story highlights:

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Americans' retirement plans have lost as much as $2 trillion in the past 15 months, Congress' top budget analyst estimated Tuesday. The upheaval that has engulfed the financial industry and sent the stock market plummeting is devastating workers' savings, forcing people to hold off on major purchases and consider delaying their retirement, said Peter Orszag, the head of the Congressional Budget Office.

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"Unlike Wall Street executives, America's families don't have a golden parachute to fall back on," said Rep. George Miller, D-Calif., the panel chairman. "It's clear that their retirement security may be one of the greatest casualties of this financial crisis." More than half the people surveyed in an Associated Press-GfK poll taken Sept. 27-30 said they worry they will have to work longer because the value of their retirement savings has declined.

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Orszag indicated the fear is well-founded. Public and private pension funds and employees' private retirement savings accounts—like 401(k)'s—have lost some 20 percent overall since mid-2007, he estimated. Private retirement plans may have suffered slightly more because those holdings are more heavily skewed toward stocks, Orszag added.

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A new AARP study found that because of the economic downturn, one in five workers 45 and older has stopped putting money into a 401(k), IRA or other retirement savings account during the past year, and nearly one in four has increased the number of hours he works.

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The country seriously CANNOT afford another four years of the Bush/McCain/Palin lunacy and refusal to face reality.