Mostpeoplejustpay offtheir mortgage, make the mandatorycontributions to their stateorprivatepension (iftheyhaveone), and keep somemoney for short-run contingencies.
In Chile, a private-sector pension scheme, funded by mandatorycontributions, now channels a tenth of most workers' pay into the fund of their choosing.
American fund managers are also doing well in other Latin American countries, which have either adopted the Chilean approach (eg, Mexico and Bolivia), or gone down a similar route while avoiding mandatorycontributions (eg, Argentina and Brazil).
Another name that frequently surfaces in the 401(k) plot discussions is longtime retirement activist Teresa Ghilarducci, a professor of economics at The New School, who believes the 401(k) should lose all its tax advantages, and instead be replaced by something she calls Guaranteed Retirement Accounts, a system of mandatory retirement contributions by both employees and their employers, that would allow for a minimum, promised investment return.