Must roll it over to a Roth IRA when it reaches $15,000.

 

You can start with as little as $25 and invest as little as $5 a month.

 

I think most people who do this will change jobs at some point after enrolling and forget about the account and lose the money.

 

It really feels more like a skimming scheme than a useful program.

 

Come on, SSI is nothing more than a Ponsi scheme.

 

A useful government program. = oxymoron.

How is this legal without action from Congress? If Congress doesn't act on this power grab I don't know who to have faith in anymore.

 

Sorry, but Congress is going to save us? May I present to you the "Affordable Healthcare Act".

Executive action?

Sorry, but Congress is going to save us? May I present to you the "Affordable Healthcare Act".

 

That was under one party rule.

What is stopping people now from contributing to a Roth IRA and buying treasuries?

A little redundancy is OK if the end result is that more people squirrel away $$ for their retirement. Everyone is getting upset over this. Save your displeasure for the big stuff -- like spending $700B on a needless land war in Asia.

I just don't get what this accomplishes. It just brings another layer of government. Everything he says this new account can do can be accomplished in current Roth IRA's. It does not benefit anyone or accomplish anything.

 

Winner winner chicken dinner. No sense using what you have in place when you can add an expensive and inefficient government program to the mix. That way you can accomplish the same thing at a far greater cost. Who wouldn't want that?

A little redundancy is OK if the end result is that more people squirrel away $$ for their retirement. Everyone is getting upset over this. Save your displeasure for the big stuff -- like spending $700B on a needless land war in Asia.

Who is going to have extra $$$ to squirel away with healthcare premiums doubling or more?

Not one of your better arguments. Try again.

 

No....

 

Skimming, loan sharking...seems the government is the new mob.

 

They are now loan sharking our youth with the college loan program. The government borrows money from the Fed at around 1%. Then turns around and loans it out to our youth at 7%. That's a big 6% spread. Then they set up payment plans that last for years and the interest payback is well over double the original loan.

 

Skimming, loan sharking...Chicago has come to Washington.

I was just reading another article on this program. First because this law was not passed by Congress the White House can't force any business to comply, and any company that does not offer direct deposit can not participate.

No....

 

Skimming, loan sharking...seems the government is the new mob.

 

They are now loan sharking our youth with the college loan program. The government borrows money from the Fed at around 1%. Then turns around and loans it out to our youth at 7%. That's a big 6% spread. Then they set up payment plans that last for years and the interest payback is well over double the original loan.

 

Skimming, loan sharking...Chicago has come to Washington.

 

While your numbers may not be exactly right your point is correct. I believe the current undergrad rate is 3.86%, not that it matters much.

 

Students under the Dept of Education loan program are worse off than they were under the old program where banks and nonprofits made the loans.

 

You should ask yourself this: why is the federal government making so much money on student loans now?

 

I believe they made $6 billion last year.

 

The elimination of the private loan program was a money grab by the president and the Dem congress. And they sold it to a public who doesn't know enough to realize what's really happening.

While your numbers may not be exactly right your point is correct. I believe the current undergrad rate is 3.86%, not that it matters much.

 

Students under the Dept of Education loan program are worse off than they were under the old program where banks and nonprofits made the loans.

 

You should ask yourself this: why is the federal government making so much money on student loans now?

 

I believe they made $6 billion last year.

 

The elimination of the private loan program was a money grab by the president and the Dem congress. And they sold it to a public who doesn't know enough to realize what's really happening.

 

I believe the unsecured loans for 'high income' families is 7% or high 6s. AND the interest starts at the time of the loan - not after graduation. But it is details of the point.

 

Lets face it. Banking in a central bank environment (as we have been in since 1916) consist of the central bank loaning out money to the TBTF banks who lend it to the smaller banks who lend it to public or businesses. The spread is all but guaranteed as long as there is a reasonable chance of repayment or there is collateral that backs the loan. Its a legal form of loan sharking/skimming.

 

It seems the big government crowd is jealous that only the private banks were in on this. This is what happens when you make a deal with the devi....rather Fed. So the big gov folks created government run mortgage functions, took over student loans and now they seem to want to get into the IRA game. Is the government wanting to replace the Fed? Highly centralized political power is scary. Highly centralized monetary power added to centralized political power is even scarier.

Yeah the graduate level loans and parent loans are in the range you're describing...5-7% int rate.

 

Let me give you one example of the effect of this change on students.

 

There is an origination fee charged to the borrower for each new loan. This fee has always been allowed to be charged to borrowers whether they borrowed from the gov't or from a private lender.

 

In recent years the loan origination fee has been 1.072% for undergraduate Stafford loans. It's much higher for other loans like graduate loans and parent loans (over 4%).

 

The private loan program was very competitive, so competitive that the origination fees all but disappeared. Only a small number of lenders even charged an origination fee and the ones that did usually refunded it once the student displayed consistent repayment. The thing to note here is that the origination fee of 1.072% is a "maximum" rate, not the required rate. Lenders could charge up to 1.072% but couldn't charge more. And that's why in that competitive environment borrowers were generally not being charged this fee.

 

Move forward to the government taking over the student loan originations, every student now is charged the full 1.072% origination fee. For fiscal year 2013, the federal government made $149 billion in student loans. That's $149,000,000,000.

 

It was approximately $100 billion in undergrad loans and $40 billion in grad/parent loans. On just the $100B in undergrad loans, the government took in a little over $1 billion in fee income. No wonder they wanted to make the loans themselves.

 

Did any of that money go toward additional Education spending. I'll give you three guesses but you'll only need one.

 

So the big sell by the Dems was that getting the private lenders out of student loans would (1) benefit the taxpayers and (2) benefit the students. I can very easily demonstrate it doesn't benefit the students. The 'benefit the taxpayer' was a rouse too. Did any of that additional income go back to the taxpayer in the form of tax cuts? No. It just added more money that congress could spend on other programs or give-aways.

 

And what sucks is this origination fee charge doesn't even address the real long term punishment the government is dishing out in higher interest charges over the life of the loans.

^ - And while the government was doing this to young people I was able to refinance twice with no money out of pocket at all. Actually there was a 'bonus' that covered things like pre-paid items. So I was being paid refinance. After the refinances....Fannie bought them within a month - to prop up their disastrous portfolio.