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The new plan to create a stock market portfolio for every child in America

cnbc.com

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Re: The new plan to create a stock market portfolio for every child in America

#4

Post by huytersd »

oceanghost wrote: post #2

So the folks who own all the stocks want the government to bid up their assets?

Yes, just like with the 401k. Get pretty much every working individual in America heavily invested in stock assets by default. During even a reasonable market it’s a win win win for everyone involved. Companies make more money, people get high returns on their money, employment is higher and the government doesn’t have to guarantee anyone’s pension. The downside is an extended bear market can collapse the entire system.

Re: The new plan to create a stock market portfolio for every child in America

#5

Post by t0mas88 »

Doesn't it increase inequality if the children of highly paid tech employees also get double the amount in their investment account compared to those born from poor parents?

That feels like it's not aligned with the original idea of giving all children an investment account.

Re: The new plan to create a stock market portfolio for every child in America

#6

Post by Kon-Peki »

Details matter. A lot.

Do you get to choose the portfolio provider? Can you move the account to a different provider? What obligations do the providers have regarding marketing, 3rd party access, etc? What types of investments are available? What funds are available? How much are their fees?

Anyone that has done the math has found that a lot of 529 plans have such bad choices and high fees that you are actually better off in a non-tax-advantaged Vanguard Total Market fund (note that Vanguard offers a good 529 plan).

Re: The new plan to create a stock market portfolio for every child in America

#7

Post by jewayne »

huytersd wrote: post #4
oceanghost wrote: post #2

So the folks who own all the stocks want the government to bid up their assets?

Yes, just like with the 401k. Get pretty much every working individual in America heavily invested in stock assets by default. During even a reasonable market it’s a win win win for everyone involved. Companies make more money, people get high returns on their money, employment is higher and the government doesn’t have to guarantee anyone’s pension. The downside is an extended bear market can collapse the entire syst…

It's definitely a win for the financial industry. They make way more in fees than they ever did from the pension funds. I would love to see the evidence for the statements "(non-financial) companies make more money", "people (broadly) get high returns on their money", and "employment is higher".

Re: The new plan to create a stock market portfolio for every child in America

#9

Post by charlie0 »

huytersd wrote: post #4
oceanghost wrote: post #2

So the folks who own all the stocks want the government to bid up their assets?

Yes, just like with the 401k. Get pretty much every working individual in America heavily invested in stock assets by default. During even a reasonable market it’s a win win win for everyone involved. Companies make more money, people get high returns on their money, employment is higher and the government doesn’t have to guarantee anyone’s pension. The downside is an extended bear market can collapse the entire syst…

Nah, if I've learned anything, it's that the money printers will turn on at the first sight of major trouble and everyone (some, more than others) will pay with inflation.
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