I am sure this will end well. Obviously the root cause is the massive shift of retirement obligations from the company to the employee over the past few decades. Combine that with a 12+ year world of no returns, and a lack of savings and you get people in their older age realizing they don't have enough to retire, and turning to methods such as this. Per the LATimes:
- Americans worried about running out of money in their golden years are trying a new investment strategy: day trading their retirement funds. Disillusioned with the conventional buy-and-hold approach, baby boomers are anxious to improve their retirement prospects after two punishing bear markets in the last decade.
- Some people are trading the mutual funds in their 401(k) plans more frequently. Others are venturing into options. And some aggressive investors have begun day trading their nest eggs — all in a bid to make up for lost time.
- Americans are a collective $6.6 trillion short of the amount they need to retire comfortably, according to a 2010 analysis by the Center for Retirement Research at Boston College.
- Schmitt and others circumvent the rules by using multiple accounts — buying in one and selling in another — to mask the frequency of their trading.
- Trading also has been made easier by the increasing availability of so-called brokerage windows, which are accounts within 401(k) plans that typically allow daily trading in funds and stocks. About 29% of companies offer them, up from 12% a decade ago, according to Aon Hewitt.
- "There is — I don't want to use the word 'desperation' — but it's close to that," Fischer said. "Ten years of a flat stock market bumps up against reality for people in their 50s or 60s who are running out of time to see appreciation" in the stock market.
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