America, Welcome to the Poorhouse

Description

“Crack open this book and enter a bromide-free zone. Jane White knows why American families feel as if they are on a treadmill running out of control, and she explains the reasons with clarity, insight, and rare honesty. She also offers several practical suggestions for how we as individuals, families, and a nation can get out of the mess. Policymakers would be wise to listen.”

Evan Cooper, Deputy Editor, InvestmentNews

“This eye-opening book sounds the alarm about many Americans’ dim financial futures if consumers, businesses, and politicians don’t change their ways. Jane White lays blame and names names. Until change happens, White offers prescriptions for your biggest money concerns--retirement, housing, college costs, and credit cards--featuring tried-and-true advice.”

Gregory Karp, Syndicated Newspaper Columnist and Author of The 1-2-3 Money Plan and Living Rich by Spending Smart

“Americans need this vigorous wake-up call if they are to make it through the first half of the 21st century. They are burying themselves in debt--for education, for homes, and for toys--leaving too little for savings and investment. Jane White shows them where they are going wrong and how they can put themselves right.”

Thomas G. Donlan, Editorial Page Editor, Barron’s National Business and Financial Weekly

“Jane White has written a barnburner of a book. Though the title may cause alarm, America, Welcome to the Poorhouse is ultimately reassuring. We can protect our own financial futures if we get wise--and get together to demand real change.”

Jacob S. Hacker, Author of The Great Risk Shift: The New Economic Insecurity and the Decline of the American Dream

Too many American families are racing toward financial catastrophe--saddled with exploding credit card and college debt, out-of-control housing costs, and underfunded 401(k) accounts.

America, Welcome to the Poorhouse reveals the political and economic forces that got us into this predicament, strategies to get Congress to enact needed reform, and practical tips you won’t find anywhere else on how to make the most of your money until reform happens. White offers indispensable practical advice for regaining control of your own financial future--specific strategies for reducing your debt, safeguarding your retirement, and helping your children get the education they’ll need to compete in today’s world.

Shrimp on the barbie, Koala bears, and a secure retirement. Why most Australians will end up with at least half a million dollars in their version of a 401(k) plan--and what we can do to transform our 401(k) plans into actual pensions.

How the mortgage industry lobbied to dismantle regulation and offer bait-and-switch adjustable rate mortgages.

How to protect yourself--no matter what happens. Your personal plan for saving for retirement, finding “bargain” colleges, and getting out of credit card debt.

How to build a citizens lobby that wins. Making taxpayers as powerful as the so-called financial services industry and getting rid of the members of Congress that do its bidding.

Contents

Introduction  1

Part I:  80% of Americans Can’t Afford to Retire

Chapter 1  Why You Can’t Retire from a 401(k) Plan: You Won’t Have Ten Times Your Salary in Your Account at Age 65  9

Chapter 2  How to Save Wisely Until We Get 401(k) Reform and How to Make Reform Happen  35

Part II:  How the American Dream Turned into a Nightmare

Chapter 3  The Mortgage Mess: It Ain’t Just Subprime[md]It’s Half of Americans in Overpriced Homes  55

Chapter 4  How Laws Protect Banks, Not Borrowers, and the Reform We Need  67

Chapter 5  The Fix: Refinance to a Fixed-Rate Mortgage; Move to an Affordable Region  81

Part III:  College Is Unaffordable When the Majority of Americans Need Degrees

Chapter 6  Why We Need More College Graduates to Compete with China and India   105

Chapter 7  How Sallie Mae Lobbied Congress and “Enticed” Colleges to Offer Its Loans  114

Chapter 8  The Fix: Grants, Government Loans, and Colleges that Are Free  129

Part IV:  35 Million Americans Are Drowning in Credit Card Debt

Chapter 9  How Credit Card Debt, Home Equity Loans Get You Over Your Head in Debt   141

Chapter 10  The Fix: How to Get Out of Credit Card Debtor’s Prison  151

Part V:  Real Campaign Reform That Puts Citizens, Not the Business Lobby, First

Chapter 11  How Big Business Owns Both Political Parties  167

Chapter 12  The Fix: Replacing Corrupt Politicians with Ones Who Work for Taxpayers  177

Conclusion  The Big Fix: Recruit the Smartest Workers from Around the World, Send Most Kids to College, Measure Household Wealth  191

Endnotes  205

Index  237

Features

Americans are going broke with inadequate 401(k) plans and soaring debt. What you can do to protect yourself and the policy changes we need.

• Learn to make the most of a bad situation: practical advice for protecting your retirement and reducing your debt, whether the policies change or not.
• How America's 401(k) contribution requirements are the second lowest rate in the world, and how personal debt and college costs are making us broke.
• Obstacles that have prevented reform and what it will take to overcome them.

Author

Jane White is Founder and President of Retirement Solutions, LLC, which promotes 401(k) reform and provides investment education. In 2007, at the U.S. Department of Labor’s invitation, White presented recommended 401(k) contribution rates to the ERISA Advisory Council. As a result of White’s testimony, the Working Group on Financial Literacy recommended that the DOL “encourage plan communication that uses income replacement formulas and final pay multiples.” A Congressionally appointed delegate to the 2002 National Summit on Retirement Savings, White first observed the 401(k) savings crisis in 1993 as associate editor of Standard & Poor’s Your Financial Future, distributed to a half a million 401(k) participants.

A former syndicated personal finance columnist for Gannett News Service, White first observed the housing bubble and the risk of adjustable rate mortgages in her 1991 book, The Cost-Conscious Homebuyer’s Guide. She has been interviewed by CNN and CNBC, and her articles have appeared in The New York Times, Barron’s, andEmployee Benefit News.

Reviews
"The starkly titled ''America, Welcome to the Poorhouse,'' talks about the severe lifestyle changes ahead for future retirees if they don't prepare now. "  -- The New York Times,  October 23, 2009.