Long run costs of dipping into insurance? As far as the status quo goes, it has been reported that a large number of people are dipping in for non-retirement use. This brings into limelight economics of the insurance funds or retirement savings. Dipping may not seem to have adverse effects initially or may be deemed as a necessary measure, but its long term effects are quite harmful on overall fiscal stature.

What do the stats say?

The data that has emerged from the market concludes that one out of four U.S residents who with a savings account or a 401(k) program is using the money for current use. This amount that is withdrawn has calculated to be around $293 billion in 2012. This is indicative of how unsafe or insecure insurance or retirement security becomes.

The situation is compounded because there have been cuts in terms of social security benefits and Medicare, meaning that the sustenance of insurance or retirement funds is the need of the hour. The pension plans nowadays are nothing to boast off either, so a stringent control of the insurance fund is needed.

More stats related to this include the 12 percent increase in people who have [Read more…]