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>>WHOA!!! What happened to the "wealth effect"? More money in my retirement account is supposed to make me feel wealthy and I am supposed to spend more.

Well, your argument is a little illogical. You have X dollars to save or spend. If you save more, you must spend less. If people quit spending, economic growth will slow or reverse. Lack of spending, both consumer and corporate, is what US recessions are usually blamed on. On the other hand, more saving=more investment, which is supposed to grow the economy.

I wonder what's going to happen as retirement plan option maximums increase over the next few years. Will our savings rate go up? Is that a good thing?


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