Why would cost under a system of PRAs be higher than the present custodian cost for an IRA account? At the Janus group of funds, IRA custodian fees are $12 per fund not to exceed $24 per account, and management fees for their combination funds are as follow: Janus Balanced Fund, "seeks long-term capital growth, consistent with preservation of capital and balanced by current income," 1.03%; Janus Equity Income Fund, "seeks current income and long-term growth of capital," 1.21%; Janus Growth and Income Fund, "seeks long-term capital growth and current income," 0.96%. So, a worker making $23,000 per year, using the current total SS payroll taxes, would contribute $2852 per year. In the best case scenario, using the Growth and Income fund, the worker would pay $27.38 + $12 = $39.38 or 1.38%, and, using the Equity Income fund, $34.51 + $12 = $46.51 or 1.63%. This assumes no return on investment, sounds like SS. Many other funds exist with both higher and lower fees, as well as higher and lower risk levels, and many other fund companies also exist with higher and lower fees. This helps illustrate the futility of the administrative cost issue since the costs under the present system are said to be 1% with the low return, high intrusiveness, and lack of freedom and security. Workers who need the guidance to understand "preservation of capital", "current income", "long-term growth of capital", etc. can be easily educated in these financial industry terms just as I was 6 years ago. In the end, the wealth workers generate and coveted by the financial industry will enable workers to get the education they need, the low cost of these accounts, the better return from the private markets, and the freedom and security away from government dependence that PRAs will provide to all workers, those making $200,000 per year, as well as those making $15000 per year.
