Justin Fox takes a look at the latest idea that John McCain has unveiled to grapple with the financial crisis–lifting the requirement that seniors withdraw a certain amount of their retirement account each year. McCain argues that investors shouldn’t be forced to sell their stocks when the market is taking a beating.
But Justin notes that if you look at how that requirement actually works, McCain’s proposal won’t mean a lot to most people–unless they happen to be over 100 years old:
First of all, the only people the suspension would help are those who don’t need the money right now. And for the bulk of retirees (that is, people in their 70s) the required annual withdrawal amount is 5% or less of the total in the account. Still, this could be a big deal for 100-year-olds, who must withdraw as much as 16% a year. They should definitely vote for McCain.