Instead of people getting penalized with a Tax Penalty from Government for withdrawing their 401(k) monies too soon for emergencies, the Tax Penalty should be replaced with dividends-based and Certificates of Deposit based Retirement Annuities as a penalty that the early withdrawers would get a return when they are supposed to retire as monthly payments in benefits. Also, the Tax Penalty being turned into a second or third round of FICA tax that goes towards early withdrawers’ Social Security, unemployment insurance and Medicare, could be a return investment for those Americans who feel more comfortable opting-in for Social Security and Medicare instead of George W Bush and CNBC salesmen dictating to us what they want our monies to go towards. So the early withdrawers would have MULTIPLE CHOICES to choose from: dividends-based Retirement Annuities, CD-based Retirement Annuities, Social Security, unemployment insurance, and/or Medicare. We can eliminate the Earned Income Tax as Penalty and keep the FICA tax of Social Security, unemployment insurance and Medicare, as well as dividends-based and CDs-based Retirement Annuities as Penalty that retirees would get as a return instead.

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