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The average 401k holder knows that it's a tax advantaged savings vehicle and that there aren't many of those available to individual investors. The tax advantage completely outweighs all of the negatives that you listed in almost all cases.

Advocating that people not take advantage of a 401k because something about the government potentially seizing it is basically saying you shouldn't save money at all.

> Read the fine print and you will find "FBO" (For Benefit Of). The tax code makes it technically owned by the government, but provided for your benefit.

No, the assets in the fund are owned by the plan administrator, and held for your benefit; this is in some ways better than you owning them, as it makes them generally immune to seizure/garnishment by creditors other than the IRS, and only by the IRS to the extent you could take a no-penalty distribution.

That's a pretty basic error in a rant about how everyone else doesn't understand the basics...

A friend of mine that's self made and worth about $40m strongly advised me to cash out my 401k. His reasoning just boiled down to who has your best interest at heart, you or some random broker in New York? If you think you can do a better job of putting your money to work, then you should. To be clear, he wasn't talking about buying mutual funds.

My counterpoint is that my wife would kill me if I cashed out my 401k.

To address your points:

* Yes, 401k plans usually have high fees, however the tax advantage they provide should more than offset those fees except for the very worst plans. And there are exceptions too: some 401k plans offered by very large companies actually have lower fees than popular low-fee IRA providers.

* When you say "get your money out of your 401k" are you referring to moving it to a low-cost IRA or cashing it out? The former is good advice if you have a 401k from an old job (that is not one of the aforementioned "very good" 401k plans). I don't think there are any reputable financial advisors that would suggest straight-up cashing out a 401k before retirement due to the taxes and penalties. The only circumstance I can think of where that would make sense is if it was necessary to avoid homelessness or pay for necessary medical care and you had already run through your non-retirement savings.

* You absolutely do "own" your money in your 401k as much as you own shares in a brokerage account or deposits in your bank account. If we're at the point where the government would confiscate funds in 401k accounts instead of just issuing new debt then the economy has probably already collapsed to a point beyond recognition.

* Your point about "clueless investment" is a critique of mutual funds and index funds not 401k plans. Someone holding an S&P 500 index fund in their IRA or brokerage account is no smarter than someone holding that fund in their 401k. Additionally, history has shown time and again that the only thing you can say with certainty about the stock market is that its aggregate value increases on average over time. The average person attempting to pick stocks, even at the sector level, is a recipie for them to miss out on the gains they need to have sufficient funds for their retirement.

* Your point about estate and income tax: and having the money in any other form would do what? You need to pay income tax on funds drawn from a (traditional) 401k plan because you deferred the tax when you deposited the funds. Whether you or your heirs are drawing the funds is immaterial in that aspect. If you have funds in a Roth 401k or Roth IRA or a regular brokerage you have already paid the taxes and as such you will not be taxed on withdrawls (except capital gains from brokerage accounts).

Similarly for the estate tax, if you had the money in cash at time of death you would still owe the same amount. On top of that, you'll be dead! What do you care what happens to the money after you're gone? Not to mention you need literal millions of dollars of assets upon death to get hit with the estate tax in the US so this will only apply to the literal 1%.

> Yes, 401k plans usually have high fees

I haven't seen these "high fees" in any of the five 401k plans across 4 providers that I have had since I started my career 17 years ago.

They're often buried in the "expense ratio" of the funds offered. My company's 401k plan has exactly 3 funds with an expense ratio lower than 0.50%, all of them US domestic index funds. All of my bond and international options have ERs over 1.00% which is unacceptably high (I have most of my holdings of those asset classes in my other retirement accounts).

I don't really see how that counts as "401k fees", since those funds charge the same expense ratio to people who buy them on the open market. Investment choice, or lack thereof, is an issue that goes beyond fund fees.

Some 401ks have access to different share classes that have (nearly) identical funds with different fee structures.

This. The employees participating in the 401k plan don't choose which funds the plan includes, HR people (who are often not very well-versed in investing) do. Those HR people will choose these high-ER funds because the 401k provider usually offers discounts to their direct costs for having them, essentially shifting the cost of running the 401k plan from the employer to the employees.

The estate tax exemption is $5.49 million and affects less than 1% of all estates.

> The estate tax exemption is $5.49 million and affects less than 1% of all estates

Well, perhaps pedantic, but the exemption effects 100% of estates. Less than 1% face any tax after the exemption.

Less pedantically, the exemption is actually $11.4 million for 2019:

https://www.forbes.com/sites/ashleaebeling/2018/11/15/irs-an...