Most people do not have the good fortune of Michael Stark. How many workers love what they do and have a short commute to work? I worked for 32 years as a civilian federal employee and my commute was 45 minutes each way. And I never loved what I did, my work was very stressful as I interacted with people from all walks of life each day-from the very poor to the very rich, most of this people were verbally abusive because I was the representative of the big bad government they hated! And my management and supervisors never appreciated all the hard work my colleagues and I did. But I had a wife who refused to work full time and a daughter to support so I had no choice but to stay until I was 55, then from age 55 to 62 I was only able to obtain a series of FULL TIME JOBS that all paid no more than $11 per hour! Then my wife wanted a divorce that wiped out $30,000 of my retirement savings to pay legal fees. So some of us "do all the right things" but still can't save enough for retirement At age 67 now, I am surviving but just barely. I rent a small apartment, do not spend more than my monthly income but have still accumulated credit card debt. My plight is due to circumstances I was never able to control although God knows I tried! Needless to say, I am not enjoying my retirement.
23
RETIREMENT? The Golden Years? Social Security? Medicare? What are those? Will our children and grandchildren have the benefit of programs that have been around since the Square Deal that was meant to set things to rights after the Great Depression. The Great Recession, arguably a Great Depression 2.0, has had the result that, while people are aware that the 1% have the game tilted in their favor, so that nearly all the new wealth in the nation goes to them. The other 99% are just not living good lives or else they'd be members of the 1%. Right? There is a ray of light, though. The Pope, bless his heart, has encouraged people to give without reservation to the homeless and panhandlers. So fear not if you lose everything.
9
This article makes me feel like a loser despite working since I was 14, putting myself through school, raising a child, building a house and being self employed for 28 years. I finally have health care, thank you Obama, but at 58 with little saving my days supporting even a frugal lifestyle are numbered. I'll be working until I drop.
16
The biggest drain against middle-class earnings is "Social Security"
Currently approximately $1.5 trillion. While quite good for those tens of millions of recipients, financially taxing for those who are required to pay. Any discussion of middle-class financial woes cannot avoid this fact.
DID YOU KNOW THAT…
64.2 million people received benefits from programs administered by the Social Security Administration (SSA) in 2014.
5.4 million people were newly awarded Social Security benefits in 2014.
64% of aged beneficiaries received at least half of their income from Social Security in 2013.
55% of adult Social Security beneficiaries in 2014 were women.
53.7 was the average age of disabled-worker beneficiaries in 2014.
86% of Supplemental Security Income (SSI) recipients received payments because of disability or blindness in 2014.
Currently approximately $1.5 trillion. While quite good for those tens of millions of recipients, financially taxing for those who are required to pay. Any discussion of middle-class financial woes cannot avoid this fact.
DID YOU KNOW THAT…
64.2 million people received benefits from programs administered by the Social Security Administration (SSA) in 2014.
5.4 million people were newly awarded Social Security benefits in 2014.
64% of aged beneficiaries received at least half of their income from Social Security in 2013.
55% of adult Social Security beneficiaries in 2014 were women.
53.7 was the average age of disabled-worker beneficiaries in 2014.
86% of Supplemental Security Income (SSI) recipients received payments because of disability or blindness in 2014.
2
I was self-employed starting in 1975, always tried to save but made very little money. I had a Keough-IRA but after 15 years still had only saved $15,000. I too thought I'd go on working forever, but eventually burned out, and couldn't sustain my income.
Also, being self-employed, my annual medical insurance costs skyrocketed, going up sharply every year. If my mother had not died and left me a large sum, which I invested, I'd be homeless now.
Also, being self-employed, my annual medical insurance costs skyrocketed, going up sharply every year. If my mother had not died and left me a large sum, which I invested, I'd be homeless now.
15
I started saving in my 30's and was 100% in the stock market
It has returned beyond my wildest dreams
It's been up and down , but staying the course has paid off
I still have faith in the system
It has returned beyond my wildest dreams
It's been up and down , but staying the course has paid off
I still have faith in the system
14
The biggest variable in saving for retirement is children. Those making a conscious decision not to have children and those unable to conceive have so much more flexibility to enjoy life in pre-retirement years and still have enough to retire without having to work. Another key is having a 401K or 403B with flexibility to allow employees greater choices of investing, especially in low-fee index funds.
9
My grandmother is 101, she lives with my mother 82 and my father 85. My grandparents saved all their lives, both of them worked till their late 70's but who saves thinking they will live so long? She run out of money about 5 years ago. She still has some real estate and I am lending her money with the idea that when she passes, the real estate will be sold and I will be repaid. She has very little income. My parents on the other hand, never saved a dime, have no social security or anything. Who foots the bill? We do! My two other siblings barely make ends meet. This all in south america, where right now it is not cheap to live (Peru). My husband and I have worked hard (he more than I) and sacrificed a lot so that now we have a good standard of living, can travel, have no debt whatsoever and can even help our children. We are doing all we can so that we are never a burden on our kids. There should be some kind of law that makes you save wether you like it or not. Also, we should not live that long! My grandmother is ok and all she cares about is if the cook came today or not. Little does she know that they don't have a cook but only one woman that comes every day to help out, most of the time my dad cooks. They have a nurse for my grandmother. and just two days ago my father broke his hip and had to have surgery, the bill? US$18,000 - who's paying it? We are!!! Not fair, especially to my husband who has worked so hard, not fair to have iresponsible parents!
8
I was able to retire a year ago at age 61. I had planned for it for years, consulting with a financial planner, contributing regularly to my 401k, and curbing spending. I was not as frugal as Ms Moske, but I never lived to the max of my income. I bought a house with a much lower mortgage payment than I qualified for. I keep cars for 10+ years. I worked to pay off my debt as quickly as possible and rarely carry any credit card debt for more than a month. I also managed to eat out, travel, and endulge periodically in an extravagance. I also fully realize that not everyone can do this, and I have been lucky along the way. I have not had significant health issues. I have employer provided benefits that are increasingly rare (pension, retiree medical, LTC insurance). I never lost my job. I had a good income. I live in an area with low housing costs. My goal was to provide for a comfortable retirement and to minimize the risk of being a burden on someone else. I know my plan could blow up if any number of things outside of my control happens, but I did the best I could do with the information I had at the time. This is also what I could do given my life and circumstances. Again, I am fully aware that this is simply not possible for many people. But anyone similarly situated should be able to comfortably retire if they planned appropriately and followed through.
7
When I was in grad school in the early 60's, I had a hard time getting through each month. I developed a habit of avoiding impulse buying. If something cost more than 25 cents, I waited a day to see if I still wanted it 'enough.' It became an automatic habit. Gradually (given inflation) that rose to $5. I'm now 12 years retired and still doing that. Yes, I have a pension to which I contributed and Social Security. I also have savings which amount to nearly 80% of the total income I received in salary over 42 years of work after grad school. My annual income now is higher than it was when I retired. I also own my own house and am debt free. Over the years, I made numerous trips to Europe and did many things I thoroughly enjoyed. (Still do,) I am still saving nearly 40% of my annual income. All of this because of developing the habit of instant gratification postponement I developed nearly 60 years ago. I haven't even noticed that that's what I've been doing for many, many years; it's simply automatic, which makes it painless.
Just a thought.
Just a thought.
15
Here's a plan - save one half of all you earn. Also, be careful with your investments. I find that it worked very well.
4
So let me get this right: the way forward is for your spouse to pass away so you can collect the life insurance to act as a bridge? Well, there is a plan isn't it?
If it were not for SS that people collect, the ability of Americans to save enough going forward due to the cost of healthcare in the U.S. to create a comfortable retirement is not at all assured. The PAST 30 years is NOT the same as the NEXT 30 years.
The Silent and Boomer generations (especially the Silent) had pensions, fully paid health insurance, low cost college tuition, low entry cost for real estate and the stock booms of the 1980s and 1990s. They also paid a lower payroll tax rate in the first half of their work lives.
The median personal wage in this country is like $30,000/yr. The median household income is $50K/yr. I don't care how many lunches you pack, it will not add up to enough given recent interest rates and market returns for you to come up with the 7 figure number (in TODAY's dollars and not tomorrow's number which would 2-3 times larger in 30-40 years).
The blind spot for many "advisers" is that they assume that historical norms will repeat. Is there any evidence given the events of the past decade that that will occur?
Obviously, I have given this some thought and obviously I know more than the average American (or perhaps even more than the average "adviser"). This is a core economic problem that cannot be resolved SOLELY through individual effort in many cases. The math does not work.
If it were not for SS that people collect, the ability of Americans to save enough going forward due to the cost of healthcare in the U.S. to create a comfortable retirement is not at all assured. The PAST 30 years is NOT the same as the NEXT 30 years.
The Silent and Boomer generations (especially the Silent) had pensions, fully paid health insurance, low cost college tuition, low entry cost for real estate and the stock booms of the 1980s and 1990s. They also paid a lower payroll tax rate in the first half of their work lives.
The median personal wage in this country is like $30,000/yr. The median household income is $50K/yr. I don't care how many lunches you pack, it will not add up to enough given recent interest rates and market returns for you to come up with the 7 figure number (in TODAY's dollars and not tomorrow's number which would 2-3 times larger in 30-40 years).
The blind spot for many "advisers" is that they assume that historical norms will repeat. Is there any evidence given the events of the past decade that that will occur?
Obviously, I have given this some thought and obviously I know more than the average American (or perhaps even more than the average "adviser"). This is a core economic problem that cannot be resolved SOLELY through individual effort in many cases. The math does not work.
26
I used this as a simple baseline using reasonable assumptions for inflation and inflation-adjusted market returns (most recent 15 year averages) over 40 years based on median incomes and a rational and realistic savings rate. I understand there are variations in outcomes but this at least gave you an idea if there was even a possibility of the numbers working out:
https://www.calcxml.com/calculators/savings-calculator-growth?skn=#top
Now take that number and calculate what realistic withdrawal rate you could get from that and compare it to what the median incomes are. What is the income replacement rate? Aha.
If your household income is way above average, any assumptions about what can be achieved skew your thinking. Policy is about making things work for MOST people absent special circumstances. If you are not thinking that way, whatever plan you come up with will not work. And, thus, here we are in 2017.
https://www.calcxml.com/calculators/savings-calculator-growth?skn=#top
Now take that number and calculate what realistic withdrawal rate you could get from that and compare it to what the median incomes are. What is the income replacement rate? Aha.
If your household income is way above average, any assumptions about what can be achieved skew your thinking. Policy is about making things work for MOST people absent special circumstances. If you are not thinking that way, whatever plan you come up with will not work. And, thus, here we are in 2017.
3
Thank you for this article. Wish we had been paying attention to this kind of advice in our younger days! The only time I had instruction in the advantages of saving was in junior high school. How to prepare for retirement should be part of the school curriculum every year through high school. Discussions of how to live modestly need to be part of that training from an early age. Since the voters in this country have decided that only the top 10% should be comfortably off while everyone else struggles, such survival lessons are a dire necessity.
12
This article is a stick in the eye for millions of Americans, who have never lost their will to work, their enthusiasm, their values. But, in this long-lasting era of vast income inequality, the hopes and dreams of so many have been and are being dashed. Save? How can people save when they can barely get by on paltry wages, gig economy jobs, crushing student debt? And why did the establishment DNC, aided by media such as the NYT, ruin the chances of Bernie Sanders to change our national priorities?
7
About 6 million Americans in the 20% of 65+ cohort continue to work. That's very conservative. Probably another 10 million of that group work part-time and/or for under the table cash.
Want to get those adult kids and grand kids out of your house? Like to see millions of new job openings for the disadvantaged?
Increase Social Security payments by an amount sufficient to induce older worker to retire. Which is basically what FDR did. And it worked.
Think that would break the bank? Not so. Run the numbers and you'll discover the net cost is minimal, if not a gain.
Want to get those adult kids and grand kids out of your house? Like to see millions of new job openings for the disadvantaged?
Increase Social Security payments by an amount sufficient to induce older worker to retire. Which is basically what FDR did. And it worked.
Think that would break the bank? Not so. Run the numbers and you'll discover the net cost is minimal, if not a gain.
12
Just last night I remarked to a friend, "I'm scared to death to grow old in this country. I've seriously thought about ending my life at whatever advanced age I feel like I can no longer live with dignity."
17
None of this type of article speaks of those who work at "blue collar " jobs , the machinist, the mechanic, the janitor, the health care worker are considered. These workers spend a lifetime doing work that some consider menial but help maintain the lifestyle of those "higher up". These are the ones who don't have the opportunity to save much for retirement and don't have pensions to supplement SS. I wish the writers could see their point of view. Yes there are examples of the ant and the grasshopper in all levels of society but I get the impression the grasshoppers are the winners in today's society.
17
Aren't all big problems like this the result of several factors? Should old folks suffer because they didn't plan well? Should they suffer because their employer had a terrible 401k?
Do we really think every citizen has the capacity to plan for retirement properly? And if they don't, how much should they suffer?
Why don't we emulate other countries who some functionally better systems for retirement (or health care and education)?
This article provides a teaching moment. But the only ones who will benefit from it won't be reading it: those in their 20's.
Wouldn't it make sense to provide a universal retirement plan that requires contribution from both employees and employers that is invested securely that provides a payout for the basics of life? Oh, wait we do have that. But it doesn't pay enough, of course.
Social Security (just like Medicare) is a well established and efficient system that need expansion - big time. Change two things and we would be on the path to civilization. Everyone MUST participate. And everyone must contribute according to ability to pay. If you are a billionaire, you can be just as happy with half that. If you have $10 million, you could be just as happy with $5 million.
When will we have enough compassion for our children and elderly to take care of them, to nurture them?
And simply put, I am a retiree and I want a raise - a good one. I know where the money is and so do you.
Do we really think every citizen has the capacity to plan for retirement properly? And if they don't, how much should they suffer?
Why don't we emulate other countries who some functionally better systems for retirement (or health care and education)?
This article provides a teaching moment. But the only ones who will benefit from it won't be reading it: those in their 20's.
Wouldn't it make sense to provide a universal retirement plan that requires contribution from both employees and employers that is invested securely that provides a payout for the basics of life? Oh, wait we do have that. But it doesn't pay enough, of course.
Social Security (just like Medicare) is a well established and efficient system that need expansion - big time. Change two things and we would be on the path to civilization. Everyone MUST participate. And everyone must contribute according to ability to pay. If you are a billionaire, you can be just as happy with half that. If you have $10 million, you could be just as happy with $5 million.
When will we have enough compassion for our children and elderly to take care of them, to nurture them?
And simply put, I am a retiree and I want a raise - a good one. I know where the money is and so do you.
12
After age 65-75, who will hire you?
After age 80/85, will all retirement savings go to a $300K/year nursing home?
After age 80/85, will all retirement savings go to a $300K/year nursing home?
9
No mention of inequality? Real medium family income is now lower than it was in 2007, the year of the last recession. Blame it on loss of good paying jobs, the decline of unions, austerity, globalization or whatever, but the fact is the the poor are getting poorer and the rich are getting richer. Government could help but its' money goes to the rich, the military and ruling the world, leaving the rest of us behind.
10
This doesn't address the fact that since people live longer, many people in their mid 50s to 60s end up with elder care responsibilities - because their parents are living into the 80s and 90s. This can have a significant impact on being able to work until you are 70. I retired sooner than I would have due to elder care responsibilities. Luckily I am very financially stable, but I still gave up a significant annual amount of income by retiring when I did. I can live on my pension and SS, and do not plan to tap my other retirement fund until I am required to make a minimum withdrawal at 70 1/2. I'm hoping that inflation doesn't cause me to outlive the means to live comfortably. Since I have no one to provide me with eldercare, this also must include factoring in the extra costs I will have when I age (assuming I live as long as my parents) that I am now providing for free.
14
No one should worry if they fail to plan. Others will pay their ways. Not a problem.
3
While it may not be wise to live beyond your means or to neglect the future, Ms Moske's husband's untimely passing is a reminder the opposite can equally be an issue. You want to live without regrets. Ms Moske is reacting to her past. It may be a great lesson; yet, it may be a hindrance.
Sure, the great recession, like the great depression before itself, can cast a shadow on many in the age of diminished expectations when we are living longer in a costly environment. But it may be okay if Ms Moske likes PB&J sandwich. If not, then there is the quality of life to balance out the quantity of life.
Sure, the great recession, like the great depression before itself, can cast a shadow on many in the age of diminished expectations when we are living longer in a costly environment. But it may be okay if Ms Moske likes PB&J sandwich. If not, then there is the quality of life to balance out the quantity of life.
9
The "Great Recession"--for those of us who built savings and avoided debt provided marvelous opportunities to buy properties at 35 cents on the dollar and buy stocks at bargain basement prices. No one who was living a financially sensible life should have suffered during that period--unless he or she lost their employment. The downturn in the financial and property markets were a boon to those who understand the reality of all investments--up and down.
I do not see how anyone who lived, spent, invested and saved according to
well-known and well-publicized investment advice could have "lost" their retirement potential because of market price declines.
Ill health and unemployment present different issues and well worth concerted policy attention.
I do not see how anyone who lived, spent, invested and saved according to
well-known and well-publicized investment advice could have "lost" their retirement potential because of market price declines.
Ill health and unemployment present different issues and well worth concerted policy attention.
2
My late husband and I lived in the USA all our lives. He was always in "perfect health" and doctors told him he'd be playing baseball when he was 100. After two close friends died suddenly and unexpectedly, we decided to nake a bucket list, When he was 50 years old, we started to "check off" that list. Our first step was to visit Paris, not once, but twice! Then, at age 52, my husband was diagnosed with a late stage cancer and died 22 months later. Do I regret spending all that money visiting Paris? NOT for one second -- even though now, 20 years, later I am still working, albeit part-time. Life is short. Enjoy it to the fullest, while you can.
30
My wife [70] and I [76] struggle with this retirement dilemma. We have 2 million +/- in our retirement funds, and strangely enough, it may not be enough. [What if we live to 95?] But we can always stagger through. We made our mistakes [we still have a mortgage], but we are fortunate, and it was owing to paying ourselves first and letting the market funds grow. We have, in the past two years, had to pay a good deal more for our health insurance, and other expenses. But we will be fine.
We have a brother in law and a son in law who, at age 54, were unceremoniously dumped by the corporations to which they had given their best years. Just before they would have been vested in their retirement funds. They were good at their work, but they were 'old,' and were thrown out. Period. No thank you's at all. Corporations don't have feelings, to be sure, but protecting their workers might be seen as a sort of corporate responsibility at least.
We have younger kids and grandkids who are getting chopped to pieces in the new economic environment: long hours, low pay, almost unbearable requirements for skills training at their jobs, child care costs that are unbelievable; I know, because we pay them.
Our lives are safe and free and we are prosperous. But we grow less prosperous by the year, as do our children.
Retirement can be rough. Even with what we thought was plenty of money.
Tom Bailey
We have a brother in law and a son in law who, at age 54, were unceremoniously dumped by the corporations to which they had given their best years. Just before they would have been vested in their retirement funds. They were good at their work, but they were 'old,' and were thrown out. Period. No thank you's at all. Corporations don't have feelings, to be sure, but protecting their workers might be seen as a sort of corporate responsibility at least.
We have younger kids and grandkids who are getting chopped to pieces in the new economic environment: long hours, low pay, almost unbearable requirements for skills training at their jobs, child care costs that are unbelievable; I know, because we pay them.
Our lives are safe and free and we are prosperous. But we grow less prosperous by the year, as do our children.
Retirement can be rough. Even with what we thought was plenty of money.
Tom Bailey
82
We are also helping our 30-something kids, even though they are well-educated hard workers. That's one reason I am still working at 68.
13
Corporate capitalism is the suicide pill of civilization.
10
Aesop's Fable, The Ant and the Grasshopper, is about a grasshopper who plays all summer while the ants put food away for the winter. When winter comes, the hungry grasshopper begs for food, but the ants refuse. This moral lesson is about the virtue of hard work and planning for the future. When we were kids in school in the 1950’s, the teacher read a moral lesson every day, often in the form of a fable. People facing retirement with insufficient resources are like the grasshopper. Too bad schools don’t provide this kind of guidance any more.
9
Right! Today's schools are more likely to teach that everyone has a RIGHT to claim against government (i.e., their fellow citizens and taxpayers) for whatever they need. "Financial distress? Not your fault. It's the system."
Unfortunately, by claiming all have rights and the system is to blame, policy cannot and does not focus on the needs and problems that really are unfortunate and should be addressed through legislation.
The NYT a few days ago ran an article about a California retired woman who had to move to a lower cost area (Iowa) because she could no longer afford
to live in CA. Yet, in profiling this woman's proliferate spending and borrowing patterns, one could only conclude that the system provided her marvelous opportunities, yet she chose to spend and borrow in ways that virtually assured calamity.
Unfortunately, by claiming all have rights and the system is to blame, policy cannot and does not focus on the needs and problems that really are unfortunate and should be addressed through legislation.
The NYT a few days ago ran an article about a California retired woman who had to move to a lower cost area (Iowa) because she could no longer afford
to live in CA. Yet, in profiling this woman's proliferate spending and borrowing patterns, one could only conclude that the system provided her marvelous opportunities, yet she chose to spend and borrow in ways that virtually assured calamity.
2
I retired (involuntarily) at age 61, but I figured I could afford it. The last 15 years I worked, I saved very large amounts of money, and took full advantage of my employer's retirement plans. I now have enough to live on my income, so I don't need to take Social Security or withdrawals from my retirement accounts until I reach age 70.
Expenses are somewhat higher than I would have expected. I spend most of my budget on property tax and medical insurance - everything else is really not very expensive if you live modestly.
I did have an inheritance, about 15% of my total assets. It is certainly useful to have a some extra capital, but I could have gotten by OK without it.
Expenses are somewhat higher than I would have expected. I spend most of my budget on property tax and medical insurance - everything else is really not very expensive if you live modestly.
I did have an inheritance, about 15% of my total assets. It is certainly useful to have a some extra capital, but I could have gotten by OK without it.
3
I was able to retire at age 60 after a 30 year career as a public school teacher. Living and saving smartly was certainly a big part of this, but another major factor that allowed me to reach this point in my life was that I belonged to a union.
46
I will need to work forever assuming a firm will have me. Too many financial upsets along the way have obliterated monies saved.
9
I'm 60, and will work a few more years --hopefully 2 or 3 or even 4 -- until I can no longer dodge the bullet and am laid off in one of our company's periodic downsizings.
My hobby for years has been exploring places to move that are low cost of living and sunny year round. I have a nice shortlist of places I like. They're all in Latin America.
So I'll be retiring on the other side of the wall!
Maybe not for everyone, but I spent about 15 years working overseas in several countries, so I speak Spanish, and know I can enjoy living in another country.
My hobby for years has been exploring places to move that are low cost of living and sunny year round. I have a nice shortlist of places I like. They're all in Latin America.
So I'll be retiring on the other side of the wall!
Maybe not for everyone, but I spent about 15 years working overseas in several countries, so I speak Spanish, and know I can enjoy living in another country.
41
If you can say "I could have retired a couple of years ago", you are wealthy by any reasonable measure. Spending time with grandkids and hobbies sounds exactly like retirement to most people, so why wouldn't you continue bringing in the paycheck as long as they are willing to keep you on. The paragraphs on Stark, 66, the COO are an incisive look into the executive office suite mindset and confirm what many of us have long suspected.
2
Think Kim Moske revealing that she was raised by two people that could not manage money is particularly cruel to them.
They have been dead over 30 years. I did not say they were bad parents, I said they could not manage their money. They obviously knew this towards the end.
25
I do not believe her comment is cruel at all. She is being honest and learned that not managing a financial plan was a disaster.
11
"Think Kim Moske revealing that she was raised by two people that could not manage money is particularly cruel to them."
Not really. I had the same kind of parents who routinely skipped out on debts, used aliases and borrowed from their parents and never paid them back who didn't have a lot either. My grandparents were at least honest people.
When her father became incompetent she took over her father's affairs and managed to redo his trust accounts that were for her, her sister and me. Neither my Aunt nor myself got a penny when he died.
I resolved when I became an adult to not live the way I was raised. While I didn't eat PB&J every day my wife and I were frugal enough that we could save to pay our son't college tuition and expenses, buy and sell properties and retire without debt. I'd counted on a pension from AT&T but when I was laid off in 1985 I became self employed and still managed to save.I had to stop working a lot after numerous physical problems caused me to reduce my hours. Moske makes that clear when she adjusted after the death of her husband. Nothing is sure.
We're not living high on the hog but we aren't scrimping either. We are able to live on our Social Security and haven't had to touch our savings.
I'm happy to see that my son has taken the frugal route even though he makes lots more more than we did and married a woman of like mind.
Some parents are examples of what we shouldn't be and some are their opposite.
Not really. I had the same kind of parents who routinely skipped out on debts, used aliases and borrowed from their parents and never paid them back who didn't have a lot either. My grandparents were at least honest people.
When her father became incompetent she took over her father's affairs and managed to redo his trust accounts that were for her, her sister and me. Neither my Aunt nor myself got a penny when he died.
I resolved when I became an adult to not live the way I was raised. While I didn't eat PB&J every day my wife and I were frugal enough that we could save to pay our son't college tuition and expenses, buy and sell properties and retire without debt. I'd counted on a pension from AT&T but when I was laid off in 1985 I became self employed and still managed to save.I had to stop working a lot after numerous physical problems caused me to reduce my hours. Moske makes that clear when she adjusted after the death of her husband. Nothing is sure.
We're not living high on the hog but we aren't scrimping either. We are able to live on our Social Security and haven't had to touch our savings.
I'm happy to see that my son has taken the frugal route even though he makes lots more more than we did and married a woman of like mind.
Some parents are examples of what we shouldn't be and some are their opposite.
5
Thanks for this thoughtful reporting.
There has been a seismic shift in America in
The attitudes of business owners away from recognizing the important contributions of workers by eliminating pensions for those who contribute to the success of a company. Today's workers are invisible.
I would like to read about business plans and policies that either continue to support some form of
Pension plan. Even with a lifetime of frugal retirement planning individually, this has been a failing plan for many Americans.
Let's explore the value and contributions made by workers, perhaps pensions could swing back in a healthy economy.
There has been a seismic shift in America in
The attitudes of business owners away from recognizing the important contributions of workers by eliminating pensions for those who contribute to the success of a company. Today's workers are invisible.
I would like to read about business plans and policies that either continue to support some form of
Pension plan. Even with a lifetime of frugal retirement planning individually, this has been a failing plan for many Americans.
Let's explore the value and contributions made by workers, perhaps pensions could swing back in a healthy economy.
4
Plan for retirement under the assumption that you will live forever. In mathematical terms, the difference in present value between a 30-40 year annuity and a perpetuity is pretty small. You can always reduce savings; much harder to reduce consumption.
The other part of the spend v. save decision comes down to expectations. The mortgage industry tells us we can spend 40% on housing. We will easily pay 35% in taxes (not just income taxes, but SS and Medicare). You are also supposed to save 15% for retirement and give 10% to your church. If you are following along with the math, these add up to 100% before you spend a dime on food, entertainment, healthcare, student loans, or anything else.
We have a very low level of financial literacy in the US. As a result, we listen to what the credit card companies tell us we can spend, rather than what we should spend. It's very hard to say no when all of the incentives are aligned to encourage consumption.
The other part of the spend v. save decision comes down to expectations. The mortgage industry tells us we can spend 40% on housing. We will easily pay 35% in taxes (not just income taxes, but SS and Medicare). You are also supposed to save 15% for retirement and give 10% to your church. If you are following along with the math, these add up to 100% before you spend a dime on food, entertainment, healthcare, student loans, or anything else.
We have a very low level of financial literacy in the US. As a result, we listen to what the credit card companies tell us we can spend, rather than what we should spend. It's very hard to say no when all of the incentives are aligned to encourage consumption.
13
Look, I get the griping, and know that saving for retirement is hard for many, but the subject that most don't want to discuss is that CHOICES MATTER, whether in elections, careers, spending habits, choosing a mate, or what have you. I see all around me people who make a decent living going up to their eyeballs in debt to buy $50,000 pick up trucks, or worse, are serial leasers with perennial car payments. I see hordes of folks who have to have the newest cell phones and pay exorbitant fees for their calling/data plans. I know a couple who, despite being of modest means, chose to have FIVE children. I see college students who rack up 6-figure debts pursuing college degrees in majors that have no chance of landing them a job that will ever pay enough to tackle those student loans. Americans, by and large, suck at deferring gratification and making financial decisions. In their defense, they are bombarded everywhere with consumerist propaganda, cleverly tailored and messaged by psych-social researchers hired by Madison Avenue to take advantage of their biological shortcomings (read Kahneman's "Thinking, Fast and Slow" for a superb discussion of how our human brains actually work). People get defensive and are quick to attack frugality and those who question our rampant consumerism, but damn, saving money is not rocket science -- live on less than you earn, invest the rest. It's that simple and has worked for legions of Americans (and others around the world) for centuries.
115
And those of us who live modesly, don't produce umpteen kids, save and defer gratification are then called "lucky" by the grasshoppers when things turn out well for us.
Health is a matter of luck, naturally, and I am grateful for it every day. Not choosing a dud mate, not having kids, saving, investing, driving an old car, shopping frugally for decades on end, having half the house I could "afford" and painting it myself, etc. etc., all are chocies that are open to just about everyone.
Health is a matter of luck, naturally, and I am grateful for it every day. Not choosing a dud mate, not having kids, saving, investing, driving an old car, shopping frugally for decades on end, having half the house I could "afford" and painting it myself, etc. etc., all are chocies that are open to just about everyone.
15
Actually, it didn't. Why do you think Social Security, Medicare, and Medicaid exist in the first place? Because our government just felt like being generous? No -- it was because legions of Americans couldn't afford to feed themselves or their children and retires were living on cat foot and eating newspaper. And because it became a glaringly obvious problem when the US initiated the draft for WW2 and had to disqualify large numbers of men because they were malnourished and, as a result, weren't healthy enough for combat. Programs in other countries exist for the same reason -- people were NOT able to get by on the typical earnings.
3
So then you are turning down Medicare and Social Security when the time comes? Because those things are being funded by other people's children. Maybe we should pass a bill to deny those benefits to the childless? Because you have failed to make the only contribution to society that actually matters in the long term.
1
i took my Social Security at 64 and moved to Ipanema, Rio de Janeiro. living two blocks from the beach on my SS income. it's a no brainer....
46
What is the health care like? (delivery and costs) -- thanks!
7
The problem with retirement savings is that it is largely designed to enrich the finance industry. Assuming everyone saved enough to live to 95, most of that savings would never be needed since most people die long before then. The only people benefiting are the money managers who take about 2% of retirement every year..
Most of the cost to the treasury of the "tax savings" from 401(K) and traditional IRA's goes into the pockets of those same money managers. Their fees are pre-tax dollars, but the rest of the "tax savings" are simply deferred. So we pay higher taxes to make up for the revenue lost to the money managers.
Their latest scheme is health savings accounts where they can claim 2% of the money people save to pay for medical bills.
"Ms. Moske is proof that it is never too early to start working on your retirement plan."
This is finance industry propaganda. They have turned retirement into a cash cow for money managers. Its the same "pie in the sky" pitch that was made to working people before Social Security. And its a phoney promise.a Instead of a secure retirement, people are forced to pinch pennies for fear their investments will tank or their money will run out.
There are easy solutions, but not so long as the money managers and their political classmates from Harvard and Yale are running the country for their own benefit.
Most of the cost to the treasury of the "tax savings" from 401(K) and traditional IRA's goes into the pockets of those same money managers. Their fees are pre-tax dollars, but the rest of the "tax savings" are simply deferred. So we pay higher taxes to make up for the revenue lost to the money managers.
Their latest scheme is health savings accounts where they can claim 2% of the money people save to pay for medical bills.
"Ms. Moske is proof that it is never too early to start working on your retirement plan."
This is finance industry propaganda. They have turned retirement into a cash cow for money managers. Its the same "pie in the sky" pitch that was made to working people before Social Security. And its a phoney promise.a Instead of a secure retirement, people are forced to pinch pennies for fear their investments will tank or their money will run out.
There are easy solutions, but not so long as the money managers and their political classmates from Harvard and Yale are running the country for their own benefit.
14
You can DIY like many of us do. or Vanguard offers a personal advisory service for a fraction of a percentage point.
17
While the financial industry is a net drag on earnings, this is avoidable. Use vanguard index funds inside an IRA.
15
Forget the money managers just invest in Vanguard funds with extremely low managerial costs. It is 0.17 or lower depending on how much you have invested. Much better than the 2% for the assets managers who can't beat the market.
8
Figuring $6 per lunch, 5 days a week and 6% accumulation overall interest for 30yrs? Guestimate = $50k. PB&J looking good!
11
Thanks. I too love "time value of money" calculators.
4
The correct number is 118,587.--not 50,000. Now PBJ look even better.
1
The longer you live, the higher the probability you will need long term care. According to the U.S. Department of Health and Human Services, 7 in 10 people over the age of 65 will require long term care.
We published an article that compares insuring with Long Term Care Insurance versus self-insuring. We provided an example of premiums and benefits for Long Term Care Insurance. Please see this link:
http://www.skloff.com/insure-or-self-insure-for-long-term-care-long-term...
Aaron Skloff, AIF, CFA, MBA
CEO - Skloff Financial Group
We published an article that compares insuring with Long Term Care Insurance versus self-insuring. We provided an example of premiums and benefits for Long Term Care Insurance. Please see this link:
http://www.skloff.com/insure-or-self-insure-for-long-term-care-long-term...
Aaron Skloff, AIF, CFA, MBA
CEO - Skloff Financial Group
3
As a financial planner, I face a consistent struggle getting people to trade security for potential return. Many clients live in fear about the market and whether their savings will hold up throughout their retirement, yet are unwilling to invest in things like income annuities or whole life insurance to stabilize their income sources. Fact is these products provide guaranteed income, the very thing that would give them security and peace of mind.
I haven't really found the magic phrase to get folks to make this trade and would love to understand better why.
If you find this topic interesting, I'd love to share more.
Thanks for your good work.
Shane
I haven't really found the magic phrase to get folks to make this trade and would love to understand better why.
If you find this topic interesting, I'd love to share more.
Thanks for your good work.
Shane
3
I think people with the steely discipline described in this article must be very rare indeed. I have worked at a paying job since the age of 11, when I had a Miami News paper route. Then mowing lawns, restaurant work, retail, manual labor, etc. then college and law school at UF, while I was working in a restaurant.
For the past 32 years I've had my own law firm. I've hired dozens of people, trained a dozen young lawyers, and paid more in taxes than many people will ever earn.
And at age 62 I worry about retirement! My wife and I have a 401k, I've been paying into Social Security for more than 40 years, and we've lived within our means.
But I had a cystoscopy last month and it cost $8,000. We pay $1500 a month for health insurance but it has a $5,000 deductible. A tooth (molars are most expensive!) broke two weeks ago and the root canal and the crown cost $3,000. (I got a deal because the dentist is my friend.) Oh, and after paying for dental insurance for decades I just found out that our policy, like most dental policies, only pays a maximum of $1000 per year! Worthless! I also just had to buy four new tires that cost $1,000.
So, I cannot afford to "retire." Thankfully, I love what I do. But it would be great if I could do it solely for the love of it. at this point in my life. But the truth is I am grateful I can still work because I didn't save enough to be one of the guys in those Pacific Life commercial. (Who are those fortunate retirees, anyway?)
For the past 32 years I've had my own law firm. I've hired dozens of people, trained a dozen young lawyers, and paid more in taxes than many people will ever earn.
And at age 62 I worry about retirement! My wife and I have a 401k, I've been paying into Social Security for more than 40 years, and we've lived within our means.
But I had a cystoscopy last month and it cost $8,000. We pay $1500 a month for health insurance but it has a $5,000 deductible. A tooth (molars are most expensive!) broke two weeks ago and the root canal and the crown cost $3,000. (I got a deal because the dentist is my friend.) Oh, and after paying for dental insurance for decades I just found out that our policy, like most dental policies, only pays a maximum of $1000 per year! Worthless! I also just had to buy four new tires that cost $1,000.
So, I cannot afford to "retire." Thankfully, I love what I do. But it would be great if I could do it solely for the love of it. at this point in my life. But the truth is I am grateful I can still work because I didn't save enough to be one of the guys in those Pacific Life commercial. (Who are those fortunate retirees, anyway?)
44
A guy with a career like yours should have financial assets of at least $10 million, with proper savings and investment.
I was a low-level IT guy in a big bank, and as retiree I could pay those bills. It would not be pleasant to write the check, but I could do it.
I was a low-level IT guy in a big bank, and as retiree I could pay those bills. It would not be pleasant to write the check, but I could do it.
1
I know exactly what you mean! I'm a banker, but was a financial advisor for many years. I keep meticulous track of our living expenses and have am good a projecting our retirement expenses. It takes much more money to live in retirement than the typical pre retiree can believe. Then come the unplanned expenses from medical issues. I defy anyone to be able to accurately project what that will take. There are people that depend on drugs costing thousands per month that just eat swallow retirement savings in gulps.
8
There are two lesser reasons, and one very large reason, that we will be able to retire soon. The two lesser reasons: 1) we stayed in the same small house for 35 years and paid it off, and 2) we saved regularly our entire working lives.
The very large reason: Neither of us had a health crisis, thus we never had our work income interrupted. Unfortunate health issues trip up many people in this country financially, no matter how responsible they may be.
The very large reason: Neither of us had a health crisis, thus we never had our work income interrupted. Unfortunate health issues trip up many people in this country financially, no matter how responsible they may be.
46
You're lucky you didn't get dumped by your employer, or that all of the jobs in your area dried up, so you were forced to move.
9
"The median retirement savings figure among all working-age families in the United States is just $5,000; the median among families with savings is $60,000." Figures like these without age brackets are unhelpful. A 22-year-old and a 60-year-old with the same amount of money saved for retirement are in two very different situations.
30
One thing not mentioned here: Alzheimer's. My father-in-law went through 500,000 in 4 years taking care of my mother-in-law. It's deveatating; people think they can care for their loved ones at home or with help of friends and family. But it never turns out the way you think it will. And the disease goes on and on.
There are very few people who can afford to take care of them selves or their lived ones with Alzheimer's. Emotionally, or financially.
There are very few people who can afford to take care of them selves or their lived ones with Alzheimer's. Emotionally, or financially.
54
Indeed you are 100% correct. The picture is grimly laid out in a new PBS documentary: Alzheimer's, Every Minute Counts. With the extension of life span, we now outlive our own health.
The coming tsunami of Alzheimer's will decimate families, along with the social, emotional, and economic glue holding a society together. Research dollars are small compared to cancer.
There is no cure and no treatment, and neither health insurance nor Medicare pays for a caregiver. (Medicare pays only temporarily, post-hospital stay).
The coming tsunami of Alzheimer's will decimate families, along with the social, emotional, and economic glue holding a society together. Research dollars are small compared to cancer.
There is no cure and no treatment, and neither health insurance nor Medicare pays for a caregiver. (Medicare pays only temporarily, post-hospital stay).
25
We need euthanasia for those with dementia. Its the only sane thing to do. I hope if that strikes me someone sends me peacefully away.
22
Meanwhile, if I am not mistaken, America as a whole is wealthier than we ever have been.
This scarcity had been chosen; it benefits those who have done the choosing; and it will continue to do so until the rest choose to choose as well.
This scarcity had been chosen; it benefits those who have done the choosing; and it will continue to do so until the rest choose to choose as well.
13
Silly, We've been on a course diverting income from working people to the 1% since Reagan's tax cuts and war on unions. The costs of that diversion of income for 30+ years are now becoming real. Where'd that income go? The answer is "to the people that now own the politicians that do their bidding".
12
When seniors work well past the conventional retirement age, the opportunities for those starting out are reduced somewhat. That is one argument for retiring if one can afford to.
9
None of my five employers offers a retirement plan, or health care, or paid time off. I am weary of being told to save, save, save when companies do nothing for their staff. Work and loyalty are not rewarded.
I do put money away for retirement and have a 1-year emergency fund, but it is much harder when your income is erratic and seasonal. Unless they are forced to, companies are not going to do anything for their part-time employees. Tired of waiting for the invisible hand to put something in that tip jar.
I do put money away for retirement and have a 1-year emergency fund, but it is much harder when your income is erratic and seasonal. Unless they are forced to, companies are not going to do anything for their part-time employees. Tired of waiting for the invisible hand to put something in that tip jar.
44
This is an observation I would like the Times to report more about. It is the slow slide away from supporting and valuing American workers! It has been gradually taking over for more than 40 years. It can change, we need to investigate and honor companies that are still
Using policies that think in a much more personal way about workers.
I am inspired by the profit sharing of the Chobani yogurt company! Write about them!
Using policies that think in a much more personal way about workers.
I am inspired by the profit sharing of the Chobani yogurt company! Write about them!
13
Susan, your chobani curiosity has immigration vibrations as well....
2
The wild card in all of retirement planning today is what will happen to Social Security and Medicare. Self-employed people and business owners (and the rich) don't need to worry about Social Security, but everyone needs to be concerned about Medicare. Gutting it will throw everyone's retirement into chaos. I am retired. And my financial advisor says I am well-positioned and have no worries. And I say if the government cuts the programs that I planned on for 40 years, and the market doesn't defy gravity and always go up, I will have reason to be anxiety-ridden. Invest in anti-anxiety drug stocks. They will do well with this government.
78
'Self-employed and business owners ' don't have to worry. ... Why is it so many that comment on the NY times articles think self-employed and/or business owners are rich. Have no worries regarding retirement? ! Enough. Not true. Never has been.
Self employed pay into ssi 2x what employees pay as they have to pay both the employee and employer contributions - 14% of their salary. Like all, they count on ssi, but like most of us, they know ssi will not cover their retirement.
Those that own businesses face the same, and over 50% fail into bankruptcy. Stop with the us vs. them!
Self employed pay into ssi 2x what employees pay as they have to pay both the employee and employer contributions - 14% of their salary. Like all, they count on ssi, but like most of us, they know ssi will not cover their retirement.
Those that own businesses face the same, and over 50% fail into bankruptcy. Stop with the us vs. them!
11
Huh? Self-employed and business owners don't have to worry? Where did that notion come from?
15
[[ Self-employed people and business owners (and the rich) don't need to worry about Social Security ]]
Why do you say that, Barry? I'm self-employed and SS is very important to me. I'm not worried because I think it'll be here for a long time. Other friends of mine seem to be worried because they chose not to hold out to age 70 to start.
Why do you say that, Barry? I'm self-employed and SS is very important to me. I'm not worried because I think it'll be here for a long time. Other friends of mine seem to be worried because they chose not to hold out to age 70 to start.
8
What happens to the stock of Peter Pan when Ms. Moske does retire? Always winners and losers.
16
That is hysterical!!! I hadn't thought of that....but it's actually Jif.
And I'll keep eating it anyway....
And I'll keep eating it anyway....
13
I know of a dual career couple, both very well paid professionals, who have zero savings and live paycheck to paycheck. They spend lavishly and have significant debt. Despite being in their mid 60's they can't afford to retire.
I also worked with a company years ago, where more than one employee quit so he could cash out his 401K and buy a boat (or similar discretionary purchase.)
What do you do to protect people like that from their own stupidity? Perhaps the answer is much higher social security taxes to force people to save for their retirement. We probably need to do the same thing for health care - force people to save for health care through taxes rather than spending their income on cable TV (as a recent Kristof column noted.)
I also worked with a company years ago, where more than one employee quit so he could cash out his 401K and buy a boat (or similar discretionary purchase.)
What do you do to protect people like that from their own stupidity? Perhaps the answer is much higher social security taxes to force people to save for their retirement. We probably need to do the same thing for health care - force people to save for health care through taxes rather than spending their income on cable TV (as a recent Kristof column noted.)
16
Charitable impulses aside, why do we want to protect people from their own stupidity?
6
Or... let them live in poverty. They did it to themselves. Why do we feel righteous about punishing criminals who committed terrible crimes, but are sympathetic when people are stupid with their money and then have to live in poverty. Both made choices and both have consequences.
15
Because in both cases, we all end up paying, in the first case in prison costs, in the second, in social services for those who can't take care of themselves. Most people don't have the financial and investment skills to plan adequately for retirement. At a time when there is a discussion of cutting social security and medicare, we should be expanding it. Removing the income cap would be a good start.
9
A person can be frugal for decades and can also spend a lot of time carefully studying the range of investment options and diligently checking the balances on quarterly statements. But as long as retirement is an individual effort, we are each at risk of the self-serving advice and decisions of financial advisors who will always know more than the cleverest and most responsible of us, and will always have some motivation to invest to their own interests rather than ours. That's why the current regulatory weakening of fiduciary obligations is so dangerous, and that's why workplace pensions provide safety in numbers (as do legitimate unions; we can argue about the corrupt pocket-lining ones elsewhere). The right wing can holler all they want about personal responsibility and about defined-contribution-defined benefit pensions being just another form of welfare. But if they don't step up and enact and enforce curbs on their professional investor cronies, we'll know whose side they are really on.
66
Not to mention you can do everything right and be diagnosed with cancer at 65 and have all those nice saving wiped out in a year.
11
You are free to open a discount brokerage account, and select whatever securities you want at $7 a trade. Many people have. Results are mixed, you have to put some time and research in.
My father did exactly that; he did well in the 1990's, and lost his shirt from 2000 on. He was conservative and saved, and had a VERY small pension and social security. The only way they could survive was with a HELOC on his overpriced house.
5
For 30 years the baby boomers were warned that social security will not be enough to live on. Live below your means and save money for old age or you will live in poverty in old age. For 30 years most baby boomers ignored the advice, did not save for old age, and kicked the can down road. It was reckless behavior on their part. Now they are running out of road to kick the can. The chicken will be coming home to roost. Baby Boomers: The most short sighted, self centered generation that is alive.
19
You describe Baby Boomers as "the most short sighted, self centered generation that is alive." That's quite a generalization to apply to about 75 million Americans.
They include people born in poverty who managed to secure a decent job and those born poor who've spent their entire lives working at or near minimum wage. People who got lucky when the stock market boomed in the early 2000s--and unlucky people whose savings were wiped out when it crashed.
It includes women and minorities who've had the decks stacked against them most or all of their lives, and trust fund kids now grown older and even wealthier through no hard work of their own.
Hurrah for you--you earned enough to save plenty to retire on, and you're absolutely certain none of your investments will turn out to be duds. You're so smart that you avoided getting hit by a drunk driver (and severely injured & unable to work). It's guaranteed that neither you nor any of your brilliant kids have been struck (yet) by a severe illness that pushed you into medical bankruptcy.
Be careful, though. Patting yourself on the back too hard and fast and often could cause crippling shoulder damage.
They include people born in poverty who managed to secure a decent job and those born poor who've spent their entire lives working at or near minimum wage. People who got lucky when the stock market boomed in the early 2000s--and unlucky people whose savings were wiped out when it crashed.
It includes women and minorities who've had the decks stacked against them most or all of their lives, and trust fund kids now grown older and even wealthier through no hard work of their own.
Hurrah for you--you earned enough to save plenty to retire on, and you're absolutely certain none of your investments will turn out to be duds. You're so smart that you avoided getting hit by a drunk driver (and severely injured & unable to work). It's guaranteed that neither you nor any of your brilliant kids have been struck (yet) by a severe illness that pushed you into medical bankruptcy.
Be careful, though. Patting yourself on the back too hard and fast and often could cause crippling shoulder damage.
76
Born in '57, I am preparing to retire (in 2017). I am financially ready, but not if I live 30 years longer,but 25. I've been lucky to avoid major illness. I've had to take care of aging parents.
Not all "Baby Boomers" are short sighted and self centered.
Oh, and I voted for Hillary.
Not all "Baby Boomers" are short sighted and self centered.
Oh, and I voted for Hillary.
14
Why did you assume I saved enough for retirement? I'm 26 years old. Relying on the government for your well being is more risking and dangerous than relying on your own smart choices and hard work. You have a lot of control over your choices and how hard you work. The government, as an individual, you have zero control. In addition, governments can run out of money (check Greece, Italy, and France). Also governments can become very corrupt and the citizens cannot stop the corruption (check Russia). Putting my financial future in the hands of the government seems seems like taking a really big risk. Really big.
2
What a dream! 401k's, pensions, ...... all depending upon corporations and their decisions. I lost half of my 401k with the recession of '08. There goes my ability to have cable tv when I'm 75. My rent will not stop increasing every 2 years. With the republicans constantly threatening Social Security and Medicare, my only 2 basically secure security (yea government!!) that security can be pulled out from under me. I read that most of the money lost by the Bernie Madoff debacle has been returned to the people ..... hey, what about my 401k from the recession???? What good was saving and investing for old age? I'm not in control. Corporations and spurious presidents are in control.
40
What did you invest your 401K in leading up to '08? The markets came back (and then some). Did you sell & lock in your losses?
9
I hear that so often, George Carlin. "We were wiped out in the recession" etc. No one was wiped out if they just let their investments ride and if they kept contributing, they are far better off today than they would otherwise have been.
Foolish people who sell in a downturn, despite copious advice to the contrary available in library books, reputable websites, etc. can't blame the rest of us for their woes.
Foolish people who sell in a downturn, despite copious advice to the contrary available in library books, reputable websites, etc. can't blame the rest of us for their woes.
22
We all know the investments came back....right to where they started 25 years ago in 1999. Thats a much worse performance than if you had simply put it in a bank - and I mean back when you could actually get 6 per cent. The 1 percent have stolen that from us while they continue to charge usorious fees when they lend via credit cards...sometimes 35 per cent. It makes me angry just to think about it.
23
It is articles like this that makes me truly in fear of Paul Ryan and Mitch McConnell. I am not a Doom and Gloom type of guy but I am in fear of when the Generation X's start to retire and the true effect of the "post pension" (401K) work place on the elderly. I think that soon, any transfer of wealth for the middle class will be decimated due to the short fall in retirement savings and that the following generation will be further disadvantaged while the rich continue to build their dynastic fortunes.
33
I never thought that I would live to see America turn into a third-world country where the elderly and sick have begging bowels on the streets and die by the millions. And the rich lock themselves up in gated communities with security systems and guns. But that is not far away if the Republicans finally get their wish.
The primary goal of the Republicans, as it has been for many, many years, is two things:
1) To cut Social Security so that millions are unable to live on it.
2) And to replace Medicare with a voucher system that ends up costing more and forces elderly to shop for insurance in a sea of insurance sharks, salivating over getting their money.
They have hated these programs and fought them tooth and nail since their inception. Currently House Speaker Ryan is leading the charge to destroy the retirements of million who have little or no pensions, and minimal savings.
We need to literally fight for our lives, and that of our children and grandchildren. Nothing less than our health and survival are at stake. Write letters to your newspaper, contact your congressmen - repeatedly, march in the streets, but whatever you do, resist!
The primary goal of the Republicans, as it has been for many, many years, is two things:
1) To cut Social Security so that millions are unable to live on it.
2) And to replace Medicare with a voucher system that ends up costing more and forces elderly to shop for insurance in a sea of insurance sharks, salivating over getting their money.
They have hated these programs and fought them tooth and nail since their inception. Currently House Speaker Ryan is leading the charge to destroy the retirements of million who have little or no pensions, and minimal savings.
We need to literally fight for our lives, and that of our children and grandchildren. Nothing less than our health and survival are at stake. Write letters to your newspaper, contact your congressmen - repeatedly, march in the streets, but whatever you do, resist!
94
Begging bowels sounds like a bad way to go, whether one is rich or poor.
That aside, why are liberals so afraid of offering vouchers as an option to people who would rather not have the government managing their health care?
That aside, why are liberals so afraid of offering vouchers as an option to people who would rather not have the government managing their health care?
2
Because vouchers don't work and only result in more costs to the end user. The most affordable health insurance options (both for the payor (government) and the beneficiary (patient) are single-payer -- across the board). Vouchers just promote corporate profiteering at every level -- which is how people end up paying $20 for an aspirin under our current health care system.
10
Because vouchers would only pay a percent. There would be no guarantee with the voucher, unlike Medicare where you know how much of the cost is your responsibility.
Think of someone in their 80's or 90's who has various medical conditions. Now, imagine them going from company to company trying to figure out how much coverage they can get for their voucher.
It's not about choice - we already have choice between Advantage and Medigap policies and the various companies that provide such supplementary coverage.
It's about solid, consistent coverage versus wondering if you can afford to be hospitalized.
Think of someone in their 80's or 90's who has various medical conditions. Now, imagine them going from company to company trying to figure out how much coverage they can get for their voucher.
It's not about choice - we already have choice between Advantage and Medigap policies and the various companies that provide such supplementary coverage.
It's about solid, consistent coverage versus wondering if you can afford to be hospitalized.
12
Inevitably we will be torturing the old. Warehousing them in nursing homes run for profit, watching them die alone in hospitals. We lack the resources or the will to redistribute enough wealth to provide a decent old age for everyone. Fair enough we are committed to American individualism and corporate capitalism and discarding the old is part and parcel of an efficient economy.
Let's at least do the most decent affordable thing. Painless efficient euthanasia available on demand. It may not be politically correct , but it is honest and humane.
Let's at least do the most decent affordable thing. Painless efficient euthanasia available on demand. It may not be politically correct , but it is honest and humane.
32
I'd sign up. i pray that if I get dementia someone puts me to sleep instead of wasting money and robbing my dignity by warehousing me for years on end. If I still have the wits I'll try to muster up the courage to do it myself.
24
Maybe use your last few dollars for a cheap flight to Switzerland. That's my retirement plan.
22
Ah, Soylent Green is coming.
9
Added to the fact that 55% of Americans have no savings for retirement, and the goal of Republicans in Congress to eliminate Social Security and Medicare, you have a probability of seeing millions of elderly begging on the streets and dying in the gutters all to give the rich more tax cuts. You may laugh, but any thinking American can see this, an portion of the population that seems too few. I have a university pension, Social Security, and Medicare all that I paid for out of my own salary, and quite a bit of money in savings like Ms. Moske here. BUT, if the cruel Republican Party is successful at eliminating Social Security and Medicare, I will be immediately poor, particularly since at 67 any health care I could get would take most of my pension. I would lose my home and not sure where I would live. So as horrible as it would be for the lower Middle Class, and it seems over 1/2 of Americans, those of us who did plan for retirement could be ruined as well. This could very well be a reality if Ryan and his cronies are successful at destroying the country.
231
Social Security and Medicare are underfunded. Only the Republicans are talking about doing something about that. You may not like their solution but it's better than the alternative - an across the board cut in Social Security benefits that will happen in a decade or so if nothing is done.
My personal opinion is that Social Security should be means tested, which means that I (age 67) and probably you, would be too rich to qualify. Then there would be sufficient funds for those that really need it.
And BTW, you only paid for a portion of your Social Security and Medicare benefits. Benefits for current retirees far exceed contributions plus interest. That's why the system is going bankrupt.
My personal opinion is that Social Security should be means tested, which means that I (age 67) and probably you, would be too rich to qualify. Then there would be sufficient funds for those that really need it.
And BTW, you only paid for a portion of your Social Security and Medicare benefits. Benefits for current retirees far exceed contributions plus interest. That's why the system is going bankrupt.
2
Its not underfunded. The GOP stole from the fund for their illegal wars. It could all be fixed in an instant if we had our priorities straight.
36
That's right Shonuff. And in 2030 we'll still get 75%. See the Social Security web site Waddell rather than Fox News.
5
Thank GOD for unions. I am a member of NEA and have a defined benefit pension. I think EVERYONE who works deserves the security of a pension. My husband works for a major Pharma, and he has a defined benefit pension too.
32
Rose, lots of people thought they would have pensions. And then their companies looted the funds in the pension plan and dumped their pensioners out on the federal government. United Airlines did it. So did Delta. American tried, but was prevented by the government; it froze its plan instead. Read "Retirement Heist: How Companies Plunder and Profit from the Nest Eggs of American Workers" by Ellen E. Schultz if you want a better idea of how corporations have looted these plans and left employees in the lurch.
27
Rose in PA, your defined benefit pension is invested in a mix of equity investments & fixed income. In March '15, it was reported that PA had the 2nd must underfunded state pension plan in the USA (source: http://www.pennlive.com/politics/index.ssf/2015/03/pennsylvanias_pension...
BTW, there is zero pension insurance on state & local pension plans...
BTW, there is zero pension insurance on state & local pension plans...
13
Amen!!
A country that lacks adequate social institutions to provide for people's needs is not a "great" country, no matter how mighty its military, no matter how large the walls that surround it.
No aggregate of individual saving can substitute for the will to take care of our people. No amount of rugged individualism can substitute for a lack of compassion.
No tally of repeated falsehoods can equal the one truth. We are all in this together.
No aggregate of individual saving can substitute for the will to take care of our people. No amount of rugged individualism can substitute for a lack of compassion.
No tally of repeated falsehoods can equal the one truth. We are all in this together.
92
Hear, hear!!
9
I wish you were right, but here in Amerikka, we are definitely NOT in this together. It's more cut throat and dog-eat-dog than ever.
18
Hey, we who want it to be so must keep working and voting - as well as running for office from the local level on up.
8
Working past conventional retirement age only is realistic if the person has skills that allow them to do this, health that allows them to do this and either an employer open to older workers or is self-employed. Many don't have these options.
I worry when I see all of the proponents of increasing the age at which one can get Social Security; that's all well and good if one has a job that they can keep doing. What of those who are physically or mentally unable to do so? What of those who are just burnt out or injured from decades on the job? And what of those who can't get hired given their age?
One of the things we need to examine is that we have managed to extend the lives of many, but not all of those years will be healthy ones. In reality, many people will live well beyond traditional retirement age but be unable to continue working; this may be for 20-30 years. I don't think as a society we are prepared for this.
I anticipate that there will be many destitute elders trying to eke out an existence on their diminished SS checks with any savings gone. I anticipate more and more seniors will be venturing across the border to live their retired lives in Mexico and places where their SS check will go further. What does it say about us as a country that US citizens who have worked their whole lives are unable to afford to retire here? Oh well; I'm sure the savings on Medicare will make some in DC happy.
I worry when I see all of the proponents of increasing the age at which one can get Social Security; that's all well and good if one has a job that they can keep doing. What of those who are physically or mentally unable to do so? What of those who are just burnt out or injured from decades on the job? And what of those who can't get hired given their age?
One of the things we need to examine is that we have managed to extend the lives of many, but not all of those years will be healthy ones. In reality, many people will live well beyond traditional retirement age but be unable to continue working; this may be for 20-30 years. I don't think as a society we are prepared for this.
I anticipate that there will be many destitute elders trying to eke out an existence on their diminished SS checks with any savings gone. I anticipate more and more seniors will be venturing across the border to live their retired lives in Mexico and places where their SS check will go further. What does it say about us as a country that US citizens who have worked their whole lives are unable to afford to retire here? Oh well; I'm sure the savings on Medicare will make some in DC happy.
123
To stimulate the economy we should be lowering the eligibility age for SS and Medicare, not raising it. Anyone with two brain cells should be able to understand the logic.
13
So my retirement strategy should be: eat the same dull, unhealthy lunch every day for 30 years and then wait for my spouse to die so I can pay off my mortgage. Got it.
45
No, the lesson is to employ delayed gratification and to put risk management tools in place. Nice snark against a decent, productive, prudent person, though.
34
Thanks Kosher Dill. BTW, I eat healthy for breakfast and lunch and have traveled all over the country and out of the country.
6
A significant part of the problem is the virtual elimination of defined benefit pension plans - the plans like your parents had, where when they retired they had a guaranteed retirement income of a certain percentage of their pay during a period just before their retirement. Instead we got a voluntary 401k defined contribution plan. Assuming you were conscientious, you could put away a small portion of your wages and invest in certain offered ways. This reduced earnings on those savings to plans which often were not balanced and which had larger than normal fees. But even if you had the right to invest as you chose, most people had neither the knowledge or time to make informed decisions. The stock market stole their earnings. Not surprisingly, a large part of the American population will now rely on Social Security for their retirement income. And the Republicans want to cut that in order to reduce the debt they ran up on the Iraq war. And they now want to do that for Medicare too. How are you ever going to negotiate a fair price with a hospital or doctor when you're on your own? A calculated plan to make the rich richer and the poor sick. Just stupid.
42
Most Americans live as if this year's income is meant for this year's expenses.
Most don't realize that their 45 to 50 years of income (from their early 20's to mid-60's) are meant to cover 65 to 70 years of living.
Most don't realize that their 45 to 50 years of income (from their early 20's to mid-60's) are meant to cover 65 to 70 years of living.
71
Most Americans can no longer both save for their old age and eat today under a roof in a heated residence. That is where corporate capitalism has led us. We are children following the Pied Piper of corporate capitalism into the sea that will drown us.
2
Ok, so if I make PB&J sandwiches for the rest of my days, and rent out the spare room, and never go to Europe, I can afford to retire.
Look, if living frugally were the answer, no one would be worried. The problem is that living frugally still doesn't answer the problem.
Here's how to make all the financial problems go away: single payor, single payor, single payor.
Look, if living frugally were the answer, no one would be worried. The problem is that living frugally still doesn't answer the problem.
Here's how to make all the financial problems go away: single payor, single payor, single payor.
61
What do you spend on clothing?
Do you drive a car that is more than you need?
How much is that smart phone (device + monthly cost)?
Do you actually watch CATV?
Do you drive a car that is more than you need?
How much is that smart phone (device + monthly cost)?
Do you actually watch CATV?
6
That's not all of it but part of it. Read the article again. I invested heavily in the stock market. I've been to over 30 states and left the country 9 times too.
4
Had an investor used a simple balanced fund such as the Vanguard Balanced Index fund holding 60% in equities and 40% in fixed income they likely would have accumulated a sufficient amount that coupled with Social Security would provide them with a dignified retirement. In 1992, the annual maximum that could be contributed to an Individual Retirement Account was $2,000. The average national wage in 1992 according to the Social Security Administration was $22,935. An 8.7% contribution rate (2,000/22,935) would have amounted to a grand total of $48,000 in contributions over the last 24 years and resulted in an ending balance of $146,015. While you didn't hit the jackpot, you did manage to grow your savings by 300% (the fund returned 8.07% annually since 1992) without having to do much except to ignore the market and let time compound your money. Getting your news from CNBC, the internet, the shoeshine boy and then taking action based on that "news" is the worse thing you can do for your financial security. Instead of watching TV an hour a month, take a walk to your local library or head over to Bogleheads.org or Vanguard.com or Fidelity.com and peruse their websites for information that are based on historical facts, not personal opinions. Would you make a medical decision based on someone's personal opinion who is not trained or hold an MD license to practice? This is no different, perhaps it is even more essential to one's continued quality of life. Good Luck!
10
All the government jobs-local, state and federal give very nice defined retirement plans for life. Liberals love government--be happy for those fortunate people.
10
Educate yourself about financial products first and be skeptical of financial advisers. We had two and they were wrong about everything including telling us not to worry about the stock market after the collapse of Lehman Bros. They were fee only but it was 1 percent of assets under management which for us was a lot. They told us to not pay off our mortgage which we did anyway. We saved 100K in interest payments. We never worried about being underwater after the housing collapse because we had no mortgage.
14
The USA does not care about its poor people or elderly. Given the last election, 62 million only care about greed and hate, and they elected an administration that only values greed and hate.
45
Employer pensions gone....sent to Wall Street so huge fees can be pilfered from the working class.....unions attacked and dismantled, good jobs sent overseas creating a low wage economy for US workers, but huge profits for the one percent, a for profit health care system that does just that...enriches health insurance and pharma company executives at the expense of the many....and now 30 years into trickle down economics that was designed for the benefit of the corporations and wealthy, you say the average worker doesn't have enough for retirement?
45
This is the real big picture!
4
Retirement scares me. In my 40's I became a single mother to 5 kids. They have college loans, and I have loans for them too. I worked part time for years when the kids were young..no 401K's then. Just getting by was all I could manage - no fancy anything for us!! I now work as a public employee in one of the 15 states where when you retire as a public employee, your Social Security (that you paid into) is pro-rated. Currently my colleagues are getting about 1/6th of their Social Security on this plan. I'm 60 and really have no idea when I will be able to retire. God forbid I ever develop a chronic illness or disability!
9
" I now work as a public employee in one of the 15 states where when you retire as a public employee, your Social Security (that you paid into) is pro-rated. Currently my colleagues are getting about 1/6th of their Social Security on this plan."
That's because you and your employer did not pay any Social Security taxes.
That's because you and your employer did not pay any Social Security taxes.
11
The USDA suggests that every child costs $200-400K to raise to age 18, not counting college costs.
So a single, low-income part-timer takes on a $1.5 million obligation, plus additional loans for other expenditures, and takes a job that will reduce her SS, and then is surprised at the penury that follows?
"Society" can't fix all manner of poor decision-making on the part of its members.
So a single, low-income part-timer takes on a $1.5 million obligation, plus additional loans for other expenditures, and takes a job that will reduce her SS, and then is surprised at the penury that follows?
"Society" can't fix all manner of poor decision-making on the part of its members.
9
But I paid in to Social Security for the many years I did not work in the public sector. i should be able to access that when i retire.
3
Despite what this article suggests, people can STILL avoid figuring out how much they can afford to pay themselves without outliving their money.
Those old-fashioned pensions usually solved that problem by giving the retiree a life annuity at retirement - a fixed monthly or annual payment that's guaranteed as long as the retiree lives.
Those annuities still exist, and the typical fixed annuity one pays roughly $6,000 per year for each $100,000 of savings invested, depending on age and whether or not a spouse or domestic partner is involved. It's not hard to find low-cost annuities from top rated companies by shopping around. The only real downside to this type of annuity is that the payments don't increase with inflation - but that was how it was in the "good old days" as well.
Those old-fashioned pensions usually solved that problem by giving the retiree a life annuity at retirement - a fixed monthly or annual payment that's guaranteed as long as the retiree lives.
Those annuities still exist, and the typical fixed annuity one pays roughly $6,000 per year for each $100,000 of savings invested, depending on age and whether or not a spouse or domestic partner is involved. It's not hard to find low-cost annuities from top rated companies by shopping around. The only real downside to this type of annuity is that the payments don't increase with inflation - but that was how it was in the "good old days" as well.
7
Doing a "back of envelope" calculation that would mean one would have to have at least one million dollars in an annuity in order to get about $50,000 per year, minus taxes, which will skyrocket in the next four years or so when the Trump plans really begin to devastate the economy. Few, very few of the Trump supporters will ever be able to do that. Indeed, it looks like at least 50% of Americans never will be able to approach that. I have a gift annuity from my alma mater. I gave $75,0000 to support graduate student research, and receive $303.13 per month ($3637.56 per year) taxed at only 33% until I'm 84 when taxes go to 100%. Gift annuities yield the best as opposed to one I investigated at Fidelity, given you're taxed on 100% and there is no annual guarantee. I was good with my money as Ms. Moske was, but without my university pension, I would be hurting, particularly since Republicans could very well eliminate Social Security and Medicare.
8
A million should get you about $60-65,000 at age 65, depending on whether married or not, assuming spouse is same age. It might do a little better in a few years, since interest rates should be higher.
Taxes will depend on whether the original investment is from IRA/401k (in which the entire payment is taxable), from Roth (in which none of it is taxable since you paid already, or from regular savings, in which it's mostly not taxed.
The CREF variable annuity is a terrific option if you understand how it works and are willing to trade some certainty for inflation protection.
Taxes will depend on whether the original investment is from IRA/401k (in which the entire payment is taxable), from Roth (in which none of it is taxable since you paid already, or from regular savings, in which it's mostly not taxed.
The CREF variable annuity is a terrific option if you understand how it works and are willing to trade some certainty for inflation protection.
3
My husband and I are in our mid to upper fifties, we've been able to save a very solid amount and recently paid off our small house that we purchased 15 years ago. This was only possible because we both had above average jobs and we have both stayed mostly consecutively employed. Live more modestly on one salary, mostly save the other has been our approach. I know that many will not be able to do this, but I'm always surprised how few double income professional couples even consider this approach. I have co-workers making very good incomes who also seem to live check-to-check.
21
Knowing what I have accomplished on one mostly-moderate income, I have pretty much zero sympathy for households that have enjoyed two incomes for a decade or more and still not managed to save much.
Perhaps they can comfort themselves in old age with the memories of spending to the hilt in youth and middle age.
Perhaps they can comfort themselves in old age with the memories of spending to the hilt in youth and middle age.
12
Live modestly on one salary? In many parts of the country, that means you'll most likely end up living in a community with low-performing schools. Which demonstrates poor long-term planning of a different kind, if you have kids.
6
And maybe they enjoyed seeing the sights before glaucoma set in and they were forced to stay at home wrapped in cheap polyester blankets smug in their austerity and their memories of canned hash and Spam for 40 years
2
The fact of the matter is that we have a President who doesn't want to pay any taxes and says that we're "all" going to be better off - and, apparently, a Congress who's willing to follow suit. As long as the majority of Americans keep swallowing this swill and thinking they can get something for nothing they will get the Government and retirements they deserve (hint - you get what you pay for - very little, i.e.).
32
It used to be blame Bush for everything--Trump has been in office a month and already he gets the blame--very pathetic.
5
Trump wasn't paying taxes even before he ran for office.
5
The anecdotal narrative of moral decay - look at this spendthrift! - and the so-called solution of brutal austerity - eat from a can! - are halves of a bankrupt whole.
12
Die at 50.. problem solved.
14
I am extremely fortunate to have a defined pension indexed to inflation. Because of this I know I will be supporting my two sisters, who have worked all their lives, as we get old. What kind of a country is this, that lets seniors fall by the wayside?
30
You apparently missed the point of the story demonstrating that with a bit of planning and self control one can fund their own retirement...
9
No you are wrong. You cannot make it, no matter how much you plan and exert self control! Not if the heartless Republicans get their way.
Not if the Republicans go forward with their plans to gut Social Security (and put it in the stock market for their rich donors to benefit from) and gut Medicare by giving us all vouchers to go and buy insurance with...at obscenely high costs.
Without these two safety nets, no one, repeat no one - except the very, very rich and healthy - can make it.
Not if the Republicans go forward with their plans to gut Social Security (and put it in the stock market for their rich donors to benefit from) and gut Medicare by giving us all vouchers to go and buy insurance with...at obscenely high costs.
Without these two safety nets, no one, repeat no one - except the very, very rich and healthy - can make it.
16
Don't forget the PBJ's. It's all about the planning...and my pbj's. :)
3
Despite fears of outliving savings, deferred lifetime annuities are nor very popular, apparently because people are even more afraid of forfeiting all that money if they die early. But remember, if that happens, you won't spend a lot of time regretting it, you'll be dead.
6
Larry, what happens if you buy an annuity from a company that can't honor its annuity payments at some point in time? That's been my serious question about buying an annuity--how do I know, in a rapidly changing world, the company will be around in 20 to 30 years to still pay me?
24
I have no pension, a plan to work until I'm 70 (should be achieveable), and a rental property to contribute extra income on tope of whatever I get from Social Security (having the GOP pull the rug out from under that very basic safety net for most Americans is a very frightening prospect) and from income from my retirement savings.
But I am planning at some point to simply opt out of the healthcare system, treating symptoms and opting for palliative care rather than fighting to extend my life beyong the point where I can live independently. Most people don't want to end their days demented and in expensive skilled nursing care. Why do we strive so hard to make that an inevitability?
I wish we, as a society--and including the medical establishment, which has many euphemisms for "terminal condition" and "death"--could have a serious conversation about the fact that death is inevitable, and that more people would take an active role in deciding how they want to live AND die.
But I am planning at some point to simply opt out of the healthcare system, treating symptoms and opting for palliative care rather than fighting to extend my life beyong the point where I can live independently. Most people don't want to end their days demented and in expensive skilled nursing care. Why do we strive so hard to make that an inevitability?
I wish we, as a society--and including the medical establishment, which has many euphemisms for "terminal condition" and "death"--could have a serious conversation about the fact that death is inevitable, and that more people would take an active role in deciding how they want to live AND die.
45
Of course, a lot of people who never bothered saving are now getting up there in years and in the last election were blaming President Obama and Mrs. Clinton for their predicament and now have President Trump to fix them up, so from here on in everything should be fine and dandy.
44
And this is the reason why Trump could ever have won the presidency, because Dems refuse to understand that no one could have predicted which jobs would survive lay offs, the Recession, wage stagnation, income inequality and which would keep their benefits.
Even Picketty didn't know until a few years ago. It's this kind of attitude that makes Clinton voters continually appear clueless, smug and the only reason Trump is in office, with or without help from the Russians. The people I know who do not have retirement accounts work 6 days a week, can never dream of having a vacation or seeing Europe in their lifetime. You're right of center ideas are killing the American dream for progress.
Even Picketty didn't know until a few years ago. It's this kind of attitude that makes Clinton voters continually appear clueless, smug and the only reason Trump is in office, with or without help from the Russians. The people I know who do not have retirement accounts work 6 days a week, can never dream of having a vacation or seeing Europe in their lifetime. You're right of center ideas are killing the American dream for progress.
6
for ordinary working people, there is NO retirement. Don't be fooled by all those narratives that saving and hard work will let you live in Bahamas and drink whtever. It ain't so. About 12 % have a company pension, but there is nothing to stop inflation (you know, the thing that the government says doesn't exist?). when I retired my rent was about 1/3 of what I now pay for basically the same junky apartment. Now it exceed greatly what my "retirement" benefit is and so having to dip into my savings which have been trashed thanks to the FED and WS, I will likely be on food stamps before long. a Spock said "work long and hard to prosper, and there is NO tomorrow for retirement".
15
Some of us got lucky. I moved to France at 26 years old and worked the next 41 years. First 30 years of it, I was not saving for retirement. But that was ok, the government made me save by taking money from me for Government retirement, an employee plan and a 'manager' plan. Thanks to that I have a comfortable retirement. How hard is that to do? Ok, first you must get rid of Trump and the Tea Party; now that is difficult !!
47
So you preferred forced savings for all in some government low risk bond. Okay -- but why should you decide for everyone? What if I want to choose a higher risk stock, or maybe need the money to pay my higher interest debts like credit cards or student loans? Maybe we can all work for the government and get paid in food and shelter -- no right to choose where or how we live, or what we eat. At what point is it preferable to give up security for choice? The government could mandate only fruits and veggies as food options, and we'd probably have a much healthier populace, much like it can mandate automatic savings. But all that is ultimately at the expense of free will. There are those that are naturally more cautious and would prefer a guaranteed middle or lower middle class for life over a brutal winner takes most capitalist plan, and there are those who want the chance at more. Who are you to decide what everyone wants or should want?
1
Having been self employed for most of my working life and past the "normal" retirement age, I continue to work. I am fortunate that I am healthy enough to do so. Financially, I could quit, but honestly, I fully expect someone else to spend my money before I can do so. The elimination of fiduciary rules only augments that feeling. So, I'll bop 'til I drop!
4
I spend a substantial time in airports and have the fortune to travel due to work opportunities. I see the Results of these perspectives in my travels. Sad that some people in America have this perspective. It shows the blindness to the outside world that some have. Here is a thought, find the best quality of life for you and go there. if you think that the US is for you and you are ok in getting less for your buck in retirement then follow the ideas in this article. If you are interest in quality of life, then open your perspective. Challenge your own perspectives so that you are able to learn that maybe a better way exist.
The under current of this article are known by most, so call me old fashion, but youth, happiness, and quality of life turned away for money at old age is a risky proposition. Look if you can't take a vacation or a lunch how is a real retirement possible in America. I know, I know, the hope of Wall Street for the common man, but hope is not reality. I know the math, but for most it's not working, yet we hope. I think it's time to challenge the perspective in this article, it's this the best way?
The under current of this article are known by most, so call me old fashion, but youth, happiness, and quality of life turned away for money at old age is a risky proposition. Look if you can't take a vacation or a lunch how is a real retirement possible in America. I know, I know, the hope of Wall Street for the common man, but hope is not reality. I know the math, but for most it's not working, yet we hope. I think it's time to challenge the perspective in this article, it's this the best way?
10
This is wrong. It's not funny that Ms. Moske has to eat peanut butter and jelly sandwiches for decades in order to survive in old age. Cancer-wise, it's a horrible idea to eat the same thing for years, but decency-wise, it's wrong that Americans are paying for politician's expensive DC lunches, while eating and living like peasants. Meanwhile, we hear about them buying another vacation home.
This is exactly what the oligarchs and their paid off GOP and SCOTUS want: they want us to work until death, pay their taxes, pay for their lunches, their maids, their third homes and force women to give birth to new slaves as the old one's die early deaths from a complete lack of healthcare.
This is a dream come true for the oligarchs are their puppets: two generations so far, working for nothing and trying to convince themselves that going on errands is a "vacation".
This is exactly what the oligarchs and their paid off GOP and SCOTUS want: they want us to work until death, pay their taxes, pay for their lunches, their maids, their third homes and force women to give birth to new slaves as the old one's die early deaths from a complete lack of healthcare.
This is a dream come true for the oligarchs are their puppets: two generations so far, working for nothing and trying to convince themselves that going on errands is a "vacation".
195
I don't think anyone was saying it was 'funny' that she eats PB&J and honestly, it sounds like Ms. Moske willingly chose to do that, in order to retire at an age that many other Americans would consider 'young'. She herself said she 'really doesn't care what she eats', which is obviously true, for she could also be enjoying other inexpensive meals if she truly cared or wanted to (rice and beans, tuna sandwich, egg sandwich, etc.)
3
Wow a very different take than I had...this lady didn't have to brown-bag her lunch every day, but she chose to, and saved money for retirement starting young, and responsibly carried life insurance. She is not just "surviving in old age". Her house is paid off and she is going to retire young with a nice condo in Florida or somewhere, even though she was widowed young and missed a lot of earning years raising children. This lady is a financial success story. We should emulate her, not feel sorry for her.
22
Lisa, she says she really doesn't care, yet mentions it as something she MUST sacrifice in order to save for the future. Do you really know people in NYC who eat PB & J for 3 decades? When you live in the Midwest, you learn very quickly that it's a cultural phenomenon to believe that you don't deserve the most basic of things, like a vacation or decent tasting food. I know 2-earner families who have to file for bankruptcy, those who can only afford enough gas to get to work, who consider dinner an unappetizing experience to get over with, like defecation. They have been taught to believe they should pay for the wealthy's taxes and that it's their fault they can't afford healthcare. It's why they vote for Trump. It's why I know too many Midwesterners who die needlessly in their 40's.
8
The US today does not have a plan for the tens of millions of people who will age into their 80s and well beyond when the vast majority will no longer be able to work or be able to get work, living solely on Social Security with little savings and no pensions. Articles like this make it sound like a family or personal problem but it very soon will be a societal problem.
60
Ssi was never intended to support one in retirement. It was a program that was to help. Government has never taken full care of the elderly from a financial perspective. Ever.
3
Current retirees' accounts needs to be taken with a grain of salt by current workers. It is common for young people today to have 75% of their paychecks wiped monthly just be rent, utilities, and student loan repayments. They can scrimp and pinch the rest of the 25% all they want, but it's not going to get them very far. After saving up a rainy day fund (3 month pay check), the next should be hammering away the student loans that commonly have 4-6% interest rate. Very few safe investments these days have a return higher than 6% to be worth diverting their loan repayment to retirement funds.
21
It's quite true, as some point out, that it is very, very difficult for a lot of Americans to save enough for retirement. But this failure also occurs in income brackets that COULD save but instead opt for a lifestyle of the present rather than worry about one of the future. I have worked with and known many, many people who have earned excellent salaries and would be quite capable of saving more than enough for their so-called golden years, but who succumb to present imaginary "needs" like ever bigger houses (change every few years, always larger), nicer and newer cars for them and their kids (somehow buying a brand new car for your high schooler is now a mandate), all the latest electronic devices and upgrades, flying off on frequent vacations, charge everything on plastic, etc..
If you can afford all that, by all means, do so - but many could save but don't (and no, it is not the fault of advertising and corporations it's a choice by consumers). It's difficult to muster much sympathy when that set of the populace then feigns surprise and asks what the government - i.e., the taxpayers, you and me - are "going to do about it".
If you can afford all that, by all means, do so - but many could save but don't (and no, it is not the fault of advertising and corporations it's a choice by consumers). It's difficult to muster much sympathy when that set of the populace then feigns surprise and asks what the government - i.e., the taxpayers, you and me - are "going to do about it".
125
I'm glad you mention this point. This of course is not to say that there aren't a great many who are indeed struggling due to lack of jobs (or jobs that simply pay well enough). And then there is the problem of our mess of a healthcare system, and people who, through some unfortunate serious accident or long-term illness, etc., found most of their savings depleted.
But there is indeed the other side of the coin...Americans who don't want to make sacrifices now, for tomorrow. You can see the two extremes in particular immigrant groups who move to the U.S., sacrifice any day-to-day luxuries, work very long hours, often start their own businesses, live with extended family members in one home, and all pool their resources to buy a house, etc. Many American families on the other hand feel that each of their children 'must' have their own bedroom (whatever happened to siblings sharing a bedroom? It used to be very common, but now it seems only 'poor' families do that....)... each adult family member 'must' have their own car (how did families manage before, with just one family car??) .... each person 'must' have their own TV in their room, etc. New iPhones every year. New clothes every season (since they 'no longer like' their clothes from last year), etc. It all points to a society of gross consumption and instant gratification. Which, when you think about it, and the impact it also has on the planet, is quite revolting.
But there is indeed the other side of the coin...Americans who don't want to make sacrifices now, for tomorrow. You can see the two extremes in particular immigrant groups who move to the U.S., sacrifice any day-to-day luxuries, work very long hours, often start their own businesses, live with extended family members in one home, and all pool their resources to buy a house, etc. Many American families on the other hand feel that each of their children 'must' have their own bedroom (whatever happened to siblings sharing a bedroom? It used to be very common, but now it seems only 'poor' families do that....)... each adult family member 'must' have their own car (how did families manage before, with just one family car??) .... each person 'must' have their own TV in their room, etc. New iPhones every year. New clothes every season (since they 'no longer like' their clothes from last year), etc. It all points to a society of gross consumption and instant gratification. Which, when you think about it, and the impact it also has on the planet, is quite revolting.
18
Simplistic view. The cost difference for a 3 bedroom home vs a four bedroom home is negligible. Is life just one long slog to the grave unless you reside in the 1%???
Why is it wrong to take a vacation? Buy a new pair of shoes? Eat a steak dinner? Otherwise is life an endless bowing down to the 401-k "God"....... How utterly depressing.
Why is it wrong to take a vacation? Buy a new pair of shoes? Eat a steak dinner? Otherwise is life an endless bowing down to the 401-k "God"....... How utterly depressing.
2
You illustrate the mindset perfectly mmf.
Some of us find shopping and mindless consumption even more depressing.
Some of us find shopping and mindless consumption even more depressing.
2
My husband and I have been putting money into 401Ks since we were in our 20s. We are now in our early 60s. We got caught in the dot.com bust and the housing crises. We pay the fees set up by the plan administrators. A lifetime of saving and we'll be lucky to live on a third of our current income in retirement. I am grateful that we will have something, but there should be more federal oversight of fees and advising available to the average worker who is trying to figure out how to make ends meet after their worklife is over. Help us Elizabeth Warren, you're our only hope.
101
How could you "get caught" in the dotcom bust or the housing crisis? If you let your retirement accounts ride, they have more than recovered.
If you panicked and "sold low" -- well, that's on you. It's contrary to ALL investing advice out there, going back decades. If you don't have the stomach for the downsides of the stock market, or if you have invested monies that you will need before accounts recover -- again, on you. All investing advice says not to panic in a downturn, not to invest money you will need on a short time horizon, etc.
People want the upside of stock market gains without bracing themselves for volatility. That is not the fault of "society."
If you panicked and "sold low" -- well, that's on you. It's contrary to ALL investing advice out there, going back decades. If you don't have the stomach for the downsides of the stock market, or if you have invested monies that you will need before accounts recover -- again, on you. All investing advice says not to panic in a downturn, not to invest money you will need on a short time horizon, etc.
People want the upside of stock market gains without bracing themselves for volatility. That is not the fault of "society."
15
I had a buy and hold philosophy. The only stock I sold was Disney. I had purchased it for both of my girls and it paid for more than half their educations. No, I did not buy stock in Jif or Skippy, contrary to popular belief. :)
9
Oh, so now you say ordinary people need to do more than live frugally and avoid bad choices--they have to "have the stomach" for the roller coaster of the stock market, and be able to survive through downturns? Should they all subscribe to the Wall Street Journal perhaps?
1
"The median retirement savings figure among all working-age families in the United States is just $5,000; the median among families with savings is $60,000."
This is terrifying. Couple this pitiful savings rate with the looming pension crisis in the states, the declining birth rate, and the backlash against immigrants--we are headed toward much higher taxes. The millenials need to be ready to either shoulder a bigger load or let their parents suffer in penury.
This is terrifying. Couple this pitiful savings rate with the looming pension crisis in the states, the declining birth rate, and the backlash against immigrants--we are headed toward much higher taxes. The millenials need to be ready to either shoulder a bigger load or let their parents suffer in penury.
36
"The reason so few people have retirement savings is not because they spend irresponsibly, but because after trimming their expenses as are as possible, they still have trouble making ends meet, making it IMPOSSIBLE to save. "
"The median retirement savings figure among all working-age families in the United States is just $5,000; the median among families with savings is $60,000."
Above two comments previously left by NYT readers are woefully lacking:
How can someone mindlessly accept such a bogus "family saving" statistic? The EPI always slants their numbers that purport to show disaster. In the first place, to interpret correctly, the figures must be age-related. Moreover, houses are much larger today--even though HH size is smaller, new car sales for the past several years have been setting records, domestic and international travel among Americans has never been higher, dining out also has climbed much higher than in decades past.
I make no claims here--good or bad. But, learn to think about complex economic issues in a more thoughtful and coherent manner prior to deriving definitive observations.
"The median retirement savings figure among all working-age families in the United States is just $5,000; the median among families with savings is $60,000."
Above two comments previously left by NYT readers are woefully lacking:
How can someone mindlessly accept such a bogus "family saving" statistic? The EPI always slants their numbers that purport to show disaster. In the first place, to interpret correctly, the figures must be age-related. Moreover, houses are much larger today--even though HH size is smaller, new car sales for the past several years have been setting records, domestic and international travel among Americans has never been higher, dining out also has climbed much higher than in decades past.
I make no claims here--good or bad. But, learn to think about complex economic issues in a more thoughtful and coherent manner prior to deriving definitive observations.
Comments on how aging out of the work force at 50 vs. 65 are my experience in IT. My previous employer outsources 1300 well paying job to India. I had to take a consulting job with no benefits. After that two year engagement was over I had time to go to the doctor and found out I had stage 3 cancer. Everyone's worse case scenario. AHC policy I took out the month before paid 70k costs, results were very good. Right now I can't find work at 62 am taking care of my 89 yr old Mother, I have saved about 150k I am afraid to touch because when that's gone I have zero. I will be getting SS this year but have to pay 550 a month for premium for health and worry that if AHC is repealed and I get sick again I'm in trouble. My golden years look more like copper years but take it one day at a time. If Paul Ryan has his way and SS is repealed I can't even imagine how many millions of Baby Boomer will dissolve. But I can say I did enjoy my life and spending money on those trips to Paris and Maui were worth it.
28
And these citizens keep voting GOP into government .. what to expect?
It's a great way to turn around higher life expectancy.
It's a great way to turn around higher life expectancy.
14
My generation (the baby boomers) never learned squat about saving and investing when we were in school. It was assumed we'd go to work for a single company until we hit 62, when we'd get a gold watch and a nice pension like our parents. But then pensions went away, replaced by 401ks, which were originally designed to defer taxes on savings plans and bonuses. They were never designed to replace pensions, but ended up doing just that.
Some of us learned to adjust. Others were like people who got pushed into a lake without being taught how to swim. We had to assume a level of risk we were never prepared to assume. In some cases, retirement savings were totally wiped out. Ask former Enron employees.
Some of us learned to adjust. Others were like people who got pushed into a lake without being taught how to swim. We had to assume a level of risk we were never prepared to assume. In some cases, retirement savings were totally wiped out. Ask former Enron employees.
29
Garbage. Rightwing claptrap.
State-spnsored mandatory tax-based retirement is the only solution since companies ain't gonna give ya jack.
SO.....expand social security and we will be done. No reason anyone should have to think about this. Only in rightwing countries...
State-spnsored mandatory tax-based retirement is the only solution since companies ain't gonna give ya jack.
SO.....expand social security and we will be done. No reason anyone should have to think about this. Only in rightwing countries...
15
American companies have routinely cheated millions of their workers out of their benefits and pensions by pretending that people working full time for years were in fact "temps" or "self employed". One of the biggest participants in these nefarious "business plans" has been American media, including print media. Often called "downsizing" the process became very pronounced in the 90s and had such wild success in the eyes of the corporate bean counters and their executives that it became standard practice. At first people were simply let go because their salaries were high. Like men with mid-life crisis dumping their wife for a trophy bride, experienced professionals were jettisoned for bright young things working for far less, who imagined it would never happen to them and simply ignored the ethical ramifications of a process they could do nothing about. They in turn were jettisoned. Some companies shifted large parts of their work forces into revolving door models, were creative talent "temps" were hired and fired in three months, the legal limit. The model gets tweaked every time the laws get tweeked and no one in either political party ever seriously investigated reforming these practices.
12
Sort of like the adjunct professor racket at colleges; I believe something like 70% of all college profs/instructors are adjuncts. In some schools it's 100%.
6
And there is virtually no news coverage of this. Trump talks about manufacturing going overseas- but nothing about how companies have simply abandoned workers. There used to be good jobs working in the back office of investment banks- benefits, 401k. Now- most all those jobs gone- yet not gone, they just have long-term "temps" doing the same work, but no paid days off, or any kind of benefits.
It's all about the "owners", the shareholders, the company owners, who are essentially akin to slave owners. Why did we let this culture of greed and disregard for honest working people take over?
It's all about the "owners", the shareholders, the company owners, who are essentially akin to slave owners. Why did we let this culture of greed and disregard for honest working people take over?
4
When the great recession came, the media began talking about the 50+ professionals who would never work again, as if this made common sense, as if it were good for the society. We're long since through the looking glass, and I knew the sanity of paying for the wisdom and talent that only experience could bring would never return when the word "recovery" was trotted out continuously for a wish, a political smokescreen, pure spin, not an event that ever actually happened. Mad fantasies about american labor abound down in D.C. on both sides of the aisle. They will continue to destabilize the society as a whole until someone gets put in power willing to use words like "exploitation" and "injustice".
4
These alarmist articles about retirement savings have been written as long as I can remember, and I am close to retirement myself. They all serve up the same prescription: hire a "financial planner" huckster who then steer your cash into products like annuities and mutual funds that he can profit from. You can then cheerfully wait for the crooks on Wall Street to engineer another market crash / economic collapse and wave bye-bye to whatever is left of your money (see 2008). Can't you folks at the NYT come up with an alternative to this hoary and failed idea? Hard working folks deserve better.
21
Re: hiring a financial planner, anyone with half a brain knows that you never work with someone that is affiliated with a bank or insurance company. Those are the people who will always steer you to annuities or products sold by their own companies. You want to find an independent fee-only (no commission) financial planner who, by law, must act in your interest.
http://www.napfa.org/about/index.asp
http://www.napfa.org/about/index.asp
11
Yes, all the minimum wage earners better learn to be more frugal so that the CEO's with mega-million incomes and mega-million retirement packages can continue with their lifestyle.
108
I'm a baby boomer, I feel like my generation has been the guinea pigs. We saw our parents' retirements supported by their pensions, social security and own savings and never learned how to adapt to the new rules, no pensions and 401 Ks. I was told years ago that my 401 k savings was like a "cherry orchard" you just take care of it, and eventually it will come to fruition. Well, I don't think that worked very well, my 401 cherry trees have not blossomed as promised. Also, life happens, divorces, unemployment, illnesses, career re-directs, all of these can stop even the best laid plans. I don't blame younger people their frustrations with us not getting out of the way, but unfortunately I am going to have to hang on to my (pretty) well-paid job till I'm 70 at least, if I can make it.
37
During the past 8 years, Obama and his self-serving Fed devastated middle class retirees, by transferring trillions of dollars of lost interest on savings to Wall Street.
8
Everyone should read this comment and, then, re-read it so the non-partisan infuriating truth of it sinks in. Now, if Republicans had held the White House, the exact same thing would be true and, therein lies the problem. The leadership of both parties are competing for the favors of Wall Street. They collude to protect the white collar criminal masterminds behind the collapse of the mortgage-backed securities house of cards and make sure that Fed policy, Treasury policy and DOJ policy are in synch with Wall Street interests, at the expense of workers, homeowners, retail investors and retirees. Trump will continue this thinly-veiled form of outright theft.
10
And letting interest rates rise, derailing the recovery, maybe letting the economy slide into actual depression, would have helped retirees? The damage had been done by the Bush administration's tax cuts, deregulation and wars.
11
Actually, GWB "devastated middle class retirees" by creating the worst financial crisis since the Great Depression. The Fed was forced to lower rates to save the economy from complete collapse. (See Krugman, Paul blog for details.)
You are listing right wing talking points that have no basis in reality, i.e., fake news.
Try expanding your sources of information. (BTW, I read alt.right "information" all the time.)
You are listing right wing talking points that have no basis in reality, i.e., fake news.
Try expanding your sources of information. (BTW, I read alt.right "information" all the time.)
17
One of the sad things about our society is the lack of understanding of basic finance. It's not really taught in school, and frankly I think it should be mandatory in high school. Retirement savings is one of those thing that shouldn't be put off until tomorrow. The best thing you have going for you when you are young is time. You never get that back.
We seem to be conditioned for "the big win", when a slow steady thoughtful plan is much more reliable.
My advice: Start early. Live below your means. Save, even when it hurts. Plan like what you save is all there is or will ever be. Oh, and do something that makes you happy...
We seem to be conditioned for "the big win", when a slow steady thoughtful plan is much more reliable.
My advice: Start early. Live below your means. Save, even when it hurts. Plan like what you save is all there is or will ever be. Oh, and do something that makes you happy...
42
Would there be so many people with high amounts of debt from college had they been taught about interest or the rule of 72? I've run into people who will never be out of debt borrowing for degrees that will never earn them enough to pay the money back.
1
The message is, unless you were very fortunate in your career or exercised extreme frugality (how do you do that raising four children?), the destiny of America’s senior citizens is to work until they drop dead.
Trillions of dollars down the drain for military intervention in Muslim civil wars overseas, and a shrinking social safety net for our own people here at home.
When I’m in Europe (once every fifteen years, on average), and I see even lower middle class people retired at age 58 and zooming around the continent on light and high speed rail, while in the US we have mostly car travel on our slaughter-house highways, I ask myself, when exactly did the middle class in America give up on quality of life — and why?
Trillions of dollars down the drain for military intervention in Muslim civil wars overseas, and a shrinking social safety net for our own people here at home.
When I’m in Europe (once every fifteen years, on average), and I see even lower middle class people retired at age 58 and zooming around the continent on light and high speed rail, while in the US we have mostly car travel on our slaughter-house highways, I ask myself, when exactly did the middle class in America give up on quality of life — and why?
480
"When I'm in Europe..I see ..retired people zooming around.."
I go to Italy yearly, and we have friends there (retired and Italian, not ex-pats) who struggle because they are helping to support their adult children who are underemployed or un-employed. The Italian economy has been in recession or near recession for years. This is a common phenomenon in Italy, Italians are struggling too.
I go to Italy yearly, and we have friends there (retired and Italian, not ex-pats) who struggle because they are helping to support their adult children who are underemployed or un-employed. The Italian economy has been in recession or near recession for years. This is a common phenomenon in Italy, Italians are struggling too.
3
The message, as I read it, is to be pragmatic in your financial (and family) planning. I do not see the Moske's as people who practiced or advocated extreme frugality. That pragmatism, I would quite agree, should apply to national policy as well as to prudent personal planning. Imperial grandeur and military meddling in the affairs of other peoples on the other side of the globe is a wasteful and pointless practice. It is why many social services available to Europeans cannot be afforded here. They have outgrown such costly, imperialistic idiocy.
3
Michael, Europe cannot sustain early retirement. Why do you think they're so desperate for business that will not come or hire. Areas in the EU have unemployment exceeding 20%. Do not think a visit every 15 years (or every year) tells you much.
1
With all due respect, Ms. Moske had an undisclosed amount of proceeds from a life insurance policy. Rarely, if ever, do I hear a "success story" these days of a person working a middle-class job and retiring early or at 65 based solely on their frugality. And Mr. Stark is a C-suite executive at a successful financial firm. Most of us will fit into the plight of Mr. Blanton, no matter how many lunches we pack.
27
Very low 6 figures (2 years of his salary) and it went to pay off my house and my daughter's two college degrees. It was a lifetime of frugality, not the insurance.
7
Your story and determination is truly inspiring. Thank you for sharing it.
1
I was always a regular worker at a normal IT job. When I retired at age 61, my spreadsheets showed me that my total financial assets were slightly more than the total salary I had collect over my 35-year career. That is the power of saving and investment.
And if I had known when I was 30 what I know today about investing, I would be even better off.
And if I had known when I was 30 what I know today about investing, I would be even better off.
2
It is Interesting how over the decades, the concept of a "safety net", something meant to help in an unusual, unforeseen, unexpected or emergency condition by it's very name, has some how come to mean getting money from the government for everyone's retirement as a sort of substitute pension or savings account. That's not what it was designed for but what it has apparently come to represent - don't worry about sacrificing a bit during your working years and saving, for Uncle Sam will step in and take care of you with "all the money" you paid in to the system. We've created a mess of a system and a mess of often unrealistic expectations.
10
Social Security was intended to supplement penaions. Where are those pensions now? Raided. Rescinded. Reduced. Ended. Gone into the pockets of zillionaire wheeler-dealers.
22
You do realize that social security is funded by mandatory contributions from both workers and employers. There is no Federal money added. In fact, the Federal government raided the social security holdings to fund Republican spending years ago.
51
The federal government raided the holding funds to pay for the Viet Nam War under Democrat Lyndon Johnson years before the Republicans.
The money by the way is borrowed and paid back with federally issued bonds which pay interest to the Social Security fund. The Feds aren't just stealing the money.
The money by the way is borrowed and paid back with federally issued bonds which pay interest to the Social Security fund. The Feds aren't just stealing the money.
Keep your money out of the "stock market". Put your 401K money into U.S. Treasuries through T. Rowe Price unless you want half of it stolen by the Robber Barons again.
Then, take action to stop Corporate Welfare with OUR hard-earned taxpayer dollars/treasuries. Get the money down to small companies that provide for/ support the communities where they reside.
Do Not Let The Robber Barons repeat 1929, 1973-74, 1987, 2002 or 2008 where the wealth was transferred directly to them.
Then, take action to stop Corporate Welfare with OUR hard-earned taxpayer dollars/treasuries. Get the money down to small companies that provide for/ support the communities where they reside.
Do Not Let The Robber Barons repeat 1929, 1973-74, 1987, 2002 or 2008 where the wealth was transferred directly to them.
14
This is irresponsible advice.
First, most Americans will need to have a large portion of their retirement accounts invested in the stock market to have any chance of retiring comfortably. Treasuries do not yield enough interest to ever make that happen.
Second, the stock market recovered after each of these, climbing to new highs a few years after the initial shock. Smart investors know this.
Everyone should meet with a financial advisor in order to understand how to manage their investments with the right risk profile to make them comfortable. Avoiding the stock market is not the answer.
First, most Americans will need to have a large portion of their retirement accounts invested in the stock market to have any chance of retiring comfortably. Treasuries do not yield enough interest to ever make that happen.
Second, the stock market recovered after each of these, climbing to new highs a few years after the initial shock. Smart investors know this.
Everyone should meet with a financial advisor in order to understand how to manage their investments with the right risk profile to make them comfortable. Avoiding the stock market is not the answer.
20
Both the religion of growth and its Cargo Cult are narratives used to justify the expansion of global finance via financialization. Are you feel'n lucky?
1
I agree. I'm no expert, but have a pretty decent overall sense of investing as compared to your 'average Joe'. What folks need to keep in mind re: stocks is that, assuming you are in it for the long-term (as one would assume when it comes to retirement planning), that what goes down will eventually go back up. I'm 53, and my former employer (a prestigious inv. mgmt. firm) sets up retirement funds for their employees, by contributing 10% of the employees' annual salaries, which the employee can then choose how to invest (by selecting from available Vanguard funds). I worked for them from 1991-2001, and with the contributions from my employer in just that 10-year time frame, and with my leaving that $ exactly where it was (with the occasional fund re-allocations now and then), it has grown enough that I will be able to retire quite comfortably. Sure, my overall fund balances have taken some scary dips, but then I knew I was in it for the long-term, and didn't freak out above the dips. Net, net, my fund balance has grown substantially, and I've no reason to think that will change over the next 10-20 years, before I completely retire from the workforce. I also know, over time, to start decreasing the overall % in stocks, to balanced funds or bonds. But for now, I'm still heavily weighted in stocks, and well-diversified across regions, Cap size, sector, etc.
9
I worked until I was 73 as a self employed consultant. Really enjoyed the work, and mental stimulation plus social contact. I grew up in a "post depression" environment and saving for a rainy day or torrential year was drummed into me as a young man. The drumming took hold so I have my parents to thank for that. Keeping the long view is the trick to preparing for your older years. So is using index funds with low service charges.
12
Good for Ms. Moske, but what if she had gotten seriously ill or injured? Saving for retirement is fine, but don't forget political action to strengthen the social safety net.
20
I have made sure to always purchase disability insurance when available.
That was impossible when full-time freelancing. We need a disability market for the self-employed. I don't want to rely on whatever SS gives out (after a long battle) should I become ill or injured and unable to work.
That was impossible when full-time freelancing. We need a disability market for the self-employed. I don't want to rely on whatever SS gives out (after a long battle) should I become ill or injured and unable to work.
7
I agree. I do have disability insurance John. Thankfully, I'm pretty healthy and yes, get a lot of fruits and vegetables...just not at lunch time. HA! Woman cannot live on pbj alone. :)
3
What I don't understand about the American attitude on retirement and planning is this: We're all for allowing individuals to plan for their future--the earlier the better, and within a minefield of deregulated and predatory financial companies looking for a piece of your action. BUT, we absolutely cannot, will not, must not, allow our public institutions--our own government--to do any planning of any significance to support the individual planning of citizens, nor have any institutional help (the CFPB, if they can't survive Congress). So much so, that when we don't like even the predictions and projections that some agencies do about the economy or budgeting, we have the GOP simply saying 'they're doing it wrong' (ie 'dynamic scoring' of the budget) and change the methodology to make numbers look 'better'.
Isn't that inherently undermining the entire idea of planning for a (retirement) future, when individuals are expected to spend a lifetime exercising discipline and thrift, but state and federal governments are whipsawed between standard budgetary and accounting practices and ideologies of 'balanced budgets' that no business (or household) could survive and still allow for appropriate investments at appropriate times of life? That's the definition of schizophrenia. We want two diametrically-opposed things that end up essentially cancel each other out. There is no effective small-scale planning when there is no long-term predictability and agreement on basics of govt.
Isn't that inherently undermining the entire idea of planning for a (retirement) future, when individuals are expected to spend a lifetime exercising discipline and thrift, but state and federal governments are whipsawed between standard budgetary and accounting practices and ideologies of 'balanced budgets' that no business (or household) could survive and still allow for appropriate investments at appropriate times of life? That's the definition of schizophrenia. We want two diametrically-opposed things that end up essentially cancel each other out. There is no effective small-scale planning when there is no long-term predictability and agreement on basics of govt.
3
To those of us who are actually facing the realities of retirement in 21st century America, articles like this are laughable. Should this really be everyone's plan: Starting at the age of 21, simply deny yourself and your family all pleasures in life—decent food, vacations, eating out, lattes, movies, etc.—and all will be fine when you're 80? Planning to work longer to compensate for lack of savings is also a trap, because it presumes that one CAN work longer and maintain a decent income. But corporate America is busily dispensing with anyone over 50, which is why the ranks of the "self-employed" are rising. Many of us who should be in our "prime earning years" are in fact working twice as hard as "contract workers" to make half off or less of what we used to make, while still shouldering the responsibilities of parenthood (e.g., student-loan debt, adult children who can get a decent job) and the additional responsibilities our own aging parents. Meanwhile, the cost of healthcare, even if you have insurance, is insane, and in this economy there are some things one simply must have (i.e. a computer, internet connection, cellphone, car), all of which must be paid for, somehow. The reason so few people have retirement savings is not because they spend irresponsibly, but because after trimming their expenses as are as possible, they still have trouble making ends meet, making it IMPOSSIBLE to save. Being able to save would be great, but many of us are too busy trying to survive.
338
Mately--Excellent comment! Expresses the feeling of millions of Americans, as we watch the "wealth gap" become a wealth chasm. Thanks!
11
I've lead a frugal life and it's not the one of deprivation that you describe. The people I know who are struggling in their 50s and 60s lived it up, often spending to the hilt of two incomes, having umpteen kids, a large house with the attendant utility/maintenance bills, two large vehicles, etc. -- and now are standing around with their mouths hanging open claiming they are somehow victims.
12
And all this is assuming no family member, especially an income-producing adult, gets sick and uses up the entire retirement account just to survive to work again. And assuming no one has to quit work to be a full-time caregiver, and that they don't lose their life investment in a house from such a medical catastrophe...
13
I'm waiting to see what happens with Trump's plan to clear the U.S. of all undocumented immigrants. As many of these work in agricultural jobs which pay minimum wage and which Americans won't take at that level and probably not even at a higher level, the cost of food will go up significantly especially if there is a high import tax on the agricultural products from Mexico.
I wonder what's going to happen to all those older people who are struggling now when they have to pay much higher prices for food. I guess Trump and his supporters will label it as a national weight loss program so something good for the country.
I wonder what's going to happen to all those older people who are struggling now when they have to pay much higher prices for food. I guess Trump and his supporters will label it as a national weight loss program so something good for the country.
30
Yep. Those $8 heads of lettuce and $3 apples are going to sting. Enjoy, Trump voters.
6
All the more rationale for folks to try growing their own food. ;-) Large swathes of Americans own homes with plenty of yard space. Still others have patios and balconies. You'd be amazed what people can grow if they really want to.
Oh, but then they'd have to get rid of their pesticide-laden green lawns, in order to have space to grow their own vegetables. They also might have to tear up their driveways that accommodate their 2-3 SUVs, if they want additional space for their vegetable gardens. Somehow, I don't see many Americans willing to make such sacrifices. They are too addicted to their vehicles and their perfect green lawns.
Oh, but then they'd have to get rid of their pesticide-laden green lawns, in order to have space to grow their own vegetables. They also might have to tear up their driveways that accommodate their 2-3 SUVs, if they want additional space for their vegetable gardens. Somehow, I don't see many Americans willing to make such sacrifices. They are too addicted to their vehicles and their perfect green lawns.
4
Maybe if the pay to pick the fruit went up, people would do those jobs. One worker can pick literally 60,000 apples and they only get paid $250 to do it. You do the math. Are you telling me that you wouldn't pay two more cents for an apple if you got paid $750 to pick the same amount? There won't be any $30 apples. That's just what our Comrade Troll Mafia (bought and paid for by Corporate Amerikka) wants you to think.
2
Here's another arguably once-dominant message about retirement:
People try to put us d-down (Talkin' 'bout my generation)
Just because we g-g-get around (Talkin' 'bout my generation)
Things they do look awful c-c-cold (Talkin' 'bout my generation)
I hope I die before I get old (Talkin' 'bout my generation)
Now you tell me....
People try to put us d-down (Talkin' 'bout my generation)
Just because we g-g-get around (Talkin' 'bout my generation)
Things they do look awful c-c-cold (Talkin' 'bout my generation)
I hope I die before I get old (Talkin' 'bout my generation)
Now you tell me....
6
I've looked into long term care insurance. Crazy expensive and will only cover 3-5 years of long term care costs. So exercising, eating right and hoping for the best.
14
Yup. My sense too of L-T care or LTD insurances are that they are just another scam product by insurance companies, with no real value, should you actually need it. I'd suspect they make you go through hoops should the time come that you want to collect on it. That, and/or that it includes all kinds of fine print and circumstances where this and that are not covered.
7
Spot-on. And what if the insurance company goes out of business. How will you make a claim ? And if you don't need long term care , you get nothing from all the premiums you paid. Bottom line. If you need LTC insurance you can't afford the premiums and if you can afford the premiums , you don't need LTC insurance.
2
The single best thing the federal government did other than Social Security was to put in place the IRA which first allowed workers to put $2,000 a year in a retirement account back in the 1980s. My accountant was very firm about this. We barely could afford it at the time, but he said you can pay it in taxes now and it will disappear into the treasury sinkhole forever....or, some day you will get it back and it will be worth a lot more than the two grand. Of course, you'll have to pay taxes on it then. Whenever you can afford it, max out the tax deferment.
25
So, our advice to young people is, "Save. Save. Save. Don't spend." This strategy will only exacerbate our low-growth economy, which we've been in for seven years. A vicious cycle. The middle class needs higher paying jobs so that working people can spend AND save. The Republican solution is to reduce taxes for the super-rich and corporations. Seriously?
243
I don't think people need to stop spending or having a nice life, but it is often HOW people spend that is an issue that many don't want to address. Why the BMW rather than the Chevy? Why a 3,000 sf house rather than a 2,000 sf house? Why the latest iPhone when the present one-year old one works just fine?
The reality is that people should be able to enjoy themselves but have to accept the reality that most of us don't have wads of cash or undeserved wealth like the Kardashians, and we can't live like "they" (in past generations, the mythical Jones next door).
The reality is that people should be able to enjoy themselves but have to accept the reality that most of us don't have wads of cash or undeserved wealth like the Kardashians, and we can't live like "they" (in past generations, the mythical Jones next door).
14
Working people need to stop listening to the liars that tell them "old fashion" pensions are a thing of the past. Working people need to unionize and protect themselves from the wealthy that bask in the glow of the production of those workers. Through their unions the workers can then get laws passed that, through taxation, distribute the wealth equitably.
46
Unfortunately there are not too many people in the country who think like Ms. Moske.
Consumerism and instant gratification are part of the American culture. Frugality is an unknown word for most of the people.
So, we shouldn't complain when we have to live our retirement life in poverty.
Consumerism and instant gratification are part of the American culture. Frugality is an unknown word for most of the people.
So, we shouldn't complain when we have to live our retirement life in poverty.
21
Right, becauae money in a savings account earns such awesome interest, and banks never charge fees for their privilege of storing and using that money.
8
I literally had co-workers look my beat-up old 220,000-mile compact car up and down, and sneer. I smiled. While they struggle with mortgages, big car loans (one of the smirkers drives a leased BMW) and other bills, I am totally debt-free, own my house outright, have a large nest egg and a couple of years ago wrote a personal check for the entire purchase price of a sporty little vehicle to replace the old beater.
It feels pretty good. I don't miss the clothing, cars, lattes, etc. that I never had.
It feels pretty good. I don't miss the clothing, cars, lattes, etc. that I never had.
37
Yes, what the article failed to mention was my 14 year old car and TV. It doesn't feel pretty good, it feels great, don't you think!! Now go eat a pbj! :)
1
Isn't it Orwellian that our less than adequate social safety net was established during the depression, expanded through the 1960's, maintained through the 1980's, has vanished before our eyes, just as baby boomers, who have paid the most into these programs, are going to need those benefits to survive in their advancing years. It's great to tell people to work past age 65, but what happens when baby boomers start hitting their 80's? Are we going to be saying 'Welcome to Walmart' on a walker with a health aide and an oxygen tank at our side?
28
Working to age 70 increases social security way more that 8%. Perhaps that is the annual increase after age 66.5- please research and correct.
7
John - https://www.ssa.gov/policy/docs/ssb/v74n4/v74n4p21.html Can you point me to a more appropriate source?
1
It's 8% per year.
1
Trump epitomizes the worship of force and the practice of cruel intolerance, an ugly spirit now emerging and taking hold in the US. It is the antithesis of securing a national minimum of civilised life ... open to all alike, of both sexes and all classes, by which we mean sufficient nourishment and training when young, a living wage when able-bodied, treatment when sick, and modest but secure livelihood when disabled or aged.
5
I retired last year at the age of 62. I am fully covered by Medicaid. Got my Medicaid card and have a good insurance plan. I will probably leave NYC because it's just too expensive. I have retirement funds but have not needed to tap into them yet. I have my SS and a nice nest egg. It's important to have all of "your ducks in a row" before you consider retiring.
3
I think you mean you got your Medicare card, but having all your ducks in a row is also based on luck, because not everyone makes enough to save substantial amounts of money, not to mention things happen in a life that we don't anticipate and they can often drain savings.
3
Hard to feel safe having all your ducks in a row not knowing what this congress and president will do.
5
To both Susan and Mary Trincome
I don't understand how you have either Medicaid or Medicare, You have to be 65 for Medicare, and you can't have over $2,000 in savings for Medicaid. You're 62 with a nice nest egg.
I don't understand how you have either Medicaid or Medicare, You have to be 65 for Medicare, and you can't have over $2,000 in savings for Medicaid. You're 62 with a nice nest egg.
7
This article is a typical, space-filling puff piece, all nice and happy with lots of choices of how to spend your retirement, and all you have to do is choose between this job or that one. Whats especially egregious is the contention that if you want to keep working until you're 65, no probs, piece of cake.
How many greeters does Walmart need, anyway?
What about the people who want to work, but no one will hire them because of their age? Ageism is alive and well in many industries. In particular, any job which is customer facing is out, and it is ESPECIALLY true in high tech. If you're over 40, it is exceedingly difficult to find a new job in programming or hardware design or especially web development. Even if you've updated your skills, if you're of a certain age, you don't fit into the crash culture of millennials. "Young people are just smarter", says Mark Zuckerberg. The mid-career unemployed are in a world of hurt, and what is being done about it? OFFSHORE MORE JOBS. That isn't a Trump statement. He knows diddly about fair employment practices. It's all about the short-term bottom line. There's no thought of doing something silly like investing for the future of the company. It's Wall Street uber alles.
America needs a major change in values. This great country was built by PEOPLE, not Wall Street derivatives traders. Only when values change will people have the option to work as long as they want. Right now, they are at the mercy of a merciless oligarchy.
How many greeters does Walmart need, anyway?
What about the people who want to work, but no one will hire them because of their age? Ageism is alive and well in many industries. In particular, any job which is customer facing is out, and it is ESPECIALLY true in high tech. If you're over 40, it is exceedingly difficult to find a new job in programming or hardware design or especially web development. Even if you've updated your skills, if you're of a certain age, you don't fit into the crash culture of millennials. "Young people are just smarter", says Mark Zuckerberg. The mid-career unemployed are in a world of hurt, and what is being done about it? OFFSHORE MORE JOBS. That isn't a Trump statement. He knows diddly about fair employment practices. It's all about the short-term bottom line. There's no thought of doing something silly like investing for the future of the company. It's Wall Street uber alles.
America needs a major change in values. This great country was built by PEOPLE, not Wall Street derivatives traders. Only when values change will people have the option to work as long as they want. Right now, they are at the mercy of a merciless oligarchy.
141
So true, everything you say, but words like "oligarchy" will get you nowhere. Bernie Sanders tried it, and look where it got him. SAD!
1
These character sketches don't represent the depth of the problem. Nor does the piece reflect on what will happen if Paul Ryan gets the 45th president's ear at an opportune time. We'll have 90-year-olds in nursing homes being given vouchers to pay for care (because subsidy is a bad word).
27
Social security was meant to be enough to live on. We must redistribute it so that it still is.
16
Social Security was intended to keep people from starvation and indignity. It was created back in the days when multigenerational households were common, so that granny and grampy could contribute their share to the running of a larger household.
SS was never intended to cover a solo home or apartment, car/transporation, health care, utilities, food, pets, leisure/entertainment/travel, clothing & sundries, gadgets and electronics, services such as lawn care or house cleaning, etc. etc. for any individual who chooses to live alone. It was always meant to supplement other arrangements and/or other income/savings.
SS was never intended to cover a solo home or apartment, car/transporation, health care, utilities, food, pets, leisure/entertainment/travel, clothing & sundries, gadgets and electronics, services such as lawn care or house cleaning, etc. etc. for any individual who chooses to live alone. It was always meant to supplement other arrangements and/or other income/savings.
20
Not quite.
"The system is not intended as a substitute for private savings, pension plans, and insurance protection. It is, rather, intended as the foundation upon which these other forms of protection can be soundly built. Thus, the individual's own work, his planning and his thrift will bring him a higher standard of living upon his retirement, or his family a higher standard of living in the event of his death, than would otherwise be the case. Hence the system both encourages thrift and self-reliance, and helps to prevent destitution in our national life." -President Eisenhower, January 14, 1954
"The system is not intended as a substitute for private savings, pension plans, and insurance protection. It is, rather, intended as the foundation upon which these other forms of protection can be soundly built. Thus, the individual's own work, his planning and his thrift will bring him a higher standard of living upon his retirement, or his family a higher standard of living in the event of his death, than would otherwise be the case. Hence the system both encourages thrift and self-reliance, and helps to prevent destitution in our national life." -President Eisenhower, January 14, 1954
10
It was never enough to live on.
Ida May Fuller was the first recipient. She put in $23.75 from 1935-1939. Her first check was for $22.54. From age 65 to age 100 she collected $22,888.
Ida May Fuller was the first recipient. She put in $23.75 from 1935-1939. Her first check was for $22.54. From age 65 to age 100 she collected $22,888.
We created a generation of no pensions. Those who could save and did had to save early and often Those who couldn't and didn't will have only Social Security. Now that the Baby Boomers are retiring we will see huge disparities. Everyone has to plan for themselves now unlike prior years.
James McGlynn CFA, RICP author of ebook "Retirement Planning Tips for Baby Boomers"
James McGlynn CFA, RICP author of ebook "Retirement Planning Tips for Baby Boomers"
5
A nice, but not extravagant, dinner in New York for two comes to about $200. I'm always astounded at the number of young people eating out and wonder how they afford it. Do they all work at Goldman Sachs, or do they figure there's no need to save because they'll never get old? I'm reminded of advice I read a few years back, perhaps referring to Starbucks. "For God's sake, make your own coffee."
30
Same here. I live in NYC and when I occasionally eat out most people seem to be in their twenties. The children of the 1 percent perhaps.
6
A good part of this is also luck. Single mom here, 3 children, no child support. I worked 30 years. 30 years of stagnant wages that didn't keep up with inflation, not to mention female earning average of 26% less then male. Laid off at 59 due to the economy. Luck....
50
I don't believe it's about luck. I've had more than my share of bad luck. I believer it's about frugality.
3
One of the saddest things in this country has been the way the Fed has kept interest rates so low throwing savers under the bus. Back when interests rates were 6% and often higher, one could keep retirement funds in safe, conservative things like CDs. With rates so low, which benefits young people seeking mortgages but not most older people who aren't buying homes, there is little option but to invest in things like stocks which aren't guaranteed and which most people don't understand in the first place.
In the Wealth section of The Times this weekend, it noted how wealthy people like Mark Cuban kept much of their wealth in cash but failed to note how for the average person doing so now wouldn't even keep up with inflation so every year you fall further and further behind.
In the Wealth section of The Times this weekend, it noted how wealthy people like Mark Cuban kept much of their wealth in cash but failed to note how for the average person doing so now wouldn't even keep up with inflation so every year you fall further and further behind.
64
I don't trust the stock market so I've stayed in CD's and savings accounts; I know that I'm not supposed to do that but just don't have the stomach for the market. Yes, inflation will eat away my money, but at least I'll sleep well( in my refrigerator box under the interstate) not having to worry about the market tanking......
3
Don't buy risky stocks. I bought Disney, Bristol Myers, Merck, McDonalds, PPG. Oddly, I didn't buy Jiff or Skippy :)
3
I admit, I'm worried. If you're not well-to-do, you should be worried, as well.
12
It is a fallacy to believe that individual retirement plans will "save" anywhere near enough to carry people through their retirement years. Why would anyone think that they would?
12
Actually, I worked as a nurse in hospitals (they have good retirement plans) for 40 years, saved/invested all I could, lived within my means, and guess what -- I do have an adequate amount in my retirement plans!
I recommend people get their RN, you can do that in increments and work at the same time. The health care field always needs you!
I recommend people get their RN, you can do that in increments and work at the same time. The health care field always needs you!
15
There's a lot of glib advice available for those who aren't facing the pointy end of this problem, but to me it all sounds hollow. I'm 61 and just got fired from a job I loved, so what happens in the next few weeks will determine the course of the rest of my life. If I can't find another good job before my checking account balance runs out, I'll be forced to retire much earlier than I had planned. I'm debt-free and have a small 401k, so I'm in better shape than many people -- but I'm still likely to spend the rest of my life in poverty, especially if Congress decides to profitize Social Security and Medicare. Advice about peanut-butter-and-jelly sandwiches doesn't t do me much good right now!
106
Sorry to hear of your current situation but I do not believe the PB&J advice was geared to you but instead the younger crowds that could learn from it.
8
Very sorry. Hope you find that job. But, be grateful you weren't retired in 2009.
PS: Don't get sick, have a pre-existing condition, or think you can depend on any stable consistent source of healthcare insurance.
98
Isn't that the truth. How many people do you hear about these days who get cancer in their early-to-mid 60s?
6
"How many people do you hear about these days who get cancer in their early-to-mid 60s?"
I'm 65, have Prostate cancer and my Blue Medicare policy is paying well over 95% of my expenses. I have had it for years and it has been stable and consistent.
I'm 65, have Prostate cancer and my Blue Medicare policy is paying well over 95% of my expenses. I have had it for years and it has been stable and consistent.
Estimates I see say you need on average 250K for out of pocket medical expenses in retirement, the stuff Medicare doesn't pay for. That is not addressed here nor is the fact that they only paying job these seniors are likely to find is a $10 an hour greeter at Wal-Mart.
71
And that 250k does not include nursing home costs
9
Also not addressed is the number of Americans who seem to believe that Medicare covers ALL of your needs once you're on it, a mythical "single payer" system that should be a model for us all. And that only applies to the medical treatment portion, not the drug part.
This is nothing new and has been the case for decades, but we need to be more aware of actuality.
This is nothing new and has been the case for decades, but we need to be more aware of actuality.
15
Jobs depend on what skills you have.
For example, if you are a retired CPA, you could probably still pick up $50 an hour at H&R Block during the tax season.
For example, if you are a retired CPA, you could probably still pick up $50 an hour at H&R Block during the tax season.
I admire both my children, who, are saving like crazy, in what they term to me, a "no pension" society. Both my wife and I do have generous pensions, which when we were working, did result in a less than ambitious saving regime. Having said that, both children, make enough money to save aggressively, while still able to maintain a fairly decent life-style. The problem for most young people is low salaries, which leave little money left over to build up a nest-egg.
81
Do you think it should be as you describe our society?
Even 20 a month when you start young results in a nice nest egg . But many kids do not seem to think that's important. This article tells us it IS important.
2
When we met we were grad students. And pretty much, during our working life, we never stopped living like grad students. We're retired now. We still have 2 cars, but one is 18 years old, the other 11 years old.
We could take cruises if we wanted. But we love our quiet, bookish life. Taking a short drive to do errands is for us an "outing." Looking out the window, we watch the world go by. The internet gives us another "window" on the world.
Old age is still very expensive. If you want medical security, even with Medicare that comes at a huge cost. (We easily spend nearly $12,000 a year on Medicare itself, Medicare secondary insurance and other medical expenses. Once you become disabled, costs of home care or assisted living can become astronomical.
We live in a society which does not take care of its citizens. Especially the old, the very young, the vulnerable, the disabled. A society which blames you if you are "in need."
I tell all young people: Live frugally. Pay off your debts. Be practical.
Many stores nearby are full of employees in their "retirement." I don't think they're all doing that "just to get out."
We could take cruises if we wanted. But we love our quiet, bookish life. Taking a short drive to do errands is for us an "outing." Looking out the window, we watch the world go by. The internet gives us another "window" on the world.
Old age is still very expensive. If you want medical security, even with Medicare that comes at a huge cost. (We easily spend nearly $12,000 a year on Medicare itself, Medicare secondary insurance and other medical expenses. Once you become disabled, costs of home care or assisted living can become astronomical.
We live in a society which does not take care of its citizens. Especially the old, the very young, the vulnerable, the disabled. A society which blames you if you are "in need."
I tell all young people: Live frugally. Pay off your debts. Be practical.
Many stores nearby are full of employees in their "retirement." I don't think they're all doing that "just to get out."
294
We could be best friends. Don't forget to eat peanut butter and jelly :)
No one should worry about their retirement but Dump Trump and the whole GOP are saying we don't. you lose jobs with an later retirement age and that is a proven fact. Living frugally isn't necessarily possible as you seem to think i takes quite a bit of luck also.
Earth to The New York Times: This. Is. Not. New. Moreover, it is not the fault of the people. With the cost of living going up year after year (and this has nothing to do with the official rate of inflation, which is bunk) and wage cuts, duh, there is less money for people to save. Notice interest rates lately? Even if people saved, they're getting bubkes in interest income. And pensions haven't been offered by stalwart companies such as IBM and AT&T for well over a decade. The shift to 401(k) plans meant that employees have to shoulder the burden of their retirement savings for the minuscule match by corporations. And Republicans want to raise the retirement age and cut Social Security and Medicare? They're sadists!
181
Out of pocket has gone up 2.5 fold for Medicare since the aca went into affect. That's how obama 'reduced healthcare cost,' for the government that is. So, you and the NY times need a new scapegoat. Congress stealing for the general fund for decades? An aging population where the government didn't plan/save?
1
Good thing there are the ''death panels'' waiting for retirees ...
On a more serious note, the FICA cap should be lifted so that Social Security benefits can be expanded. ( and tied to COLA )
Bring back unions and actual RRSP's while you're at it.
On a more serious note, the FICA cap should be lifted so that Social Security benefits can be expanded. ( and tied to COLA )
Bring back unions and actual RRSP's while you're at it.
165
Yes, to raising the FICA cap! This would ensure the longevity of Social Security.
Yes, also be bringing back pensions. I am close to retirement and have a traditional defined benefit plan (pension). It is nothing less than a miracle. All Americans should have a pension.
Yes, also be bringing back pensions. I am close to retirement and have a traditional defined benefit plan (pension). It is nothing less than a miracle. All Americans should have a pension.
6
Sadly, incredibly, Congress will not raise the current FICA cap ($127,200), and certainly never lift it completely, because it would increase the taxes on their salaries of approximately $175,000.
4
MediCare, which is part of FICA, is already uncapped. Moreover, if your income is high, you actually pay at a higher rate, 3.8% instead of 2.9%.
I agree with Resident - cost of unanticipated healthcare, need for long-term care/assisted care, medication costs 62-85 years of age are those unknown variables that make retirement planning much more difficult.
43
Most of us will have to plan on a simple retirement while continuing to save for unknown health expenses that might pop up in the future.
6
Life expectancies will start to drop off after pollution increases back to 1930 levels. Three or four overseas conflicts should do the trick with the younger generation, along with bad water and bad food little if any immigration, we should be back to 225 million in no time..
116
Agreed. I think life expectancy will start to decrease except for a few very wealthy people.
8
Start saving at the earliest age - be sure to "pay yourself first" - pay into retirement accounts the maximum amounts and take advantage of employer contributions to the fullest.
At 62 she will need to find health insurance until 65 when Medicare becomes available to her.
I'm not excited about her buying a condo in Florida for use only two or three months a year - costs associated with it are more than renting for a month or two.
At 62 she will need to find health insurance until 65 when Medicare becomes available to her.
I'm not excited about her buying a condo in Florida for use only two or three months a year - costs associated with it are more than renting for a month or two.
38
Was thinking the same thing. Unless her employer offers health insurance after retirement which is very rare in the private sector.
3
Paying the maximum amount allowed into my retirement account would take more money than I bring home. Sadly, I think I am the norm, not the exception.
3
Thanks and you're right, healthcare is a concern of mine. I have $800 budgeted. If it's more than that, I may have to make adjustments. Thanks about the condo thought but I live simply, it'll be a low priced condo. The kitchen can be small because I only need room for peanut butter and jelly. :)
3
I keep hearing that the retirement age needs to be raised and so-called "entitlements" need to be reduced because life expectancy is increasing, but there was a NY Times story published on December 8, 2016 that stated that life expectancy in 2016 actually declined, mystifying the big thinkers. It seems that a lot of people are repeating a "truism" about life expectancy that isn't actually true. Policy changes are being debated in Washington based upon this erroneous perception. Life expectancy in the United States is actually decreasing not increasing, if the NY Times article is to be believed. One of the basic tenets of "Mein Kampf" was the telling of the "big lie:" if it is repeated often enough, people will believe it's true. In the new "post-truth" world, facts don't actually matter, only unverified beliefs do.
51
You've perfectly described the Trump world where so many of his fanatics believe the only truth is what comes from his deceitful lips.
1
Unfortunately for the vast majority of Americans the golden years are more likely to be anything but.
With savings rates at or near historical lows, at a time when the average American has less than $10,000 in retirement savings, America gets a solid F when it comes to forward thinking and planning.
And don't think the answer is 401K plans managed by mutual fund managers or the big investment houses as they are only interested in selling you products that produce big fees for them and sub-optimal returns for you.
The answer is to take the advice from Warren Buffett, invest for the long term in low cost index funds which have historically out produced managed funds by nearly 50%. The investment advisors hate this, because it means you don't need them peddling you poor advice and high commission products, but you cant argue with the facts.
With savings rates at or near historical lows, at a time when the average American has less than $10,000 in retirement savings, America gets a solid F when it comes to forward thinking and planning.
And don't think the answer is 401K plans managed by mutual fund managers or the big investment houses as they are only interested in selling you products that produce big fees for them and sub-optimal returns for you.
The answer is to take the advice from Warren Buffett, invest for the long term in low cost index funds which have historically out produced managed funds by nearly 50%. The investment advisors hate this, because it means you don't need them peddling you poor advice and high commission products, but you cant argue with the facts.
87
Costs of mutual funds and financial advisors is a huge factor in retirement savings. Some people are too willing not to shop around, thinking that paying high fees will get them better advice. This is 100% false. What you get for higher fees is whiter teeth and a bigger smile from your advisor. Studies have shown in the long run no one does better than index funds. Why give 1% or more for that? Even if your return is an annual 5%, giving away 1% annually is 20% of your income. And it will kill your compounding. Know your costs!
11
How could you possible write about someone retiring at 62 and not mention healthcare. Especially given what's happening in the country right now.
261
Also, it is essential that our government increase or strengthen Social Security. It will be a foundation we will all need whether or not we are Democrats or Republicans.
80
Unless the woman in this article has post retirement healthcare offered by her employer she will have to depend on finding it through the ACA. And as you say that is looking very uncertain right now. She might do better working until she is eligible for Medicare.
19
I do not. It is a concern. I have budgeted in $900 a month for healthcare. Hopefully I can get it for around that. You are right, if it weren't for that issue, I'd be out much sooner. Thanks.
3