During inflationary times, it's perfectly logical to spend your money as soon as you get it.
Pretty Scary...
- Thread starter oilyriser
- Start date
- Status
This is bogus...
Naysayers have have been saying the same thing for as long as I can remember, at least 50 years.
There are a lot of people with pre funded retirement plans. Just another form of saving. Also, 401Ks, IRA's. My wife and I each have all three. It adds up to quite a piece of change. And then there is home equity, in my case about $200K in today's market. While there will always have people who live paycheck to paycheck, Increasing numbers of people are investing in one way or another. Just ask Pablo who the elephant in the bedroom is, hint, think Pension funds.
Naysayers have have been saying the same thing for as long as I can remember, at least 50 years.
There are a lot of people with pre funded retirement plans. Just another form of saving. Also, 401Ks, IRA's. My wife and I each have all three. It adds up to quite a piece of change. And then there is home equity, in my case about $200K in today's market. While there will always have people who live paycheck to paycheck, Increasing numbers of people are investing in one way or another. Just ask Pablo who the elephant in the bedroom is, hint, think Pension funds.
- Joined
- Sep 28, 2002
- Messages
- 39,799
This is news? Sorta like Greenspan coming up with the revelation that SS and debt were heading us into trouble??
You gotta love how the media braces us for the obvious. You've got to break news of stuff gently to your children.
"The water gets hot and floats on the air. When it gets cold ..they huddle together and get heavy and fall back to earth. That's rain."
"The water gets hot and floats on the air. When it gets cold ..they huddle together and get heavy and fall back to earth. That's rain."
I'm the first to say people don't save enough, but the way the USA calculates savings rate is really silly. It's really a "leftover money" rate.
It's doesn't even count 401K's, etc. And all the numbers are estimates. Crazy.
Let's do the real numbers! they still will be scary.
Like the massive amount of people slouching towards retirement in their 50's, with zippo saved!!
It's doesn't even count 401K's, etc. And all the numbers are estimates. Crazy.
Let's do the real numbers! they still will be scary.
Like the massive amount of people slouching towards retirement in their 50's, with zippo saved!!
pablo, since you know quite a bit about finances and such can you explain this one to me?
it's hard to see the print on that flyer, but what kind of savings program is that? at only 2k a year ? i don't understand how $20k turns into $462k, you don't get something for nothing... thats an insane return
it's hard to see the print on that flyer, but what kind of savings program is that? at only 2k a year ? i don't understand how $20k turns into $462k, you don't get something for nothing... thats an insane return
That's just a typical example comparison of why starting early in an IRA/401K makes sense. 2K was based on the early days of max IRA. Of course if you have a 401K you can go higher per year.
Looks like they used 8%, which is standard - no guaranties. I use 8% as my lower limit.
Looks like they used 8%, which is standard - no guaranties. I use 8% as my lower limit.
what if you just work odd jobs, or whatever....say your company doesn't have a roth/401k....can you just set one up somewhere and contribute and get the same returns?
and what if for some reason, 3 years down the road you quit contributing...do they give you penalties for not contributing? and i assume you have to be 65 or wait so long before you can take it out
and what if for some reason, 3 years down the road you quit contributing...do they give you penalties for not contributing? and i assume you have to be 65 or wait so long before you can take it out
Remember also that retirees are a growing segment of the population.
Retirees/older folks control most of the country's wealth. And since they are drawing on their savings and whatnot, with little to no income, they count toward the negative savings rate.
I'm not implying that Americans save, just saying that there's more to statistics...than just statistics.
Retirees/older folks control most of the country's wealth. And since they are drawing on their savings and whatnot, with little to no income, they count toward the negative savings rate.
I'm not implying that Americans save, just saying that there's more to statistics...than just statistics.
The way the government defines 'savings' is another problem. Many individuals refer to 'savings' as money that people put into bank accounts that are legaly classified as 'savings', (as opposed to 'chequing' accounts).
'Savings' does not include the stock of assets (such as homes, stocks, etc.), nor does it include heavy 'savings' that are present in the corporate sector, which is healthier today than it almost ever has been.
If someone is to blame here -- it is the CEO's and CFO's of the country -- who won't begin any new projects in America because they are stuck in the past with delusions of extraordinarily high discount rates on their investments. In the process, they are hoarding billions, if not trillions of dollars in cash or cash equivilants, keeping bond rates artificially low (suppressing private savings), and seriously reducing economic growth and the maintenance of the USA's technological and competitive advantages.
'Savings' does not include the stock of assets (such as homes, stocks, etc.), nor does it include heavy 'savings' that are present in the corporate sector, which is healthier today than it almost ever has been.
If someone is to blame here -- it is the CEO's and CFO's of the country -- who won't begin any new projects in America because they are stuck in the past with delusions of extraordinarily high discount rates on their investments. In the process, they are hoarding billions, if not trillions of dollars in cash or cash equivilants, keeping bond rates artificially low (suppressing private savings), and seriously reducing economic growth and the maintenance of the USA's technological and competitive advantages.
This is news? Sorta like Greenspan coming up with the revelation that SS and debt were heading us into trouble??
Yea funny how after a bazillion years he jumps off the car just before it heads off the cliff. And now all of a sudden he see Jezez. What a tool. He shoulda' just stayed home with Andrea and had his way with her. The country (and he) would be a whole lot better off.
Yea funny how after a bazillion years he jumps off the car just before it heads off the cliff. And now all of a sudden he see Jezez. What a tool. He shoulda' just stayed home with Andrea and had his way with her. The country (and he) would be a whole lot better off.
robbobster has it. Increasing numbers of retring people will cause a huge problem. If everyone were to retire tomorrow and try to spend their $ savings, their money would be worthless, since nobody would be producing anything to buy with the saved money. Then there's the problem of increased medical spending as retired people get older, and not enough people to supply the medical services. Add to the cauldron the increased demand for resources from China and India, as their populations enter the yuppie phase, and you have a real problem.
A national sales tax will probably be put in place, to tap into the retirees' spending, since they will no longer beearning as much income. Also, immigration has to be increased to fill in the demographis problems.
Maybe people will want to retire in China.
A national sales tax will probably be put in place, to tap into the retirees' spending, since they will no longer beearning as much income. Also, immigration has to be increased to fill in the demographis problems.
Maybe people will want to retire in China.
I have two comments.
#1: Countries with which we have large trade deficits are the ones effectively covering our debt since we buy their stuff now and borrow to pay them. That means any loss of American jobs due to trade imbalances can be linked to this behavior.
#2: If I am someone who does have a positive savings rate, I am going to be really steamed if (I mean when) I have to pay higher taxes and other costs someday to cover the debts from the lavish and irresponsible spending of others.
#1: Countries with which we have large trade deficits are the ones effectively covering our debt since we buy their stuff now and borrow to pay them. That means any loss of American jobs due to trade imbalances can be linked to this behavior.
#2: If I am someone who does have a positive savings rate, I am going to be really steamed if (I mean when) I have to pay higher taxes and other costs someday to cover the debts from the lavish and irresponsible spending of others.
for some reason i have seen a lot more houses on the market now, i don't know if it's due to people not being able to pay their bills so they have to sell, or the fact that people are tapped out for money and aren't buying...
btw - i know NO ONE who saves their money... my FIL is 55 and doesn't believe in saving, he says "why when you can use the money now" so it's gonna be strange for him when he stops driving a truck and has $200k to pay on his massively mortgaged house LOL....
btw - i know NO ONE who saves their money... my FIL is 55 and doesn't believe in saving, he says "why when you can use the money now" so it's gonna be strange for him when he stops driving a truck and has $200k to pay on his massively mortgaged house LOL....
- Status
