Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
It really is a shame that by and large American school systems both public and private no longer teach basic fiscal math. If more persons understood and knew how to calculate compound interest a vast fog would be lifted.
Up until say the 1980's or 1980's our parents, grandparents, etc... understood that saving was something one started young and kept up even when times were "bad". When one is in the thing for the long haul the ups and downs of interest rates/markets even themselves out, and one almost always comes out ahead.
Within one's own family, friends and relations know plenty that saved everything starting from Holy Communion, birthday and other cash gifts given as a child to setting aside a portion (no matter how small) of any money earned be it from babysitting or a paper route. That money over time grew and helped the first major expenses of young adulthood (college, buying a first home, etc..)
Far too many Americans, especially the young or even middle aged do not begin to think about much less plan for retirement well beyond when they should. This can only mean they must set aside more and wait longer to retrieve than say someone who has been saving/investing since say their 20's. Hint, starting at 40 or even 50 while better than nothing still means such persons will be behind the former (those that began earlier).
Personally think as the Boomers and their parents/grandparents numbers decline so does the active memory of the Great Depression. Anyone who lived through that event and or was brought up by someone/persons who did has a dramatically different view about savings IMHO than those say <30 today.
The household savings rate for Americans has been on the decline for ages. While the recent economic upheavals and fiscal/credit meltdown has caused some changes it is still true most do not save anywhere near enough not only for retirement but a bit of something to keep the wolf away from the door during bad times.
Like Scarlett O'Hara far too many young or even middle-aged Americans don't think about retirement savings today, but put it off until "tomorrow".
It really is a shame that by and large American school systems both public and private no longer teach basic fiscal math. If more persons understood and knew how to calculate compound interest a vast fog would be lifted.
....
The household savings rate for Americans has been on the decline for ages. While the recent economic upheavals and fiscal/credit meltdown has caused some changes it is still true most do not save anywhere near enough not only for retirement but a bit of something to keep the wolf away from the door during bad times.
Like Scarlett O'Hara far too many young or even middle-aged Americans don't think about retirement savings today, but put it off until "tomorrow".
I think much of this is due to wanting instant gratification. Although I went to private schools, we learned compound interest in 7th grade or so. My public school friends were also taught compound interest at some point too.
you have to look under the hood in inflation adjusted dollars..
-1.7%, +5.1%: The change in average household income between 2010 and 2011 for the middle 20 percent, and the top 5 percent, respectively. The disparity means income inequality increased in 2011.
$7,887, -12.4%: The decline in median working-age household income from 2000 to 2011 in level terms and percentage terms, respectively
$6,518, -16.8%: The decline in median African-American household income from 2000 to 2011 in level terms and percentage terms, respectively
$4,695, -10.8%: The decline in median Hispanic household income from 2000 to 2011 in level terms and percentage terms, respectively
$50,622, $48,202: Median earnings for a man working fulltime, full year in 1973 and 2011, respectively
$28,699, $37,118: Median earnings for a female working fulltime, full year in 1973 and 2011, respectively
the numbers in the census were skewed because so many women went in to the work force and had higher wages through the years. men dropped in real dollar terms.
Last edited by mathjak107; 08-22-2014 at 03:28 PM..
I think much of this is due to wanting instant gratification. Although I went to private schools, we learned compound interest in 7th grade or so. My public school friends were also taught compound interest at some point too.
How long ago was this may one ask? Only require information as it seems none of the children one has met recently who are in school know about CI.
but long term care insurance which is highly recommended today for a couple with assets may just eat that slack right up.
as far as mortgages more than 1/2 of all retirees have out standing mortgages. now many are fixed rate so inflation on your largest expense may have less of an effect but the spending in dollars may remain constant in todays dollars for quite a while. renters would feel inflation more than homeowners would,.
It really is a shame that by and large American school systems both public and private no longer teach basic fiscal math. If more persons understood and knew how to calculate compound interest a vast fog would be lifted.
Up until say the 1980's or 1980's our parents, grandparents, etc... understood that saving was something one started young and kept up even when times were "bad". When one is in the thing for the long haul the ups and downs of interest rates/markets even themselves out, and one almost always comes out ahead.
Within one's own family, friends and relations know plenty that saved everything starting from Holy Communion, birthday and other cash gifts given as a child to setting aside a portion (no matter how small) of any money earned be it from babysitting or a paper route. That money over time grew and helped the first major expenses of young adulthood (college, buying a first home, etc..)
Far too many Americans, especially the young or even middle aged do not begin to think about much less plan for retirement well beyond when they should. This can only mean they must set aside more and wait longer to retrieve than say someone who has been saving/investing since say their 20's. Hint, starting at 40 or even 50 while better than nothing still means such persons will be behind the former (those that began earlier).
Personally think as the Boomers and their parents/grandparents numbers decline so does the active memory of the Great Depression. Anyone who lived through that event and or was brought up by someone/persons who did has a dramatically different view about savings IMHO than those say <30 today.
The household savings rate for Americans has been on the decline for ages. While the recent economic upheavals and fiscal/credit meltdown has caused some changes it is still true most do not save anywhere near enough not only for retirement but a bit of something to keep the wolf away from the door during bad times.
Like Scarlett O'Hara far too many young or even middle-aged Americans don't think about retirement savings today, but put it off until "tomorrow".
Here's a shocker the majority of people from the generation you wrote about didn't save enough for retirement either.
Assuming you have healthcare when you retire, your monthly expenses may actually go down.
For example:
Mortgage should be paid off
Commuting expenses will go away
Healthcare is the very big wildcard in retirement.
Only females have a higher use rate of healthcare then seniors. This translates into on average older persons spending more of their income on healthcare than say young or even middle aged persons.
Medicare does not cover everything and even with Obamacare changes there are still gaps. It also seems certain that those retiring in future years are not likely to have the generous employer sponsored health plans many seniors have today. Perhaps union and or federal/local government workers, but don't see it for your average private sector employee/retiree.
This will mean larger hits to retirement savings to pay for healthcare. That will force reallocation of funds from elsewhere in many cases. Suppose persons could spend down in an attempt to get on Medicaid.
spending down for medicaid sucks for the stay at home spouse and depending where you live may not be an option without driving your spouse in to poverty
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
