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I have lived on $9 per hour or about 16,000 for the past 15 years. Luckily I have health insurance provided by employer. I get by because I don't have many of the problems/expenses that many low wagers have (Kids, divorce expenses, car, etc) Most of my co-workers are homeless to borderline homeless.
I'm talking about someone who has made less than 20 bucks an hour their entire life for whatever reason. Places that pay that low generally do not have a 401k or pension plan. A low wage worker will have very little (if any) money to save after living expenses are paid.
They don't retire. I see grocery cashiers working well into retirement age, with no plans to leave. Businessmen who have been downsized 10 years before their retirement date end up working at Wal-Mart or elsewhere in close to minimum-wage jobs.
Really, the question should be: how does anyone retire? These days, retirement is a luxury few can afford.
I live in California, and we have prop 13 so I don't need to worry about my property tax rates going through the roof, unless we move.
But what do people do when the property tax rate gets raised outside of their control? Technically they're now "not living within" their means. But it's not their doing.
I was originally from California, my siblings live there, I once owned some apartments there.
Things often happen that were outside of your control.
These days, retirement is a luxury few can afford.
I'm calling out BS on that statement. Certainly few to no low wage workers can afford to retire. But the majority of people can afford to do so. They just don't want to do the necessary savings because they view it as a sacrifice that won't benefit them anytime soon. It's completely wrongheaded, because having savings starts benefitting a person right away because of lower stress, etc. But you can't convince people of this because they've been conditioned by the TV and their peer group (who are also not saving much) to spend too much.
I have lived on $9 per hour or about 16,000 for the past 15 years. Luckily I have health insurance provided by employer. I get by because I don't have many of the problems/expenses that many low wagers have (Kids, divorce expenses, car, etc) Most of my co-workers are homeless to borderline homeless.
I am also fortunate to have health coverage provided by my employer. Even though you earn more than I do, I have settled in an area where this level of income is not that hard to prosper.
There was a story in one AARP bulletin about someone living on $600. Did it by renting from relatives, never turning on the heat, using food pantries. But $600? Even someone who has worked full time minimum wage all his life should be receiving more than that from SS.
I thought it would be helpful to do the math on the Social Security website calculator. I'll even reduce "all his life" to 35 years, which yields the maximum time-qualifying wage factor into the calculation.
A worker who worked since January 1, 1980 for 35 years (retiring December 31, 2014) earned a gross total of $340,900 in actual dollars at the relevant minimum wages at 2000 hours per year. No overtime, no outside income. Income in 2014 would be $14,500; income in 1980 would have been $6200.
That worker, when claiming at age 62, would receive in current dollars a monthy SS OASI check of $681
When claiming at "full retirement age" (varies between 65 and 66 depending on birth year), that worker would receive a monthly check of $873
When claiming at delayed retirement age of 70, that worker would receive a monthly check of $1192.
If that worker claimed at age 70, he would be earning 14,304 per year, near the maximum in actual dollars earned during his 35 years of working life.
LOL, well, this is true. But, let's not assume they never worked. Which means they paid into the "insurance" of those government resources.
This is an example of my point - you can't assume that poverty = unemployed. Or that they didn't pay into the system that "supports" them in their old age. This OP is about low-wage earners.
Case in point. Same for me. I did become disabled when I was 49 years old. I worked most of my life, paying taxes since the age of 16. But, taking time off for school, being married and a mom, etc., and the fact that I "only" worked as a secretary and other lower-paying jobs, means that my SS will be around $830 last time I checked - starting at age 64.
Oh, gosh, forgot about laundry. The machines here in my low-income senior building cost $3.00 for one load to wash and dry! And they're those small stacked washer/dryer units, too. So, I tend to wear the same clothes until they start to stink or get stained lol! I just rotate them in the closet to minimize the number of loads I wash, and so the other tenants and management don't realize I'm wearing the same clothes over and over .
Plus, our machines are the low water use type that have to take a special low-suds soap with the "he" symbol. Fortunately, I found some at Grocery Outlet at a reasonable price. But I was hand washing for a while there, because I didn't want to spend the money on the expensive "he" soap until I found some on sale.
I'm not whining here. I do okay. It's a challenge for sure. But, the thread was about how do we do it, and then it morphed into why people can't save 10% of their income when they're really low income. Hopefully, the point has been made that yes, we can survive, but, we probably can't save any money that won't end up being used for some necessity, eventually.
Nearly all detergents, even the name brand ones are HE with no extra cost. I use Purex and it's cheap and works great. I look for a $1 off coupon on line which makes it even cheaper. I have a front load energy efficient washer only so I have to buy the HE too. I think the manufacturers are making all detergents HE now! In case you didn't know.
Not so. I have worked for over 50 years of my life and my SS in under $600 month. I worked in restaurants and hotel front desk for most of that but also worked in bookkeeping/accounting for a few years. This is why I will be working till I drop dead, unless some kind of disability hits me first! My mom and dad were self employed for many years and she gets less than $700 month. She owns her home outright, and everything else she has, plus I pay her rent for her guest house. We both do okay. She does get some food stamps...about $70 month...and our church has a really good food pantry.
I also worked in low wage jobs, convenience stores, Wal-Mart and then accounting, with my last 2 jobs of 15 years bolstering my social security monthly benefit greatly. My benefit estimate used to say $700 a month, but since I worked a lot of years with much higher wages it ended up being $1,000 a month, which I manage on quiet nicely. I would suggest folks try to get the highest paying job they can before they retire!
I thought it would be helpful to do the math on the Social Security website calculator. I'll even reduce "all his life" to 35 years, which yields the maximum time-qualifying wage factor into the calculation.
A worker who worked since January 1, 1980 for 35 years (retiring December 31, 2014) earned a gross total of $340,900 in actual dollars at the relevant minimum wages at 2000 hours per year. No overtime, no outside income. Income in 2014 would be $14,500; income in 1980 would have been $6200.
That worker, when claiming at age 62, would receive in current dollars a monthy SS OASI check of $681
When claiming at "full retirement age" (varies between 65 and 66 depending on birth year), that worker would receive a monthly check of $873
When claiming at delayed retirement age of 70, that worker would receive a monthly check of $1192.
If that worker claimed at age 70, he would be earning 14,304 per year, near the maximum in actual dollars earned during his 35 years of working life.
The federal poverty level for a family of two is $15,730.
I also worked in low wage jobs, convenience stores, Wal-Mart and then accounting, with my last 2 jobs of 15 years bolstering my social security monthly benefit greatly. My benefit estimate used to say $700 a month, but since I worked a lot of years with much higher wages it ended up being $1,000 a month, which I manage on quiet nicely. I would suggest folks try to get the highest paying job they can before they retire!
It actually doesn't matter too much when you work the highly paid years because previous years are indexed for inflation when SS calculates your benefits. So, earnings of $7000 in 1975 might translate into $35000 in today's dollars (I don't know, I just used that number as an example). However, you have to have 35 years in, so if you have only 30 years (as many women do because they stayed home to care for their children) you get 0s averaged for those years, which is why so many women get more as spouses than on their own. If you have more than 35, then SS takes your highest 35.
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