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Old 01-02-2016, 02:13 AM
 
71,519 posts, read 71,694,121 times
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i would not agree. .


if you put 100k in the fidelity insight growth model in 1987 , which i used for decades that 100k is now over 2 million without adding a penny .

that is just using average fidelity funds

compounding can out weigh the initial contributions by far . time is your friend .

compounding takes those little bits most of us are able to save and over time generally grows it by a lot . but the time frame you were born will have a lot to do with those returns .

wwhile certain timwe frames look great you have to look at the time frames preceding it .

investors always say how lucky folks were if they ere invested from 1987 to 2003 . they saw 17 years of almost 14% cagr returns .

but what they don''t realize is the time frame leading up to it was horrible . markets and inflation sucked so it was all well and good these great times appeared , only few were able to save money during those early years to even grow .

Last edited by mathjak107; 01-02-2016 at 02:22 AM..
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Old 01-02-2016, 02:32 AM
 
Location: Los Angeles area
14,018 posts, read 17,732,288 times
Reputation: 32304
Quote:
Originally Posted by HappyTexan View Post
There has to be a retirement crisis in order for the government to propose and promote their fix.
And many of these academics think the government should provide in retirement.


A year old but still a good article.


There Is No Retirement Crisis - Bloomberg View
Back on topic, I finally got around to reading your article and I agree it's still a good one. One of its main points is how flawed methodology can be used to spin the conclusion in a desired direction. For example, there have been other threads on other articles in which the articles bemoan that Americans are not saving enough, citing 401K balances as proof, as if 401K balances were the only source of income for retirement for everybody, which is nonsense. It's nonsense because there are other significant sources such as pensions, real estate holdings, even the value of a large paid-off house which will be sold upon retirement in order to downsize.

Let's face it - articles draw readership when they claim some dire event or situation is looming. Articles such as the one you cited above attract, by their titles, a more rational readership. That doesn't prove the article is correct, of course, just that it is not pandering to the Chicken Little mentality.

So is there a retirement crisis or not? I am not expert enough to know for sure, but it doesn't seem so to me. Sure, there are some people who are destitute or near-destitute, but are there enough of these, percentage wise, to constitute a crisis? I don't think so. There will always be some people struggling because there will always be those who spent every last dime and didn't plan at all as well as others who suffered tragic illnesses or injuries. That is why there is a safety net, the galling thing about which is that it "saves" the former as well as the latter types. But there is nothing to be done about that.

I wish the thread could get back to its topic instead of discussing the merits of this or that investment strategy.
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Old 01-02-2016, 02:44 AM
 
71,519 posts, read 71,694,121 times
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the other factor is since the official financial survey that used to be part of the census was done away with the small random sampling now done can be way off .

no one really knows anymore what we all have . conclusions are fabricated from a relatively small sampling through the acs survey.

what we all have is infinite in answer , it isn't like did you ever smoke pot , yes or no .
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Old 01-02-2016, 06:20 AM
 
29,775 posts, read 34,860,277 times
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Should/Do/Oughta people have a better life style in retirement than when working? Have a better retirement than their years prior to 66 even if not working? The question about a crisis should involve a comparison of folks lifestyle ages 50-66 and after age 66. Or if you prefer an earlier year span to compare retirement to.
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Old 01-02-2016, 06:43 AM
 
33,046 posts, read 22,048,755 times
Reputation: 8970
Quote:
Originally Posted by Escort Rider View Post
Back on topic, I finally got around to reading your article and I agree it's still a good one. One of its main points is how flawed methodology can be used to spin the conclusion in a desired direction. For example, there have been other threads on other articles in which the articles bemoan that Americans are not saving enough, citing 401K balances as proof, as if 401K balances were the only source of income for retirement for everybody, which is nonsense. It's nonsense because there are other significant sources such as pensions, real estate holdings, even the value of a large paid-off house which will be sold upon retirement in order to downsize.

Let's face it - articles draw readership when they claim some dire event or situation is looming. Articles such as the one you cited above attract, by their titles, a more rational readership. That doesn't prove the article is correct, of course, just that it is not pandering to the Chicken Little mentality.

So is there a retirement crisis or not? I am not expert enough to know for sure, but it doesn't seem so to me. Sure, there are some people who are destitute or near-destitute, but are there enough of these, percentage wise, to constitute a crisis? I don't think so. There will always be some people struggling because there will always be those who spent every last dime and didn't plan at all as well as others who suffered tragic illnesses or injuries. That is why there is a safety net, the galling thing about which is that it "saves" the former as well as the latter types. But there is nothing to be done about that.

I wish the thread could get back to its topic instead of discussing the merits of this or that investment strategy.

Exactly what is the "safety net" for childless adults and why do I see so many homeless?
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Old 01-02-2016, 06:57 AM
 
Location: Jamestown, NY
7,841 posts, read 7,327,156 times
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Quote:
Originally Posted by Burkmere View Post
A few decades ago it was true that public sector employees earned significantly less than their private sector counterparts and took a pension to have security and make up for the lesser salaries.

That condition is no longer true. Public sector salaries have skyrocketed and so have pensions. I was a public sector employee and I made a good salary and have a great pension. There may be a few exceptions to my assertion, but the drift has been towards higher public sector salaries due to strong unions, etc. and also hereat pensions.

How many private sector folks do you know that make equivalent salaries or more who can retire in their 50's after 30 years of working in middle class jobs. Not many. I'm quite willing to debate this because most folks don't have a clue about it and I worked in this are for a living.
The reason that public sector salaries have "soared" is because governments have shed low level, low paid jobs and replaced them with better educated technical people. The typing pools and rooms full of clerks that were common in state and local governments thirty years ago are long gone, replaced by a couple of admin assistants and their computers ... and all the programmers who create and maintain all the software the governments use ... and the technicians who keep all the computers and the HVAC units going etc.

Most of the mental hospitals and centers for the mentally retarded have been emptied out and 24/7 care staff is gone, replaced by program administrators and other professionals. Most law enforcement officers even in my backward area of the state have at least associate degrees and many have bachelor's degrees.
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Old 01-02-2016, 06:59 AM
 
71,519 posts, read 71,694,121 times
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Quote:
Originally Posted by freemkt View Post
Exactly what is the "safety net" for childless adults and why do I see so many homeless?
because as i tell you over and over , once you commit financial suicide there is a pretty good chance nothing can revive you .
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Old 01-02-2016, 07:02 AM
 
Location: Jamestown, NY
7,841 posts, read 7,327,156 times
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Quote:
Originally Posted by LS35a View Post
Here's your retirement crisis:

The low interest rates required by the insane levels of government spending are absolutely screwing seniors.

There's just no place to get anything but a pathetic return on your investment.

And no investments are safe. Not the stock market, certainly not the bond market.
Low interest rates are not the result of government spending. Low interest rates have come about because of low inflation, which is certainly better for most people than the high inflation we had back when rates on savings were high like in the 1980s.
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Old 01-02-2016, 07:17 AM
 
71,519 posts, read 71,694,121 times
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poor economic conditions globally are the reason for such low rates . low rates are the result of , not the cause of .
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Old 01-02-2016, 07:25 AM
 
Location: RVA
2,164 posts, read 1,265,616 times
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I personally don't think the comparison to pre of a post retirement lifestyle is a valid methodology of whether there is a crisis or not. Thats like saying that there is an income crisis because so many people make close to the poverty level. The "crisis" is media driven as a fictional impression of retirement being long walks on the beach or woods everyday, while traveling anywhere they want without a care. For some,mthat will be retirement, but normally only because of sacrifice for many years it delay gratification. Gratifications today rob from gratifications of tomorrow. The level of required gratification is a personal and hugely varied one, as witnessed by the existence of this forum.

Whether we agree with or we like it or not, a capitalistic society like ours requires haves and have nots. Capitalism only provides opportunities to elevate oneself to a higher income and lifestyle, it does not guarantee it like so many want to believe. If you want any guarantees then a socialist society is required which eliminates most of the opportunities to elevate significantly. That's why it's called the American Dream, not the American Guarantee. Unfortunately envy often causes bemoanment of "its not fair", which coattails on the care we administer by being an empathic society to take care of the truly unfortunate, and that expenss adds to the outcome where we find ourselves in the current spiral of widening income gaps. "Retirement" has always been historically a fairly recent development because in a capitalistic society, true personal financial independence is actually possible. In other societies and even our own early one, the pooled resources of FAMILY income were required to survive old age. Everyone ina family worked if they were able to contribute, and lifespans were far shorter because of it. But old age was an excepted outcome and there was little worry of your station because you witnessed what it would be from an early age. Todays youth grow up with little or no witness of the hardships of growing old, instead have a mindset of entitlement because they have only ever seen comfort and material possession, not the work that historically went in to it, or the pain and suffering of failure, often without it being any fault of the family member, but simply war, crop failure, disease, or weather. The midset of todays youth is 100% media driven dream worlds, that we have allowed in the guise of wanting to spare our children any suffering. Suffering is required to appreciate the lack of it.

What we have is a media driven perception of a reward that is touted as an entitlement due to only age. No one really has the entitement to retire simply because they are 65, but the media pushes that on us endlessly. You MAY retire comfortably, IF you successfully save, chose the right lifestyle, have good health, etc etc because capitalism allows accumulation of wealth. The retirement "crisis" is a minor subset of the jobs and youth work ethic crisis in the USA. A society that employs people in jobs that increasingly produces less, but instead simply provides services and income based off percentages of others wealth is doomed to fail. Todays youth have no desire to work in a factory setting or any uncomfortable setting at all for that matter, regardless of whether it is required to survive or not, even IF the jobs were available. There is a retirement crisis, but not for current or even near current retirees, the crisis is our children's and grandchildren's retirement because they all belong to an employment model that increasing produces nothing of value, so they will never get ahead, and as a result I predict we will find ourselves with the requirement to become an increasingly socialist society just to survive.
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