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Old 01-07-2017, 08:43 PM
 
910 posts, read 528,866 times
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Quote:
Originally Posted by StillRoaming View Post
Every generation faces a different set of circumstances and challenges. The key is figuring out how best to maneuver your particular challenge and not to compare yourself to other generations. Although some current retirees have it made financially and seemingly had an easy time of it, you might not know what they went through. Because the standard of living for the younger generations is so high today, it is easy to assume that older people grew up the same way. Many did not have a nice home with a nice car and money to go out and eat good food. Many struggled to survive but figured out how to make it.

My grandfather was of the generation that started with little money and eating ketchup sandwiches. He learned construction and made the wise choice to give up some of his salary to go to a lower paying State road job with a pension. They were big savers because that is what they learned growing up. Their ability to save was a great advantage to them in the 1970's - 90's when interest rates at banks were over 10%, and that allowed them to accumulate a great deal of secure money on a smaller salary. They found the best way to maneuver around their particular set of circumstances.

My father, on the other hand, was a farmer. At a relatively young age, he purchased one farm then a second. He and my mother lived in an old farm house on the second farm throwing every dollar into the mortgages. We didn't have a bathroom in this house until I was six, were lucky enough to get hand-me-downs to wear, but made out. I wonder how many young people today would make that kind of sacrifice to gain financial freedom. My parents were savers who paid their own health insurance and were responsible for their retirement savings. They sacrificed but did very well without a pension. Again, they found the best way to maneuver around their particular set of circumstances.

Things are reversed now. In the olden days, people started off poor and learned to grow whatever money they could lay their hands on. There was nowhere to go but up. Today, people are coming from a richer environment and struggling to maintain what they consider normal. Do some need to reconsider what is normal? Are they willing to truly sacrifice for financial independence?

We have to readjust our thinking. Things have changed, and pensions are becoming a thing of the past in the private sector. Interest rates are historically low, which has punished many savers or pushed them into less secure investments, but has made it possible for young people to own homes.

My advice to the younger people is to make the sacrifices you need to in order to be become well off financially. You can sit around depressed because you won't have the same type of retirement as your parents or you can take it on yourself to make your own retirement. Get together $1,000 and open something like a Vanguard Target Retirement account with automatic investments every pay day. Watch your money grow and move it as necessary. Take charge of your future.
I think what is different is the skyrocketing costs of simple things that all generations want. In the olden days people wanted a house in a safe area with decent school opportunities for their children. Back then you could do that on a man's salary and have a wife who stayed home full-time. Yes that house was small but it met the standards. Today young people just want the same thing--a house in a safe area with a decent school district. Does that house have more space and bells and whistles than past houses? Sure. Of course you can live in a smaller/cheaper house in the ghetto but then you won't have the same safety and good schools. Today even two-income couples are priced out of many housing markets.

Same with health insurance. My parents always paid their own (owed a business) and it was never as cost-prohibitive as it is now. Same with college. Even going to city college is exponentially more expensive than "back then". It is hard for young people to "make sacrifices" when they start out with three strikes against them if you consider big expenses like housing, healthcare and education.
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Old 01-07-2017, 09:30 PM
 
2,292 posts, read 1,558,471 times
Reputation: 2737
Quote:
Originally Posted by in_newengland View Post
The idea that two 30 year olds, with liberal arts degrees right now who have been working in retail and trying to pay off college debt, will ever be in that position, even not adjusted for inflation, is laughable.

Well, the news is that you are generalizing and stereotyping us. Most of us had to specialize in something, often something we weren't interested in, to get a job. And many of us went to cheap state colleges and worked our way though.

For example, when I told my dad I wanted to major in liberal arts, he said No. And that was final.

You can't usually get a real job if you major in liberal arts and I don't know who is telling anyone that they can. Another example: my ex had to give up his love of music (his dream of majoring in it and becoming a professional musician) to become a CPA in order to earn a living. He also gave up his dream of attending Williams College because his parents couldn't afford it. He lived at home, worked, and attended a local college.

I gave up my love of art to major in education "so that you can get a job." I purposely went to a state college because I had younger siblings who needed to go to college too.

I don't have kids but my nieces are going to college and living at home and they are studying some high tech stuff that I don't even understand. They'll do fine but they are NOT studying liberal arts. They both are serious about being able to support themselves.

You major in something that is marketable. Very often you don't even need to go to college because there is already a surplus of college educated people. The young people can research and find out what jobs to train for.

It probably won't be a dream job. Most of us never worked at a dream job. But most of us didn't have to work ten hours a day in a sweat shop either, like our grandparents or great grandparents may have. We had it better but we did not have it great.

Life is full of surprises but those who do the research and put some thought into it can probably figure out what to do. A lot of us floundered, fell down, got back up again and kept on trying. Yes, there should definitely be safety nets for those who, through no fault of their own, fall upon hard times or simply do not have the ability to earn a living. But I think most young people just have to figure out how to earn money, get a job, and start out at the bottom and work their way up. And be patient--how many of us started out at the top?
There are many jobs you can get with a liberal arts degree. In fact, in many instances it is preferred to a technical major. You just have to be smart, industrious and get your foot in the door. I don't know why this myth keeps popping up so often. I worked in a career center of a large university while I was getting my M.A. and employers preferred liberal arts grads, albeit good ones!!
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Old 01-08-2017, 01:09 AM
 
6,437 posts, read 3,065,752 times
Reputation: 5843
Quote:
Originally Posted by basehead617 View Post
Young Gen-Xers and Millennials are starting decent paying careers much later in life, making much less than their parents, and are unable to save any money at all due to high cost of living and debt, and flattening investment gains.

Their retirement will arrive and they will have likely zero or negative net worth. On top of that, social security will likely be somewhat insolvent and unable to pay even the meager benefits it now provides. And medicare will hardly be in better shape.

The only way I see this crisis being handled is by the economy taking several enormous body blows, a plummeting housing market, along with plummeting cost of services, e.g. massive deflationary pressures, product/food shortages, etc.

Rich baby boomers make the political decisions in this country and the insane wealth of the baby boomer generation (and even their pension-fattened parents) is distorting the discussion here of what it means to be a retiree - even a modest retired couple of a mailman and a teacher are retiring filthy rich compared to how the young generations will.

Are there any think tanks studying what it will mean for a generation to retire with virtually no money, in a country that will likely not have today's safety net?
I don't know any Gen X or Millenial kids in this sitch unless they have substance abuse problems or other issues like mental illness.

We have two Gen X and two Millenial kids. They are all doing fine.

I worry that some of them are compromising their future retirements by overextending themselves, but not much I can do about that other than counsel them. Ultimately its up to them.

Three out of the four are making more money and living much higher on the hog than we did at their age. The other one is living about the same, although he has made some not so smart choices imo to live beyond how we lived at his age.

In the end, I think they will be ok and they will likely inherit a substantial amount of money from us that will mitigate any bad choices they make.
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Old 01-08-2017, 02:06 AM
 
1,190 posts, read 657,597 times
Reputation: 1021
Quote:
Originally Posted by basehead617 View Post
Young Gen-Xers and Millennials are starting decent paying careers much later in life, making much less than their parents, and are unable to save any money at all due to high cost of living and debt, and flattening investment gains.

Their retirement will arrive and they will have likely zero or negative net worth. On top of that, social security will likely be somewhat insolvent and unable to pay even the meager benefits it now provides. And medicare will hardly be in better shape.

The only way I see this crisis being handled is by the economy taking several enormous body blows, a plummeting housing market, along with plummeting cost of services, e.g. massive deflationary pressures, product/food shortages, etc.

Rich baby boomers make the political decisions in this country and the insane wealth of the baby boomer generation (and even their pension-fattened parents) is distorting the discussion here of what it means to be a retiree - even a modest retired couple of a mailman and a teacher are retiring filthy rich compared to how the young generations will.

Are there any think tanks studying what it will mean for a generation to retire with virtually no money, in a country that will likely not have today's safety net?
GREAT THREAD!! I am terrified for my 25 yr old son though he has a good job. So we are preparing to live out in the boondocks and he will inherit the land, 50K's worth which shows a home on it though we havent built one yet. But property taxes should be very low. It is within 20 minutes of two towns planted within BLM land and the State Recreation Area. Live off the grid. Maybe have others live illegally on the property in nice enough trailers paying rent. Providing solar panels as energy and water. When we pass, we hope to pass on a house, a ROTH Ira w/50K+ 50K+ in cash and hopeflly one other home. He can be self-sustaining because these 401k's, stocks, Social Security, lots of things just won't be there for him or our future grand-kids I fear. It might not be there for me as many predict SS will run out in 2032.Hopefully I am wrong. But for this reason we will NEVER spend much more than to meet our basic needs and our tastes are simple anyhow, luckily! So it shouldn't be difficult to save enough for him
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Old 01-08-2017, 06:41 AM
 
Location: USA
6,223 posts, read 5,353,584 times
Reputation: 10636
Quote:
Originally Posted by Burkmere View Post
There are many jobs you can get with a liberal arts degree. In fact, in many instances it is preferred to a technical major. You just have to be smart, industrious and get your foot in the door. I don't know why this myth keeps popping up so often. I worked in a career center of a large university while I was getting my M.A. and employers preferred liberal arts grads, albeit good ones!!

Right. If going the liberal arts route, you want to make sure you obtain a degree at a school like Princeton where Wall Street and big shot companies recruit out of.

Most of the liberal arts grads I know ended up stuck in retail or fast food management. Which is a shame because you don't need a degree to do that. My DM at one store worked his way up from grocery sacker.

If i had to do it all over again I would have majored in engineering or computer science. I know students are getting offers for 70k+ jobs even before graduation. Of course it helps to go to a top school as well. I don't know any liberal arts grads getting those kinds of offers unless they went to Harvard or Yale.

It today's economy you pretty much have to major in a field that pays, regardless if you don't even have a passion or interest in it.
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Old 01-08-2017, 06:44 AM
 
2,442 posts, read 2,067,677 times
Reputation: 5690
Quote:
Originally Posted by NancyDrew1 View Post
GREAT THREAD!! I am terrified for my 25 yr old son though he has a good job. So we are preparing to live out in the boondocks and he will inherit the land, 50K's worth which shows a home on it though we havent built one yet. But property taxes should be very low. It is within 20 minutes of two towns planted within BLM land and the State Recreation Area. Live off the grid. Maybe have others live illegally on the property in nice enough trailers paying rent. Providing solar panels as energy and water. When we pass, we hope to pass on a house, a ROTH Ira w/50K+ 50K+ in cash and hopeflly one other home. He can be self-sustaining because these 401k's, stocks, Social Security, lots of things just won't be there for him or our future grand-kids I fear. It might not be there for me as many predict SS will run out in 2032.Hopefully I am wrong. But for this reason we will NEVER spend much more than to meet our basic needs and our tastes are simple anyhow, luckily! So it shouldn't be difficult to save enough for him
Saving for your children is admirable but I would still do the things you want to do and enjoy life. Like us, they will get by.
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Old 01-08-2017, 06:49 AM
 
Location: Colorado Springs
4,830 posts, read 4,940,887 times
Reputation: 17284
Some of the Millenials are starting off with huge college debts. They'll spend the first 10 years of their working career working off that debt while trying to save a down payment for a house.

As a result, they will likely delay saving for retirement. Oh yeah, if they have kids the clock starts running, just 18 years until that balloon payment is due: College Tuition!

Do the math. For most of them, the following is true: You can't get there from here.
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Old 01-08-2017, 07:02 AM
 
Location: USA
6,223 posts, read 5,353,584 times
Reputation: 10636
The ones with big debts are those who majored in fields like medicine which have a huge return on investment. Now if you borrowed 100k to study art history, then well...
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Old 01-08-2017, 07:16 AM
 
Location: Los Angeles area
14,018 posts, read 17,723,738 times
Reputation: 32304
Quote:
Originally Posted by NancyDrew1 View Post
GREAT THREAD!! I am terrified for my 25 yr old son though he has a good job. So we are preparing to live out in the boondocks and he will inherit the land, 50K's worth which shows a home on it though we havent built one yet. But property taxes should be very low. It is within 20 minutes of two towns planted within BLM land and the State Recreation Area. Live off the grid. Maybe have others live illegally on the property in nice enough trailers paying rent. Providing solar panels as energy and water. When we pass, we hope to pass on a house, a ROTH Ira w/50K+ 50K+ in cash and hopeflly one other home. He can be self-sustaining because these 401k's, stocks, Social Security, lots of things just won't be there for him or our future grand-kids I fear. It might not be there for me as many predict SS will run out in 2032.Hopefully I am wrong. But for this reason we will NEVER spend much more than to meet our basic needs and our tastes are simple anyhow, luckily! So it shouldn't be difficult to save enough for him
No one is predicting that Social Security will "run out" in 2032. The prediction is that benefits may have to be reduced to 75% of promised levels. That's a far cry from "running out", although it would be a serious development if it occurs.

Why won't 401k's and stocks "be there" for your son? Have you been reading web sites where they also offer gold for sale?

What makes you think your son will ever want to live "out in the boondocks"? Has he expressed that desire?

And finally, have you carefully considered the part of your plan which involves intentionally doing something "illegally"? That might not be so wise.
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Old 01-08-2017, 07:30 AM
gg
 
Location: Pittsburgh
17,923 posts, read 18,237,420 times
Reputation: 11476
Quote:
Originally Posted by basehead617 View Post
Are there any think tanks studying what it will mean for a generation to retire with virtually no money, in a country that will likely not have today's safety net?
I am a Gen X and almost made baby boomer. I think most people will work to the grave, which isn't all that bad if you enjoy your work. Some people like to work. Maybe work part time. It is what it is in the US. The Millennial's seem to want socializm and let the government take care of them. The Gen X'ers are holding on to the old ways and working extremely hard, but in fairness the Gen X people like myself are swimming in college debt, so that is part of this puzzle. People will just do what they have to. No sense worrying about it.
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