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Old Today, 04:23 AM
 
26 posts, read 2,550 times
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I run into so many people who are retirement age that tell me they don't have a dime saved and plan to move in with their kids when they can't work anymore. These are middle-income people who worked non stop since about 1980.

So I did some calculations: If they started working in 1980 and made $10,000 a year to start and put 10% of that in a mutual fund that was 70% stock and 30% bond they would have $650,000 today.

If that person was never promoted during their career and only got cost of living increases and finished with a salary of $35K today, their social security would be $1350 at age 66 (full retirement age). Take 4% out of the $650,000 and you have $2166.00 a month, add Social Security and you have $3516.00 a month. If married double that figure.

Even a poor person who made no more than $35,000 a year can retire comfortably if they just would have saved 10% of their gross salary a year., can't they?
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Old Today, 05:27 AM
 
Location: R.I.
1,012 posts, read 617,128 times
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Quote:
Originally Posted by Questions and Comments View Post
Even a poor person who made no more than $35,000 a year can retire comfortably if they just would have saved 10% of their gross salary a year., can't they?
When you have a household income of building up to and ending at $35,000/year you tell me how far that goes to shelter, feed, clothe, educate, and fund some activities for 3 children for 18 years ? Folks in this income situation are lucky to have two nickels to rub together by the time their last kid is out of the house. And even if they can save 10% of their $35,000/year income from say age 50-65 they will be very lucky to have saved $65,000. You sure you didn't add an extra zero by mistake ???
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Old Today, 05:35 AM
 
Location: Pennsylvania
16,420 posts, read 10,399,937 times
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I started as a medical technologist in 1977 and made 5.!0/hr. That was a pretty good wage. Came to a bit over $10,000/year.

More than most middle income no degree workers made. Add, as mentioned, kids, economic busts, maybe a few years of no jobs.


Saving 10% was probably not practical. Doesn't mean nothing should have or could have been saved; just not 10%.
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Old Today, 05:36 AM
 
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$35K/year is equivalent to 2 adults making about $7/hour. Maybe folks in that situation need to do something differently like get a trade or not try to raise 3 kids.
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Old Today, 06:06 AM
 
26 posts, read 2,550 times
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What I always ask people who never saved a dime for a rainy day or retirement is this question: "What if your employer had paid you 10% less, would you have survived?" They think about it and finally answer "yes, I guess so." Maybe people should think long term and pay themselves first and act like they got a job that pays 10% less, so they can save.
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Old Today, 06:13 AM
 
Location: Scottsdale, AZ
7,901 posts, read 4,836,576 times
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Quote:
Originally Posted by Questions and Comments View Post
Even a poor person who made no more than $35,000 a year can retire comfortably if they just would have saved 10% of their gross salary a year., can't they?

You seem both extraordinarily out of touch and fond of asking hypothetical questions.


I don't have any patience with your lack of a clue. I've been poor. I vividly remember what it was like. Every time I got a few dollars ahead, something happened. Car needed new tires, insurance premium went up or had an uninsured medical expense. I didn't have a birth family to loan me money when things got rough or savings to fall back on.


People who don't make much money are always living on the edge.
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Old Today, 06:19 AM
 
6,365 posts, read 4,788,310 times
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Quote:
Originally Posted by fluffythewondercat View Post
You seem both extraordinarily out of touch and fond of asking hypothetical questions.
Could it be that we have a reincarnation of Serious Conversation?
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Old Today, 06:31 AM
 
2,263 posts, read 777,174 times
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I DID save that much the last 15 years I was working- it was well over that if you added employer contributions to the 401(k) plan. Before that I was living in NNJ and it was everything I could do to keep the bills paid and max out my 401(k), so maybe I was saving 6% with the employer adding another 3%. I was a single mother with no CS, DS was falling through the cracks in the expensive public school system, so after paying a premium to live there I ended up spending the cost of a new SUV to send him to a military boarding school for HS.

What saved my rear end was that when I married and we moved to a LCOL area, I cleared over $200K from selling the house and was able to invest most of it. Second DH was a much better financial partner; he retired when we moved (he was 65 and worked in advertising, so zero chance of getting a job) and started SS but spent very little of it so that got saved, too.

It helped that I was in a very good field and had only one child and that we were both healthy.
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Old Today, 06:33 AM
 
26 posts, read 2,550 times
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Quote:
Originally Posted by fluffythewondercat View Post
You seem both extraordinarily out of touch and fond of asking hypothetical questions.


I don't have any patience with your lack of a clue. I've been poor. I vividly remember what it was like. Every time I got a few dollars ahead, something happened. Car needed new tires, insurance premium went up or had an uninsured medical expense. I didn't have a birth family to loan me money when things got rough or savings to fall back on.


People who don't make much money are always living on the edge.
I have been poor most of my life and somehow survived and managed to save at least 10 percent of my income for a rainy day. I had plenty of rainy days! I just paid myself first and put the money in a lockbox for longer term needs that could not be touched.

Again, I ask the same question: If you are poor and claim you are not able to save, what if your employer paid you ten percent less, would you survive?
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Old Today, 06:38 AM
 
276 posts, read 106,187 times
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When I was struggling to just keep a roof over my head, if that employer paid me less (that did happen through a cut in hours) I would and did look for another job. I was fortunate that I found one quickly. Until the new job came through, I worked at a second job just to make ends meet. At that time, I couldn't save 10% because I needed 100% of my income just to live.


Fast forward about 15 years and I was able to save at least 6% of my income when I changed careers and took a very large pay cut. As soon as I could bump it up to 15%, I did.
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