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Old Today, 10:47 AM
 
30,013 posts, read 35,107,644 times
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https://www.bloomberg.com/news/artic...n-their-wealth

I suspect there are a number in the forum this might represent!
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Old Today, 10:52 AM
 
Location: equator
3,694 posts, read 1,627,013 times
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Dang! I knew my mattress felt lumpy....
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Old Today, 11:03 AM
 
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Quote:
Originally Posted by Sand&Salt View Post
Dang! I knew my mattress felt lumpy....
I suspect some are doing it literally. It is a great lead with a lot of food for thought. I hesitated to highlight any at first as I didn’t want to seem to be embracing some of the points right out of the box.
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Old Today, 11:05 AM
 
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The following is from the link:

If well-off retirees are more frugal than necessary, they end up denying themselves the fruits of a lifetime of hard work. Their heirs eventually benefit, but the vitality of the American economy suffers. “Wealth is getting more and more concentrated among households that are averse to spending it,” says Matt Fellowes, a former Brookings Institution fellow who’s founder and chief executive officer of United Income, a retirement planning startup. “It’s trillions and trillions of wealth that is not benefiting anyone except asset managers.”
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Old Today, 11:35 AM
 
Location: Tucson/Nogales
17,567 posts, read 21,444,340 times
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I'm living in a senior Mobile home co-op in Tucson, and I decided to head up an Art Fund Drive to put some art work/statues, sculptures in our artless community plaza. I kicked it off with a $250 donation, and I requested that 200 individuals in the park contribute $10 each.

It's been 6 months now and the fund is barely over $400, not enough $$ to buy anything decent. The office assistant said that you have to remember there's people barely scraping by here, and $10 is a lot of $$.

Ok! I asked for too much! Then how about $5 each and that would bring the fund up to $1250.

I was in accounting for 10 years and I have a keen nose for those scraping by and those that could write a check for $1000 or $5000 and not miss it the next day. One theory of mine is seniors are living under a veil of fear, fearful SS will run out some day, along with Medicare and better not spend it.

I ran into a man walking his dog the other night. He told me he just spent $6000 on an operation for his dog, and $1000 to remove 5 teeth. And not even $5 for the art fund? Scraping by?

I've grown so disgusted with it all I'm now going to request the Board refund the donations to the donees and close it down.

I had put together a nice catalog of potential works of art, for people to look at, and I added that anyone giving to the art fund would be able to vote on which art work they prefer for the plaza.
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Old Today, 11:51 AM
 
Location: Tennessee
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I suspect a lot of this is holdover from the Great Recession and our very impermanent society.

I was ready to graduate college when the markets crumbled in 2008. We had no clue what lay ahead. There were was tons of financial carnage from new graduates to senior citizens. At least for awhile, people became a bit more financially conservative.

Today's society is just extremely unstable. I've been fired with no notice before and no idea that anything was even wrong. Jobs are rarely secure. Markets gyrate wildly. The news cycle is full of craziness and instability, and that leads to people not being able to plan well.

I can't blame people for sitting on their wealth when things seem wild.
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Old Today, 11:54 AM
 
Location: Central Florida
2,064 posts, read 2,691,239 times
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Quote:
Originally Posted by TuborgP View Post
The following is from the link:

If well-off retirees are more frugal than necessary, they end up denying themselves the fruits of a lifetime of hard work. Their heirs eventually benefit, but the vitality of the American economy suffers. “Wealth is getting more and more concentrated among households that are averse to spending it,” says Matt Fellowes, a former Brookings Institution fellow who’s founder and chief executive officer of United Income, a retirement planning startup. “It’s trillions and trillions of wealth that is not benefiting anyone except asset managers.”
So now I have to feel guilty for being frugal!
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Old Today, 12:01 PM
 
Location: SLC
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The retirees with money are looking at two scenarios: (1) die with money left behind, vs. (2) run out of money before death. In the very individually (as opposed to group) rational system we have, the backstop for those running out of money is thin to non-existent. So, it is completely rational to try to eliminate the chance of scenario (2), making scenario (1) more likely. This has as much to do with the asymmetry of the costs/consequences of the two outcomes.

The asymmetry can be reduced if there were a backstop such a social welfare system which that guaranteed adequate care of the aged retirees (including those who run out of assets late in life). But, that is definitely not happening.

Furthermore, most people who build up assets on their own combine hard work and good fortune with responsible spending habits. Those aren't going to change because some 'financial adviser' thinks it is better for the economy.

It is a tussle between individual rationality vs. group rationality. We cannot ask the retirees going into their diminishing capacity years to be big on the group welfare and risk scenario (2) while teaching them to be in individually rational throughout their lives.
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Old Today, 12:07 PM
 
30,013 posts, read 35,107,644 times
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Quote:
Originally Posted by kavm View Post
The retirees with money are looking at two scenarios: (1) die with money left behind, vs. (2) run out of money before death. In the very individually (as opposed to group) rational system we have, the backstop for those running out of money is thin to non-existent. So, it is completely rational to try to eliminate the chance of scenario (2), making scenario (1) more likely. This has as much to do with the asymmetry of the costs/consequences of the two outcomes.

The asymmetry can be reduced if there were a backstop such a social welfare system which that guaranteed adequate care of the aged retirees (including those who run out of assets late in life). But, that is definitely not happening.

Furthermore, most people who build up assets on their own combine hard work and good fortune with responsible spending habits. Those aren't going to change because some 'financial adviser' thinks it is better for the economy.

It is a tussle between individual rationality vs. group rationality. We cannot ask the retirees going into their diminishing capacity years to be big on the group welfare and risk scenario (2) while teaching them to be in individually rational throughout their lives.
Very in tuned with the article!
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Old Today, 12:33 PM
 
Location: Haiku
4,541 posts, read 2,698,408 times
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Quote:
Originally Posted by TuborgP View Post
The following is from the link:

If well-off retirees are more frugal than necessary, they end up denying themselves the fruits of a lifetime of hard work. Their heirs eventually benefit, but the vitality of the American economy suffers. “Wealth is getting more and more concentrated among households that are averse to spending it,” says Matt Fellowes, a former Brookings Institution fellow who’s founder and chief executive officer of United Income, a retirement planning startup. “It’s trillions and trillions of wealth that is not benefiting anyone except asset managers.”
This of course leads to the discussion on withdrawal methods, one of which is to take a percentage of your current assets. Of course with the stock market way up, your withdrawal goes way up.

For us, we are spending a bit more than we normally do but not nearly what we could. We just don't spend that way. We are not frugal at all - we buy whatever we want when we want. But we don't live real high on the hog either. This is probably an artifact of being raised by parents who went through the Depression and drummed into me to live within our means.
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