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actually most that never invested in stocks and bonds either had to be very rich or have very small withdrawals.
you cannot draw much out a year for 30 plus years and inflation adjust unless you invest in something .
If you can get by with an under 2% withdrawal you stand a chance.
You still have to hope you do not have extended periods of negative interest rates , emergencies or big unexpected expenses as you will have no cushion for awe craps.
you can try more but statistically the money will be gone before you are.
sorry ,no magic here.
Last edited by mathjak107; 03-10-2013 at 03:29 PM..
It is a combination of quantitative easing (the Federal Reserve printing money and buying T notes) and the fact that a lot of people are looking for save havens to park their cash during the down turn.
guess they picked the riskiest place to do it with negative real returns on cash instruments. had they paid attention to what was going on the safe haven should have been nice safe treasury bonds the last 13 years..
Why are they so low. It would seem to me that if it were to be raised people would start saving more and more, I also know that it would make it harder for businesses to expand and survive and harder for people to meet their mortgage payments. But Interest Rates have been higher during good times and bad and people have survived. So why are they so low.
Interest rates are being artificially held near zero by The Fed for one reason: our government has borrowed so much money that interest rates are now the fourth largest federal budget item. Should interest rates rise, huge chunks of money now must be either lost to the spending of Washington, or re-created with massive new taxes on the already-struggling working class.
Of course, this is a disaster for anyone trying to save or retire. I think those currently retired, will be the last to do so (and guess who paid most of that bill? Their kids). Social Security's inevitable collapse will be the death knell for the Baby Boom's retirement. Even worse, too bad the massive problems our economy has (removal of an economic engine like manufacturing, decimation of the working class with Free Trade, the endlessly dropping value of labor, the retiring of the Baby Boom, and the rise of dependency on government) are now structural.
The future of every American has been so perfectly wrapped up in a "no win" scenario, that I almost wonder if it was not our leader's sheer incompetence, but more an intelligent collusion by world-wide leaders who decided that America would fall from prosperity to absolutely collapse between 1970-2020. Either way, the result is the same.
Holy cow. Looks like this question is a clear honeypot for the conspiracy and doomsday theorists.
Whether interest rates are 1% or 6%, I'm going to continue investing and enjoying life.
I find it amusing that some have the attitude that we stock investors must be a bunch of dice-rolling, high-rolling hotheads. Have fun "saving," fellas.
like i said , the complainers and chicken littles have a terrible track record.
it is all well and good they complain but when they do nothing to play the cards they are dealt they get poorer and poorer and it is everyone elses fault but their own.
i just hope they don't become tax payer burdeons with their great wisdom of financial planning.
i know i rather plan based on facts and math rather than the bull-sh*t in my head, the seat of my pants and hope.
Because the government wants to make it easier for people to be able to afford loans for homes, equipment, cars and businesses, which in turn grows the economy. When government wants to increase growth, they lower interest rates. When government wants to slow growth, they increase interest rates.
I find it amusing that some have the attitude that we stock investors must be a bunch of dice-rolling, high-rolling hotheads. Have fun "saving," fellas
Who said that? To be clear, my attitude is the stock market has become chronically dependent on wasteful over-consumption to stay afloat, with no regard for the financial health of the citizenry. Investors expect the FED/USGovt/Taxpayer to continue shouldering the cost(s) via so-called deleveraging.
I stand by my previous statement that the stock market couldn't compete with CD rates post-2000; & that's 1 reason why we have relatively low/ZIRP for the past 10+yrs!
There's an article in the Jan/Feb 2013 Money magazine (pg 71-75) that says stock P/E ratios are enhanced by low interest rate policy. It also surmises that millennials will start to invest more & buy homes/cars as the economy slowly improves—even with their student loan debt! Investors should count on these upcoming bodies to fuel the stock market, just as the baby boomers did. Lots of cheerleading of ZIRP, but little talk about the millennials DEBT &/or future erosion of their purchasing power.
Your attitude and statements are conspiracy mixed with fairytale economics.
One thing I find funny is how people so-often trash debt and praise savings, as if they weren't the two sides of the same coin. Without debt, there is no savings.
But it is clear you feel you are a victim, and even my best argument can't overcome that motivation.
Seeing the good or the bad is your choice. I encourage people to think practically and have an underlying long-term belief. Mine is that America will do well and businesses will do very well. Like mathjak said, you can either complain or play the cards you are dealt.
The US is more of a safe haven than anyone can really believe in this country.
-We've built up this "safe haven" status for so long (since the end of WWII)....it's so gradual, and so invisible. Americans tend to know almost nothing about the rest of the world. So we don't know how good or bad other countries are doing versus us. We've got this almost impregnable safe haven status.
Kind of like having a castle in the middle of an ocean. Everybody else is basically in rowboats. I.e. even England or Germany. Maybe they've got 1 story or 2, or 3, but we've got about 15 stories built with the toughest stone.
-The old rules for interest rates go out the window completely in such a safe haven status country. People are lemmings to start with. You've got crowd behavior (people tend to do the same things as everyone else). And the safe haven status is so deep....you get wild results. I.e. 0% or 1% interest rates in a country so in debt as ours.
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Low interest rates make stocks appear cheap
