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Healthcare is the very big wildcard in retirement.
Only females have a higher use rate of healthcare then seniors. This translates into on average older persons spending more of their income on healthcare than say young or even middle aged persons.
Medicare does not cover everything and even with Obamacare changes there are still gaps. It also seems certain that those retiring in future years are not likely to have the generous employer sponsored health plans many seniors have today. Perhaps union and or federal/local government workers, but don't see it for your average private sector employee/retiree.
This will mean larger hits to retirement savings to pay for healthcare. That will force reallocation of funds from elsewhere in many cases. Suppose persons could spend down in an attempt to get on Medicaid.
bugsy i have been trying to educate folks on forums about retirement planning for years. most are clueless and run on myth and old wives tales.
they have zero clue about anything relating to a financial plan. most folks end up comitting their own financial suicide left to their own devices..
where the issues start and end are just all over the place. but the common denominator is most folks pout more time into buying a refrigerator or car then their own financial planning.
in fact a study the other day showeed employees devoted more time to selecting a restaurant then their 401k plan.
it isn't about compound interest as much as understanding how to match investments to time frames or matching investments to your pucker factor, it is about the long term tax structure you start building day one that carrys through to retirement.
it is about what insurances your assets need to mitigate damage from unforseen happenings.
the list of financial ignorance goes on and on.. infact we don't even have guidelines for how to spend in place.
I believe all schools teach compound interest. People are more educated today than they were in the past. There are more people graduating college than in the past.
Most people know what to do, but choose not to. People like buying things now instead of saving for the future.
The generation you speak of didn't save enough for a luxury retirement either. Most are living solely on social security.
it isn't about compound interest as much as understanding how to match investments to time frames or matching investments to your pucker factor, it is about the long term tax structure you start building day one that carrys through to retirement.
it is about what insurances your assets need to mitigate damage from unforseen happenings.
the list of financial ignorance goes on and on..
If person A has 300,000 in a savings account it beats person B that saved nothing at all.
not if that other person has a nice pension . retirement is all about cash flow and how you achieve that cash flow.
someone with 500k in the bank and a 70/30 mix of equities/bonds has had more cash flow then someone with 1 million in the bank invested in cd's and short term bonds. .
not if that other person has a nice pension . retirement is all about cash flow and how you achieve that cash flow.
someone with 500k in the bank and a 70/30 mix of equities/bonds has had more cash flow then someone with 1 million in the bank invested in cd's and short term bonds. .
I should of said in situations were everything else is equal.
I believe all schools teach compound interest. People are more educated today than they were in the past. There are more people graduating college than in the past.
Most people know what to do, but choose not to. People like buying things now instead of saving for the future.
The generation you speak of didn't save enough for a luxury retirement either. Most are living solely on social security.
That is not universally true. Many "Boomers" believed they were "set" for retirement in that they trusted company pension obligations would be honored. Well since the 1980's (or before?) you know what has happened to that "promise" as company after company went bankrupt and or otherwise wiggled out of their obligations. If you were already retired and or close to it when all this happens there is not much you can do is there?
the reality is things are never equal. we all live in different areas ,have different needs ,wants , savings and incomes.
personally living in queens which is a borough of nyc i would not have retired early if all i had was a million dollars. on the other hand if i lived in missouri or tennesee i need a fraction of what i need to cover the same wants and needs.
retirement planning is not only about paying bills.
it is about how much powder you want to keep dry to avoid the stresses of unexpected spending and emergencies. it is about how much of a legacy is important to you .
it is about how much of a cushion do you want to maintain so that income stream stays consistant no matter what the markets and interest rates throw at you.
how much do i need is a question that takes in far more then basic expenses.
I believe all schools teach compound interest. People are more educated today than they were in the past. There are more people graduating college than in the past.
Most people know what to do, but choose not to. People like buying things now instead of saving for the future.
The generation you speak of didn't save enough for a luxury retirement either. Most are living solely on social security.
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