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The big problem in threads like this one is how to respond rationally and objectively to an original post which is full of wild exaggeration and emotional over-statement. Yes, apparently the gen Xers will have a more difficult time than their boomer parents, in the aggregate. The older boomers at least graduated from college debt-free, and perhaps many of the younger boomers too. (Although I'm not really sure about the younger boomers).
Let's take this statement by the OP:
"Their retirement will arrive and they will have likely zero or negative net worth," How are we to take that seriously? That would mean most of them would fail to pay off their college debt in time to save at all before retiring? I don't buy that.
Let's take another one: ".......... 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." "Insane wealth"???? Perhaps the select few boomers who have made it into upper management and the small number who have become specialty surgeons and a few other similar categories can be said to have "insane wealth" but even then the statement is a bit of a stretch.
It is a shame that the wild, ranting nature of the original post renders a meaningful discussion of the topic so much more difficult, because it's a worthy topic.
My hope is that the conversation will devolve in a more reasonable direction.
ER, yes, wild generalizations much? Plenty of Boomers have had it hard, by the way.
I have three Gen X kids and they are doing OK. All are saving money. Pensions are a thing of the past for them; so they have to save money. And we emphasized that to them early on. We know they are saving, so we don't have to keep reiterating that now.
What we have done is to make sure that our two grands will have some money for college. It will not pay for everything, but it will help. The money is to be used for higher ed.
I think one of the things that holds younger people back is college debt. It looms enormously over many of them. I also think that this debt keeps our economy from being as robust, because there is less for people to spend. However in our area, rents are climbing ever higher, so rent or mortgage payments are eating up a greater percentage of incomes as well.
But part of the problem is that Gen Xers and Millennials choose to live in higher COL areas. Lifestyle is very important to many of them. So, they might choose to live in an urban area that has a high COL, rather than in an outlying area. Perhaps they also chose to attend a more expensive university previously. And expensive electronics have become necessary to us all. And good smartphones, computers, and other portable electronics are still expensive.
So there are many elements to this. But I don't think you can accuse Boomers of being greedy. We inherited a different economy. And as the economy changed, some Boomers were left out.
In my working career I have been laid off several times, had my 401k stolen by my union (worked for a trust office for bunch of crooked ones) and had serious medical illnesses which involved a lot of medical bills.
To the OP, there are no guarantees in life, take care of yourself the best you can and don't expect others to be talking about your future.
There are a few of us who have been around for a good time period in this forum and we have travelled this path together. Many have shared their ups and downs and you speak the truth. There is one poster who had their life do a 180 turn around from what was expected. He was expecting to die first and his wife was bringing in the retirement income. As life would have it she passed first and his retirement did a 180 if sorts. That played out in this forum so your wisdom and willing to share should be food for all of us.
How many BB were laid off? Without work? Had to go five years just to get back to where they were?
To assume that everyone will have a picture perfect career trajectory if they only *put in the effort* is naive. Layoffs, mergers, companies bought and sold and jobs eliminated ... dip into savings, etc. Medical bills. Too many ifs to count.
It's a different world and to assume that everyone will be retiring no problem *if only* they put in the effort is foolish.
It's typical of to accept our own successes as purely the product of our own skill and expertise, and our own failures as just "bad luck". As for others' failures - they've brought that on themselves through laziness and poor choices and their successes are due mostly to luck!
Why do we think like this? Easy - so we can feel in control of our own lives and confident that our successes will continue (if we are in fact successful) and if we're doing badly, confident that our "luck" will change and we'll finally see some light at the end of the tunnel.
It's a primitive form of self preservation that may have served us well in the dark ages but only makes us pompous, selfish, and uncharitable now.
It's typical of to accept our own successes as purely the product of our own skill and expertise, and our own failures as just "bad luck". As for others' failures - they've brought that on themselves through laziness and poor choices and their successes are due mostly to luck!
Why do we think like this? Easy - so we can feel in control of our own lives and confident that our successes will continue (if we are in fact successful) and if we're doing badly, confident that our "luck" will change and we'll finally see some light at the end of the tunnel.
It's a primitive form of self preservation that may have served us well in the dark ages but only makes us pompous, selfish, and uncharitable now.
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?
Sounds like your smart enough to work and invest so you will be comfortable. Just like I did.
There are a few of us who have been around for a good time period in this forum and we have travelled this path together. Many have shared their ups and downs and you speak the truth. There is one poster who had their life do a 180 turn around from what was expected. He was expecting to die first and his wife was bringing in the retirement income. As life would have it she passed first and his retirement did a 180 if sorts. That played out in this forum so your wisdom and willing to share should be food for all of us.
Everyone thinks it can't happen to them... until it happens.
How many BB were laid off? Without work? Had to go five years just to get back to where they were?
To assume that everyone will have a picture perfect career trajectory if they only *put in the effort* is naive. Layoffs, mergers, companies bought and sold and jobs eliminated ... dip into savings, etc. Medical bills. Too many ifs to count.
It's a different world and to assume that everyone will be retiring no problem *if only* they put in the effort is foolish.
And some of us experienced all of the above. Nobody has picture perfect career trajectory, not even Steve Jobs.
A mailman and teacher are retiring filthy rich? I believe you have quite a skewed perspective.
An annuity to provide a COLA-protected $40K per year for life starting at age 62 is a bit more than $1 million. How many people do you know who have $1 million in their 401(k) and IRA accounts? Not filthy rich but their retirement is easily in the 80th percentile.
A union public school teacher in the Northeast typically vests 2% per year in their pension. At age 60, they're retiring early at 70% pay and full health benefits with some COLA protection. Their pay is seniority-based. In my town, they're making about $70K so they're getting a $50K pension plus about $10K worth of health benefits until they hit Medicare age that none of the rest of us get. The cash value of that is about $1.5 million. I'd certainly love to have that deal.
An annuity to provide a COLA-protected $40K per year for life starting at age 62 is a bit more than $1 million. How many people do you know who have $1 million in their 401(k) and IRA accounts? Not filthy rich but their retirement is easily in the 80th percentile.
A union public school teacher in the Northeast typically vests 2% per year in their pension. At age 60, they're retiring early at 70% pay and full health benefits with some COLA protection. Their pay is seniority-based. In my town, they're making about $70K so they're getting a $50K pension plus about $10K worth of health benefits until they hit Medicare age that none of the rest of us get. The cash value of that is about $1.5 million. I'd certainly love to have that deal.
To me, that is very far from filthy rich. But how each one of us define it, is all relative.
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