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BSUTOP25

Retirement Crisis

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I'm not sure how this is a surprise. A lot of people know exactly that their lives will be shit when they're old. If you had the choice of affording your family a decent life now, maybe go on vacation from time to time, pay for school, etc. or "save" that money for a slightly less shitty old age, what would you choose? Especially since a lot of people are forced to cash out to pay medical bills apparently. The likelihood of that happening only increased with advanced age and increasing healthcare costs. 

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8 hours ago, roswellcoug said:

 

A lot of older folks are working to keep health insurance until they're 65 and can qualify for Medicare.

These folks are not poor, but are getting raked over the coals for Obamacare premiums. 

Obama was an enemy of the poor.  Democrats still are.

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There may have to be a better way to teach kids earlier about investing. I remember when I graduated from college we had a little class on it. But it went in one ear out the other for most of us my class.

Luckily for me, my sister's boyfriend ended up working for an investor and convinced me to get a better look. Now I'm 34 and my 401k is about twice my yearly gross income. But if he wouldn't have talked to me more about it, Id still be using my paycheck to buy all my friends rounds throughout the night, heh.

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13 hours ago, Old_SD_Dude said:

A lot of folks don't even have access, and many more don't have the spare $$ to contribute. If every dollar is accounted for making ends meet, you can't plan for later. 

Almost everyone who claims they don't have the money to contribute to an IRA or 401K is just having a problem with priorities.

Cancel you damn Iphone.  Cancel your gym membership and workout at home.  Get rid of that car payment and by a 500$ car until you can afford something better.   You can't afford a new car until you can write the check.    You can't afford anything you are putting on a credit card.

There is very little reason if you have a job not to be contributing some amount.  I understand emergencies but keeping $10K in savings solves most of them.

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1 hour ago, bluerules009 said:

Almost everyone who claims they don't have the money to contribute to an IRA or 401K is just having a problem with priorities.

Cancel you damn Iphone.  Cancel your gym membership and workout at home.  Get rid of that car payment and by a 500$ car until you can afford something better.   You can't afford a new car until you can write the check.    You can't afford anything you are putting on a credit card.

There is very little reason if you have a job not to be contributing some amount.  I understand emergencies but keeping $10K in savings solves most of them.

Exactly...  there's no accountability in our culture and far too many care more about instant gratification than planning for the future.  I guarantee I come from a family of more humble means than the majority of people who "can't afford" to save for retirement - and I'm the youngest of 10 kids to boot.  My parents qualified for every government assistance program under the sun (refused to take part in it) and still managed to amass a sizable portfolio that has served them well in retirement.  We just didn't have a lot of the luxuries many of my friends' families had (eating out, video games, cable tv, nice cars, vacations, etc.).

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3 hours ago, Stealthlobo said:

There may have to be a better way to teach kids earlier about investing. I remember when I graduated from college we had a little class on it. But it went in one ear out the other for most of us my class.

Luckily for me, my sister's boyfriend ended up working for an investor and convinced me to get a better look. Now I'm 34 and my 401k is about twice my yearly gross income. But if he wouldn't have talked to me more about it, Id still be using my paycheck to buy all my friends rounds throughout the night, heh.

 

3 hours ago, bluerules009 said:

Almost everyone who claims they don't have the money to contribute to an IRA or 401K is just having a problem with priorities.

Cancel you damn Iphone.  Cancel your gym membership and workout at home.  Get rid of that car payment and by a 500$ car until you can afford something better.   You can't afford a new car until you can write the check.    You can't afford anything you are putting on a credit card.

There is very little reason if you have a job not to be contributing some amount.  I understand emergencies but keeping $10K in savings solves most of them.

 

1 hour ago, NorCalCoug said:

Exactly...  there's no accountability in our culture and far too many care more about instant gratification than planning for the future.  I guarantee I come from a family of more humble means than the majority of people who "can't afford" to save for retirement - and I'm the youngest of 10 kids to boot.  My parents qualified for every government assistance program under the sun (refused to take part in it) and still managed to amass a sizable portfolio that has served them well in retirement.  We just didn't have a lot of the luxuries many of my friends' families had (eating out, video games, cable tv, nice cars, vacations, etc.).

I couldn't agree more with these three posts. This problem is primarily due to poor judgment and prioritization. A large number of people who are unprepared for retirement put their money toward leisure and toys. I know people who make 50k a year but lease an fully loaded SUV for $400+ a month. These people should be paying around $150 a month for an older vehicle and investing the other $250+ toward retirement. 

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6 hours ago, BSUTOP25 said:

 

 

I couldn't agree more with these three posts. This problem is primarily due to poor judgment and prioritization. A large number of people who are unprepared for retirement put their money toward leisure and toys. I know people who make 50k a year but lease an fully loaded SUV for $400+ a month. These people should be paying around $150 a month for an older vehicle and investing the other $250+ toward retirement. 

I don't disagree with you in terms of priortization. But if you think that someone can retire saving $3k a year you're mistaken. 

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13 minutes ago, Old_SD_Dude said:

I don't disagree with you in terms of priortization. But if you think that someone can retire saving $3k a year you're mistaken. 

The car payment illustration was just a single example of a multitude of poor choices that households make -- $3k/year in car payments combined with many other bad choices (e.g. eating out and drinking too much) add up cumulatively. I was simply trying to point out how many people throw their money at stupid shit rather than investing for their retirement. 

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1 hour ago, Old_SD_Dude said:

I don't disagree with you in terms of priortization. But if you think that someone can retire saving $3k a year you're mistaken. 

Hogwash...  if a person starts putting away $3K a year at the age of 30 that turns into $435K ($621K if start at age 25) at age 65 assuming ZERO increase in amount saved over time and a 7% average annual return.  Is it enough to retire on?  Debatable, but it's a good start and better than where the average American approaching retirement finds themselves today and they somehow survive.  Most folks who just "can't afford" to save for retirement can probably carve out $3K per year. 

There's absolutely no excuse for not being a millionaire at retirement age in this country.

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another thing I would add to add to your future financial health is make sure you take care of your physical health (strong correlation between physical and financial health):

- get an annual physical (if your near age 50, have a colonoscopy)

- stop smoking, limit alcohol

- exercise

- if your overweight (start getting that under control - you see very few overweight 70-80 year olds)

one major illness can cripple a lifetime of savings, like a lot of posters mentioned, our family had a major illness at it was crushing financially, and its still challenging

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13 hours ago, bluerules009 said:

Almost everyone who claims they don't have the money to contribute to an IRA or 401K is just having a problem with priorities.

Cancel you damn Iphone.  Cancel your gym membership and workout at home.  Get rid of that car payment and by a 500$ car until you can afford something better.   You can't afford a new car until you can write the check.    You can't afford anything you are putting on a credit card.

There is very little reason if you have a job not to be contributing some amount.  I understand emergencies but keeping $10K in savings solves most of them.

I couldn't agree more. According to the last Consumer Reports issue, a new TV cost over $1,000 in 2016. Over a thousand bucks when you can get a perfectly good flat screen that lasts 10 years for less than $400! Most Americans don't even consider a new car under $20,000 when they shouldn't be driving a new car in the first place. A phone costs $500 and gets replaced in less than two years. The list goes on. America doesn't have an income problem, it has a spending problem. 

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For comparison: In other rich parts of the world, you can buy plenty of new cars under 10k, simply because fewer people are willing to take out big loans to buy a car. Check out this Romanian gem sold all over Europe: the Dacia Dokker. No frills, less than 100 hp, slower than tickets sales at SJSU. But it has airbags, it sips gas, and it hauls your family and all your stuff. Plus, it can probably be repaired with a hammer and swear words. Try that in the US.

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10 minutes ago, I am Ram said:

For comparison: In other rich parts of the world, you can buy plenty of new cars under 10k, simply because fewer people are willing to take out big loans to buy a car. Check out this Romanian gem sold all over Europe: the Dacia Dokker. No frills, less than 100 hp, slower than tickets sales at SJSU. But it has airbags, it sips gas, and it hauls your family and all your stuff. Plus, it can probably be repaired with a hammer and swear words. Try that in the US.

We hate having a car payment so we only buy cars we can outright pay for.  We save up for it, and pay for it.  It's worked well for us. 

I know some on here don't like Dave Ramsey, but his step by step approach works.  Getting out of debt and saving for the future is super liberating, imo.

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34 minutes ago, I am Ram said:

For comparison: In other rich parts of the world, you can buy plenty of new cars under 10k, simply because fewer people are willing to take out big loans to buy a car. Check out this Romanian gem sold all over Europe: the Dacia Dokker. No frills, less than 100 hp, slower than tickets sales at SJSU. But it has airbags, it sips gas, and it hauls your family and all your stuff. Plus, it can probably be repaired with a hammer and swear words. Try that in the US.

work with a 25 year old who lives with his folks and bought a $50k fully decked out Chevy truck.

For his ego I guess.

Parks it out front in the co. lot where everyone  can it.

 

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33 minutes ago, Jack Bauer said:

We hate having a car payment so we only buy cars we can outright pay for.  We save up for it, and pay for it.  It's worked well for us. 

I know some on here don't like Dave Ramsey, but his step by step approach works.  Getting out of debt and saving for the future is super liberating, imo.

Very true. We bought our first and only new car after the Toyota Camry acceleration problem when all Japanese manufacturers offered 0% financing. We weren't in a hurry to pay off that loan obviously, but that car had been paid off for a while now. And we bought a nice 3-year old SUV for a little over half of what it must have been new (Who sells a new car after three years???). We'll be paying that one off for three more years, I think. Those cars will hopefully last us a good long while. After that, it's going to be cash or 0%. No more interest on loans.

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14 minutes ago, Lester_in_reno said:

work with a 25 year old who lives with his folks and bought a $50k fully decked out Chevy truck.

For his ego I guess.

Parks it out front in the co. lot where everyone  can it.

Ouch. That's especially embarrassing since his coworkers know how old he is and probably have a rough idea of how much he makes. Different people have different circumstances of course, but if two young guys pull up in my lot for a job interview, one in a 50k truck and one in a 90s Japanese shit box, Mr. Shit Box wins the first impression.

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10 minutes ago, Lester_in_reno said:

work with a 25 year old who lives with his folks and bought a $50k fully decked out Chevy truck.

For his ego I guess.

Parks it out front in the co. lot where everyone  can it.

 

See a lot of young adults my age do something similar.  I am buying a second car for the mountains.  Looking at a used Forerunner with 140,000-160,000 miles on it and will be putting half down on it.  I have friends who make $10 an hour driving Tundras and shit.  

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3 hours ago, I am Ram said:

For comparison: In other rich parts of the world, you can buy plenty of new cars under 10k, simply because fewer people are willing to take out big loans to buy a car. Check out this Romanian gem sold all over Europe: the Dacia Dokker. No frills, less than 100 hp, slower than tickets sales at SJSU. But it has airbags, it sips gas, and it hauls your family and all your stuff. Plus, it can probably be repaired with a hammer and swear words. Try that in the US.

With enough seating for the visitor's section at a SJSU game...

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48 minutes ago, Joe from WY said:

I've never bought a car I didn't pay cash for either. I don't see the point in having a $400/month payment or whatever just to impress people. 

I agree, it's much more impressive to be able to say "Hey bitches!  You see this BMW?   I paid cash for this baby!".... 

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On 8/8/2017 at 7:42 AM, Joe from WY said:

It's a sad reality. They need to hike the SS age up to 70 right off the bat because people are living too long. 

Well given the average age is falling people are taking care of that.   With no resources they are offing themselves. 

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