Retirement

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paflyer said:
The smartest guy in the world can still have the worst timing. But that doesn't mean anyone else is obligated to bail him out and make him whole. Life owns nobody anything. Suck it up and move on.
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Nobody?

Suck it up?

All because of timing?

Is that what society is?
 
JoseCuervo said:
Is that what society is?
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Depends on the society, who's running it, and whether those subjected to them can fight back.

At least in all of my history books, that's the repetitive theme. Naturally oppressive people tend to run pretty poor societies.

What is your plan to help S. Africa? Is it related to your plans for retirement?
 
Frankly, I don't think self funded retirement is a solvent scheme in America for the majority. Employers dont pay enough for it to pencil out. I'm sticking with employer funded vehicles. Government A-funds, airline B-fund, or a combination of both. No private A funds though, those are not worth the paper they're written on, as many airline pilots and auto workers found out. 401ks at my low six figure income class, is a suckers bet. I'll never get to the goal, without living so miserly the raising of my family becomes a pyrrhic victory. If I was a 300k earner for two decades straight I'd feel differently about self funding. Alas I'm not. I'm also undershooting my housing costs and generally disavowing home ownership at this juncture of me and my wife's vocational life. Just too much forced vocational nomadism in both our lives for homesteading costs to be worth the hassle. It saves us a bundle on the budget, which essentially funds the airplane operation. Selfish, neglectful parents we are.....:rolleyes:
 
JoseCuervo said:
I agree, many are still worn out, but, it is disingenuous for the poster above to claim that we as a society have not moved onward and upward from an agrarian society to a manufacturing society, to a now service society. The physical toll on one's body is much less, collectively, than it used to be 50 years ago, and 80 years ago (whenever Social Security was enacted.)
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I may no such claim about the movement from an agrarian society. My comments were more that while most of us here are most likely work in an office setting, that there are in fact still many that do manual labor for most if not all their life. Lots of service people moving packages in warehouses and trucks for people to get their "stuff" from online shopping. Too many don't realize there are those in the US that are not doing as well. A good many people working two or three jobs just to make ends meet, largely as they don't have any skills that are worth much.
 
There is a book that came out in the 90's and has been since updated that contains great information on how to have a successful retirement in my opinion. It deals with consumption and saving habits. It also talks about raising independent children. I recommend it to everyone.

The Millionaire Next Door by Thomas Stanely and William Danko
 
JoseCuervo said:
Nobody?

Suck it up?

All because of timing?

Is that what society is?
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You and your ilk are free to contribute as much as you want to sooth your guilt complex. But you don't, you expect other people to support your "causes", under threat of imprisonment.
 
Matthew said:
Trying to differentiate between the deserving poor and the undeserving poor has always been a tough job. My take: To have a "society" you do need some way to provide some basics for those unable to provide for themselves. Otherwise you don't have a society as much as you have a gated community. But those basics probably should be just that, basics. I think a spirit of charitable giving runs deep in the US and goes a long way.
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Charity, yes, to those deserving of it. But the rebellion against unjust confiscation of wealth to satisfy some far away elite group's demands also runs deep.
 
JoseCuervo said:
When I used to go to So Africa, the people inside the gate had a life expectancy of 70~ years, the people outside the gate had a life expectancy of 42~ years.

I would hope we all could agree that there was a moral failing there.
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Not our problem to solve.
 
paflyer said:
Charity, yes, to those deserving of it. But the rebellion against unjust confiscation of wealth to satisfy some far away elite group's demands also runs deep.
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Yeah. For some reason we have allowed our government to decide who and how much, "From each according to his ability, to each according to his need." I think there are studies that show that the more the government gets involved, the less personal charitable donations are raised.

Getting back on the retirement track...I do know people that have been very concerned that they can't donate as much money in retirement, so they make up for it by volunteering the extra time they find they have.
 
paflyer said:
Charity, yes, to those deserving of it. But the rebellion against unjust confiscation of wealth to satisfy some far away elite group's demands also runs deep.
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I'd just like to add to this, paying your taxes is not charity and in no way should be considered charity.
 
PaulS said:
I'd just like to add to this, paying your taxes is not charity and in no way should be considered charity.
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I guess you did not read the Farm bill past last session of congress?
 
Forgetting for the moment that South Africa is a sovereign nation, free to decide how to deal with it's own citizens:

"We" as in I feel a moral or religious obligation towards helping my fellow man? Or "we" as in, "Because I feel I have an obligation, I must force you to oblige, too"?

Financing, saving, planning for our own retirement means we are attempting to become self sufficient and not relying or pressuring others to support us. Isn't that a moral obligation, too?
 
Matthew said:
Forgetting for the moment that South Africa is a sovereign nation, free to decide how to deal with it's own citizens:

"We" as in I feel a moral or religious obligation towards helping my fellow man? Or "we" as in, "Because I feel I have an obligation, I must force you to oblige, too"?

Financing, saving, planning for our own retirement means we are attempting to become self sufficient and not relying or pressuring others to support us. Isn't that a moral obligation, too?
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You do realize we have varying standards and expectations in this country? Nobody is asking you to time travel back to SoAfrica Apartheid.

Do you feel any obligation to help others or leave the world/county/neighborhood a better place?


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paflyer said:
You and your ilk are free to contribute as much as you want to sooth your guilt complex. But you don't, you expect other people to support your "causes", under threat of imprisonment.
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You have no desire to help others?


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hindsight2020 said:
Frankly, I don't think self funded retirement is a solvent scheme in America for the majority.
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This comment had me wondering so I grabbed the median household income from the St. Louis Fed and ran some numbers.

Obviously as a quick back of the napkin number check, there's assumptions here. Like saying "the majority" is a bell curve around the median.

$56,000/year, investing 10% of that, for 40 years, at a 4% return (that's ultra conservative) yields about half a million bucks.

So you'd be living off of 50,000/year, investing roughly $6000, for the working years to get that.

Then you'd expect to live on about $25,000/year in retirement with everything paid off, and do that for 20 years.

It isn't gravy train, but it's not starving either. Assuming you avoided consumer debt like the plague and paid off the house.

The big bankrupter in that estimate is medical issues. And that's where your statement probably becomes accurate. In normal health, the median can keep themselves in a similar lifestyle as they had throughout life with a simple consistent 10% investment.

If they decided to spend every penny and start thinking about retirement 20 years too late, that's not going to work.

But smart upstanding citizens taught compound interest by our top notch schools would never do that... right? :) Oh. Wait...
 
denverpilot said:
This comment had me wondering so I grabbed the median household income from the St. Louis Fed and ran some numbers.

Obviously as a quick back of the napkin number check, there's assumptions here. Like saying "the majority" is a bell curve around the median.

$56,000/year, investing 10% of that, for 40 years, at a 4% return (that's ultra conservative) yields about half a million bucks.

So you'd be living off of 50,000/year, investing roughly $6000, for the working years to get that.

Then you'd expect to live on about $25,000/year in retirement with everything paid off, and do that for 20 years.

It isn't gravy train, but it's not starving either. Assuming you avoided consumer debt like the plague and paid off the house.

The big bankrupter in that estimate is medical issues. And that's where your statement probably becomes accurate. In normal health, the median can keep themselves in a similar lifestyle as they had throughout life with a simple consistent 10% investment.

If they decided to spend every penny and start thinking about retirement 20 years too late, that's not going to work.

But smart upstanding citizens taught compound interest by our top notch schools would never do that... right? :) Oh. Wait...
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Median income has not been $56k for 40 years.

Rest of your "analysis" crumbles.


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JoseCuervo said:
Median income has not been $56k for 40 years.

Rest of your "analysis" crumbles.
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4f4b347c119f374e7cc90fede2662de9.png
 
hindsight2020 said:
Frankly, I don't think self funded retirement is a solvent scheme in America for the majority.
Click to expand...
denverpilot said:
This comment had me wondering so I grabbed the median household income from the St. Louis Fed and ran some numbers.

Obviously as a quick back of the napkin number check, there's assumptions here. Like saying "the majority" is a bell curve around the median.

$56,000/year, investing 10% of that, for 40 years, at a 4% return (that's ultra conservative) yields about half a million bucks.

So you'd be living off of 50,000/year, investing roughly $6000, for the working years to get that.

Then you'd expect to live on about $25,000/year in retirement with everything paid off, and do that for 20 years.

It isn't gravy train, but it's not starving either. Assuming you avoided consumer debt like the plague and paid off the house.

The big bankrupter in that estimate is medical issues. And that's where your statement probably becomes accurate. In normal health, the median can keep themselves in a similar lifestyle as they had throughout life with a simple consistent 10% investment.

If they decided to spend every penny and start thinking about retirement 20 years too late, that's not going to work.

But smart upstanding citizens taught compound interest by our top notch schools would never do that... right? :) Oh. Wait...
Click to expand...

Your numbers are correct, but change the numbers just a little and it gets much better. I ran a quickie calculator and used 8% for the rate of return pre-retirement, and 6% post-retirement (pulling some out to near-cash for cushion). The numbers for the long term average for the stock market vary depending up on the time segment used. Varying for 2-3% inflation made a big difference.

If one adds Social Security the funding balloons and lasts past age 97 (end of the graph). Of course there are debates/arguments on how long SS will last. The other part is if the employer matches any of that 10% the results are great. Even a 4% match by the employer gives the same result of having SS, positive past age 97. With SS it grows forever. My employer matches the first 6%.
 
denverpilot said:
This comment had me wondering so I grabbed the median household income from the St. Louis Fed and ran some numbers.

Obviously as a quick back of the napkin number check, there's assumptions here. Like saying "the majority" is a bell curve around the median.

$56,000/year, investing 10% of that, for 40 years, at a 4% return (that's ultra conservative) yields about half a million bucks.

So you'd be living off of 50,000/year, investing roughly $6000, for the working years to get that.

Then you'd expect to live on about $25,000/year in retirement with everything paid off, and do that for 20 years.

It isn't gravy train, but it's not starving either. Assuming you avoided consumer debt like the plague and paid off the house.

The big bankrupter in that estimate is medical issues. And that's where your statement probably becomes accurate. In normal health, the median can keep themselves in a similar lifestyle as they had throughout life with a simple consistent 10% investment.

If they decided to spend every penny and start thinking about retirement 20 years too late, that's not going to work.

But smart upstanding citizens taught compound interest by our top notch schools would never do that... right? :) Oh. Wait...
Click to expand...


I agree in principle with you, but it appears to me as I read it that you're simply advocating economic stoicism, when the real reason we are not compensated better as a proletariat is because capital owners have bought and paid for the best government they can get and the GINI index has skyrocketed to hell. This isnt some righteous economic baseline or manifest destiny one merely needs to accept like your proposal of self funded advocacy seems to suggest. That's where I part company with you. I think we re being robbed in plain sight and the bi partisan non difference system we live under is the main tool for our disenfranchisement. The difference is that in America they tell you that because you have access to cheap electronics and entertainment that somehow that means you're truly free and can't possibly be enslaved or disenfranchised.

We re being robbed of our labor value under the threat of globalization, and you want to be a pollyanna about half a million self-saved pennies in retirement while the housing, education and health care costs keep crushing budgets every year? Nope, not this guy. I'm not advocating a castle for every man regardless of market value, but there's plenty of deferred compensation in these corporate pirates' coffers to fund double-digit B funds for every rank and file employee. Monies that would provide much higher velocity of money in the proles' hands and actually help a 70pct personal consumption GDP based economy. But private american workers and the self employed are too drunk on public sector schadenfreude to show some unity instead of the languishing they suffer by continually voting for Trojan horse partisan politics that make them feel good about social agendas that don't put food on table, while said economic policies unload the horse inside the kitty at their expense.

I'll keep being the public worker Boogeyman with my "commie thirst" for pensions and Bfunds, ironic accussation since I am military. Y'all can keep grinding it out to 401ks to end up at the same lifestyle level of a social security only recepient. The level of hyper productivity in the American proletariat is astonishing. Biggest collective of job-security-worried workaholics I've encountered in my relatively well traveled life. We ought to have a hell of a lot more street affluence and retirement solvency than what we have to show for. America is great if you're fifthy rich, no doubt about it. But there's a lot of places a lot easier to navigate if you want to be an overworked serf for median wages. Bottom line, I accept and support your point about financial literacy education and the power of compounding, but as the oldest of the millennials/youngest gen X, I wholeheartedly reject the notion that the discussion regarding employer funded retirement (pensions and b funds) is a ship that sailed forever in 1983. I'll torch my street before I get obediently fleeced like that. To quote in living color. Homey dont play that. I'll expat with a clear conscience if I have to. I've served my Country already, ive earned the right to call out when it has turned its back on me. But I also rather become involved in a movement for more labor centric change, before I give up on her. God help us all, for the sake of our progeny I hope we can reverse this resurgence to the high income disparities of the early 20th century.

ETA: 8PCT ROI for 30 years ? Lol hope is not a plan.
 
JoseCuervo said:
Median income has not been $56k for 40 years.
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Oh, now I understand your jackwagon claim. You are correct that the medium income has not been $56k for ALL of the last 40 years.

Those whose primary language is English or American interpret your statement to be mean that it was LAST $56k 40 years ago.

I didn't realize we we're discussing Economics as a Second Language. Yah, that's what ESL really stands for.
 
How prevalent were company pensions before SS?

Years ago I worked for a company that had a pension, they have since phased it out. I was there just long enough that I'll get some beer money every month after whatever age it kicks in. I was curious if the entrance of SS into the mix gave companies an excuse to get out of the pension business?

As far as saving for retirement - it's hard work. And trying to save something, anything, each paycheck takes a lot of effort for young families (I remember those days). Kids, spouse, one income, a chance of layoff any day, maybe student loans, a couple of old cars that need maintenance, whatever. We managed to make it work, but it wasn't easy at all. Once it DOES get started, it's much easier to maintain - as long as you don't end up furloughed, layed off for an extended period, or have your pay cut for whatever reason. I work with and around a lot of people who live paycheck to paycheck, and it's not because they overspend, it's because they just don't make very much and the cost of living never goes down. The left side of the curve has a very tough time looking 20-30 years down the road when they need to make their rent payment next week.
 
paflyer said:
Gotta love the "liberal" mentality...
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Just a question. Do you feel an obligation to help others? To leave the world better than you found it?

Or, is it ok for your kids and your grandkids to have to deal with what you left behind?

There is no "liberal" or "conservative" answer. It is personal to each person.
 
Ravioli said:
Oh, now I understand your jackwagon claim. You are correct that the medium income has not been $56k for ALL of the last 40 years.

Those whose primary language is English or American interpret your statement to be mean that it was LAST $56k 40 years ago.

I didn't realize we we're discussing Economics as a Second Language. Yah, that's what ESL really stands for.
Click to expand...


Now go look at the half-baked analysis that falsely used a $56k income for the last 40 years. And you can see that "analysis" crumbled due to being based on data he did not understand.

Wasn't an English game, it was a "fun with math" game
 
hindsight2020 said:
I agree in principle with you, but it appears to me as I read it that you're simply advocating economic stoicism, when the real reason we are not compensated better as a proletariat is because capital owners have bought and paid for the best government they can get and the GINI index has skyrocketed to hell. This isnt some righteous economic baseline or manifest destiny one merely needs to accept like your proposal of self funded advocacy seems to suggest. That's where I part company with you. I think we re being robbed in plain sight and the bi partisan non difference system we live under is the main tool for our disenfranchisement. The difference is that in America they tell you that because you have access to cheap electronics and entertainment that somehow that means you're truly free and can't possibly be enslaved or disenfranchised.

We re being robbed of our labor value under the threat of globalization, and you want to be a pollyanna about half a million self-saved pennies in retirement while the housing, education and health care costs keep crushing budgets every year? Nope, not this guy. I'm not advocating a castle for every man regardless of market value, but there's plenty of deferred compensation in these corporate pirates' coffers to fund double-digit B funds for every rank and file employee. Monies that would provide much higher velocity of money in the proles' hands and actually help a 70pct personal consumption GDP based economy. But private american workers and the self employed are too drunk on public sector schadenfreude to show some unity instead of the languishing they suffer by continually voting for Trojan horse partisan politics that make them feel good about social agendas that don't put food on table, while said economic policies unload the horse inside the kitty at their expense.

I'll keep being the public worker Boogeyman with my "commie thirst" for pensions and Bfunds, ironic accussation since I am military. Y'all can keep grinding it out to 401ks to end up at the same lifestyle level of a social security only recepient. The level of hyper productivity in the American proletariat is astonishing. Biggest collective of job-security-worried workaholics I've encountered in my relatively well traveled life. We ought to have a hell of a lot more street affluence and retirement solvency than what we have to show for. America is great if you're fifthy rich, no doubt about it. But there's a lot of places a lot easier to navigate if you want to be an overworked serf for median wages. Bottom line, I accept and support your point about financial literacy education and the power of compounding, but as the oldest of the millennials/youngest gen X, I wholeheartedly reject the notion that the discussion regarding employer funded retirement (pensions and b funds) is a ship that sailed forever in 1983. I'll torch my street before I get obediently fleeced like that. To quote in living color. Homey dont play that. I'll expat with a clear conscience if I have to. I've served my Country already, ive earned the right to call out when it has turned its back on me. But I also rather become involved in a movement for more labor centric change, before I give up on her. God help us all, for the sake of our progeny I hope we can reverse this resurgence to the high income disparities of the early 20th century.

ETA: 8PCT ROI for 30 years ? Lol hope is not a plan.
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That was a very long way to say you trust everyone to keep finding your pension for your lifetime.

Works if the fund is solvent and/or politicians vote to bail it out with public loan money.

You missed a critical item in my original post in response to the idea that pensions and age 65 retirements haven't been reality since 1983... I carefully stated that government workers are the exception.

And I gave the demographic example of how eventually the folks who never had those will eventually say "meh" to continuing to fund them via mass debt where the taxes paid only cover the interest on the debt incurred.

Timing affects the outcome of the raindance. You'd have to look and see what you think the solvency is of your particular pension system to decide your risk of folks deciding to not replenish it if it goes insolvent.

You can't be affected by the typical way to destroy a private pension, the owners simply sell the company and the new owners don't purchase the separate entity that the pension operates from. You have a very different "deal" than everyone else, and have had since the 80s.

Not a complaint. An observation. You may make the cut before it gets voted away. Most votes to kill public funded and backed insolvent things get done by a fairly quick but not instant ramp down of the benefit. Example: VA benefits limited post-service by income. That's already done now in the great suck-back.
 
PaulS said:
I'd just like to add to this, paying your taxes is not charity and in no way should be considered charity.
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I gotta disagree, amicably - quite a few local (and state) gov'ts do, in fact, divert significant tax dollars to charity. I worked in local gov't for some time, and that was a routine expense - "hiring" the orchestra for a July 4 celebration at a price quadruple the actual cost; supplementing non-profits that also benefited from CFC., etc. It's one reason my wife and I stopped making donations to charity.

I'm middle-middle income, no dog in the fight - I do know that the bulk (90%+) of the income tax revenue collected is paid by the top 10% of earners. Been that way a long time. Leave it you your own sensibilities to decide if that's fair or not. Those numbers are approximate, by the way, for the literal minded. I think just under 1/2 the population pays no Fed income tax, though I'm sure in most states they still pay state and local taxes.

Funny story - rented a car at LAX recently, two days, at $16.00 a day. The taxes and "fees" doubled the cost. I know, that's CA, where the gov't is dysfunctional, but though extreme, not atypical. My state (MD) and local counties sell alcohol, have interests in casinos, and will be participating in selling dope soon - I imagine they'll gradually phase in prostitution, after a multi-year campaign to make it palatable.

I'd be OK with some of it, if they got the basics right, and kept gov't out of arenas I think the don't belong in. The last local gov't I worked with ran a golf course, day care, swimming pools, sponsored an "incubator" for womens business, and the common thread was all the program's real cosst exceeded the private endeavors doing the same thing. . .
 
JoseCuervo said:
Now go look at the half-baked analysis that falsely used a $56k income for the last 40 years. And you can see that "analysis" crumbled due to being based on data he did not understand.

Wasn't an English game, it was a "fun with math" game
Click to expand...

Is this a redux of retirement 40 years ago, or is this retirement planning today? The same graph indicates how many significant reductions in median income over the 40 year period? (please provide YOUR definition of significance as you answer)

I gotta go mess with AoA guy some more... you guys can get back to baking.
 
Matthew said:
How prevalent were company pensions before SS?

Years ago I worked for a company that had a pension, they have since phased it out. I was there just long enough that I'll get some beer money every month after whatever age it kicks in. I was curious if the entrance of SS into the mix gave companies an excuse to get out of the pension business?

As far as saving for retirement - it's hard work. And trying to save something, anything, each paycheck takes a lot of effort for young families (I remember those days). Kids, spouse, one income, a chance of layoff any day, maybe student loans, a couple of old cars that need maintenance, whatever. We managed to make it work, but it wasn't easy at all. Once it DOES get started, it's much easier to maintain - as long as you don't end up furloughed, layed off for an extended period, or have your pay cut for whatever reason. I work with and around a lot of people who live paycheck to paycheck, and it's not because they overspend, it's because they just don't make very much and the cost of living never goes down. The left side of the curve has a very tough time looking 20-30 years down the road when they need to make their rent payment next week.
Click to expand...


You have to go back in history, but two things happened to destroy the old pension system.

Reagan (I believe) passed tax laws that put IRAs into being (may have been earlier) and, the thing that stood out more to me, was that there were lots of companies with overfunded pensions that weren't adding to shareholder value.

This resulted in the old "corporate raiders" like Trump's buddy Carl Ichan, and Kholber, Kravits, Roberts, and others being able to buy the companies and raid the pensions, bankrupt the companies and move on.

This was all mid80s, or so.

Tax Policy became moving from defined benefit (pension) to a defined contribution (think 401k).

I worked for a company in the 90's that was late to do away with pensions, so I still get a statement each year letting me know what I can have now as a lump sum, or at some future date as a monthly pension. Eventually, At age 60, it will easily cover all my flying expenses.....
 
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