Retirement savings ....Yikes !

[zzvyb6]

If you plan on having a comfortable 30 year retirement and getting $40,000 per year from your IRA, it would take about a million dollars, based on a 'safe' withdrawal rate of 4%. There are a number of good, free, "Retirement Planning Calculator" scripts available online. I checked mine out with the amounts, years, growth rates and withdrawal terms using my own data and they all hit the targeted yearly income very close.

The most gain comes from savings early on in your work life. The more you subtract paying for expensive things (cars, toys, homes, kids tuition, vacations, etc) can put you into the poorhouse later in life.

I'm actually withdrawing less that my IRA is earning, so mine is continuing to grow. Many of my investments are doing well above 6%. But, I still collect bottles and cans other's toss out and get the deposit money, shop at Salvation Army for clothes, and drive small, old econoboxes for rides. I don't buy a new tractor every year, either. Raised the price of baled hay this year for the first time in 25 years. (That will be cash only, Ma'am).

 

[J F]

It would be nice if there were a "Retirement Planning" class, either available or mandatory, in each grade 9-12, plus every year of college. Mandatory would be great, but the howling would kill it, I'm guessing.

 

[KTurner]

It would be nice if there were a "Retirement Planning" class, either available or mandatory, in each grade 9-12, plus every year of college. Mandatory would be great, but the howling would kill it, I'm guessing.

How about we set the sights a little lower and aim for just a single class in the public education system at any level that explains the concept of a budget.

Keith

 

[J F]

I think "Home-Economics" has tried that for decades, along with other skills.

 

[J F]

And I'm not disagreeing with you Keith, budget should be taught...again and again and again, starting with simple math, imo.

 

[J F]

Of course, it would be great if the teachers grasped the basic concept of "budgets" as well as saving for yourself....I know, I know...a political argument...apologies. (not to mention a very broad generalization)

 

[JDgreen227]

And I'm not disagreeing with you Keith, budget should be taught...again and again and again, starting with simple math, imo.

Jay, for the vast majority of my adult life, going back to 1972 I have kept a very detailed WRITTEN budget with careful records filed away. I can tell you within two minutes how much I spent on groceries in April of 2005, how much I spent on gasoline in July of 2009, how much I spent on property taxes in 2011 or how many miles I drove each vehicle in February of 2013. You make an EXCELLENT point...problem is, far too many people have no clue and no idea of what keeping a budget entitles...MAINLY because if you have it written down on paper, it is REAL and you have to deal with the reality. My ex wife never kept a budget and was always broke despite having 2X my income...she never knew where her money went.

 

[J F]

Great post, and I agree, if it is written it does become much more "real".

My grandmother (89 at this time), still has written records of her bills in from the 60's...it's fun/depressing to hear about what things cost "back then".

 

[Gale Hawkins]

I just heard a panel discussion on the news about retirement savings and a survey was done that showed 57% of the people at or near retirement age of 65 yrs. old had less than $25,000.00 in the bank...and 28% said they had a bad view of the future and economy...Now this is not good.... Imagine , what are these seniors going to do ? No interest is being paid on savings, pensions for many are non existent, retirement accounts were raided by many to survive this depression...at least that is what the panel said..

The 10% that will be taken from current holders of 401K, etc with account balances over $250K nation wide at some future point will easy the pain for the sub $25K retires I expect one way or another.

 

[Pilot]

2 points:

1. Adults in my son's age group (42) don't seem to be saving anything, buying on time with nothing down, which got us into the financial crisis that is still going on. He bought his house with nothing down, fortunately early enough that he had some real equity before the financial crisis hit; others weren't so lucky. What are they going to do at retirement?

2. Forbes magazine reports that all 1400+ billionaires in the WORLD are worth about $5.4 trillion. Seize all their wealth, Americans and foreigners alike and it won't cover the debt the US has built up in the last 4 years. We can't solve the US financial problems by taxing the rich. There's going to be a reckoning.