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Retirement in the USA; Not a rosy future
Topic Started: Jan 5 2014, 05:20 AM (109 Views)
campingken
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http://finance.yahoo.com/news/baby-boomers--poorer-in-old-age-than-their-parents-162653066.html

According to this article only 10% of the baby boomers have a guaranteed for life retirement income and that number is dropping every year. Realistically you will need to save over a million dollars to have enough money to enjoy retirement and that won't be possible for a large, and growing, number of Americans.
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Neutral
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By the time you're 60 they will be letting the 60ish crowd all die. No, not a great outlook for you Ken.
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Pat
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Most of the problems in that article are related to the woman making very bad decisions. Dad, the depression era guy was probably more protective of his future having lived in tough times. The era of the define pension is in it's twilight, an example up here that is in all the news is Boeing, they are demanding an end to their plan and will move production elsewhere if the demand is not met. Same with their healthcare plan. Maybe this is a cyclical event for modern times, once people see how tough these non planner baby boomers have been , the next generation will be more thoughtful and plan better.
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Thumper
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My kids are investing in their retirement and will probably exceed my nest egg.
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Mountainrivers
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Thumper
Jan 5 2014, 05:47 AM
My kids are investing in their retirement and will probably exceed my nest egg.
My daughter, who works at Georgia Tech and her husband, who works for a railroad already have exceeded my nest egg. I'm very proud of her. My son, otoh, owns a used car business and spends every nickel he earns. He's in for a hard time when he gets old. Nothing I've said has made any difference with him. His wife's family has money and I suppose they will help them out if they need it. He loves the car business though, so retirement might not appeal to him.
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Brewster
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I think my kids expect their inheritance will help.

They're in for an awful shock.
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tomdrobin
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People will get by, although they will live modestly if they don't have a pension. Many will delay retirement. I know many 70 year olds that are still working. It is possible to get by on SS if you have no house payment, car payment etc.
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Those of us with defined benefit pensions are OK, assuming those benefit palns are secure. When you look at Nortel fro exampl,e you realize that is not always the case. One of the worlds major telcom manufacturers going under and employees having pensions halved. In canda everyone is assured a govenrment penison that is less than SS in the US, but if you have worked you also get Canada pension which when added to that is similar in amount to SS. In Canada you do not have to worry about any medical premiums if you are just on that.

My wife & I both have defined benefit pensions, Canada pension & old age security, plus RRSP's which are like 401Ks. All of that puts us at about 75% of our working income. Plenty, except for trips like the one I am on now which has been expensive

1) ABS system packed it in on the truck
2) Had to replace 4 shocks & 6 tires
3) RV water heater stpped working
4) RV window leaked causing damage that had to be repaired
5) RV Air conditioner stopped working
6) TV antenna jammed solid in down position

I suspect I disturbed an Indian burial ground
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campingken
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Tom,

People will "get by." However the new "American Experience" will be to work until you die. The "Golden Years" are going the way of the rotary telephone.

If you save a million dollars and follow the 4% a year withdraw rule that means you have $40,000 a year retirement income. Most people won't save close to 1 million and if you plan to enjoy life $40,000 a year won't get you very far.

The woman in this article didn't make bad choices so much as the jobs she had went away. What struck me is the fact that a mere 10% of the baby boomers have defined pensions and that number is dropping..
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tomdrobin
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I guess it depends on what one considers "The Golden Years". If you concentrate on filling your life with those "Golf Balls" (ie; friends and family), then you don't need travel and material things to make you happy. My parents lead the simple but adequate life for most of their working years. After dad retired they enjoyed camping in their RV "up north" and riding their bicycles. Trips to Europe and or the Caribbean were simply not even a consideration. After Dad passed mother lived on about $1200 a month in SS and a small pension payment for 15 more years. She actually did quite well, and was able to pay for all the things she needed and actually saved money each month towards things like the new TV, appliances etc. People that grew up during the depression sure knew how to get by and live a full life for not a lot of money. Future generations may have to also.

I have some relatives who retired from the state and make as much in SS and pension as they did working, and are still bitching about their pensions being taxed. Hello? Feel fortunate you aren't one of those working and paying taxes into their 70's because you have no pension.
Edited by tomdrobin, Jan 6 2014, 04:34 AM.
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