Half of Americans Have Less Than $2,000 Banked for Their Golden Years

[Brother Hesekiel 2,235]

My parents' generation had nothing. Grown from the ashes of WWII, if they wanted something they had to save for it, penny by penny. Even 30 years ago buying on credit had a very bad reputation in Europe. When my parents bought their home back in 1973, they had to pay down about 50%.

The problem is that people today want stuff. They want it now, whether or not they need it. Part of it is their fault, part of it is their parents' fault, part of it is the fault of a society that deliberately instills desire in the consumer and tells them that they can have what they want now, and they do want it now and don't have to pay a penny until 2015.

I too was stupid for too long. Had nice cars, enjoyed life, and didn't really safe when I should have. I was over 30 by the time I understood what saving for a rainy day means. Luckily I eventually turned my habit around and started saving. Put 10 to 15% away from every dollar earned. Bought commercial real estate which alone and by itself, once it's paid off and I retire in about 15 years, should be valuable enough to secure a retirement about worries.

All of this happens in the human brain. It takes the proverbial "click" which often happens once you notice that the guy across the street from where you renting an apartment owns his nice house, yet drives a crappy old car, while you just spent $3K on credit, for new blingy 22" wheels to dress up your ride. All on credit, of course.

At some point you realize that it means nothing what other people think of you; all what matters is that you are smart with your money. I have a friend who worked for a local newspaper here in town for a long time. When he was laid off three years ago, I felt sorry for him. I still see him every day riding his bicycle and he's always in a good mood. He just bought his first home, paid $365K cash for it. Money he had saved. I asked him about the job situation. He replied that he now works on his home, isn't really looking for a job. "But the bills," I replied. He told me that he doesn't have to work again, ever, since her really has no costs, no debt, and spends only very little money every month, little enough for his CD to take care of.

That's the extreme side of being thrifty. I try to be rather "normal" but given the choice of having a cool things and not a penny to my name, or old things and never having to worry about bills anymore, I think the choice is clear. I never owned a new car in my life and have no desire to ever change that.

The smartest thing parents can instill in their children is to start saving from early on. A Roth IRA at age twenty, continuously fed, virtually guarantees a retirement as a multi-millionaire.

Edited July 24, 2010 by Just Bob

[Pinocchio Liberal 268]

"One out of three working Americans does not have retirement savings beyond Social Security, and about 35% of those over 65 rely almost totally on Social Security alone," Dallas Salisbury, president of the Alliance for Investor Education and the Employee Benefit Research Institute (EBRI) , explained to AlterNet. "Of the remaining two-thirds of working Americans that have some retirement savings, 27 percent report less than $1,000, 16 percent between $1,000 and $9,999, 11 percent between $10,000 and $24,999, 12 percent between $25,000-$49,999, and 36 percent $50,000 or more." Perhaps the most shocking number is that half of Americans have $2,000 or less saved for retirement.

...

"Individuals need to follow the advice of the ages," said Salisbury. "Spend less than you earn by 25 percent, and save for your future. This keeps your lifestyle from getting ahead of your income."

http://www.alternet.org/story/147570/the_retirement_nightmare:_half_of_americans_have_less_than_$2,000_banked_for_their_golden_years

[Captain Oates 910]

All of this happens in the human brain. It takes the proverbial "click" which often happens once you notice that the guy across the street from where you renting an apartment owns his nice house, yet drives a crappy old car, while you just spent $3K on credit, for new blingy 22" wheels to dress up your ride. All on credit, of course.

A Roth IRA at age twenty, continuously fed, guarantees a retirement as a multi-millionaire.

Wirklich ! yes the poshness of the car usually bears an inverse correlation to the value of the house it's parked outside. Look at Warren Buffet's lil ole house.

I have a 3 year old Camry and I will keep it. It is the 3.5 V6 268 horse power so I am not skimping. I could go buy a 7 series BMW but I prefer the extra freedom that the funds give me. My wad will give me more freedom than US Citizenship and that's for sure.

...and who bails greece out - yes the Germans - the borrowers always come to the savers when they mess up.

I am done with handing money out. They can have it when I die and every day from now until then it will give me a glow of satisfaction that I am truly free. I don't need to spend a penny of it to get a massive glow of satisfaction - to get my money's worth.

Edited July 24, 2010 by saywhat

[Ladylethal 12]

I hope I can start saving for me and Luis's retirement starting very soon. Things were a bit crazy over here for a while but we should be turning a new page soon. Only savings I have right now is a retirement plan back in Brazil that my parents made when I was a teenager, and they just kept it on auto deposit even after I moved out and got married. It's not a huge sum every month (about U$150, and as a retirement plan it builds up interest annually and grows a little), although it's in my currency and not in dollars, at least it's something.

[Ban Hammer 12,835]

i agree on the living frugally as stated by bob and saywhat. my former stepmother had a habit of getting a brand new vehicle every 1-2 years. meanwhile, i'm still driving the vehicle i bought in 1996.

tossing money at a car, trading it in every few years - maybe a status symbol, but those that do this sure don't get anywhere. an old yet reliable beater is like money in the bank.

[Pinocchio Liberal 268]

Very good just dont touch the principal. To Laura.

Edited July 24, 2010 by Col. Lingus

[Pinocchio Liberal 268]

i agree on the living frugally as stated by bob and saywhat. my former stepmother had a habit of getting a brand new vehicle every 1-2 years. meanwhile, i'm still driving the vehicle i bought in 1996.

tossing money at a car, trading it in every few years - maybe a status symbol, but those that do this sure don't get anywhere. an old yet reliable beater is like money in the bank.

CAR PAYMENTS SUCK!

[Captain Oates 910]

I hope I can start saving for me and Luis's retirement starting very soon. Things were a bit crazy over here for a while but we should be turning a new page soon. Only savings I have right now is a retirement plan back in Brazil that my parents made when I was a teenager, and they just kept it on auto deposit even after I moved out and got married. It's not a huge sum every month (about U$150, and as a retirement plan it builds up interest annually and grows a little), although it's in my currency and not in dollars, at least it's something.

Petrobras ! my Brazil etf (exchange traded fund) is my top earner. Brazil is the future - stick with it.

China needs Brazil.

My boss used to run a cheap car and paid low tax. He had 5,000 people reporting to him. He used to wink and say "it's better in my pocket "

[Pinocchio Liberal 268]

Petrobras ! my Brazil etf (exchange traded fund) is my top earner. Brazil is the future - stick with it.

China needs Brazil.

My boss used to run a cheap car and paid low tax. He had 5,000 people reporting to him. He used to wink and say "it's better in my pocket "

My job pays me depreciation plus mileage so they basically make my payments.

[Captain Oates 910]

My job pays me depreciation plus mileage so they basically make my payments.

Cool

just having a job right now will put you ahead of many.

I know a guy who has 'sacked himself '

walked off the job coz he didn't like his co workers

He is in his mid 50's

He won't believe what happens next - or doesn't more like

Edited July 24, 2010 by saywhat

[Ladylethal 12]

Very good just dont touch the principal. To Laura.

Honestly, that thing is just there, as a gift from my parents, while they can afford it, the payments will continue on auto-deposit until I'm 53, which is the end age we put down on the plan (35 year plan if I recall correctly). The monthly extract arrives at their house and I don't even know how much money I have in it right now. So no, there's no plan to ever touch it.

@Charles - My dad used to trade cars every year but if as I recall it was due to cars in Brazil losing their value quickly over the years, so he'd sell while the car still had good value and just put in the difference to the new car (for many years it was actually same car, newer model), back when he could afford it easily. But in the late 90's the auto industry in Brazil changed a bit (lots of brands opened factories there, etc.) and dad stopped doing that, keeping cars for several years before changing it.

These days as my mom moved back to the farm, they only own a bunch of pick up trucks that get severe beating on our dirty roads around the farm, so he'll usually buy new ones when the old ones spend more time in the shop than in use.

[Sofiyya 1,687]

You never learn your lesson:

If you don't want to attract the mods, you should cease imagining what people are and then posting those imaginings as fact to support insults. You have done it at least three times today with different people and we resent it.

I am not bald and fat and sad and all the other things you surmise and post

Don't blow this thread up as well

I am very happy thank you . I am good looking and tall and broad and fit with nice hair and no paunch and lot's of money from secure and inflation proofed sources.

If I see you making things up about either me or other people according to your imagination, I will report you.

Now you've done it. She will add "lying about money" to the list she is compiling about your negatives. She gets a tinkle in private places when she accuses someone of falsifying their finances. Get used to it; she loves that tickle coz she gets it no other way

[slim 1,514]

Why would Americans save money when we have Social Security? Duh!

[SuperDuper! 230]

I don't claim to be a financial expert - however, I have been led to believe that there are plenty of people out there who have had their 401K wiped out because of the depression. Perhaps this is all fear mongering?

Hey, "wiped out" is over-the-top drama queen language, badame madame..

The fact is, some folks 401(k) have merely turned into a 201(k).

That's all.

[Gary and Alla 3,694]

Obama will bail them out with YOUR savings!