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(CNBC)   More and more Americans are opting for an early retirement rather than hold out hope their 401Ks and pensions will be there in ten years   (cnbc.com) divider line 125
    More: Scary, public sector workers  
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5701 clicks; posted to Main » on 15 Oct 2013 at 5:36 AM (38 weeks ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2013-10-15 10:14:07 AM

AngryDragon: Headso: baufan2005: AngryDragon: ThatGuyFromTheInternet: AngryDragon: Even if you save $200 a month starting at 25.

Aaaaaand that's how I know you haven't been 25 in quite  while.

My step-son is not even 23, goes to school, works two jobs, and saves at least that much.  It's not impossible.

My friend does to but he has never had a gf and lives at home with parents with all bills paid.

I know a guy who is 18 has 37 jobs goes to medical school full time is a classical musician who plays in the BSO and dates 4 super models depending on what city he happens to be in at the time. If he can do it anyone can.

I didn't say anyone could, I said it's not impossible.  It all comes down to you being confident in a pension/social security and having faith that the government is going to take care of you in 40 years.  If the cost of one night at the bar a weekend insures that you won't be living in a box when you're older, you may want to consider it.

Your choice.


When you're young in this day and age in America your money could be easily taken at any time if you suffer a medical problem, so you have to weigh that short term fun not just with your future as an old person but the decent chance you are just saving to pay a small portion of medical costs before you file for bankruptcy. Not even mentioning the people who really have no capacity to save even those that do have some calculations to make that we as young people never did, the idea of saving money for the future is not really as attractive as it once was.

Bankruptcies resulting from unpaid medical bills will affect nearly 2 million people this year-making health care the No. 1 cause of such filings

...

Even outside of bankruptcy, about 56 million adults-more than 20 percent of the population between the ages of 19 and 64-will still struggle with health-care-related bills this year, according to NerdWallet Health.
 
2013-10-15 10:19:43 AM

badhatharry: Too bad their jobs are going with them. It used to be when the old man retired everybody moved up the ladder.


Is the U.S. ready for an economy where there is simply no traditional employment for over half the population? Profoundly no.

People work more hours, for less money, and take less vacation. There are fewer jobs out there; fewer workers are needed. We're approaching the golden age of automation that the futurists talked about in the first half of the 20th century.

The economic disruption is just starting.
 
2013-10-15 10:21:26 AM

OnlyM3: [www.upl.co image 660x513]


Do Republicans ever create any humor that are not derivative of the work of liberals?
 
2013-10-15 10:28:39 AM

The Irresponsible Captain: People work more hours, for less money, and take less vacation. There are fewer jobs out there; fewer workers are needed.


Wait, I thought the complaint was that hours were being cut back so employers don't have to give benefits?  You people need to get your whine consistent at least.
 
2013-10-15 10:29:35 AM

Headso: AngryDragon: Headso: baufan2005: AngryDragon: ThatGuyFromTheInternet: AngryDragon: Even if you save $200 a month starting at 25.

Aaaaaand that's how I know you haven't been 25 in quite  while.

My step-son is not even 23, goes to school, works two jobs, and saves at least that much.  It's not impossible.

My friend does to but he has never had a gf and lives at home with parents with all bills paid.

I know a guy who is 18 has 37 jobs goes to medical school full time is a classical musician who plays in the BSO and dates 4 super models depending on what city he happens to be in at the time. If he can do it anyone can.

I didn't say anyone could, I said it's not impossible.  It all comes down to you being confident in a pension/social security and having faith that the government is going to take care of you in 40 years.  If the cost of one night at the bar a weekend insures that you won't be living in a box when you're older, you may want to consider it.

Your choice.

When you're young in this day and age in America your money could be easily taken at any time if you suffer a medical problem, so you have to weigh that short term fun not just with your future as an old person but the decent chance you are just saving to pay a small portion of medical costs before you file for bankruptcy. Not even mentioning the people who really have no capacity to save even those that do have some calculations to make that we as young people never did, the idea of saving money for the future is not really as attractive as it once was.

Bankruptcies resulting from unpaid medical bills will affect nearly 2 million people this year-making health care the No. 1 cause of such filings

...

Even outside of bankruptcy, about 56 million adults-more than 20 percent of the population between the ages of 19 and 64-will still struggle with health-care-related bills this year, according to NerdWallet Health.



20%?  That's a lot of people.

And I'll bet a large portion continue to have cable, netflix, hulu, and unlimited data plans.  Keep in mind that a lot of the health-care-related bills they'll be struggling won't be high enough to file bankruptcy over, just lower on the priority list.  Yes, it sucks when you receive a bill for $500, $1000, or even $10,000, but it can be paid eventually.  A lot of people (I didn't say all, so calm down) choose not to because what's the worst that happens?  Bill collectors can't take away your health.

Though part of the problem is also the providers.  The billing practices are ridiculous in some cases.  I have seen providers that send a seperate bill for every single line item from a single visit to a doctors office.  They can't be terribly surprised when people are overwhelmed and eventually forget to pay for something.  Hospital billing is worse.  Standardized billing practices would definitely help alleviate some of this problem.
 
2013-10-15 10:30:00 AM

trappedspirit: PhDemented: AngryDragon: Even if you save $200 a month starting at 25. By 65 you will have amassed over $750,000. You don't have to be socking away thousands, you just have to start early and do it consistently. It's the miracle of compound interest.

Man, I wish I was making enough when I was 25 to have $200 to invest a month

Were you making below minimum wage or wasting too much?

 
2013-10-15 10:30:33 AM

Headso: When you're young in this day and age in America your money could be easily taken at any time if you suffer a medical problem, so you have to weigh that short term fun not just with your future as an old person but the decent chance you are just saving to pay a small portion of medical costs before you file for bankruptcy. Not even mentioning the people who really have no capacity to save even those that do have some calculations to make that we as young people never did, the idea of saving money for the future is not really as attractive as it once was


I empathize with this statement absolutely.  My ex-wife had serious medical issues and the cost ran into the tens of thousands of dollars.  401K and IRA dollars are considered protected in a bankruptcy filing though.  No matter what financial hardship you fall on, those dollars are yours when you retire if you leave them alone.

Again, anything is better than nothing and the earlier you start the more it will be.
 
2013-10-15 10:44:00 AM

trappedspirit: PhDemented: AngryDragon: Even if you save $200 a month starting at 25. By 65 you will have amassed over $750,000. You don't have to be socking away thousands, you just have to start early and do it consistently. It's the miracle of compound interest.

Man, I wish I was making enough when I was 25 to have $200 to invest a month

Were you making below minimum wage or wasting too much?


Monthly Expenditures:

Filling up at the gas pump once a week - $50
Healthcare Insurance - $250
Car Insurance - $150
Car Payment - $200
Food - $300
Rent (Assuming Roommate) - $300

Just the bare minimums are covered with minimum wage. How exactly do you afford any sort of savings here? This doesn't take into account student loans, clothing, personal hygiene, etc. The only way kids can afford that out of college is to have a legitimate job, or multiple jobs, or with their parents helping pay for things like insurance (or the kids living at home).
 
2013-10-15 10:57:33 AM
$200/mo can be pretty steep when first starting out. The problem is saving for a rainy day - you'll have a lot of rainy days over your lifetime.

I'm 50 and the biggest worry I have is medical care. When Obamacare happens it shouldn't affect us too much, but if I retire early I'll end up paying more with less benefit.  I've stayed pretty healthy over my lifetime and he total cost of medical care I've received, (not out of pocket or co-pay, but total), is about 5 grand. I've paid close to $80K for health insurance, probably over $200K if my employers share is factored in. Not sure why I can insure my house for $35/mo, but for health I'm looking at over $500 with $1500 deduct plus 10% - and that's the cheap plan hoping we can retire and get part time jobs to bring in $30K/yr max. Fortunately, in our case the house is paid off and the kids are gone, but for a young family?

I think health care cost too much. Go to your average hospital and view the opulent surroundings - what is the true cost of health care? No wonder there are so many expats.
 
2013-10-15 11:14:19 AM
Just ask Detroit retirees how their pension and benefits are treating them.  Once the municipality goes bankrupt the pension and bennies you have been getting for 10 years is now gone or greatly reduced.

So, retiring early is no guarantee that you've locked anything in.
 
2013-10-15 11:18:10 AM

the money is in the banana stand: trappedspirit: PhDemented: AngryDragon: Even if you save $200 a month starting at 25. By 65 you will have amassed over $750,000. You don't have to be socking away thousands, you just have to start early and do it consistently. It's the miracle of compound interest.

Man, I wish I was making enough when I was 25 to have $200 to invest a month

Were you making below minimum wage or wasting too much?

Monthly Expenditures:

Filling up at the gas pump once a week - $50
Healthcare Insurance - $250
Car Insurance - $150
Car Payment - $200
Food - $300
Rent (Assuming Roommate) - $300

Just the bare minimums are covered with minimum wage. How exactly do you afford any sort of savings here? This doesn't take into account student loans, clothing, personal hygiene, etc. The only way kids can afford that out of college is to have a legitimate job, or multiple jobs, or with their parents helping pay for things like insurance (or the kids living at home).


So maybe everyone can't start when they are 23.  The point is still valid.  You don't need to bring home a fortune to create a decent (not extravagant) retirement for yourself.  You need the discipline to save early and maybe a little creativity on how to find some extra cash to put away.

But, strangely, it seems you want to convince the world (or maybe just fark) that it's impossible for anyone to fund a retirement on their own.
 
2013-10-15 11:19:35 AM

Ficoce: I think health care cost too much


Hmm, I wonder why.

"The CEO of Aetna Inc., Mark T. Bertolini, had a 2012 pay package that more than tripled - nearly quadrupled - his compensation the year before, according to documents filed Friday with the U.S. Securities and Exchange Commission.
Bertolini was compensated a total of $36.36 million last year, not including $11.1 million in stock awards which vest later and are based on the company's performance."
http://articles.courant.com/2013-04-08/business/hc-aetna-ceo-bertoli ni -pay-20130408_1_aetna-ceo-magellan-health-services-inc-aetna-inc

Or maybe I don't.
 
2013-10-15 11:51:55 AM
Scary in some ways, good in others.
 
2013-10-15 11:57:40 AM

MemeSlave: Animatronik: Some Coke Drinking Guy: Scary?  This is actually a good thing.  More people who retire, the more jobs that open up.  Since most retiring people are at the top of career, that also means it is good jobs becoming available, and that the younger generations can finally move up into something that doesn't pay a good wage in 1978, which their old fogey bosses, who just retired, thought was perfectly reasonable.

The benefits that were negotiated for govt employees were based on shorter life expectancies and a younger population, and on top of that were ridiculous anyway, in many instances. We need people to retire later because we can't support them for 20-30 years, and in many cases we can't replace their skillsets. People who are counting on state govt pensions may be making a mistake...

We also need old people to die, and not consume their accumulated assets in their last few years trying to stay young and healthy.   As a nation we're eating our seed corn, who leaves houses and property and assets to their kids anymore?   If every generation has to start from scratch now, how do we accumulate wealth?


Starting from scratch is the best way to accumulate wealth.

Never buy a new car and never get rid of a good car with less than 130k miles. Never lease a car.

Save at least 25% of after tax income.

Do not overextended yourself to buy anything, especially a house.

Always pay off credit cards every month.

If you are staying in a shiat job just to live with hipsters in the city, don't complain that you have 50 bucks in your bank account.

Get rid of the iPhone if you aren't saving any money.
 
2013-10-15 12:03:54 PM

TheStag: the money is in the banana stand: trappedspirit: PhDemented: AngryDragon: Even if you save $200 a month starting at 25. By 65 you will have amassed over $750,000. You don't have to be socking away thousands, you just have to start early and do it consistently. It's the miracle of compound interest.

Man, I wish I was making enough when I was 25 to have $200 to invest a month

Were you making below minimum wage or wasting too much?

Monthly Expenditures:

Filling up at the gas pump once a week - $50
Healthcare Insurance - $250
Car Insurance - $150
Car Payment - $200
Food - $300
Rent (Assuming Roommate) - $300

Just the bare minimums are covered with minimum wage. How exactly do you afford any sort of savings here? This doesn't take into account student loans, clothing, personal hygiene, etc. The only way kids can afford that out of college is to have a legitimate job, or multiple jobs, or with their parents helping pay for things like insurance (or the kids living at home).

So maybe everyone can't start when they are 23.  The point is still valid.  You don't need to bring home a fortune to create a decent (not extravagant) retirement for yourself.  You need the discipline to save early and maybe a little creativity on how to find some extra cash to put away.

But, strangely, it seems you want to convince the world (or maybe just fark) that it's impossible for anyone to fund a retirement on their own.


This myth about investing is actually not supported by recent rates of investment return.

If you save $2400 a year, after 40 years you might have more like 200 to 300k, not 750 k. You would have to increase the amount you save as you get older.
 
2013-10-15 12:04:15 PM

Animatronik: Starting from scratch is the best way to accumulate wealth.

Never buy a new car and never get rid of a good car with less than 130k miles. Never lease a car.

Save at least 25% of after tax income.

Do not overextended yourself to buy anything, especially a house.

Always pay off credit cards every month.

If you are staying in a shiat job just to live with hipsters in the city, don't complain that you have 50 bucks in your bank account.

Get rid of the iPhone if you aren't saving any money.


Better if it's pretax income or if after tax into a Roth IRA.
 
2013-10-15 12:08:00 PM

what_now: ...and now that they can get affordable health care without staying in a job they hate, they can spend their middle years doing something they may enjoy.

Terrible.


You're new here, aren't you?

/don't worry
//your Statement is in the mail
 
2013-10-15 12:42:00 PM

Animatronik: This myth about investing is actually not supported by recent rates of investment return.

If you save $2400 a year, after 40 years you might have more like 200 to 300k, not 750 k. You would have to increase the amount you save as you get older.


http://cgi.money.cnn.com/tools/savingscalc/savingscalc.html

2400 tax advantaged
40 years
0 starting balance.

Try it.

And it's not a myth.  You just have to be consistent.
 
2013-10-15 01:17:54 PM
I bought back my military time so at 41 I already have 18 years towards retirement
also get $ from the VA
retiring early is so much better under the current system
I could work for 30 years and not make much more than if I retire sooner.
the question is, avoiding use of the 401k system until it's worth so much more
I don't have the luxury of assuming social security will be there to help me at retirement age
 
2013-10-15 06:14:18 PM
Shoot, they might start their own business like they always dreamed and become real job creators.

/since our other job creators arn't
 
2013-10-15 06:43:19 PM

ImmaHoopyFrood: PunGent: Besides, driving a nice car in Boston is like taking a Monet to a soccer riot...

The only times I've actually felt uncomfortable driving was in Boston and Chicago.  Kind of like there was a new set of rules and I missed the memo.  I've done D.C. and L.A. and they weren't that bad in comparison, just slow.


Just remember:  turn signals are for confusing the opposition.   PROPER use of signals is a sign of weakness, or, worse, that you're not from around here.

/Been rear-ended twice, resulting in two totalled cars, both in crystal-clear visibility, in five years.
//hit by one driver of each gender, so yay, equality, I guess...
 
2013-10-15 06:58:25 PM
1) So what is the average percentage of money spent on pensions?  Because Vallejo was at 14 percent of the city budget in 2011 and is up to 18 percent as of 2013 (hence why they're about to go bankrupt again).  But what those stories always lack is context.  Is that high or low in the context of California?  Is that high or low outside of the context of California?  What are other cities doing when 1 in 6 (and pretty soon 1 in 4) of their tax dollars is getting dumped into a black hole (to fulfill promised benefits for which people took lower salaries in exchange for stability, yes, I've heard it)?   Since Europe tends to be a useful data point for seeing what California's going to do, what's Europe doing?  And how are they doing it?

2) So at what point do the cities say "Fark Calpers"?  Because while Calpers is technically funded, it's technically funded on the backs of 18 percent of a city's budget and an additional 50% increase over the next decade.  Once 1 in 4 dollars is flowing into pensions, who will riot first?  At what point will people decide that spending those billions on doing the massive (and necessary.  Transit-Oriented Development only takes you so far (especially when thePeninsula is just too wide to get appropriately served by Caltrain and the buses run at 5 MPH) so you will need extra lanes/roads, the mass transit sucks to begin with and needs BILLIONS of dollars in improvements, upgrades and new routes even if you don't do those necessary road upgrades, and it takes 3 hours to get from SJ to Vallejo by mass transit vs. 1 by car anyways, so transit's NEVER going to happen for that use case) infrastructure upgrades that California needs is better than dumping them into pensions?
 
2013-10-15 07:03:49 PM

PunGent: ImmaHoopyFrood: PunGent: Besides, driving a nice car in Boston is like taking a Monet to a soccer riot...

The only times I've actually felt uncomfortable driving was in Boston and Chicago.  Kind of like there was a new set of rules and I missed the memo.  I've done D.C. and L.A. and they weren't that bad in comparison, just slow.

Just remember:  turn signals are for confusing the opposition.   PROPER use of signals is a sign of weakness, or, worse, that you're not from around here.

/Been rear-ended twice, resulting in two totalled cars, both in crystal-clear visibility, in five years.
//hit by one driver of each gender, so yay, equality, I guess...


Yeah, in both towns I noticed you could be doing some city driving on one-way streets that were 3 lanes that suddenly went to 2 or 1 and everyone riding bumpers.  Locals of course knew what was coming for them and it was a race to the pole position.  At least it was always in company rentals.  Didn't have any accidents but they were day trips.  Doubt my luck would have held out for a full week.
 
2013-10-15 08:48:49 PM

AngryDragon: Headso: When you're young in this day and age in America your money could be easily taken at any time if you suffer a medical problem, so you have to weigh that short term fun not just with your future as an old person but the decent chance you are just saving to pay a small portion of medical costs before you file for bankruptcy. Not even mentioning the people who really have no capacity to save even those that do have some calculations to make that we as young people never did, the idea of saving money for the future is not really as attractive as it once was

I empathize with this statement absolutely.  My ex-wife had serious medical issues and the cost ran into the tens of thousands of dollars.  401K and IRA dollars are considered protected in a bankruptcy filing though.  No matter what financial hardship you fall on, those dollars are yours when you retire if you leave them alone.



Currently.  Ask the folks in Hungary what happens when the government really, really needs money...and all those private pension funds are just SITTING there...

I bet we'll see a teensy little rider slipped into a Congressional bill, midnight on Decemeber 31st, about ten years from now...taxing future IRA and 401Ks a teensy little 1 percent.

And that'll be the thin end of the wedge.

Just saying...nothing is permanent except death and taxes.
 
2013-10-15 09:50:54 PM

PunGent: Currently.  Ask the folks in Hungary what happens when the government really, really needs money...and all those private pension funds are just SITTING there...

I bet we'll see a teensy little rider slipped into a Congressional bill, midnight on Decemeber 31st, about ten years from now...taxing future IRA and 401Ks a teensy little 1 percent.

And that'll be the thin end of the wedge.

Just saying...nothing is permanent except death and taxes.


Then get something other than a 401K where you can invest in the stock market and withdraw money at any time.  Doesn't mean that you won't get boned, but at least you'll be obscure.  Besides, if they do it like they did in Cyprus, you'll have enough warning to jump up to Canada, pull out all your money through an ATM over the weekend, and then run.

The only thing magical about your 401K is that pulling out early costs you money (and the delayed taxes).

/So yes, we promised people a bunch of money.
//But no, there's no farking way we can ever pay it, mostly because we never planned to pay it, and partly because the demographics have changed.
///So we'll continue screwing the young and sacrificing our infrastructure to support the old.
 
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