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(USA Today)   Old and busted: Putting away money in a 401(k) or IRA to provide income for yourself in your golden years. New Hotness: FARK THAT WE'RE GOING TO DISNEYLAND   (americasmarkets.usatoday.com) divider line 114
    More: Dumbass, retirement planning  
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5792 clicks; posted to Main » on 23 Jun 2014 at 10:13 PM (9 weeks ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2014-06-23 09:32:56 PM
How did "saving money" go from never being a thing to "old and busted"?
 
2014-06-23 10:15:01 PM
David Bowie?
 
2014-06-23 10:16:07 PM
Vacation?  What's that?
 
2014-06-23 10:17:37 PM
Oh is it because we're worked until we die now so hoarding an unreachable sum of cash seems futile?
 
2014-06-23 10:17:45 PM
Vacations keep me from shooting people in the face so there's that.
 
2014-06-23 10:17:50 PM
I thought the retirement plan was to buy a big family house then cash out before a housing bubble bust then moving into a much smaller place or an apartment.
 
2014-06-23 10:18:11 PM

rumpelstiltskin: How did "saving money" go from never being a thing to "old and busted"?


Saving money used to be a thing.  The U.S. has had savings rates over 10% for much of its history.  Then we decided that everybody gets their own 3000 square foot house, 3 cars, and 2 annual vacation trips.  Then we decided it was all "Wall Street's fault"
 
2014-06-23 10:18:29 PM
Macys window?....Labor Day?...who did what to whose dog?????
 
2014-06-23 10:18:29 PM
This seems like a valid plan, if your retirement plans are to turn your "On-Off" switch to "Off"
 
2014-06-23 10:18:53 PM
Vacation planning and retirement planning? Who are these people?

Where do I sign up?
 
2014-06-23 10:19:35 PM

RumsfeldsReplacement: Saving money used to be a thing.  The U.S. has had savings rates over 10% for much of its history.  Then we decided that everybody gets their own 3000 square foot house, 3 cars, and 2 annual vacation trips.  Then we decided it was all "Wall Street's fault"


It also doesn't help that the median middle class wage has stagnated for the past three decades
 
2014-06-23 10:21:39 PM

RumsfeldsReplacement: rumpelstiltskin: How did "saving money" go from never being a thing to "old and busted"?

Saving money used to be a thing.  The U.S. has had savings rates over 10% for much of its history.  Then we decided that everybody gets their own 3000 square foot house, 3 cars, and 2 annual vacation trips.  Then we decided it was all "Wall Street's fault"


Don't forget the 500$ phones and 125$/mo cell bill for every occupant plus cable tv plus Internet. Every home dumping hundreds per month into inedible data. THIS is where American savings disappeared.
 
2014-06-23 10:21:40 PM

RumsfeldsReplacement: Then we decided that everybody gets their own 3000 square foot house, 3 cars, and 2 annual vacation trips.


Apparently the majority of the population missed the boat.

And the Koch Brothers have just made another million dollars in the few seconds it took me to write this.
 
2014-06-23 10:23:59 PM
Retirement planning is easy when you have a diversified portfolio of none dollars.
 
2014-06-23 10:27:30 PM
I haven't gone on a vacation some I was 13. My kids think sleeping over at a friends house is the best thing ever. I made poor financial decisions year after year (aka MOAR CREDIT CARDS). I am finally getting that fixed. The SECOND I get enough money together to have 3 months of my bills paid AND be able to take my family to Disneyworld you bet your ass I'm going too. I will only be able to do it for them once. Maybe.
 
2014-06-23 10:28:10 PM
♫ They made up their minds
And they started packing
They left before the sun came up that day
An exit to eternal summer slacking
But where were they going without ever
Knowing the way? ♫
 
2014-06-23 10:28:25 PM

the_sidewinder: RumsfeldsReplacement: Saving money used to be a thing.  The U.S. has had savings rates over 10% for much of its history.  Then we decided that everybody gets their own 3000 square foot house, 3 cars, and 2 annual vacation trips.  Then we decided it was all "Wall Street's fault"

It also doesn't help that the median middle class wage has stagnated for the past three decades


It also doesn't help that Wall Street goes on a coke binge every 12 hours so that it doesn't start shaking.
 
2014-06-23 10:29:19 PM

the_sidewinder: RumsfeldsReplacement: Saving money used to be a thing.  The U.S. has had savings rates over 10% for much of its history.  Then we decided that everybody gets their own 3000 square foot house, 3 cars, and 2 annual vacation trips.  Then we decided it was all "Wall Street's fault"

It also doesn't help that the median middle class wage has stagnated for the past three decades*


And close to a quarter of the population has fallen been shoved out of the middle class by tax policies that redistribute income and wealth to the have-mosts, and subsidize exporting capital, factories, and good jobs.
Oh, and pervasive union-busting.

*Three-and-a-half decades, but who's counting?
 
2014-06-23 10:29:50 PM

Sugarbombs: the_sidewinder: RumsfeldsReplacement: Saving money used to be a thing.  The U.S. has had savings rates over 10% for much of its history.  Then we decided that everybody gets their own 3000 square foot house, 3 cars, and 2 annual vacation trips.  Then we decided it was all "Wall Street's fault"

It also doesn't help that the median middle class wage has stagnated for the past three decades

It also doesn't help that Wall Street goes on a coke binge every 12 hours so that it doesn't start shaking.


Is Wall Street shaking because too much coke or not enough coke? Only one way to find out...
 
2014-06-23 10:31:47 PM
I have a friend who is always complaining about how money is tight, is always borrowing money from her family (who is lower middle class), and really wants to move out of her current apartment due to a hatred of her roommate but for years hasn't been able to afford it.  However, she still manages to go on vacation almost monthly.  It's not always elaborate trips (although she usually does one of these a year), sometimes they are simply road trips, but she always finds the time and money despite never having enough to pay bills or move out on her own.  She doesn't seem to see a connection between these two things.  I have no clue what she plans to do in the future since she is likely to not get married, has no kids, and her family is not wealthy.  I hope her low paying jobs that she's constantly missing for her trips will be able to allow her to save something for retirement, but I'm highly doubting it.

I feel sorry for her, but that only goes so far sometimes...
 
2014-06-23 10:34:35 PM
And even when you save, the folks supposedly "taking care" of you are out to screw you.

My wife retired a few weeks ago, and had a small retirement, not a ton, but north of $100k.  Her companies 'retirement experts" tried their best to get her to trade her entire amount in on guaranteed payment of $650 a month for the rest of her life, with a minimum payout of 20 years.

Yeah - about 3.5 percent return, and they keep the principle.

Since I am still working, we don't need the cash right now, so  we decided to withdrawal all her 401k and invest in diversified mutual funds (8.5 percent over the last 10 years, 15 percent last year alone) with an advisor that analyzes and makes daily adjustments, and just rollover the profit.   We got a dozen calls from her employer, basically painting every horror story on the planet, and telling her that she was taking a terrible risk.

So far, so good.
 
2014-06-23 10:36:34 PM

PillsHere: I have a friend who is always complaining about how money is tight, is always borrowing money from her family (who is lower middle class), and really wants to move out of her current apartment due to a hatred of her roommate but for years hasn't been able to afford it.  However, she still manages to go on vacation almost monthly.  It's not always elaborate trips (although she usually does one of these a year), sometimes they are simply road trips, but she always finds the time and money despite never having enough to pay bills or move out on her own.  She doesn't seem to see a connection between these two things.  I have no clue what she plans to do in the future since she is likely to not get married, has no kids, and her family is not wealthy.  I hope her low paying jobs that she's constantly missing for her trips will be able to allow her to save something for retirement, but I'm highly doubting it.

I feel sorry for her, but that only goes so far sometimes...


Now tell us how she has a new iPhone and her kids all have new iPads and eighty million channels on cable and drives a new Cadillac Ford Fusion.
 
2014-06-23 10:36:56 PM
Why am I supposed to be spending so much time thinking about retirement planning?  For me, retirement planning meant deciding how much to deposit pre-tax and whether I want it to go into low, medium, or high risk packages.  Every quarter I get a statement telling me how much my retirement fund has grown.  Am I supposed to be doing more thinking than that?
 
2014-06-23 10:39:27 PM

nijika: Oh is it because we're worked until we die now so hoarding an unreachable sum of cash seems futile?


Because socking it away making interest at 1% seems kind of pointless, while the banks make 15%?

So many lazy kids out there... man im gonna work until im 80!  Seriously... i'll work the lottery machine at the local grocery store.  Something to do instead of sitting around doing nothing all day.
 
2014-06-23 10:40:58 PM
I spend more time planning vacations because my savings "plan" doesnt change.  5% into my 401k, 5% into the Roth 401k, and a fixed amount is withdrawn  for some no-load mutual funds each month.  Hell, I was a fully licensed financial planner, and I don't pay much attention to it.  Let it sit.
 
2014-06-23 10:41:13 PM
FTFA Chances are you spend more time planning your vacations than planning for retirement

If you are spending more time planning for retirement over planning a vacation then you are a fark'n idiot that doesn't deserve either.

/and subby has proven that
 
2014-06-23 10:43:26 PM
So I can put away about 20$ a month, and I'm 42, I'm ahead of the game right?

/My father had more put away in the 70's before he was 20.
//had a house and a cottage by my age. PAID
///guess I suck somehow, or I didn't get given so much free stuff
////Tenured 2 years after graduation (72, my birth day!)
//Not even remotely bitter, no not at all.
 
2014-06-23 10:45:07 PM
I don't know. I think I'm doing okay. I have a small carpet cleaning business in receivership; my wife Annette's drawing a salary from a deferred bonus from two years ago. We have fifteen thousand left on the house at eight percent.
 
2014-06-23 10:46:48 PM

Ozarkhawk: And even when you save, the folks supposedly "taking care" of you are out to screw you.

My wife retired a few weeks ago, and had a small retirement, not a ton, but north of $100k.  Her companies 'retirement experts" tried their best to get her to trade her entire amount in on guaranteed payment of $650 a month for the rest of her life, with a minimum payout of 20 years.

Yeah - about 3.5 percent return, and they keep the principle.

Since I am still working, we don't need the cash right now, so  we decided to withdrawal all her 401k and invest in diversified mutual funds (8.5 percent over the last 10 years, 15 percent last year alone) with an advisor that analyzes and makes daily adjustments, and just rollover the profit.   We got a dozen calls from her employer, basically painting every horror story on the planet, and telling her that she was taking a terrible risk.

So far, so good.


I hate to be a dick, but you dun goofed.

A 650/month annuity, depending on her age, may not have been too bad. $100k isn't that much for retirement savings.

And withdrawing it all means you pay taxes on all of it, which likely puts you in the 28% tax bracket. Rolling it over would let you pick your own mutual funds, and avoid paying the taxes on what you didn't withdraw. Also, 15% last year alone isn't saying much since the stock market alone did 30%. Although when picking a mutual fund, never go on past performance. Index funds are where it's at. And financial advisors, especially ones that "make daily adjustments", are ones that take you to the cleaners. They get commission typically, so they take your money on "adjustments"
 
2014-06-23 10:49:44 PM

sharphead: nijika: Oh is it because we're worked until we die now so hoarding an unreachable sum of cash seems futile?

Because socking it away making interest at 1% seems kind of pointless, while the banks make 15%?

So many lazy kids out there... man im gonna work until im 80!  Seriously... i'll work the lottery machine at the local grocery store.  Something to do instead of sitting around doing nothing all day.


Working until you're 80 sounds like a good idea until you become feeble at 65 and senile at 75.
 
2014-06-23 10:50:37 PM

machoprogrammer: Ozarkhawk: And even when you save, the folks supposedly "taking care" of you are out to screw you.

My wife retired a few weeks ago, and had a small retirement, not a ton, but north of $100k.  Her companies 'retirement experts" tried their best to get her to trade her entire amount in on guaranteed payment of $650 a month for the rest of her life, with a minimum payout of 20 years.

Yeah - about 3.5 percent return, and they keep the principle.

Since I am still working, we don't need the cash right now, so  we decided to withdrawal all her 401k and invest in diversified mutual funds (8.5 percent over the last 10 years, 15 percent last year alone) with an advisor that analyzes and makes daily adjustments, and just rollover the profit.   We got a dozen calls from her employer, basically painting every horror story on the planet, and telling her that she was taking a terrible risk.

So far, so good.

I hate to be a dick, but you dun goofed.

A 650/month annuity, depending on her age, may not have been too bad. $100k isn't that much for retirement savings.

And withdrawing it all means you pay taxes on all of it, which likely puts you in the 28% tax bracket. Rolling it over would let you pick your own mutual funds, and avoid paying the taxes on what you didn't withdraw. Also, 15% last year alone isn't saying much since the stock market alone did 30%. Although when picking a mutual fund, never go on past performance. Index funds are where it's at. And financial advisors, especially ones that "make daily adjustments", are ones that take you to the cleaners. They get commission typically, so they take your money on "adjustments"


Respectfully, I didn't goof.  And I wasn't clear, it was a rollover to an IRA.  I've known the advisor forever, and its the same fund she has personally.  We are fine thanks.
 
2014-06-23 10:55:39 PM
What's a vacation?  Any more I get the feeling my retirement party is going to involve three EMTs and a body bag.
 
2014-06-23 10:56:10 PM

Ozarkhawk: Respectfully, I didn't goof.  And I wasn't clear, it was a rollover to an IRA.  I've known the advisor forever, and its the same fund she has personally.  We are fine thanks.


Ok, that is good. Just making sure. Seen and heard of a lot of financial advisers screwing people over.
 
2014-06-23 10:57:58 PM

sharphead: nijika: Oh is it because we're worked until we die now so hoarding an unreachable sum of cash seems futile?

Because socking it away making interest at 1% seems kind of pointless, while the banks make 15%?

So many lazy kids out there... man im gonna work until im 80!  Seriously... i'll work the lottery machine at the local grocery store.  Something to do instead of sitting around doing nothing all day.


1%? Only online banks are anywhere near 1% interest right now. Highest I have seen even in an online bank lately is like .9%. Most banks are .01-.2%. Although when interest rates go back up next year, it should go up a bit.

Savings are still good for emergency funds, but a terrible idea for retirement.
 
2014-06-23 10:58:21 PM
Team union pension and annuity
 
2014-06-23 10:58:45 PM

PillsHere: I have a friend who is always complaining about how money is tight, is always borrowing money from her family (who is lower middle class), and really wants to move out of her current apartment due to a hatred of her roommate but for years hasn't been able to afford it.  However, she still manages to go on vacation almost monthly.  It's not always elaborate trips (although she usually does one of these a year), sometimes they are simply road trips, but she always finds the time and money despite never having enough to pay bills or move out on her own.  She doesn't seem to see a connection between these two things.  I have no clue what she plans to do in the future since she is likely to not get married, has no kids, and her family is not wealthy.  I hope her low paying jobs that she's constantly missing for her trips will be able to allow her to save something for retirement, but I'm highly doubting it.

I feel sorry for her, but that only goes so far sometimes...


I have (had, I guess) a friend like that.  One terrible financial decision after another.  The worst was quitting a good job that barely covered expenses and taking two part time jobs that didn't even come close.  I think she stopped talking to me because every time she complained about her situation, I offered suggestions to improve her financial woes.  Step 1: Move out of that overpriced apartment!  Here's a list of places in your area that are 1/3-1/2 of what you're paying now.  "But I looooove my apartment."

Okay, I guess it wasn't "suggestions".  More like "a suggestion".  The next best thing I could come up with was "go back in time and don't quit your old job" but that didn't seem very practical.
 
2014-06-23 10:58:54 PM
I'm trying to be good and save.  I have a couple of Roth IRAs, my employer matches up to 6% of my 401K contribution and I put away a couple of hundred bucks a month in a life insurance policy. The goal of course is to keep contributing while not touching it if possible for for the next twenty years or so.

I have this disconcerting thought that things like potable water and fuel will be very costly and problematic to acquire in the next couple of decades and to be on the ass end of no savings would not bode well.

/I know. Sleep well.
 
2014-06-23 11:02:04 PM
I thought the in thing was using your retirement money on diapers, viagra and paying hot college chicks to bang you or marry you. At least that's my retirement plan.

profile.ak.fbcdn.net
i1.sndcdn.com
 
2014-06-23 11:02:27 PM
Well funded, government-backed, defined-benefit pension plan available unreduced at age 58. (25 years)

/One of the lucky.
 
2014-06-23 11:07:22 PM

jtown: Why am I supposed to be spending so much time thinking about retirement planning?  For me, retirement planning meant deciding how much to deposit pre-tax and whether I want it to go into low, medium, or high risk packages.  Every quarter I get a statement telling me how much my retirement fund has grown.  Am I supposed to be doing more thinking than that?


I'd advise knowing what kind of expense ratios are on those 'packages' (a lot of companies offer utter shiate funds with 1.25%+ annual ERs, loaded funds, transfer-out fees, etc).  In that case, you might contribute enough to get your employer match, but otherwise should fund your own low-cost (Vanguard or Fidelity index fund) IRA.  Or even just invest in regular taxable index funds.

Otherwise, yeah, I spend more time picking out a hotel for one night than seriously studying my IRA all year.
 
2014-06-23 11:08:37 PM

kling_klang_bed: I thought the in thing was using your retirement money on diapers, viagra and paying hot college chicks to bang you or marry you. At least that's my retirement plan.

[profile.ak.fbcdn.net image 200x232]
[i1.sndcdn.com image 555x574]


Good luck with that unless you have a net worth in the 9 figures
 
2014-06-23 11:13:56 PM
I look at he stocks app on my iPhone every 90 minutes or so and get worked up over every little up or down Netflix has. Does that count?
 
2014-06-23 11:14:03 PM
Oh, it's this thread again.

The haves bragging and telling the have-nots to invest the money they don't have. Add a dash of "Well if you'd just cut your cable subscription..." as if there weren't decades of stagnant wages, benefit cuts, and rising cost of living, and you have every thread like this, ever.
 
2014-06-23 11:14:13 PM
Everything in moderation.  Yes, retirement is important but so is living your life.  Youth goes away, your kids grow up quick, and if you wait till your 59 or 69 to start living your life you have pretty much wasted it.  You have to look at all the tradeoffs.  It doesn't mean going into debt to go on vacation or not saving for retirement.  But if you never spend any money, never enjoy life....  I feel bad for you.  All the money in the world isn't going to allow you to go back in time and enjoy a vacation at Disney with your kids when you are in your 70s.
 
2014-06-23 11:20:23 PM

brian_ellenberger: Everything in moderation.  Yes, retirement is important but so is living your life.  Youth goes away, your kids grow up quick, and if you wait till your 59 or 69 to start living your life you have pretty much wasted it.  You have to look at all the tradeoffs.  It doesn't mean going into debt to go on vacation or not saving for retirement.  But if you never spend any money, never enjoy life....  I feel bad for you.  All the money in the world isn't going to allow you to go back in time and enjoy a vacation at Disney with your kids when you are in your 70s.


Hell, that's easy:

Don't have kids.
 
2014-06-23 11:21:03 PM

Lawnchair: Or even just invest in regular taxable index funds


I max out my IRA and whatever's left goes into a regular taxable medium risk fund.  Mostly for future home improvement needs (I need new flooring and siding in the next few years and eventually a new driveway).  And the money's there so I can always max out my IRA deduction.  It'll be worth it eventually, right?
 
2014-06-23 11:23:35 PM
I'm in my mid twenties and I have the conclusion that my retirement will consist of blowing through my savings after getting laid off for whatever reason, followed by eating a bullet.

Vacation now and enjoy life when you're young.

/It also didn't help that I was making sub-poverty wages for 3 years after getting my handshake and piece of paper
//Got a good job now
 
2014-06-23 11:26:59 PM
Tough times for working people these days.

Certainly will not be a great retirement for everyone.

But like someone pointed out,  if you never take that trip with the kids while you are relatively young...then you are kind of farked.

You'll wait too long, get old and it won't be the same.
 
2014-06-23 11:28:14 PM

Ozarkhawk: And even when you save, the folks supposedly "taking care" of you are out to screw you.

My wife retired a few weeks ago, and had a small retirement, not a ton, but north of $100k.  Her companies 'retirement experts" tried their best to get her to trade her entire amount in on guaranteed payment of $650 a month for the rest of her life, with a minimum payout of 20 years.

Yeah - about 3.5 percent return, and they keep the principle.

Since I am still working, we don't need the cash right now, so  we decided to withdrawal all her 401k and invest in diversified mutual funds (8.5 percent over the last 10 years, 15 percent last year alone) with an advisor that analyzes and makes daily adjustments, and just rollover the profit.   We got a dozen calls from her employer, basically painting every horror story on the planet, and telling her that she was taking a terrible risk.

So far, so good.


While your theory is certainly sound, I'd be seriously worried about your "daily adjustments". Skeezy traders use such 'churn' to pilfer the account's gains. A friend of mine wound up paying $100.00 a pop for 'trade receipts' and at the end of a couple years was left with nothing but a pile of pink half-sheets of paper, one for each receipt, wishing they were hundred dollar bills again.
 
2014-06-23 11:28:37 PM
Plastics
 
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