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Re: Excellent Retirement Crisis Analysis
Old 09-08-2004, 11:52 AM   #41
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Re: Excellent Retirement Crisis Analysis

Happy birthday John Galt. In honor of your birthday, a parody of Julie Andrew's song "These are a Few of My Favorite Things:"

Wondrous Things

Maalox and nose drops and needles for knitting,
Walkers and handrails and new dental fittings,
Bundles of magazines tied up in string,
These are a few of my favorite things.

Cadillacs and cataracts and hearing aids and glasses,
Polident and Fixodent and false teeth in glasses,
Pacemakers, golf carts and porches with swings,
These are a few of my favorite things.

When the pipes leak,
When the bones creak,
When the knees go bad,
I simply remember my favorite things,
And then I don't feel so bad.

Hot tea and crumpets, and corn pads for bunions,
No spicy hot food or food cooked with onions,
Bathrobes and heat pads and hot meals they bring,
These are a few of my favorite things.

Back pains, confused brains, and no fear of sinnin,
Thin bones and fractures and hair that is thinin,
And we won't mention our short shrunken frames,
When we remember our favorite things.

When the joints ache, when the hips break,
When the eyes grow dim,
Then I remember the great life I've had,
And then I don't feel so bad.

Author Unknown
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Re: Excellent Retirement Crisis Analysis
Old 09-11-2004, 07:40 AM   #42
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Re: Excellent Retirement Crisis Analysis

Quote:
Hi everyone,
Didn't feel like signing in under my name Liltime. Here's my two cents.
jkirzec: and everyone else. A must read is The Coming Generational Storm, a review is on the first page of retire early homepage. Full of stats but it is an easy read. Chapter 8 "Securing your Future" is good for all.
Speaking as a Generation Xer I would say that assumption is not correct, we are not willing to work hard. We want more of a balance between work/family/leisure. What seems to be a common theme with this generation which can be misinterpreted is that we don't feel as much loyalty to a particular employer, we are somewhat disenfranchised. I personally do not plan to work like a dog till I drop then pay a good chunk in taxes. In 13-15 years I plan to be out of the 9-5 salaried employee category and do some consultant work and have some passive income that is not taxed as highly. I hope others in my generation are paying attention or they will be in for a rude awakening. Higher taxes to pay for Social Security, Medicare, and Medicaid and very little benefit from Social Security by the time we retire, which is already up to age 67(full benefits) and I'm betting will be age 70 by the time I actually get there.
A fellow GenX here...

You are correct, we aren't particularly loyal - but neither are the companies. They're not loyal to us in particular, or American workers in general. The Fourth Turning calls us Nomads, and that is pretty close.

If you're coming from a background of seeing a lot of layoffs as a kid, and seeing outsourcing today, then you are definitely going to feel that:
1. Loyalty isn't rewarded
2. Hard work is rewarded but only as much as it helps your career
3. You need to be able to support yourself when you are let go, though savings/investments/etc.
4. Why not just RE and get out of this mess and enjoy life?

I've spent the last year adding to my cash balance. I think I have more cash on hand than most of the REs here, and I work for a company that isn't going away, or doesn't even have any plans to do the overseas move - not that I know of, anyway.
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Re: Excellent Retirement Crisis Analysis
Old 09-12-2004, 09:10 PM   #43
 
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Re: Excellent Retirement Crisis Analysis

hey Whakamole,
I wish I could say I was well on my way, as you are. I will just be getting on track again by the end of the year when I start at a JOB and make plans for my exit at the same time. Small business and real estate is the way to go from what I have read and seen. I can't do the
9-5 for 30 years. We seem to be in a precarious situation, Xer's. It has been noted we will be the first generation who will not do as well as our parents. Not a pretty picture. I'm wondering when did you start saving for ER and what is your plan? If posted that info on another thread just give the link.
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Re: Excellent Retirement Crisis Analysis
Old 09-13-2004, 03:50 AM   #44
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Re: Excellent Retirement Crisis Analysis

Good Morning
Lili, I think that you, and others from GENX (for want of a better term) who think like you are, will be far ahead of 99% of your generation and still ahead of 98% of the Boomers (me). On average, of course, you are correct about your generation not doing as well as your parents.

Do not trust your future ER to a corporate entity. They have no loyalty or consience and cannot see beyond the next dividend or stock price increase. However, use corporate entities as ruthlessly as they would use you to futher your ER plans whenever you can. Government in a similiar manner can't see beyond the next election.

Invest in yourself emotionally, with education, and of course with savings.

my 2 cents

Have fun all

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Re: Excellent Retirement Crisis Analysis
Old 09-13-2004, 05:24 PM   #45
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Re: Excellent Retirement Crisis Analysis

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It has been noted we will be the first generation who will not do as well as our parents.
Noted, but in no way proven. There is a long term US tendency for generations to prosper relatively more or less, according to whether the included birth cohorts are larger or smaller than the preceding generation. There was a baby boom from the end of WW1 to the crash in 1929. Then a baby bust from then until the post WW2 years. The Boomer Generation that began after WW2 created the Boomer name, because it was so much larger than the small birth cohorts of the 30's and War Years. This "Big Boom" peaked in 1957, but continued with relatively high birth cohorts until about 1964-66. After this began a series of low birth years, during which the average fertility per woman decreased from well above 3 children to just slightly above 2. This period ended in the mid eighties or so, with the advent of the echo boomers. Fertility per woman remained low, but there were so many women from the post war boom having children, that the absolute number of births again reached 4 million as it had in 1957. The Big Boom is actually a tough generation to belong to, lots of competition on the job, lots of competition to buy a house, lots of competition to buy stocks and other retirement assets. Even with almost all women working, the boomers are in sad shape heading into retirement.

If things hold true to form, x-ers should be the beneficiaries of boomer pain, buying stocks and other assets including houses from them at relatively good prices, and then selling them much later to "echo-boomers" at newly inflated prices.

This is only a theory, although it has played out in the past, and it makes sense. There is a rich academic literature on this topic. I think it is very likely to hold true, especially with respect to stocks. After all, the "bubble" of the second half of the 90s was caused by boomer excesses and retirement panic.

In may not hold true of houses, especially on the coasts, because of intense immigration. Many immigrants have good incomes (Chinese, Indians, Russians and Ukrainians) and many groups that don't nevertheless band together and can afford a suburban house. To some one used to living in a tin shack made from Coca-Cola signs in Guatemala, are 15 or so people in a suburban house a problem?

Mikey
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Re: Excellent Retirement Crisis Analysis
Old 09-13-2004, 05:44 PM   #46
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Re: Excellent Retirement Crisis Analysis

>>Even with almost all women working, the boomers are in sad shape heading into retirement.


Is this indisputably true? I have heard it so many times, and wouldn't be suprised if it is true, but where are the facts? and why is it so?


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Re: Excellent Retirement Crisis Analysis
Old 09-13-2004, 06:19 PM   #47
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Re: Excellent Retirement Crisis Analysis

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>>Even with almost all women working, the boomers are in sad shape heading into retirement.


Is this indisputably true? I have heard it so many times, *and wouldn't be suprised if it is true, but where are the facts? and why is it so?

? I guess damn little is indisputably true. On this particualr topic, TH has posted recent survey results in another thread. I leave it to you to find the post, or use Google. I can't remember where it is, but it was within the last week or so.

As to why, first you will need to satisfy yourself that it is true. Then, if you are satisfied as to the veracity of the assertion, re-read my post above for one idea as to why. You might do your own research for other possibilites. I am sure there are many. I would interested in seeing anything you find.

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Re: Excellent Retirement Crisis Analysis
Old 09-13-2004, 07:00 PM   #48
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Re: Excellent Retirement Crisis Analysis

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If things hold true to form, x-ers should be the beneficiaries of boomer pain, buying stocks and other assets including houses from them at relatively good prices, and then selling them much later to "echo-boomers" at newly inflated prices.
If this is true it will not benefit the X-ers very much if any. *We've had to compete with boomers who've filled up the corporate ranks and left few to no openings for us. The recession in the early 90's was particularly bad on the leading edge X-ers who were just leaving school and had trouble getting their first job. The boomers have driven up housing and stock prices that the X-ers buy. *The ones who will likely do well will be the leading edge of the boom-echo who will be into buying time when the selling begins and the prices drop.
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Re: Excellent Retirement Crisis Analysis
Old 09-13-2004, 07:28 PM   #49
 
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Re: Excellent Retirement Crisis Analysis

Hi Mikey,
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Re: Excellent Retirement Crisis Analysis
Old 09-13-2004, 07:50 PM   #50
 
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Re: Excellent Retirement Crisis Analysis

Hi Mikey,
Don't know how I accidently posted that blank one. A few factors to look at: people of the X-gen have been moving back home in recent years in large numbers, in the near future we will pay a hefty amount in taxes to support S.S, Medicare and the new drug benefit. The cost is out of hand and there will not be enough workers to support those that will be retired, that is a fact. There have been many surveys and much research on this topic they all seem to come to the same conclusion. It is not that dismal for all Boomers although a good number will be in dire straits. Personally I am trying to see my way out of this generational and financial dilemma. My Dad is already past the age for Social Security and he is still working full time.
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Re: Excellent Retirement Crisis Analysis
Old 09-13-2004, 09:31 PM   #51
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Re: Excellent Retirement Crisis Analysis

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If this is true it will not benefit the X-ers very much if any. *They've (we've) had to compete with boomers who've filled up the corporate ranks and left few to no openings for them (us). *They've driven up housing and stock prices that the X-ers buy. *The ones who will likely do well will be the leading edge of the boom-echo who will be into buying time when the selling begins and the prices drop.
This only follows if the X-er is a robot. There is no law that he/she must buy what he considers to be an overpriced house. There is even less reason to buy an overpriced stock. As at all times, it helps to be able to make an independent valuation, and act accordingly.

The job problem may be true, I don't know. Since you can't time your career like you can investments you are pretty well stuck with whatever you have available at a given time.

Mikey
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Re: Excellent Retirement Crisis Analysis
Old 09-13-2004, 09:36 PM   #52
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Re: Excellent Retirement Crisis Analysis

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My Dad is already past the age for Social Security and he is still working full time.
Lili, I am not sure what point you are making. Your Dad must be in his 60s. If so, he is a member of one of the the most generationally privileged groups in American history.

Are you saying that he likes to work? Or that he didn't save enough to be able to make it on what you are also stating is very high social security being paid to his generation?

I don't quite get your drift.

Mikey
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Re: Excellent Retirement Crisis Analysis
Old 09-13-2004, 10:54 PM   #53
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Re: Excellent Retirement Crisis Analysis

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There is even less reason to buy an overpriced stock.
Assuming your theory is correct, gen-Xers shouldn't buy stocks until, say, 1/2 of the boomers have retired and have sold their stocks. That means staying out of the market for another 10 years or so. Or did I misunderstand you?
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Re: Excellent Retirement Crisis Analysis
Old 09-14-2004, 09:32 AM   #54
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Re: Excellent Retirement Crisis Analysis

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Assuming your theory is correct, gen-Xers shouldn't buy stocks until, say, 1/2 of the boomers have retired and have sold their stocks. * That means staying out of the market for another 10 years or so. * Or did I misunderstand you?
Wab:

While you are waiting for comment from Mikey, thought I'd throw in an undemographic comment.

As we all know, both stocks and bonds were in the dumper from 1966-1982, followed by the most powerful market in both stocks and bonds for the next 18 years that we "probably will ever see" (at least in my life-time).

I recently switched from 80 percent stocks and 20 other to the exact opposite. (About 5 mos. ago).

Only time will tell if this was a good move, but for me personally, I had no comfort zone in either stocks or long bonds at current levels.

If I'm wrong, hell, won't be the first time

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Re: Excellent Retirement Crisis Analysis
Old 09-14-2004, 09:39 AM   #55
 
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Re: Excellent Retirement Crisis Analysis

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I had no comfort zone in either stocks or long bonds at current levels.

If I'm wrong, hell, won't be the first time
If you are wrong, it won't really matter. If your plan works, you will only regret money that you could have made. That is the nature of diversification. Sacrficing returns for reduced volatility

I personally like the 110 - age formula for computing stock/Bond allocation. At your age the most you should be in stocks should be around 40%. and 20% is not that out of line.

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Re: Excellent Retirement Crisis Analysis
Old 09-14-2004, 10:50 AM   #56
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Re: Excellent Retirement Crisis Analysis

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If you are wrong, it won't really matter. If your plan works, you will only regret money that you could have made. That is the nature of diversification. Sacrficing returns for reduced volatility

I personally like the 110 - age formula for computing stock/Bond allocation. At your age the most you should be in stocks should be around 40%. and 20% is not that out of line.
Cutthroat: What a sneaky way to call me an old phart

Speaking of being out of line, (beings you didn't argue with me), hope that all the hook-ups you get on your Alaska trip come close to running you out of line.

Have fun

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Re: Excellent Retirement Crisis Analysis
Old 09-14-2004, 12:31 PM   #57
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Re: Excellent Retirement Crisis Analysis

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Assuming your theory is correct, gen-Xers shouldn't buy stocks until, say, 1/2 of the boomers have retired and have sold their stocks. * That means staying out of the market for another 10 years or so. * Or did I misunderstand you?
Well, that is not how I would conceptualize it. My approach would be tempered by demopgraphic considerations, but not controlled by them. Since there are good demographic reasons why stocks might be facing a headwind in the not too distant future, and since this condition could last a while, I would not be in a big hurry to load up at present levels. OTH, if the S&P were yielding 4.5% or even 4%, I might disregard any demographic theories, feeling that even if true they were trumped by values available in the present.

Also, I should note that I can't take credit (or blame) for this theory. It is widely published in academia, and also widely debated. There are plenty who do no buy it, or think that other factors will dominate.

I don't want to engage in another valuation debate. But to me, staying with a lot of stock today is like staying with a bad poker hand. You might win, but the odds are not good.

Mikey
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Re: Excellent Retirement Crisis Analysis
Old 09-14-2004, 05:23 PM   #58
 
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Re: Excellent Retirement Crisis Analysis

You know, in spite of my rep., I don't see myself as
argumentative. Egomaniacal, overbearing,
condescending, pushy, combative, confrontational,
in-your-face, but not really argumentative
Seriously, it's a great advantage in day to day living.
Insults, attacks, spurious implications, unfounded
accusations, trumped up charges, and mean-
spirited insults are easily ignored. Truly, you can not
imagine how powerful this is. I suppose these qualities
would be of great value in politics. Super ego and
rhino-thick skin. Count me out of that, but those traits
offer a lot of protection against life's slings and arrows.

BTW, I don't recall Cut-Throat being all that argumentative, although "Blow me!" was a bit much.

John Galt
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Re: Excellent Retirement Crisis Analysis
Old 09-14-2004, 09:21 PM   #59
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Re: Excellent Retirement Crisis Analysis

He's definitely argumentative.

So are you.



Nyah! :P
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Re: Excellent Retirement Crisis Analysis
Old 09-14-2004, 10:03 PM   #60
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Re: Excellent Retirement Crisis Analysis

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My approach would be tempered by demopgraphic considerations, but not controlled by them. Since there are good demographic reasons why stocks might be facing a headwind in the not too distant future, and since this condition could last a while, I would not be in a big hurry to load up at present levels.
I was just curious how you would translate the theory to practice. If it were true that boomers were driving stock prices up, you'd expect them to continue to do so until the first wave hit retirement age (in about 5 years), wouldn't you?

Fundamentally, stock market growth is a function of GDP growth. And I'm sure a large chunk of GDP growth is a function of the total number of people employeed. It should be possible to calculate the fraction of GDP comprised of all salaries, and then estimate when the total salaries will start to drop. We might be able to improve on the Gordon Equation
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