‘Alarming Number’ Of Middle-Income Boomers Put Brakes On Retirement

[W2R]

So, he learned to fly and flew the coop?

Nah - - he solo'd and never got his pilot's license. This was about 22 years before our divorce.

 

[kumquat]

And who doesn't worry about outliving their money? The question is how much and how often.

I'm one. My SWR is between 2 and 3%. However, the historical data may not represent the future. That being said, I may worry about it but I don't obsess over it.

How much? Very little
How often? Whenever my portfolio drops 10-20%.

What to do? Worry and change things when the WR >= 4%. In 4 years that hasn't happened

 

[ziggy29]

Nah - - he solo'd and never got his pilot's license.

I resemble that remark....

 

[beowulf]

Having grown up in the Bronx (NYC) in an apartment, the opportunities for raising chickens, having a goat or a cow, and owning a gun (Sullivan Act ) were extremely limited. I suppose we could have raised fish in the bathtub, but that would be somewhat inconvenient . We did have a steady supply of roaches and the occasional mouse, but I wouldn't call them good eating. We did have rats down by the rivers that you could put a saddle on, but rat souffle was never one of my favorite dishes. Some people did catch pigeons and squirrels in the parks, but they were really nasty and filthy animals. All that survivalist stuff is great when you have 40 acres and a plow, but in the city it's a real issue .

The closest thing I remember to really fresh anything was the egg man and the milkman, but they were gone by the late '50s. In fact, frozen orange juice was an amazing development, as, until that time, the only way to get OJ was to squeeze it yourself.

We did have lots of fresh produce stores, but even back then, they were pricey and the stuff had taken days to get to the city and was not "farm fresh." City folk just don't have the same opportunities for living off the land as those in flyover country .

 

[alex11]

Note, the $20k annuity was tongue in cheek... but, as a quick, fun thought experiment

$100 a month for food would buy:

Month 1:
50 lbs hard red spring wheat berries - $25
50 lbs great northern white kidney beans - $30
25 lbs powdered milk - $33
10 lbs peanuts - $15
pack of veggie seeds - $2

Month 2:
1 lb italian seasoning - $6
1 lb cinnamon - $5
12 lb short grain brown rice - $25
10 lb rolled oats - $10
5 lb honey - $20 (grade AA, not pure clover honey)
1 lb active dry yeast - $6.50
20 lbs potatoes - $10
10 lbs lentils - $10
2 packs veggie seeds - $7

Of course, first thing I'd look at, since that's more food than one or two people can eat, is splitting cost with another family so that I could put about half of the budget on veggies while waiting for mine to grow.

Where do you get your 50lb bag of Kidney Beans and your wheat berries?

Thanks

 

[Webzter]

Where do you get your 50lb bag of Kidney Beans and your wheat berries?

Thanks

From an Amish bulk foods store a couple hours south of here in northern Indiana.

Good places to check would include any Mennonite or Amish stores in your area, an LDS Cannery (any I've looked into don't require you to be a member), food co-ops (they may not carry in-stock but may be willing to order), bulk food stores, grain elevators, and, for the wheat at least, local flour manufacturers. There are also some online places but their costs seem to be substantially higher.

A note on going the grain elevator route.... you'll want to make sure it's suitable for human consumption. Also, there are varying levels of quality... well, not quality, but work involved. The cheapest to buy / most intensive work is 'field run' or 'field run from storage'. This is minimally winnowed, dirty, and basically from the thresher to you. Following would be 'pre-cleaned'. This is going to be winnowed which means chaff, smut balls, droppings, etc, have been removed. Next would be 'pre-cleaned and packaged'. Same benefit as before but it's also bagged.

To give you an idea on price... you might be able to get field-run for half as much as pre-cleaned and packaged. I've also seen the pre-cleaned stuff from $25-$60 for 50 lbs with the higher price being via online stores.

Storage is also a consideration, especially if you're considering long-term storage.

You can do a lot with wheat berries when you're buying in bulk... just make sure you're buying wheat suitable for your goal. You can cook 'em, boil 'em, grind them.. grind them coarse so you get nice bran flakes, grind them fine for flour (which is where getting a hard versus soft is important if you're not planning to add gluten and are planning to make bread).

And, of course, you can do a lot with a bean too

 

[Beryl]

"A nationwide sample of 500 American baby boomers (ages 47 and 65) who are not yet retired and have an annual household income of between $25,000 and $75,000 participated in the Internet-based survey."

What a pile o' crap in that article. If I was in that age group, and that was my peak income, I too would have problems with my personal vision of retirement.

Many members of this forum cannot relate to most American baby boomers because we've meticulously planned for ER. We may be in for a rude awakening as those who have not will affect everyone - whether we like it or not.

 

[ziggy29]

Many members of this forum cannot relate to most American baby boomers because we've meticulously planned for ER. We may be in for a rude awakening as those who have not will affect everyone - whether we like it or not.

And this isn't only a "rude awakening" for the boomers who can't retire -- it's also on the young adults whose careers can't get going in part because there are few jobs being vacated by said boomers who can't retire.

 

[Webzter]

And this isn't only a "rude awakening" for the boomers who can't retire -- it's also on the young adults whose careers can't get going in part because there are few jobs being vacated by said boomers who can't retire.

My brother, a licensed paramedic, can't get a job in his field. Apparently the burnout rate on paramedics is generally extremely high and so there's usually continual openings at the bottom for new talent as the top moves on to a new career after 5-10 years. However, with the market the way it's been for the past few years, the 'old-timers' are staying put.

 

[East Texas]

Where do you get your 50lb bag of Kidney Beans and your wheat berries?

Thanks

http://www.honeyvillegrain.com/

 

[ladypatriot]

Many members of this forum cannot relate to most American baby boomers because we've meticulously planned for ER. We may be in for a rude awakening as those who have not will affect everyone - whether we like it or not.

Why? How? Honestly, I'm not being confrontational, but I don't understand why other boomers' poor planning will affect me or cause me any "rude awakenings." Perhaps you're seeing something I'm not.

LadyPatriot

 

[GregLee]

Why? How? Honestly, I'm not being confrontational, but I don't understand why other boomers' poor planning will affect me or cause me any "rude awakenings." Perhaps you're seeing something I'm not.

Recall the anti-smoking argument made that smokers make themselves sick, and then non-smokers have to pay for their medical care? In those days, I was still smoking, and I found this argument very irritating, because it seemed like such a limp excuse for restricting my liberties. All the same, it makes a sort of twisted sense. Same thing here. If you are profligate, and I insist on paying to support you when you are impoverished, then you have harmed me by your improvident behavior.

 

[Rustic23]

We have millions of baby boomers that have not prepared for their retirement. It is the functions of government to take care of these poor souls, and to do that we must level the playing field. Therefore, we will take funds from those that have planned for their senior years and spread those funds amongst everyone. It is the only fair thing to do.

 

[bssc]

I suspect that Social Security will be harder to collect, with reductions for having assets, pensions or the like. Just to make it fair for those that didn't save. I have planned with that as a possible scenario.

 

[ladypatriot]

We have millions of baby boomers that have not prepared for their retirement. It is the functions of government to take care of these poor souls, and to do that we must level the playing field. Therefore, we will take funds from those that have planned for their senior years and spread those funds amongst everyone. It is the only fair thing to do.

The only way the government can take money from me is through taxes. It does seem inevitable that taxes (both ordinary income and capital gains) will increase, and some of our investment income will be affected. But we've already planned for that.

Now, another possibility is that eventually there will be some sort of "means testing" for social security and/or medicare, and those with assets will be expected to receive less from the government, but getting legislation like that passed will create such a political firestorm that I see it as only a remote possibility.

LadyPatriot

 

[ERD50]

Now, another possibility is that eventually there will be some sort of "means testing" for social security and/or medicare, and those with assets will be expected to receive less from the government, but getting legislation like that passed will create such a political firestorm that I see it as only a remote possibility.

LadyPatriot

Well, as I understand it (forget the details), but taxes on SS went up at some point, right? So that was a somewhat back door adjustment.

If the people being taxed are in the minority (as it appears those who planned for a comfortable retirement are), then those in office may not care what the minority sees as 'fair'. Tax the minority to gain the votes of the majority. Political firestorm in name only.

Not a prediction, I'm just sayin'.

-ERD50

 

[Rustic23]

Never underestimate the avarice of your elected official. Why do you think 50% of the population don't pay taxes? The government can raise user fees, cut the tax brakes corporations get i.e. the corporation will pay more taxes and collect those from you and me, raise user fees, reduce deduction i.e close loop holes, means test, extend age requirements, reduce benefits, and so on. The goal of the average professional politician is to play to the rich enough to get money for campaign while buying sufficient votes from the poor to get re-elected.

 

[ziggy29]

Why? How? Honestly, I'm not being confrontational, but I don't understand why other boomers' poor planning will affect me or cause me any "rude awakenings." Perhaps you're seeing something I'm not.

Boomers not retiring = more young people unable to find a decent job = more lousy economy, higher expenditures in unemployment benefits and other social programs = more young adults living with Mom and/or Dad well into their mid-20s and beyond.

There are plenty of ways it affects many of us even if we are prepared to retire at a decent age ourselves. None of us are in a vacuum.

 

[ERD50]

Boomers not retiring = more young people unable to find a decent job = more lousy economy, higher expenditures in unemployment benefits and other social programs = more young adults living with Mom and/or Dad well into their mid-20s and beyond.

There are plenty of ways it affects many of us even if we are prepared to retire at a decent age ourselves. None of us are in a vacuum.

Add to that - A college education is increasingly important to enter the job market, and education costs have outpaced inflation. So this puts a real stretch on the younger generation, compared to previous generations. Invest all that money/time on an education, and then graduate into a tough, tough job market. Not a pretty picture. A friend of my sons graduated with a degree in Construction Management in 2004 - oops, bad timing. He's having a tough time. I feel for these kids.

-ERD50

 

[East Texas]

Why? How? Honestly, I'm not being confrontational, but I don't understand why other boomers' poor planning will affect me or cause me any "rude awakenings." Perhaps you're seeing something I'm not.

LadyPatriot

It’s a new version of the Ant and the Grasshopper fable. In the new version the ant (boomers who saved) and the grasshopper (boomers who didn’t) follow a similar path as in the original tale. The ant does everything right - saves, spends below his means, lives a relatively frugal life during the accumulation phase in order to have a comfortable retirement. The grasshopper doesn’t do squat about saving and enjoys living a life of luxury with the understanding the “government” will take care of him/her in the later years.

Time passes and the ant takes early retirement and enjoys all the things financially independent retirement has to offer. The grasshopper complains to the lobbyists about how unfair it is the grasshoppers have to continue working while the ant enjoys a life of leisure.

The lobbyists put pressure on the legislatures that their poor misunderstood grasshopper shouldn’t be penalized for not saving for retirement. After all, it just wasn’t his fault. He had mortgages and new car payments and boat payments and private school for the kiddos and trips several times a year and it took a lot of money to live the lifestyle they deserved. It just wasn’t fair the ant had everything going into retirement while the grasshopper had nothing.

So the government, in their infinite wisdom, said the ant should subsidize the grasshopper. The ant would pay hefty taxes on their retirement funds in order to help the grasshopper retire in reasonable comfort. So the ant cuts back on expenses in order to live within the reduced financial means and the grasshopper kicks the spending up a notch. After all, if he really gets in over his head financially he can file bankruptcy (which is another penalty in the way of increased prices for goods and services). The grasshopper’s motto is “nothing ventured, nothing gained”.

At this point the ant sells everything and moves to a small island off the coast of wherever. The grasshopper moves into a government housing project and survives on food stamps and Medicare and continues to whine about how unfair things are for him. Meanwhile, the ant sits on the veranda enjoying the cool breeze coming in off the ocean. He pops the top off a cold beer and doesn’t give a d@mn about anything. Because, after all, he is finally FIREd.

 

[winger]

. Why do you think 50% of the population don't pay taxes?

Untrue. 50% of the population doesn't owe FIT. I can't imagine how a person would live in this country and not pay taxes.

Hurt's your story, I know.

 

[Rustic23]

Come on! Employment tax is similar to having a firm deduct for a pension. You are paying for a direct future benefit. Yea, I also know the courts say it is not guaranteed, so you can save your little fingers on that argument. They also pay sales tax and they pay the increased prices to corporations so they can send it to the government. It does not alter the fact that over 50% of the people do not pay income tax, a point I feel fairly sure you knew I was making, so the gotcha had little effect! But if it make you feel better, to say 'Yea, but they pay FICA' well OK.