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Do you feel besieged, financially speaking?
Old 05-31-2010, 12:50 PM   #1
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Do you feel besieged, financially speaking?

I think it is fair to say that there is a huge amount of angst out there regarding the future. Almost everyone I know (from working folks to retired folks and youngins) feels like they are going to suffer financially in the future one way or the other. Escalating health care costs, higher taxes, high unemployment, lower wages, low interest rates, fear of inflation or deflation, benefits cuts, low returns on investments, high deficits, relatives requiring significant financial aid, the list goes on and on... Whether those fears are founded or not, they seem to exist nonetheless.

Do you feel like your financial future is at risk? What are your fears and hopes for the future?

I am not looking for a political debate or hysterics, just some honest truth about how people around here feel about the future...
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Old 05-31-2010, 01:37 PM   #2
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I feel great about the future. I have no fears or stress about it. Life is comfortable. You wanted the truth. That's it.

My income taxes have gone down. My utility bills have gone down. My property taxes have gone down. My salary has gone up. I do pay a little more for company-sponsored health insurance.
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Old 05-31-2010, 01:48 PM   #3
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You wanted the truth. That's it.
That's exactly what I wanted, the truth. I have no "green shoot" or "doom and gloom" agenda.
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Old 05-31-2010, 01:52 PM   #4
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I'm with LOL! on this one.

Let's take them one by one:

Escalating health care costs - my company rates stayed the same from 2009 to 2010, and the plan I have now is cheaper and better than the one I was using before.
higher taxes - yes, but I'm making more money lately too. If you mean higher tax rates, well, I worry about what I can control. I only have a little input into my Congresscritters, and they all are pretty fiscally conservative. We're getting outvoted at the moment.
high unemployment - I'm employed, and my company is hiring. As long as my group executes reasonably well, there are millions of dollars of profit we can make.
lower wages - My wages have gone up by about 30% in the last year, and are the highest they've ever been.
low interest rates - I like the low interest rate on my mortgage. I liked being able to borrow at 0% on credit cards and get 5% on savings accounts, but I knew that wouldn't last. I still get 2% on my cash, which I don't consider to be too awful.
fear of inflation or deflation - I'm still not sure which one I am supposed to fear -- I guess we haven't decided which we're going to have yet. Looking at the data, over the past year or so inflation is right in the target of where the Fed wants it to be, I thought.
benefits cuts - My company just reinstated profit sharing and 401(k) matching.
low returns on investments - My S&P500 index funds have gone up about 75% since March of last year. May was a downer, but I certainly expect corrections every so often.
high deficits - I do worry a little bit about the deficits, but I think the better metric is ratio of debt to GDP, which is on the high side historically, and will get higher if we keep going forward the way we are at the moment. I wonder if we will continue forward the way we have been. Personally I am looking at the Congressional elections this November for a pulse on what we as a nation are going to choose to do.
relatives requiring significant financial aid - All of my relatives -- at least any I would consider helping -- are better off than me.

I'm actually pretty optimistic about the future. I'm educated, healthy, employed, content, and am far better off than most in this world. If I lost my job, or my health, or my kids, that would be significantly problematic. Otherwise I don't worry too much about the headlines.

2Cor521

P.S. -- I would say that it is easy to focus on one's own situation and both look for reinforcing data around us as well as project that onto the nation or world as a whole. It was harder for me to be optimistic last summer when I was working for stock and the company I was at wasn't sure if they were going to be able to pay me. I do feel badly for those of us who have been out of work for a while, especially those in the 40-65 age range who are more expensive workers (salary and healthcare costs). That is a scary feeling.
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Old 05-31-2010, 01:56 PM   #5
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I don't post on the worry/rant threads because I am generally not worried. I also feel quite confident about the future and don't feel a huge amount of financial pressure. Of course, everyone's personal inflation rate is different, so those hurting the most will likely be the most vocal. There is also a lot of financial noise out there (talking heads), but once you know to tune it out, it is a lot less scary.
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Old 05-31-2010, 02:04 PM   #6
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I retired in 2008 at the age of 45. I feel great about the future now that I am out of the rat race.
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Old 05-31-2010, 02:08 PM   #7
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While I am sometimes disappointed about the present, I am always confident about the future. Until a day arrives and passes, the possibilities for it, and me, are endless. In fact, I'm so confident, I wrote a song about it:




Honestly, I am happier now than I have ever been and very confident about the future. As I wrote in another thread, the year I was 18 was the worst of my life, but I survived it. Every year has gotten better since then, and I have no reason to believe they won't continue to improve.
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Old 05-31-2010, 02:10 PM   #8
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I don't feel besieged at all, and neither do I feel much angst.

I do feel that unexpected things have come out of left field from time to time, but when in life does that not happen? In general, things are seeming better than I had expected, so far this year.

Hope that the above statement doesn't "jynx" things for us...
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Old 05-31-2010, 02:17 PM   #9
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I don't feel besieged, but "the recent unpleasantness" convinced me to keep my WR lower than I had originally planned, and that decision has had consequences, such as continuing to rent rather than to buy a condo. Meh.
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Old 05-31-2010, 02:19 PM   #10
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Quote:
Originally Posted by FIREdreamer View Post
Do you feel like your financial future is at risk? What are your fears and hopes for the future?

I am not looking for a political debate or hysterics, just some honest truth about how people around here feel about the future...
I do have concerns about the future in regards to things I can not control...such as MegaCorp healthcare, social security, stock mkt...etc. However, there are many things I can control..such as most of my expenses. I can also choose to have a grateful attitude...

A couple of months ago my doc thought I had a brain tumor (fortunately I did not). This type of experience puts things into perspective.

If we do the best we can to prepare....how can we ask more from ourselves?
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Old 05-31-2010, 02:20 PM   #11
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Oh boy. I'm with the worriers on this one.

I think health care costs are likely to continue their increase at rates above general inflation. I hope to stay employed long enough that the reform provisions guaranteeing ability to buy insurance without pre-existing exclusions and without fear of recision go into force. (If that happens without repeal, then that will reduce my worry) but I do expect rates will be sky high, as will medical costs.

Employment is problematic. I found a stable situation after 2 job changes away from companies that were collapsing around me in the last year. I was laid off as were many colleagues I respect and think have strong skills. It's not enough in the current economy, as some of them are still out of work. I was lucky, but I might not have been and I worry about conditions that could impact my current employer. Or a double dip. Or continued pressure to outsource. Or just dump the older workers and replace them with younger cheaper ones (yes, I know it's illegal, but it certainly does still happen).

Financially, my portfolio has not kept up with any of my 3 year old projections, but I am grateful I have at least what I have. I'm in better shape than many colleagues, but still worry that all this savings and LBYM may not pay off like I want it to. I've blown way past my intended retirement age and may still be another 10 years (no longer early) before I can retire. I'm worried that significant inflation (think early 1980's or worse) may be coming to enable some very large institutional debts to be paid off with inflated dollars. Likewise, I think I will still collect some social security, but not all that's been promised and I will need to make up the difference or be ready for increased taxes that may target assets, instead of just income.

I do try to tune out the majority of the noise (gold doomsday scenarios, ongoing religious wars, increase in terrorists, oil spill disasters) but that still leaves a lot of potential for bad sequences of events to hurt my finances. I'm hopeful that if things can hold together for a few more years I will have accumulated enough that I am insulated from the worst of the likely employment and economy scenarios, but I'm not safely there yet.
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Old 05-31-2010, 02:21 PM   #12
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And to put things in perspective, May was touted as the worst May in the stock market since 1940. I'm laughing because the indexes are about where they were in mid-February. It seems like everyone wants the stock market to only go up. Well, it has done just fine this year.

And in May there were two days where the stock market just exploded upwards. My portfolio's two best one-day gains both occurred this May.
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Old 05-31-2010, 02:30 PM   #13
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Nope, not besieged. I think most of the worst issues are in thge rearview mirror and a sustaind economic expansion will cover a multitude of sins. My main issueis that as a result of the financial crisis I find myself underemployed. I am working through the decision process of what I can and wish to do about that. Still looking at ESR in 3 to 5 years.
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Old 05-31-2010, 02:40 PM   #14
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Do you feel like your financial future is at risk? What are your fears and hopes for the future?
My financial future looks wonderful. Risk has been factored in and I am still smiling and sleeping well.
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Old 05-31-2010, 02:41 PM   #15
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yes, I do sometimes feel overwhelmed by the thought of all the things that could go wrong in the future. I think some people basically have a confident, optimistic outlook on life in general, but I'm not one of them.

As one worry-wart to another, I really want to recommend that you read the book T-Al suggested in my thread: "How to Stop Worrying and Start Living". I'd read it before, but he reminded me to dust it off and refresh my memory. Just for starters, here is one reminder from among the many in that book, that always helps when I start feeling nervous about the future.

Most of the things you worry about never happen.
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Old 05-31-2010, 02:44 PM   #16
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A couple of months ago my doc thought I had a brain tumor (fortunately I did not). This type of experience puts things into perspective.

If we do the best we can to prepare....how can we ask more from ourselves?
So happy that turned out OK. You're right about gaining perspective when you have a fright like that.

DH and I don't worry too much. We've done everything we think is important to cover our bases. FIRECalc and every other calculator we've used indicates we'll have enough to live a comfortable life. If I had to pick one thing I do have concerns about it would be health care. But, hey, we've got health plus LTC insurance. Can't do much more than that other than take care of ourselves.
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Old 05-31-2010, 02:44 PM   #17
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I feel like I'm in decent shape, but I have always worried about the future....to some extent. I'm just a very cautious person.
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Old 05-31-2010, 03:43 PM   #18
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Well, I'll have to say I'm a little frustrated to say the least.
I'm not fully invested as I needed to be for retirement.
I'm not seeing anywhere near the recommended 4% or better return I need.
The stocks I bought during the fall of 2008/2009 are doing fine but I was too paralyzed to buy bond funds as they fell with the stock market. I was/am very new to investing and just couldn't bear to see everything I was buying drop like a rock. I'm proud I bought stocks on the dips (tip from LOL/livesoft) but didn't make the same grade on bonds. I'm OK but still trying to get the bond side of my investments handled. I keep thinking just be patient and it will all work out though.
I will admit, I'm trying to time the bonds somewhat.
I'm not a very good loser (loss aversion, guilty as charged) when it comes to my savings..
My cash is in Cd's earning between 2% & 3%.
That will have to do for now. Health care is another concern but I'm covered at the moment.
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Old 05-31-2010, 03:56 PM   #19
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Quote:
Originally Posted by FIREdreamer View Post
Do you feel like your financial future is at risk? What are your fears and hopes for the future?
I am not looking for a political debate or hysterics, just some honest truth about how people around here feel about the future...
Honest truth? Is the surf up tomorrow? Well, then, woo-hoo!

If we ever get another thread titled "DOW 14,000, wheeeee!!" then I might start to get mildly concerned.

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Originally Posted by Dawg52 View Post
I'm just a very cautious person.
Unless properly medicated, of course...
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Old 05-31-2010, 03:58 PM   #20
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Most of the things you worry about never happen.

Thomas Jefferson wrote: "How much pain the evils cost us that never happened."

Problem is, as you say, remembering it when it counts!

As to the OP's question: do I feel besieged financially? No. Am I keeping a watchful eye on the current financial markets? Absolutely. Do I feel there are significant financial headwinds? Clearly. Will standards of living for most be declining in the future? I think so.

My bottomline is that I think I'm positioned better than most to weather the storm.
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