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Growing number have no savings
Old 02-03-2011, 12:39 AM   #1
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Growing number have no savings

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A recent Harris Poll found that thirty-four percent of Americans have no retirement savings and 27% have no personal savings
And surprising to me:

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Seventy percent of [high net-worth] boomers said they plan to work in retirement even if it is part time simply "to remain more active and engaged."

Poll finds growing number of Americans have no savings or retirement funds | AHN
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Old 02-03-2011, 04:43 AM   #2
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Seventy percent of [high net-worth] boomers said they plan to work in retirement even if it is part time simply "to remain more active and engaged."
Assuming this means... I don't need the money, I am enriched by going to my job...

There are some people that have jobs that are also their calling or avocation. The lucky few.

There are some business owners that want to stay in touch with their business even though they handed off the baton.

Quite number of these folks are senior management lifers that enjoy sitting on the throne (they do not have any other life... can't imagine one)!


I know a few people in the lower ranks that continue to be lured into doing their job... (called upon by some manager that cannot/won't work out a replacement). I think those people get some satisfaction out of feeling useful to the organization or to someone in the organization.


I am in the 30%... I am ready to disengage!



Oh... I almost forget.... the key to understanding this study.... not many people are high net worth (relatively small population)!

LBYM people that saved and invested their way into HNW are not typical!
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Old 02-03-2011, 09:03 AM   #3
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from the article...
Some of the other key findings from research includes that 31% of all adults report that they keep their personal savings "mostly in bank savings and and/or CDs", 17% keep "a relatively equal mix of stocks/mutual funds and investments such as bonds and money market funds", 11% keep their personal savings "mostly in stocks and/or mutual funds", 8% keep theirs "mostly in bonds, money market funds and other stable investments."

Sounds like PTSD of the 4Q08 variety. I will confess to having some of that myself.
I migrated my AA from 50/50 to 40/60 in 1Q09. I'm in a temporary 30/70 AA right now until I reformulate my long term AA plan, NLT mid year 2011.
Once I do my taxes...
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Old 02-03-2011, 10:57 AM   #4
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from the article...
Some of the other key findings from research includes that 31% of all adults report that they keep their personal savings "mostly in bank savings and and/or CDs", 17% keep "a relatively equal mix of stocks/mutual funds and investments such as bonds and money market funds", 11% keep their personal savings "mostly in stocks and/or mutual funds", 8% keep theirs "mostly in bonds, money market funds and other stable investments."
Am I unusual in that I only keep about $7k in the bank, and the other mid-six figures is invested in a low cost 90/10 mix of stock and bond mutual funds?
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Old 02-03-2011, 11:40 AM   #5
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Am I unusual in that I only keep about $7k in the bank, and the other mid-six figures is invested in a low cost 90/10 mix of stock and bond mutual funds?
It all depends on your age, the size of your nestegg, your stomach for risk, whether you (will) have a pension or not, your trust in the market, etc etc.
I invest as a moderate conservative. I am 52 years old with a modest failsafe pension and a 2nd much smaller one on the way in 4 years.
I always ask myself this kind of question..."if x% of my retirement portfolio was sent to the bottom of the river in concrete shoes, where would I be?"
I set my AA accordingly.
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Old 02-03-2011, 11:51 AM   #6
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True. I'm 38 and feel I have time on my side. I can be aggressive. When I am your age I expect I will be closer to 60/40.

Still, I'm mystified why 31% of people would choose such poor investment vehicles.
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Old 02-03-2011, 11:54 AM   #7
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Not said here is the worrisome impact it will have when people who *may* be able to leave their jobs won't do so out of fear or some rationalized "fulfillment" (it sounds better say you're staying because you like the stimulation than because you are afraid or desperate), preventing the usual attrition rates that can help some of the unemployed find work.

As long as this is the mindset, folks, expect 10% headline unemployment for many years to come, and "real" U-6 unemployment north of 15%...
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Old 02-03-2011, 12:01 PM   #8
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Yeah but...

Aren't there always about 20% of the nation living in poverty? So they wouldn't have any significant savings. The other 7% can be others who are having it really rough, with a few foolish spenders thrown into the mix. As far as the 31% in CDs and savings, they could easily be a combination of the people who have a little savings but not enough to be concerned with investing, as well as old people who probably should be diversified but just won't do it. I don't find these numbers all that shocking. Actually, given the fact that wages are shrinking, food and energy costs are rising rapidly (despite no inflation), and spending is increasing again, the fact that 73% of the nation has savings is pretty positive.
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Old 02-03-2011, 12:36 PM   #9
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In ten years the LBYM'ers will be living like third-world royalty in armed compounds to protect themselves from the massed hordes of lumpen proletariat who didn't save for their own futures.

Or not, YMMV...
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Old 02-03-2011, 12:40 PM   #10
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In ten years the LBYM'ers will be living like third-world royalty in armed compounds to protect themselves from the massed hordes of lumpen proletariat who didn't save for their own futures.

Or not, YMMV...
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Old 02-03-2011, 12:51 PM   #11
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Originally Posted by Keim View Post
True. I'm 38 and feel I have time on my side. I can be aggressive. When I am your age I expect I will be closer to 60/40.

Still, I'm mystified why 31% of people would choose such poor investment vehicles.
Just make sure you have the total Freebird mentality like I do "at my age"!

No offense was taken. I'm busting your chops.
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Old 02-03-2011, 01:23 PM   #12
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Originally Posted by freebird5825 View Post
Just make sure you have the total Freebird mentality like I do "at my age"!

No offense was taken. I'm busting your chops.
Heh-As usual I deserve it.
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Old 02-03-2011, 03:55 PM   #13
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Ain't statistic wonderful!

What we are not told, or the survey did not address is 'What is the state of your retirement plans?' If someone had ask us ten years ago how much we had in retirement savings, it would be a dismal amount compared to income we would need. However, SS, a Military Pension, a county pension, and a bank pension would not be mentioned.

I am not saying the article is wrong, or right, it just does not give you enough background into the poll to know.
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Old 02-03-2011, 04:58 PM   #14
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34% of US adults have no retirement savings? Meh. Probably at least half of those are aged 18-28. I wouldn't expect many people that age to have saved anything much.

The ones who need to worry are the 40+ year old people with no savings, a mortgage underwater, and $8K in CC debt.
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Old 02-03-2011, 07:25 PM   #15
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I'd say that the increase in the number without savings reflects the economy. Lots of unemployed people spend their savings.

The absolute starting value partially reflects the fact that the lowest income 20% (or 30%) of Americans simply don't have a lot of money. They'll tell you they are concentrating on putting food on the table today. They can also expect a better replacement ratio from SS than higher income people.

And, of course, there are employed people who could cover all the necessities of life and still have plenty left over for savings, they just don't save. But with these numbers, it doesn't appear they dominate the survey.
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Old 02-04-2011, 01:50 PM   #16
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The ones who need to worry are the 40+ year old people with no savings, a mortgage underwater, and $8K in CC debt.
Only $8k in credit card debt? That's almost being frugal. The average debt per household with credit card debt is $15k.


Credit card statistics, industry facts, debt statistics
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Old 02-04-2011, 05:22 PM   #17
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In ten years the LBYM'ers will be living like third-world royalty in armed compounds to protect themselves from the massed hordes of lumpen proletariat who didn't save for their own futures.

Or not, YMMV...
Except LBYM'ers will lead seemingly modest, ordinary lives and the proletariat won't realize same - as in The Millionaire Next Door.

I'll guarantee you my neighbors, co-workers and even family have no idea what DW and I are worth, we like it that way and enjoy life under the radar. We don't care about "stuff" and appearances at all anymore... I've always enjoyed being underestimated. Only my boss knows I'm retiring at this point, he told me "a lot of [company] people are going to be shocked when they hear you're retiring."
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Old 02-04-2011, 06:32 PM   #18
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I'll be living in Mexico and will look like the proletariat living among the wealthy drug lords.
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