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Old 03-16-2015, 01:58 PM   #61
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That's excellent, brewer12345!

Can early retirees audit?
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Old 03-16-2015, 02:34 PM   #62
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Financial literacy is dangerous!

There are entire industries founded on the lack of financial literacy of their customers. An outbreak of financial literacy would endanger these industries, their shareholders, and even the jobs of all their employees!

Our fight against job-killing financial literacy is ongoing. It threatens to force employers to preemptively lay off employees or decide not to hire new employees. It is a danger to job growth, and a hazard to our economy.

Help stamp out financial literacy today!

This message sponsored by the Variable Universal Life Annuity Sales Association of America in conjunction with Dewey, Cheatham, and Howe Full Service Brokerage.
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Old 03-16-2015, 02:46 PM   #63
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I once saw a man like that, although I don't think he needed the money or the insurance. I think he was simply in denial and thought that his cancer was beatable.

My dad doesn't need the money, but he would work until the day he died if his body would have allowed it. In fact up until recently he worked for free with my brother at his shop. Some people are just wired that way. When he was sitting in the pews as a youngster, he must have really paid attention to that "Protestant work ethic" sermon.


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Old 03-16-2015, 03:45 PM   #64
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Originally Posted by brewer12345 View Post
Financial literacy is something that has always seemed sorely neglected to me. I recently started volunteering with Junior Achievers. Last week I did the first of 5 weekly sessions with 26 2nd graders at a nearby elementary school following a curriculum/lesson plan JA provided. The kids absolutely eat this stuff up. If it continues to go as well as the first lesson did, I will be doing this for a long time.
Awesome! What a great contribution!
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Old 03-16-2015, 05:10 PM   #65
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Financial literacy is dangerous!

There are entire industries founded on the lack of financial literacy of their customers. An outbreak of financial literacy would endanger these industries, their shareholders, and even the jobs of all their employees!

Our fight against job-killing financial literacy is ongoing. It threatens to force employers to preemptively lay off employees or decide not to hire new employees. It is a danger to job growth, and a hazard to our economy.

Help stamp out financial literacy today!

This message sponsored by the Variable Universal Life Annuity Sales Association of America in conjunction with Dewey, Cheatham, and Howe Full Service Brokerage.

We're more likely to be struck by ReWahoo's asteroid...


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Old 03-16-2015, 07:41 PM   #66
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I know there are threads about this and it has been discussed a lot. But in looking at this latest report, well, I guess I never really absorbed how bad it is going to be for a lot of our fellow Americans.

45% of all working households have no retirement plans at all and half of those are headed by someone 45 to 65 years old! That is a hard situation to fix.

From the report:

"Account ownership rates are closely correlated with income and wealth. Nearly 40 million working-age households (45 percent) do not own any retirement account assets, whether in an employer-sponsored 401(k) type plan or an IRA. Half of these households with no retirement savings are headed by someone between age 45 and 65, and may have too few year to catch up.

The average working household has virtually no retirement savings. When all households are included— not just households with retirement accounts—the median retirement account balance is $2,500 for all working-age households and $14,500 for near-retirement households. Furthermore, 62 percent of working households age 55-64 have retirement savings less than one times their annual income, which is far below what they will need to maintain their standard of living in retirement."

Link to report: http://www.nirsonline.org/storage/ni...l_rsc_2015.pdf

I know that many on here will say that it is their own fault for not saving for retirement. But I have to agree with this report that public policy must change to make it easier for Americans to save.

Given that half of workers that could contribute to a retirement plan DON"T contribute, I wonder if we have to go to something mandatory - like SS contributions. I don't have all the answers, but this is so sad.
Low wages and the cost of healthcare will make it impossible for millions of working Americans to accumulate enough savings to retire.

The math won't work.


The current public policy is that taxpayers subsidize low wage workers with food stamps.
The future public policy will have Taxpayers also subsidizing their retirement.
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Old 03-16-2015, 07:49 PM   #67
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Originally Posted by brewer12345 View Post
Financial literacy is something that has always seemed sorely neglected to me. I recently started volunteering with Junior Achievers. Last week I did the first of 5 weekly sessions with 26 2nd graders at a nearby elementary school following a curriculum/lesson plan JA provided. The kids absolutely eat this stuff up. If it continues to go as well as the first lesson did, I will be doing this for a long time.
I was a JA volunteer for a few years back when I had a j-o-b. Being in the classroom with those kids (and not having to worry about discipline) was a great experience. Especially when you saw the lightbulb come on for some of them.
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Old 03-16-2015, 07:55 PM   #68
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I was a JA volunteer for a few years back when I had a j-o-b. Being in the classroom with those kids (and not having to worry about discipline) was a great experience. Especially when you saw the lightbulb come on for some of them.
Funnily enough, the first thing they wanted to ask me about when I got there was counterfeiting. Since we have both one of the US mints and a Fed Bank branch in town and I have worked at one of them, I was able to field the questions, but it was pretty funny.
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Old 03-17-2015, 10:38 AM   #69
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That is a better problem than in the past where traditional pension plans were ineligible to be rolled over and many were forgotten about. I have 2 small pensions from companies I left 25 and 30 years ago and can easily see why some folks don't keep in touch with old employers so they can collect future pensions.

...
The fat lady just sang on public pensions:

California public workers may be at risk of losing promised pensions - LA Times

From the article:

Quote:
The agency's most significant setback came in Stockton's bankruptcy case. The judge approved the city's recovery plan, including maintaining employees' pensions, but ruled that Stockton could have legally chosen to cut workers' retirements.

In his written opinion, U.S. Bankruptcy Court Judge Christopher M. Klein blasted CalPERS as "a bully" for weighing in on the proceeding to insist — wrongly — that the city had no choice but to pay workers their promised pensions.

Karol Denniston, a public finance lawyer at Squire Patton Boggs, said Klein's ruling was "critical for every municipality in California."

"Next time we see a Chapter 9 bankruptcy filing," she said, "pensions will be up for negotiation just like every other creditor.
"
Coming to a pension near you. As goes California, so goes the nation.
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Old 03-17-2015, 11:10 AM   #70
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I don't think anyone should be surprised by that, because a lot of governments have promised way more than they're actually contributing to pensions. The stock market has probably bailed some of them out recently but all you have to do is look at Detroit to see where a lot of them are headed.

http://time.com/money/3582218/retire...avers-warning/
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Old 03-17-2015, 12:05 PM   #71
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I don't think anyone should be surprised by that, because a lot of governments have promised way more than they're actually contributing to pensions.
Well maybe I shouldn't be surprised by that, but I am not ashamed to admit that I am. Actually to me this more than surprising; to me this is shocking. I'm also shocked and disgusted at what has already happened to private pensions in the past couple of decades. We can adjust and life goes on - - but we don't have to like it, of course, and I sure don't. Would it sound too curmudgeonly if I pointed out that the world is going to h*ll in a handbasket?
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Old 03-17-2015, 12:10 PM   #72
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The current public policy is that taxpayers subsidize low wage workers with food stamps.
The future public policy will have Taxpayers also subsidizing their retirement.
Future? See ACA
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Old 03-17-2015, 12:34 PM   #73
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Low wages and the cost of healthcare will make it impossible for millions of working Americans to accumulate enough savings to retire.

The math won't work.


The current public policy is that taxpayers subsidize low wage workers with food stamps.
The future public policy will have Taxpayers also subsidizing their retirement.
Of course this isn't the future. Just look up social security bend points to see this is actually past present AND future.....
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Old 03-17-2015, 01:07 PM   #74
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Future? See ACA
With or without the ACA, the American taxpayer will continue to subsidize millions of low wage workers who work for corporations that make billions in profits.

Nothing wrong with big profits. But we do have a retirement crisis and we are all going to help pay for it.

401ks are great for higher income earners but the math isn't going to work for middle to low income earners.

So this report shouldn't surprise anyone.
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Old 03-17-2015, 01:10 PM   #75
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Of course this isn't the future. Just look up social security bend points to see this is actually past present AND future.....
Its probably going to take more than just social security to fix this mess.
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Old 03-17-2015, 02:19 PM   #76
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So this report shouldn't surprise anyone.
no surprise here
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Old 03-17-2015, 02:36 PM   #77
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Well maybe I shouldn't be surprised by that, but I am not ashamed to admit that I am. Actually to me this more than surprising; to me this is shocking. I'm also shocked and disgusted at what has already happened to private pensions in the past couple of decades.

...
IMHO, we're in for a lot more "surprises" (alternative media has been talking about/warning of this for years). Won't happen overnight, more like a slow, steady drip of eroded "entitlements". There's simply been too much promised and not nearly enough $ to fulfill those promises. Applies to SS and Medicare, too. Couple that with low expected returns, and you really have a nowhere to hide type of situation. I have friends who devoted their entire lives to government--everyday workers who never received bloated salaries. Reduced pensions for them will mean a lifetime of missed opportunity to make more $ in the private sector. A no win situation.
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Old 03-17-2015, 03:49 PM   #78
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IMHO, we're in for a lot more "surprises" (alternative media has been talking about/warning of this for years).
Alternative media and Warren Buffett. Warren Buffet wrote this in 1975:

"Rule number one regarding pension costs has to be to know what you are getting into,” Buffett wrote to Graham. “As will become so expensively clear to citizens in future decades, there has been even greater electorate ignorance of governmental pension costs.”

Buffett Says Pension Tapeworm Means Decade of Bad News - Bloomberg Business
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Old 03-17-2015, 04:51 PM   #79
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IMHO, we're in for a lot more "surprises" (alternative media has been talking about/warning of this for years). Won't happen overnight, more like a slow, steady drip of eroded "entitlements". There's simply been too much promised and not nearly enough $ to fulfill those promises. Applies to SS and Medicare, too. Couple that with low expected returns, and you really have a nowhere to hide type of situation. I have friends who devoted their entire lives to government--everyday workers who never received bloated salaries. Reduced pensions for them will mean a lifetime of missed opportunity to make more $ in the private sector. A no win situation.
Remember back 20 years ago when teachers and government workers were heroes in our economy because they made such small salaries compared to the private sector.

Then the economic downward spiral started and it appears that now those once underpaid teachers are just evil government union workers with a pension and the blame for all our fiscal problems.
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Old 03-17-2015, 04:55 PM   #80
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Low wages and the cost of healthcare will make it impossible for millions of working Americans to accumulate enough savings to retire.

The math won't work.


The current public policy is that taxpayers subsidize low wage workers with food stamps.
The future public policy will have Taxpayers also subsidizing their retirement.
Actually if a low wage person retires at FRA the math isn't near as bad as you think because SS replaces a much higher percentage of income for low wage workers. This study indicates replacement rates of 72% for singles and 63% for couples for those whose income is in the lowest 20%.

Note that this replacement rate compares SS benefits with gross income, so a 72% replacement rate is actually much higher if one compares SS benefits to pre-retirement take-home pay (which presumably is all spent). After SS and federal withholding someone who is single earning $2,000 a month would take home 83% of their gross, so SS would really replace ~87% (72/83) of their pre-retirement takehome pay... and that assumes they reside in a state with no state income tax... in states with an income tax the replacement rate would be higher.

Is this a great outcome.... no, but it isn't as dire as you seem to think.
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