quotes like this drive me nuts

[tulak]

I was reading this article on msnbc and when I get to the end, it had quote that is just wrong. For some reason, it irked me more than most of these articles tend to. Economy hitting elderly especially hard - Retirement - MSNBC.com

“I have been saving every year for some 40 years now trying to get ready for this moment where I might be able to have a little more time for family, for friends,” Looney said.

Now he expects to have to work for at least five more years.

If anyone should know, it’s John Looney. He works for AARP.

And I ask myself, how can someone have been saving for 40 years, especially the last 40 years where the S&P500 has returned over 10% on average, and not have enough to retire on? Of course, the article won’t actually provide numbers; that would hinder the authors ability to get his message across: that the elderly are having problems retiring.

Don't get me wrong: overall it's a sad situation. I suspect that a good part of it comes because most people don't prepare properly and it's not necessarily their fault, just the reality of the situation.

It's just the quote at the end that rubbed me wrong. 40 years savings, yeah, right. More articles like this, and then nobody will save. After all, if he can't do it after 40 years, then what chance do I have...

 

[rs0460a]

I suspect that a good part of it comes because most people don't prepare properly and it's not necessarily their fault

In most cases it is their fault.

OK - 40 years. So, how much did he put away (e.g. percentage of retirement income)?

BTW, I retired last year (age 59) and I volunteer 1-2x week for Meals on Wheels (and get no reimbursement for gas, even though I am a driver).

This "news" is just "static". Plan your (financial) retirement, execute the plan, and ignore the "static" (including CNBC ).

- Ron

 

[ziggy29]

The bottom line is that stuff like this happens all the time and in all economies. But the media, always looking for "we're all doomed and the economy and the markets are killing everyone" stories, only highlight stories like this when people are feeling gloomy already, just increasing the feeling of helplessness and futility.

Pretty rotten, I think. Way to help ensure the self-fulfilling prophecy, guys.

 

[OAG]

Hey, he dropped his change in the jar for 40 years and now can afford the "burial" policy that is advertised on TV - an it will pay for two burials (at today's rates).

We must have more journalists than lawyers (no offense Martha) in this country now. They do not have to even search for these stories - just go to the local Bingo Parlor, pot luck dinner, attend the FA "free lunches" and the stories will be there. It's entertainment!

I also know there are many, many people having a real rough time of it, but most I would suggest, are doing their best and are not whining about it (at least not in public).

 

[Bestwifeever]

I completely agree with how annoying quotes like these are.

Probably Looney (a) likes his job a lot and doesn't want to leave anyway or (b) wants to retire with exactly the same lifestyle he has always enjoyed or (c) possibly refinanced all the equity from his home (and used it for something other than his home) and now is upside down on his mortgage? He definitely should come clean about that quote and why he hasn't saved enough to retire, since he works for the organization that presumably helps people have a satisfying retirement.

 

[tulak]

In most cases it is their fault.

Deep down, I agree with you, but I figure I should give them the benefit of the doubt, especially when I haven't even been around for 40 years.

But I do know that if the next 40 is like the last, I'll be done saving in a less than 20 years for a retirement that lasts over 40 years. Which is why this guy irked me so much.

 

[cute fuzzy bunny]

He probably put $100 a month into the company plan in a money market account, or into something with a bunch of high expenses that underperformed the s&p500 by 5% a year.

Unfortunately putting money aside every month for a long time isnt the only thing you need to get right.

When I met my wife she'd been signed up by her employer for a variable annuity that was withdrawing money from her paycheck and putting it into a money market fund...for the prior 6 years...that would have been from 1994-2000.

 

[Frugality_of_Apathy]

I was reading this article on msnbc and when I get to the end, it had quote that is just wrong. For some reason, it irked me more than most of these articles tend to. Economy hitting elderly especially hard - Retirement - MSNBC.com



And I ask myself, how can someone have been saving for 40 years, especially the last 40 years where the S&P500 has returned over 10% on average, and not have enough to retire on? Of course, the article won’t actually provide numbers; that would hinder the authors ability to get his message across: that the elderly are having problems retiring.

Don't get me wrong: overall it's a sad situation. I suspect that a good part of it comes because most people don't prepare properly and it's not necessarily their fault, just the reality of the situation.

It's just the quote at the end that rubbed me wrong. 40 years savings, yeah, right. More articles like this, and then nobody will save. After all, if he can't do it after 40 years, then what chance do I have...

When most people think about saving they usually mean they put some money in a savings account and if it should ever hit the the 5 digit mark then they are gonna spend that on some luxury vacation or getting that boat they always wanted. Saving and investing are mutually exclusive in most peoples minds and "windfall profits" must be spent immediately. That's just common sense.

The thing that irks me more is that AARP is "formerly the American Association for Retired Persons." So now AARP doesn't stand for anything it's just a random bunch of letters with name recognition.

 

[CitricAcid]

When most people think about saving they usually mean they put some money in a savings account and if it should ever hit the the 5 digit mark then they are gonna spend that on some luxury vacation or getting that boat they always wanted. Saving and investing are mutually exclusive in most peoples minds and "windfall profits" must be spent immediately. That's just common sense.

The thing that irks me more is that AARP is "formerly the American Association for Retired Persons." So now AARP doesn't stand for anything it's just a random bunch of letters with name recognition.

Like the SAT...

To this person, I predictably agree with most of the posters. It is admirable that this person (maybe because he works for AARP) saves money every month for the last 40 years, it is far better than most do. How much did he save? Did he invest it well? Has he taken anything out of his "savings"? As FoA said, I think many people think of saving and investing as entirely different things. Saving means not spending it this instant, and will probably be spent two months from now. Investing means risking all your money!

I just think it comes down to the fact that people expect the situation to be perfect (a perfect economy, a perfect savings plan), yet the responsbility for their safe retirement boils down to them alone. During this economic times, nobody is saying that it is incredibly easy. Other households, however, are cutting back on spending a little, pushing back retirement maybe one year, shifting their investments around possibly, but then again nobody promised them a retirement as a guarantee anyway.

 

[Pete]

But the media, always looking for "we're all doomed and the economy and the markets are killing everyone" stories

I don't think this is true. The media gives us what we want or at least what we will pay attention to. It wasn't long ago they were trotting out a bunch of DOW 26,000 types and we bought all that hype too.

 

[ziggy29]

I don't think this is true. The media gives us what we want or at least what we will pay attention to. It wasn't long ago they were trotting out a bunch of DOW 26,000 types and we bought all that hype too.

Yes, when the market was flying high. Fear and greed sell. Then, it was greed. Now, it is fear. They play into both emotions and fuel both panic and irrational exuberance.

 

[CuppaJoe]

Guy at the coffee shop was a frugal b*stard all of his life. Worked low paying jobs, somewhat above minimum wage, six days a week, 10 hours a day. Started collecting Social Security at age 65 while still working, saved every penny of his SS check, probably in a basic savings account. Worked until he could work no longer. Was okay with SS plus an equal amount of saved SS for a couple of years. Times are very tough for him now.... Some people spring for meals, sometimes the coffee shop employees say, "it's on me...."

So you ridicule him, but the big difference between he and I is that I was much better paid and I learned how to invest. When could he have learned to invest, on his 10 minute coffee break on Wednesdays?

I suspect that the AARP pays diddli-squat. But we will never know the full story. Judge not!

 

[Bestwifeever]

You're right, we don't know the circumstances of the AARP guy's life, so who knows why he can't retire yet (or how old he is, even).

Here is a quote from the AARP/Careers with AARP site:

AARP is a great place to work. We offer competitive salaries, excellent benefits, and opportunities to learn, grow, and advance. But even more, every day at AARP, we have the chance to improve people’s lives. That’s what we mean by: “The power to make it better.”

 

[unclemick]

Sooo - we should pass the hat - to buy an Ultimate Cheapskate book to enlighten this dude AND help a new forum member!

heh heh heh -Where's my Curmudgeon Certificate? - CUT SPENDING STUPID! - or maybe Jeff can give him the soft sell on frugal.

 

[ziggy29]

Guy at the coffee shop was a frugal b*stard all of his life. Worked low paying jobs, somewhat above minimum wage, six days a week, 10 hours a day. Started collecting Social Security at age 65 while still working, saved every penny of his SS check, probably in a basic savings account. Worked until he could work no longer. Was okay with SS plus an equal amount of saved SS for a couple of years. Times are very tough for him now.... Some people spring for meals, sometimes the coffee shop employees say, "it's on me...."

So you ridicule him, but the big difference between he and I is that I was much better paid and I learned how to invest. When could he have learned to invest, on his 10 minute coffee break on Wednesdays?

I suspect that the AARP pays diddli-squat. But we will never know the full story. Judge not!

Maybe, maybe not. But IMO, the point is that this is just another "the economy sucks and you're doomed" article in the mainstream media.

In other words, it is the current economy being blamed and not decades of low salary and/or savings rate. It's all the economy's fault. It's taking us all down and there is no hope. Where did I put my roll of Reynolds Wrap?

 

[Marquette]

Yes, to be meaningful, it'd have to say "he saved x% of his salary for 40 years in a x account and now it's just not enough". That'd require real reporting, though. Oh, and even then, could he have managed to save more to get ready for this point?

My wife has a coworker that puts all of her 401k money in the stable value option because she can't stand the thought of losing money.

 

[Milton]

The Silver Lining

Interesting 'sidebar':

Among Americans 50 and older:
— 45 percent say food prices have caused a hardship for their budgets
— 39 percent think at least some foods will have to be rationed within a year
— 47 percent are shopping for food less frequently
— 41 percent are eating less meat
— 18 percent have started eliminating some meals

Eating less, and especially eating less meat, are good ideas for many people in late middle age and old age. Highly processed foods can be replaced by relatively inexpensive fruits and vegetables.

 

[cute fuzzy bunny]

My wife has a coworker that puts all of her 401k money in the stable value option because she can't stand the thought of losing money.

Yeah thats a good one, since she's implicitly losing money.

I think that was the "question #2" regarding inflation that so many people over the age of 50 didnt understand?

 

[CuppaJoe]

You're right, we don't know the circumstances of the AARP guy's life, so who knows why he can't retire yet (or how old he is, even).

Here is a quote from the AARP/Careers with AARP site:

Interesting, BestWifeEver, got me thinking. What do they do at the AARP, it's several publications and maybe some envelop stuffing. I'm being simplistic but I can tell you about my business neighbors on the floor I work on. One group is the West Coast site for two national magazines and the other puts out a regional newspaper. Both organizations bring in extra help at certain times of the month--I doubt that any of them bring home a full diddi-squat paycheck.

We might guess that some people violate the first rule of investing--start with the highest possible salary you can attain. What's 10% of diddli?

 

[unclemick]

I've said this more than once on this forum: skip the Norwegian widow for the moment and flash back to the 7th grade circa 1950's in the PacNW. My Father's Aunt - aka 'da Swedish maid' died in New York. Left him 10-15k in mutual funds(1950's $) plus a paid trip to take her remains back to a family plot in Finland.

After the trip - he dumps those evil stocks and we get a house in the city - with real sidewalks. I go to the library and read up - cause I'm curious about these here mutual fund things.

She was a maid all her working life.

heh heh heh - When I sold the house in 93, the records said it cost 7500 in 1958. It was painted and reroofed before we moved in.

 

[cute fuzzy bunny]

What do they do at the AARP, it's several publications and maybe some envelop stuffing.

Huge membership base, substantial government lobby, manage discount programs with tens of thousands of retail and restaurants, run their own or offer brokered services for insurance, investing, and their own line of mutual funds, along with thousands of publications for retirees.

So yeah, they've got mailroom and janitor jobs, but I'd hazard a guess that the average AARP employee makes as much as any other white collar employee.

 

[ziggy29]

What do they do at the AARP

[-]Pursue policies on entitlements that bankrupt their grandkids[/-] A lot of lobbying on behalf of the interests of people over 50.

 

[CuppaJoe]

Maybe, maybe not. But IMO, the point is that this is just another "the economy sucks and you're doomed" article in the mainstream media.

In other words, it is the current economy being blamed and not decades of low salary and/or savings rate. It's all the economy's fault. It's taking us all down and there is no hope. Where did I put my roll of Reynolds Wrap?

I agree about the gist of the article but I took OP's question to be: why can a person save for 40 years and still not have enough?

 

[Bestwifeever]

Interesting, BestWifeEver, got me thinking. What do they do at the AARP, it's several publications and maybe some envelop stuffing. I'm being simplistic but I can tell you about my business neighbors on the floor I work on. One group is the West Coast site for two national magazines and the other puts out a regional newspaper. Both organizations bring in extra help at certain times of the month--I doubt that any of them bring home a full diddi-squat paycheck.

We might guess that some people violate the first rule of investing--start with the highest possible salary you can attain. What's 10% of diddli?

No clue what the guy makes or his background but according to Google searches he is the director of the Colorado office (his position also skipped over in the article) so he probably gets paid more than an envelope stuffer. But more than that, I think the point of the OP is that quotes like these are dropped into a story to support the writer's point at face value, when really this particular quote by itself is meaningless (as noted above: so how much DOES he have saved, percentage or $? So how old is he? So when does he want to retire? etc.).

 

[cute fuzzy bunny]

By the way, AARP lists John Looney as their "Colorado Director", and he's quoted in several articles criticizing senate votes on medicare and patients rights.

So...I'm guessing he was probably making some decent money...and to not have invested enough or well enough when working a senior job for an organization that has a primary focus on advising people on how to prepare for and live well in retirement...well...go ahead and make your own joke.