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Old 06-14-2009, 04:56 PM   #21
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clifp's Avatar
Join Date: Oct 2006
Posts: 7,455
Originally Posted by walkinwood View Post
From the article
""The hard reality that we're coming to face at this point is that society can't afford to have a huge segment of our workplace sitting idle for 20 to 30 years,""

That's the unvarnished truth. If you want to be part of the small segment that can, you need to plan for it. Can't expect society to hand it to you on a platter.
Exactly right. I am struck by how many of the profiles of "victims" in this recession have spent more than 100% of their income over long periods of time. We can't as a society afford to give these people anything more than meager existence in their old age. Both because our competitors in Asia, and even Europe don't do this and also as deterrence. e..g if you don't save money for your retirement you'll end up eating catfood and be a burden on your children.

The average America who saves up to the employee match in their 401K (say 6%) and perhaps moves up to 10% during their 50s well need to work through their 60s, and hopefully on average die before they turn 90.

The almost 1:1 ratio (or in my case more than that hopefully) requires a massive savings rate. Virtually every regular on this forum maxs out their 401k, contribute to IRA if available and saves outside also. This even includes those folks with a generous government pension. There are a heck a lot of people in the forums who's saving rate exceeds 20%. Unfortunately while this saving rate is good for us as individual, it is potentially ruinous for the economy as a whole. E.G Japan or the Q4 2008.

On the other hand, spending 102% of our income as society is even worse.

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