Summary Findings – Net Worth Comparison USA

[braumeister]

If I did the same job in the private sector, my salary would be nearly double, and there would be employee matching in a 401k.

That's a very valid point. The military has a great retirement plan, but I know for a fact that I could have made several times my military salary in the private sector. I know because I was repeatedly recruited by executives during my Air Force career.

I stayed in for many reasons, and I'm glad I did, but it's important to look at the total picture when discussing pensions. There are always ways to improve both the fairness and the effectiveness of any system.

 

[jazz4cash]

I will say that I'm not jealous. I simply think that some pension agreements are being "gamed" by individuals to boost the pension amounts far higher than was ever imagined by the original agreement.

So doesn’t the organization have a responsibility to taxpayers to close loopholes to prevent the system from being gamed? I know it’s extremely tough to fix problems already baked into the system but going forward these loopholes need to be closed. I can’t blame the individuals.

 

[skipro33]

How is it 'gaming' the system when it's a pension, but not when it's filing taxes or ACA? I've read plenty here on how to maximize one's personal interests when it comes to those two subjects and not a peep that it's gaming the system.
When staying within the laws and rules of any of those programs, it's not gaming, it's just being smart. Who walks away from the table with money still on it anyways?

 

[HI Bill]

If one works for the military, and qualifies for their pension, I see nothing wrong with them taking it, then continuing to w#rk. The job, like those of police and firemen, carry above-average risk, and part of the 'carrot' to sign up is the pension and benefits. Those who take the risk, make it to retirement age, then continue as a consultant or for another agency and w$rk for another 20 years deserve a second pension, IMHO. I'm not concerned about a lack of pension or retirement income equality. People choose careers based on the satisfaction they gain from them, the pay, the benefits and the location. Choose wisely, and you'll come out ahead, most likely.

 

[HI Bill]

Who walks away from the table with money still on it anyways?

Almost every FIRE person (it's the OMY syndrome). Leaving a good-paying career at age 50 or 55 is, by definition, leaving your peak earning years on the table.

 

[Rambler]

It is interesting that my 84 year old parents, who never earned more than $25k per year were able to amass enough to put them in the top 50%. They’re frugal folks, haven’t had a mortgage nor any other debt since they were age 50, and drive their cars until they can no longer be driven (dad sold his 25 year old Nissan truck when they moved to AZ a couple years back...had about a quarter million miles on it and still ran great). That said, sometimes they are so frugal that they forget to enjoy, or simply forgo a simple pleasure from time to time. I’m also surprised where this table puts me, having been retired for nearly 8 years...I figured I’d have dropped a notch or two by now, but still holding steady.

 

[GTFan]

How is it 'gaming' the system when it's a pension, but not when it's filing taxes or ACA? I've read plenty here on how to maximize one's personal interests when it comes to those two subjects and not a peep that it's gaming the system. When staying within the laws and rules of any of those programs, it's not gaming, it's just being smart.

I and others that have taken advantage of ACA have posted about gaming it just like folks game all sorts of other gov't programs. Not going to dig those up but it's not like anyone playing ACA for max subsidies is pretending that they're not.

But yeah, it's just being smart no matter what program or pension you're (legally) taking advantage of.

 

[skipro33]

I and others that have taken advantage of ACA have posted about gaming it just like folks game all sorts of other gov't programs. Not going to dig those up but it's not like anyone playing ACA for max subsidies is pretending that they're not.

But yeah, it's just being smart no matter what program or pension you're (legally) taking advantage of.

Thank you. I stand corrected then.

 

[Out-to-Lunch]

They’re frugal folks... drive their cars until they can no longer be driven

so far, so good...

(dad sold his 25 year old Nissan truck when they moved to AZ a couple years back...had about a quarter million miles on it and still ran great).

I am confused. Do they drive their cars until they cannot be driven, or do they sell their cars when they are still running great? :?

 

[PandaBear]

I look at these numbers and see the yearly income at a 4% withdrawal rate. Even the top 5% median person with a million bucks is only generating $40k a year. That is far from rich living.

Very true. But I how many people are like my dh and me.....”only” 2 million. But we have/will have 2 pensions. They don’t count in net worth, but make a big difference in our standard of living.

 

[Dtail]

I and others that have taken advantage of ACA have posted about gaming it just like folks game all sorts of other gov't programs. Not going to dig those up but it's not like anyone playing ACA for max subsidies is pretending that they're not.

But yeah, it's just being smart no matter what program or pension you're (legally) taking advantage of.

Do the same here with the ACA subsidies, plus Irrevocable Trusts for my parents.
No guilt here.

 

[Rambler]

so far, so good...



I am confused. Do they drive their cars until they cannot be driven, or do they sell their cars when they are still running great? :?

The truck was the only one sold before it had pretty much died. They gave it up because mom gave up driving, and they kept their newer, but still 14 year old car. Their 14 year old Corolla replaced one that was about 15 years old, that had been T-boned and totaled in an accident. The truck and these two cars are the only vehicles they ever bought new. I learned to drive at 16, in a used VW bus they had bought when I was 6, and in which my next sister two years younger than me learned to drive, as did my brother, seven years younger. Im not sure, but I think my youngest sister also learned to drive in it, but only in our Almond orchard when it was used in place of the old truck. At that time, the old Datsun truck (1300cc engine, 0-60mph in 57 seconds) had died. I think they sold the VW for scrap when I was about 30.

 

[Out-to-Lunch]

The truck was the only one sold before it had pretty much died. They gave it up because mom gave up driving, and they kept their newer, but still 14 year old car. Their 14 year old Corolla replaced one that was about 15 years old, that had been T-boned and totaled in an accident. The truck and these two cars are the only vehicles they ever bought new. I learned to drive at 16, in a used VW bus they had bought when I was 6, and in which my next sister two years younger than me learned to drive, as did my brother, seven years younger. Im not sure, but I think my youngest sister also learned to drive in it, but only in our Almond orchard when it was used in place of the old truck. At that time, the old Datsun truck (1300cc engine, 0-60mph in 57 seconds) had died. I think they sold the VW for scrap when I was about 30.

Awesome stories! I love it. (Except for the T-boned part, obviously.)

Makes my 1995 Honda Civic seem sprightly and youthful!

 

[youbet]

. Here in Illinois, we have agreements normalize pension amounts to the single highest paycheck an individual received...........Illinois has a state constitution that protects these agreements

That is not correct KarlH.

In reading your previous posts and comments, I noted much of what you said is not true. My guess is you're confusing "pensions from public bodies within Illinois" with "pensions administered by the state of Illinois." For example, pension benefits the sewer workers employed by your town earn are not a State of Illinois pension. They're a public pension from a town within Illinois. Two very different things.

Illinois has made some progress on the benefit side of state pensions. For example, teachers hired for the past 8 years have been hired to a new system called "Tier 2." Tier 2 eliminates opportunities for so-called "gaming" of the system, moves full retirement age out significantly, reduces the COLA to less than inflation and, generally, results in much smaller payouts. The remaining issues are: (1) Teachers hired prior to 8 years ago are still earning benefits under the old Tier 1 system and (2) the state refuses to fully fund the system annually. They always collect every penny of the 9%+ the teachers contribute, but generally skip or drastically under-fund their payment. It's kind of like an SS system where employers would be allowed to skip or under-fund their payment.

County and municipal public pensions are an entirely different matter. They are not protected by the Illinois Constitution but most have legal agreements requiring the employer to fully fund the pension each year. Those employees, IMHO, are much better off than the teachers and state employees despite not having the constitutional protection.

 

[youbet]

Makes my 1995 Honda Civic seem sprightly and youthful!

We just, sadly, lost our 2000 Civic. One of the steel brake lines rusted out quickly leaking all the fluid from the system and creating quite a surprise for me! I got a couple estimates from shops I've done business with before and the price tag for redoing the system was too high to justify. (20 year old car with about 180k miles.) So, I sold it to a DIYer for $500 and waved goodbye.

That leaves us with only our older vehicles, a 1999 F150 and a 1999 Buick Century.

DW thinks it's time to start shopping!

 

[Out-to-Lunch]

We just, sadly, lost our 2000 Civic. One of the steel brake lines rusted out quickly leaking all the fluid from the system and creating quite a surprise for me! I got a couple estimates from shops I've done business with before and the price tag for redoing the system was too high to justify. (20 year old car with about 180k miles.) So, I sold it to a DIYer for $500 and waved goodbye.

That leaves us with only our older vehicles, a 1999 F150 and a 1999 Buick Century.

DW thinks it's time to start shopping!

Yeah, it is hard to know what needed repair is enough to make one cry "uncle." Mine has been holding up well at 187k (knock on wood).

One interesting thing is that my model (an Si hatchback) is very popular among some youngsters for hot-rodding. So from time to time I get unsolicited offers to buy it from me, both in person and in the form of notes left under my windshield wipers. So I think that I will be able to get rid of it when the time comes!

My "toy car" is a '99 (BMW 3-series convertible with a swapped '00 Camaro engine), but the "new car" is a 2015 Subaru. We only bought a new one because my DW dislocated her shoulder and could no longer drive a manual tranny.

 

[youbet]

Yeah, it is hard to know what needed repair is enough to make one cry "uncle." Mine has been holding up well at 187k (knock on wood).

.

Indeed, you do not ever know!

Our Civic seemed to have the gift of eternal life for years and years. It just went and went and went. No accidents. No corrosion. An EX 4-door sedan.

Then DW left to do some shopping and when she pressed the brake after backing down the driveway, the pedal went to the floor. I got it to the shop using the handbrake. Up on the lift, we found all four brake lines that run through a central plastic channel from the master cylinder to each wheel were badly corroded. And one had rusted though and all the brake fluid had departed........ If you poured brake fluid into the cylinder, it just ran out the corroded brake line to the floor.

Replacing the lines is very labor intensive and, after watching a few YouTube videos, I decided that as a geezer I wouldn't be able to do it. 20 years ago, I wouldn't have hesitated. I found a DIYer who wanted to buy the car and take on the job, so that was the end of the Civic, at least for us.

Of all the things I had imagined could lead to the demise of that car, rusting brake lines wasn't one of 'em!

 

[CardsFan]

Since this has turned into a car thread:

We buy new cars. Keep them 8-10 years. Put low miles on them (DW just sold her 2012 Pathfinder with 64,xxx miles). We have not had any repairs of consequence in over 20 years. Just maintenance.

She bought a new higher end car, I still have my 2012 Altima with 55,xxx miles.

I see no advantage to keeping a car until I don't trust it. YMMV

FWIW, DSIL has a 20 year old Sentra. She lives with DMIL, who is willing to buy a new car. DSIL is stubborn. I don't like a 62 year old woman driving a 90 yo woman around in a 20 year old car. Money is NOT the issue. DSIL is just plain stubborn.

 

[Out-to-Lunch]

I see no advantage to keeping a car until I don't trust it. YMMV.

I don't really disagree.

I bought my car from its original owner in 2001. He kept meticulous records, including the original purchase and ALL service items (tires, etc.) Obviously, I knew how much I paid him for the car and how many miles it had. So I tallied up all of his expenses per mile compared to all of my expenses per mile. This included both operating costs and depreciation. (I used Edmunds or KBB prices for the residual value of my car at any point in time.)

Long story short, I think he got the better end of the bargain. I even took steps to take inflation into account to make the margin smaller.

But I don't care. I just like the car and want to keep driving it!

 

[zippy2020]

So much depends on where you live, however, if you factor in the cost of living. I was reading a NYTimes article pre-COVID. Can't remember exact details but it had something to do with retirement planning, and how much living costs fluctuated depending on where you reside.

Our retirement income looked great vs the national income average. Top 8%, woohoo!

Then when I paged down and put in my zip code for a recalculation, we dropped to Top 20%. LOL!

 

[cyber888]

But, at this point, I'd say it would take more like $2.5M or so for me to feel secure, whereas in the past I was happy with $2M, and actually starting to think about retiring. I'd never think of $2M, or even $2.6M, as being "wealthy", though, although I guess "wealthy" means different things to different people. If you're a long ways from it financially, it probably does look like a lot of money.

If you are living in DC, I agree with the $2 mil minimum - expensive city. I live in NC and $1.2 mil - $1.3 mil works.

 

[cyber888]

I guess i'm really really low mileage. Your 2012 SUV has 64K. My 2013 allroad has 35K. I think I have 8-10 more years to get to 64K miles .

Since this has turned into a car thread:

We buy new cars. Keep them 8-10 years. Put low miles on them (DW just sold her 2012 Pathfinder with 64,xxx miles). We have not had any repairs of consequence in over 20 years. Just maintenance.

She bought a new higher end car, I still have my 2012 Altima with 55,xxx miles.

I see no advantage to keeping a car until I don't trust it. YMMV

FWIW, DSIL has a 20 year old Sentra. She lives with DMIL, who is willing to buy a new car. DSIL is stubborn. I don't like a 62 year old woman driving a 90 yo woman around in a 20 year old car. Money is NOT the issue. DSIL is just plain stubborn.

 

[Retire52]

All my life I focused on long term financial freedom. It worked out so well, I stopped working at 45 and bought a Tesla (actually 2 of them).

Sometimes you can have both.

Haha, you are correct, Sir! just make sure you get the order right, FI first, then Tesla

 

[Gumby]

Haha, you are correct, Sir! just make sure you get the order right, FI first, then Tesla

Exactly right. The big problem I see is people living rich before they actually are rich.

 

[KarlH]

Haha, you are correct, Sir! just make sure you get the order right, FI first, then Tesla

For me it's FI, Tesla (with cash), then Retire... working on that last part now.