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Most Millennials Have an Unrealistic View of Their Retirement Prospects, Analysts Say (hsbc.com)
From a blog post on research firm HSBC: HSBC calls for millennials to wake up to living and working longer, as research finds only 1 in 10 expects to work past 65. Most millennials have an unrealistic view of their retirement prospects according to a new report from HSBC. The latest report in The Future of Retirement series, Shifting sands, finds that on average millennials expect to retire younger than other working age generations. Millennials expect to retire at 59, two years younger than the working age average of 61. The survey of over 18,000 people in 16 countries finds that only 10 percent of millennials expect to continue working after 65 -- even as their generation faces unprecedented financial pressures and state retirement ages continue to rise around the world. This is despite 59 percent of millennials agreeing they will live much longer and will need to support themselves for longer than previous generations.
I was thinking that I won't be able to retire the way things are.
They don't expect to live past 65, given the state of healthcare in this country.
This view is unrealistic because it fails to account getting &*#@ed by boomers both with national debt, student debt, globalization suppressing wages, and lack of opportunities due to boomers working past retirement.
Millenials don't expect to work past 65 because they'd be surprised if they make it past 50 without committing suicide.
I have never met someone below the age of 30 that thought they had a chance of retiring at all. The majority expects Social Security to be gone, they have never seen a job with a pension, and they just lived the prime of their lives through the economic recession shattering both 401k investments and realestate.
Millenials are keenly aware of how screwed they are.
Seriously, the math is not hard. Live a simple life that concentrates on happiness instead of stuff, and make saving a healthy percentage of your income. You will be financially independent and have the option to retire well before 50.
Or you can choose to save 10% or less, inflate your lifestyle at every raise and work until you are 70+. More likely you will get laid off in your 50's and have to "retire" badly when all you can find is low wage jobs.
For the overwhelming majority of people in this country, retirement plans will be best summarized as "hope to die at work". Few people are making enough money beyond their needs to be able to save money towards retirement.
Damn_registrars has no butt-hole. Damn_registrars has no use for a butt-hole.
In other news, I hear a bunch of buggy makers expect to be able to pass their trade down to their grandson.
Or coal miners expecting a boom in coal consumption.
Or unskilled laborers expecting those pesky computers and robots to disappear someday.
Or Americans expecting to work less, produce less but get paid more than the other 80% of humanity forever and ever.
if i die before next week
I'd be surprised if they make it past 50 WITH committing suicide.
Millennials expect to retire at 59, two years younger than the working age average of 61
So they're only slightly more optimistic than actual stats would play out? I bet that's par for the course for any generation when they were still 20 years out from retirement.
jail / prison has better healthcare then the ER!
Why the age of retirement is going up. Baby boomers are retiring on the back of the increased contributions millennials had to make.
Who are these idiots who think they can retire 6 years early to the actual retirement age? I never met one like that, other than the ones who still think they will win big money later in life and be able to retire early.
Emotionally stunted wrecks this generation are.
I'm a millennial according to the definition (born 1983). I'm working hard to get a deposit for a flat in London (because rent is dead money), and my expectation unrealistic view of my retirement prospects looks like this: I'll retire at 105 and then probably die without taking my pension out because it will still be useless for living.
They are counting on UBI or some other manifestation of the welfare state to carry them through life.
They are, after all, greatly entitled!
Young people realize that they will not live that long, because the world will fall apart and we will all die far before young people are retirement age. Might as well enjoy life NOW and not worry about retirement.
I've been called a millennial before, and I have no misconceptions about having absolutely no prospects for retirement. Savings? Save what? I work 3 jobs and 120% of my income is accounted for each month.
Maybe one day.... nah.
Most of us expect to die by 40 anyway.
The Wall Street Journal had a recent article about people who are least concerned about outliving their retirement savings are most likely to be a financial risk. The days of retiring at 65 and dropping dead at 70, which was the reality when Social Security got set up in the 1930's, are long gone..
https://blogs.wsj.com/experts/2017/02/17/the-people-least-concerned-about-outliving-their-savings-may-be-most-at-risk-financially/
The "research" comes from the bank that would like you to be more "responsible" with your money, like giving it to them. This is a bank that has paid billions of dollars in fines over the last five years for money laundering and interest rate rigging. The key statement form the report: "Despite the apparent ‘reality gap’ in Millennials’ retirement expectations, most (68%) have started saving for retirement, at an average age of 26. Millennials are also more likely than other generations to take investment risks to boost their retirement saving..."
So it's not that the millennials are unrealistic, they are saving a plenty, it's that the Fed and other national banks are keeping the interest rates artificially low to boost asset prices and prop up failing mega-banks including HSBC. So please HSBC, tell me more about how I need to "save" more for the retirement so that the government can bail you and your ilk out again when you blow up the economy with asset bubbles.
Because robots.
No, it doesn't. It's a popular meme around here but completely untrue. In jail, they will offer you some base level of care for serious problems but prison officials get to determine how serious it is and if it gets treated. Jail providers tend not to be on the right side of the bell curve, so even if you get to see the doc or midlevel, you may end wishing you hadn't.
If you need to be treated for a psychiatric illness, your choice of medicine will be significantly limited since many of those drugs can make you feel good (and thus have a marketable value in jail and are heavily restricted. If you hurt, well, too fucking bad. You get a tylenol or, if you're very lucky a tylenol and an ibuprofen.
The major downside of going to the ER for care is that the guy next to you might be strapped down to the gurney and being rather vocal about it. He's the one that got the bill from the last time he was in the ER.
Faster! Faster! Faster would be better!
Is there anything they *do* have a realistic view about?
Not designing UIs, that's for sure.
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
Otherwise they might not be as accepting of their next 60 years of shit pay for shit jobs.
no kidding.
OTOH, since robots will have all the jobs, they won't have anything to retire from.
Sheesh, evil *and* a jerk. -- Jade
I'm in my 40s, so I've started thinking about it. You know what? I can't see myself retiring, and it's not about money.
I just wouldn't know what to do with myself other than become a couch potato. I've already travelled the world as much as I care to (and have a bit more travelling to do to keep the spouse happy).
I'm not rich enough to just do 'whatever', but have more than I need to get by. Unless I win the lottery so I can fiddle around on a large scale, I'll keep working just for something useful to do.
What retirement looks like for me is slowing down, not stopping.
Generation Z (the generation that comes after the Millennials (who were formerly called Generation Y)) is shaping up to be one of the most alert and sensible yet.
Many of them were born after the events of 9/11, so they didn't experience the upbeat times of the 1990s.
Being the children of Generation X, a generation that suffered long and hard thanks to the Boomers and Millennials, they have also been raised with a more realistic and negative outlook on the world.
They're nowhere near as naive and idealistic as the Millennials and the Baby Boomers are.
The Internet has given Generation Z a much broader and realistic perspective of the world around them.
Generation Z is far more grounded than earlier generations, at a much younger age.
They show a conservatism that has only typically developed much, much later on in the lifespan of other generations.
Generation Z doesn't care about political correctness.
They think that the Millennials' emphasis on tolerance, acceptance, and being inclusive is a load of sissy bunk.
They say what they want, and they don't give a damn who it offends. Just look at YouTube comments as an example of this.
They know that paying huge sums of money for useless college degrees is dumb, and they refuse to do it.
The oldest ones are opting to become apprentices instead of going to college, and are learning valuable trades instead of learning about gender studies and leftist nonsense like that.
They see the existing system for what it is, and they feel no need to abide by its conventions.
They don't consider debts racked up by the Boomers and Millennials to be valid. They won't inherit them. They'll just default on them when the time comes.
They don't hold third-worlders in high esteem like the Boomers and Millennials do. They don't want to waste money on foreign aid, and they sure don't want to let any more of them into Western nations.
They aren't idealists like the Baby Boomers are, and they aren't petty snowflakes like the Millennials are.
They're their own generation, and they're not going to put up with the disaster that the Boomers, and to a lesser extent the Millennials, have created.
Generation Z is going to sweep it all into the trash.
Millenials don't expect to work past 65 because they'd be surprised if they make it past 50 without committing suicide.
I don't think Uber can employ *that* many people.
It must have been something you assimilated. . . .
The major downside of going to the ER for care is that the guy next to you might be strapped down to the gurney and being rather vocal about it. He's the one that got the bill from the last time he was in the ER.
That and possibly being turned into a heroin addict. Maybe the jail approach isn't all that bad.
I'm no millennial -- I'm over 50 -- but it's just as well that I don't believe in 'retirement' as a Real Thing, because even if I'd've been able to earn enough money over the course of my life to actually save any money for this mythical alleged 'retirement' thing you all speak of, when everything blew up in 2007, it would have all been gone anyway.
I don't even believe in 'retirement' as a Real Thing. Unless you're super-rich, what's it going to mean? Working your ass off your entire life, denying yourself the things you really want to do with your non-work hours, getting fat, stressed out, and physically unfit, so you can spend your so-called 'retirement' money on doctors, surgeries for the various diseases you've developed because you were too busy working your ass off to take proper care of yourself, and being too old, weak, and sick to actually do anything, other than sit around and wait for death to come and end your misery? Fuck that shit. I'll just keep working until I drop dead, and meanwhile doing the things I want to do, while I'm still strong and healthy enough to actually do them, and I'll die flat broke -- and who gives a damn if I do? Not married, no kids, nobody depending on me financially; why the hell shouldn't I do whatever I please? Even if some mythical alleged 'afterlife' exists, nobody running that show is going to care if I had money left in the bank or not.
The rest of you? I almost feel sorry for you, if you're middle class white trash like me, and are actually falling for the 'retirement' meme. You're blindly putting away money that you probably won't live long enough to actually use, and meanwhile you're stacking up a hefty list of regrets for all the things you didn't do while you were young and healthy enough to actually do. You'll die with money in the bank that ungrateful offspring will scoop up and use for something stupid, and your final thoughts will likely be all the regrets for all the things you didn't do. How sad!
Take my advice: Live while you can. Have some emergency cash in the bank if you can afford it? Sure. Makes sense. Save every dime you make? Hell, no! Plan on not having any regrets when your time coimes. You're only here once, and there's nothing afterwards.
Are you saying that kids these days are saying they don't want to work and think they will live forever! No way! never!
I think not!
love is just extroverted narcissism
Millennials are starting to work later than previous generations, so they plan to make up for it by retiring earlier.
Note to ACs: I usually delete AC replies without reading them. If you want to talk to me, log in.
What kind of responses can you expect but kid's responses?
and you've accurately described my world view.
Just FYI, the heroin addicts are also in jail.
As a millennial, I always assume that retirement is permanently out of reach myself. I can save all I want and it won't do me any good when a small jug of milk will cost $100 by the time I reach 65.
Daily read for tech news: Freezenet.ca
Social security will most likely be around in some form, and may have to be expanded at some point to cover the realities that no one is saving on their own. I'm not worried about the baby boomers or the generation after -- they all have pensions and will most likely die off quicker than future generations will. Just think of how many people smoked in the 50s compared to today, or drank themselves into oblivion after work every night, or spent the late 60s on drugs. Overall, they will have more health problems and the temporary bump up in social security payments will be short.
The problem becomes how to fund retirement of people who don't have pensions, haven't saved and will live much longer lives. I think at some point work as we know it will disappear for most people too, so we're in for a bad ride at least in the short term. I'm saving, mainly because I don't want to depend solely on social security as my only retirement income, but most younger people aren't because they can't. But, when almost everyone of average intelligence has no useful skill to sell employers, massive unemployment will be the bigger problem. That's where I think a universal income will have to come in. It would have to be something like social security disability, but not for a physical disability. I'm not sure how palatable that would be -- you'd basically be saying that half the population is mentally handicapped, but I think that's the reality we're headed towards. You're not going to take a truck driver, factory worker or customer service person and teach them software development or data science.
Too soon man, too soon.
I tend to rant.
I hope I don't come off as sanctimonious since I once thought I would never be able to save enough to retire. I thought, knew actually, my parents generation had it much better with plenty of jobs and pensions for when they stopped working. I decided to do what I could fully expecting social security to be bankrupt when I needed it. I still am not sure how that will play out since I'm not collecting yet but I started saving earnestly some 30 years ago, weathered some tough market swings and still came out ahead. The stock market is really the only way to generate enough wealth to beat inflation unless you have an inheritance coming your way. There is plenty of useful, free advice to assist you on your journey. I recommend the Boglehead forum as a good place to start. As you close in on your retirement goal reduce risk and expect market volatility. So live below your means, save as much as you can, don't pay unnecessarily for financial advice and stay the course. Nobody knows the future. I mean this with great sincerity.
Is that even living?
Why not live in a cubicle and eat millet for the rest of your life, big savings there and you'll have plenty of money saved when you retire, so you can go back to your cubicle and eat extra-fancy millet for 20-30 more years
Once Millennials start dominating politics, everyone will get a fat income for free. Good times will be here again. Yay!!
Then when a quarter of you die while on the job, we can send those benefits to cover the people who live longer than average.
“Common sense is not so common.” — Voltaire
Here's the real quick run down for you.
There's something called a "mutual fund". It's a way to invest in lots of companies at ounce. A specific type, the "index mutual fund" means you are investing in 200 of the largest companies. That's pretty damn safe long term - Coke, Walmart, Toyota, etc aren't all going to go bankrupt any time soon. By investing in an index fund, you'll get paid about 8% per year more than inflation. So if you invest $100, every year you'll get paid about $7-$8 plus a bit more that covers inflation.
If you want to spend about $60K / year in retirement, that means you need to have about $850K invested. (7% of $850K is $60K). In other words, $850K invested will provide a PERMANENT income of about $60K.
That does NOT mean you need to put $850K into your investments, because your investment (your index fund) is growing *while* you're working. To have $850K 30 years from now, about $580/month needs to go into your index fund. That doesn't mean *you* have to put in $580 each month, though. Most employers match retirement savings (that match is basically free money for you). Typically, you need to put in about $373 / month and your employer will match half of that, $186 / month.
So you put in $373 / month, your employer puts in $186, and after 30 years you have a *permanent* source of income that produces $60K / year forever.
This. I've conceded that my retirement plan is suicide. Enjoy life while you're young!
"Young People Don't Realize How Fucked They Are, Say Old People Who Fucked Them"
See subject: Again, well done & "great minds think alike"... your post is HIGHLY insightful (more than informative imo).
APK
P.S.=> Land is the key kiddos - they aren't making any more/there are NO "land factories" & you can eat what land produces (you can't eat gold)... apk
Most Millennials Have an Unrealistic View of Everything.
I'm an American. I love this country and the freedoms that we used to have.
We've been living in an economic climate that actually punishes savers for almost a generation now. This is to be expected. I honestly don't care because I will be dead soon. But those robots had better get good at making stuff extremely cheaply because hungry people are the surest way to tear a civilization apart.
Seven puppies were harmed during the making of this post.
.... about getting stagnation of wages under control within their lifetime.
AC comments get piped to
Just call them 17 year olds or whatever they are.
Is that $60k index-linked to inflation, or $60k level?
7% of $850k assumes relatively risky investments, so an event like 2009 and you could be having to survive on much less.
7%? Where are taxes accounted for in that?
As a 30 year old I do save but I'll never be able to fully retire because Soc Security will be long gone and bankrupt when I retire but I'm still paying into it money that could work for me in my own investments.
unless they were very, very wealthy. Also, google the phrase "infant mortality" sometime while you're at it. Or spare a thought to the 45,000 people who die unnecessarily every year because they don't have access to health care. Health care that we could easily afford if but choose not to because freedom. The freedom to die sounds great when you're not the one doing the dying.
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
I think you need to get caught up on current events. The heroin addicts are everywhere.
Who is comming up with these stupid naming conventions?
Throw in stupid notions like "tiny houses" which rob naive millennials of asset appreciation vehicle "home ownership" that generates American's greatest wealth; and you've got a guaranteed work till death prospect.
Check the median income in this country.
You're blowing smoke. Just like those asshats who ran stories about the guy that paid off $100k of debt during the recession with clean livin' and neglected to mention his $120k/yr salary in a low cost part of the country.
And why should I have to keep cutting my quality of life for yet another round of tax cuts for the God damned 1%?
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
Every young person secretly expects to be a millionaire before they're middle aged.
If your house is paid off and maybe wind or solar powered. Then yes. The social security income and the Medicare should in theory be enough to buy food and health expenses. You may need catastrophic insurance coverage. I mean the biggest problem is when you may have to move to a nursing home.
The title is what I recall hearing on an NPR report back around 1990 and this sentiment was echoed for much of the early '90s. As it turns out many of us far exceeded what our parents accomplished financially. I see this as a similar reality check for Millennials. The reality is that it is tough to make a living and build a nest egg, but it can be done.
Title got cut:
"GenX will be the first gen to not do as well as their parents."
Most are not dont fall for that and be fucked out of ever getting any Social Security.
Most Millennials Have an Unrealistic View of Everything
Anecdotes are irrelevant.
Oh please. This is just more insurance and investing firm Fear and Uncertainty.
Look, just save and invest - in stocks, forget bonds - 10 percent of your salary before taxes in the lowest cost retirement ETF or mutual fund. Low expense ratio like 0.07 percent S&P 500. Do that before any matches.
You'll be golden.
If you "can't save", just start with the amount for a full match or half match then increase by 1 percent total salary whenever you get a pay increase.
It's not hard.
They just want you to think you have to pay 1 percent in fees when you can spend 1/10th of that, for no better returns.
-- Tigger warning: This post may contain tiggers! --
I've always thought the same.
1) I won't live past 65 so who cares.
You don't say how old you are now, but if you're age 40, your life expectancy is another 40 years, so you have 15 years unaccounted for. On the average
Graph of (remaining) life expectancy: http://www.roperld.com/science...
Most of us don't have that option - our companies are not going to keep us on until we die. We'll get downsized, outsourced, etc. at least once or twice and then not hired on anyplace else because of rampant age discrimination. After all, with more available workforce every year,
Demographics say otherwise. The demographic data, in this case, are helping you (assuming you want to stay employed...)
The reason for age discrimination is that employers can. That's because the baby boom generation means that there are an excess of population; you can afford to not hire the older ones, 'cause there's plenty of people looking for jobs. But the baby boom was last millennium.
it isn't like there are going to be enough jobs to go around.
That demographic bulge is over-- by the time millennials are ready to retire, there won't be that big bulge of population. We'll be in the population decline segment of the demographics. Too few people, not too many.
In other words, you've been sold into slavery.
HSBC is HongKong Shanghai Bank of Commerce. Headquartered in London, it is probably the sixth largest bank in the world by assets. This article is not originating from a policy think tank concerned about millennial wage earners saving enough for their retirement. This is a business that makes money by encouraging customers to leave cash not being spent on necessities with them. Its a lame, stupid marketing piece.
Millennials should not be overly concerned about copying traditional habits used to build a retirement nest egg. They should be worried about whether they can have a lucrative career in a field they choose, since computerization is going to be wiping out all sorts of occupations, from trucking and taxis, warehouse stocking, to medical doctors, lawyers, and financial/insurance analysts. You can't be considering taking on a 30 year mortgage, if your profession could be wiped out after 20 years, and its stupid to be worrying about developing a 401K portfolio if you're still buried in (stupid) student loan debt for the next decade (ha ha).
If millennials really want to plan for their long term future, thirty to forty years from now, they should consider whether they want to develop survivalist skills, or a firearm and ammo collection if they want to go out in a blaze of "glory". It doesn't seem productive to plan for a future based on assumptions that won't be true thirty years out.
There is no America. There is no democracy. There is only IBM and AT&T and DuPont, Dow, General Electric, and Exxon
They ARE entitled to early retirement! We all are. The massive prosperity brought by the machine age is what entitles us. Nobody should have to work more than ten years. And the work day should be shortened to 6 hours. We should demand nothing less. It is trivially affordable. People who say otherwise are either ignorant or they are liars and thieves who profit from slavery. They make their profits by obstruction.
And how do we reconcile this article about us all having to work past 65 with the other recent claims saying that 30-40% of us will be unemployed in the next few decades due to AI and robotics?
That's the overall long term average US stock market return net of inflation. As you might expect*, returns tend to be higher when inflation is higher, and lower when inflation is lower. Therefore the net-of-inflation return is actually fairly steady at 7%-8%.
Obviously a late 2008 early 2009 time period causes people to worry, but we're talking about 30 years of saving followed by 30 years of withdrawals. That will surely include some good times and some bad times. 2008 AND 2002-2007, AND 2009-2017. In the last 20 years, the Dow has gone from 11,000 to 21,000. In the last 10 years, from 15,000 to 21,000.
* Consider that bonds compete with stocks on price, aka discount, aka return. Obviously bonds must pay high rates when inflation is high. When bonds pay higher net rates, buyers go to bonds, and leave stocks cheap in terms of PE, increasing stock returns.
Dear HSBC.
Please re-orient your world-paradigm to include the possibility that the majority of the current working generation, and generation X-ers, strongly believe that due to the efforts of banks like you, that the country and it's economy is totally fscked and needs to completely disintegrate before it can be rebuilt properly. Basically, it's inevitable market forces will cause all the rich people to completely lose their power and influence and when that happens, borders will change and a lot of suck will ensue. Let me put it to you in financial terms so you have a better understanding. I am a single male and make an 80th percentile income, nationally; I save about a quarter of my income; my living expenses are about a third of my income. The difference I spend on self-improvement and college courses. I keep my money in a checking account because savings accounts have provided sub .1% returns for the last decade, and because the day I can't withdrawl the money my other investment, lead and gunpowder, is going to be far more valuable than anything I have in that account anyway.
I have zero expectation the government will provide me with social security, zero expectation the stock market will provide me with a reasonable IRA or 401K, zero expectation I will ever get a job with a pension, and zero expectation I will have health care for the majority of my life. When my bosses shoved a 401k contribution plan down my throat yelling at the top of their lungs "It's Free money!", I literally told them to take the money and spend it on hookers and blow because that would be more constructive.
It is a perfectly reasonable world-view to fly high on hopium and enjoy life while you can before monstrosities like you, HSBC, literally destroy the world. We've got NINJA Loans in 2008 and the housing market still has not deflated from that, we still give 0% down home loans, we've got 20% of our GDP and about 50% of our governmental spending going to medical expenses, something like a third of families are on food stamps, and 80% of the population doesn't have $500 in their bank account or sock drawer to cover for a major emergency. Only a monstrosity would go to a population where these things are true and say things like "Hey guys, you need to be reasonable and save for retirement!". You are like Marie Antoinette, completely and utterly detached from anything we'd even remotely consider reality.
I can only pray you look in the mirror and see what you have become. When history is taught 100 years ago, your executive management team will be vilified on the same level we vilify Mao and Hitler today. I can also pray that, if the Wiemar republic can turn into a international war machine in 3 years, that we can turn into a prospering country the likes of which the world has never known in 6 months due to the technology we have today.
The potential is there. You are in the way. And what really makes you a monster is, you keep us from realizing that.
Here's a brief log of my expectations over my adult(ish) life, as someone just barely young enough to count as a millennial (I turn 35 this year):
20 years ago, I thought that I was going to easily be rich and famous when I grew up, because I was consistently and effortlessly outperforming all of my peers at school, and the world of course is intrinsically just so that kind of ability will surely be rewarded as I avail myself of the opportunities equally available to all, right?
15 years ago, after falling flat on my face into poverty immediately upon adulthood and taking two years with almost zero guidance or support to figure out what the fuck I had to do to get my life back on track, I thought that maybe I could still salvage that dream after like, maybe a decade-ish of hard work? By my thirties maybe?
10 years ago, after disappointingly little progress in that regard despite my best efforts (and continued astounding academic success meanwhile), I thought that maybe I would "settle" for a "normal" life in an "ordinary" house in the suburbs working some "boring" career my whole life and doing some kind of interesting life's work that was a mere shadow of my true potential in my spare time beside that.
5 years ago, I thought that I would be lucky not to die in the street when I was old like it increasingly seemed my parents were going to do, it seeming just barely possibly to avoid that with a ridiculously enormous amount of effort and sacrifice and basically neglecting everything I ever dreamt of actually doing with my life just to, maybe, hopefully, reach the point I thought I would "settle" for, and previously thought was the normal condition of all moderately functional adults, in time to have a few years' breather before I died in which to maybe write some kind of memoirs about the things I once thought I was going to do with my life? please?
Today, even after my life has turned around dramatically from that point, thanks to that enormous effort and ridiculous sacrifice and a heaping pile of the good fortune sorely missing from most of the decades prior, I'm still not sure if that's ever going to be possible. Have since learned that my current income is twice the median American's, and I've never really made much less than the median, which only makes the difficulties endured despite that seem even more depressing. Currently living in a tiny trailer on rented land so as to be able to save enough money that someday I can put enough of a down payment down that the interest on a mortgage won't be so high as to push the date I can start saving for something besides housing back past the time I'll probably die. Long-term girlfriend patiently waiting for me to be able to afford a larger trailer with enough room for the two of us to live together and so be able to get married, currently aiming for maybe some time around when we're 40? Then probably another decade of saving after that before we can put a big enough down payment on a real house, what amounts to about half the purchase price. We don't want kids anyway, but we basically don't have the option of them at this point, not without sacrificing all hope.
That's all assuming that the past five years' miracle progress continues unabated, which is far, far from assured and I constantly expect any moment to lose absolutely everything and go back to zero again. But then, running the numbers sometimes, somehow, it seems like if all the trends over my lifetime continue at their average rates... somehow I might be able to retire in my mid-late 50s and live off investment income for the rest of my life after that? What the fuck? I don't believe it. But the math keeps telling me that. That most of life is hopeless and shit, and then around now it starts getting gradually better, and then suddenly in the moderately-near future everything is miraculously perfect forever. But I'll fucking believe it when I see it. I'm still assuming I'm going to die in the streets like my parents still look to be doing, and life can fucking prove me wrong if it can. Please. Please prove me wrong.
-Forrest Cameranesi, Geek of all Trades
"I am Sam. Sam I am. I do not like trolls, flames, or spam."
I didn't read TFA or any of the comments, so this may be redundant. My perspective is that by the time you kids are retiring any government funding for old people will have vanished under shear weight of numbers, and lack of workers to pay for it. This isn't entirely disastrous as government funding for old people is supposed to be a safety net, whereas in Australia at least it is a big part of many people's retirement plans at the moment. Roughly speaking if you have less than half a million dollars in financial assets you'll get a state pension (your prime residence is not included in that). To make up for what you lose by having assets in excess of that you need about 1.5 million. So for the vast proportion of people at the moment quite simply finding a loose million in spare change isn't an option, so they de-asset one way or another (house improvements,caravan, boat and 4wd) and get the state pension.
If we assume that 1.5 million is a reasonable target in 2017 (it is way low in my opinion but at least it's a peg in the ground), I'd point out that is roughly ten years pay, so compound interest is your friend, you aren't going to save that directly. But of all the investments I've made (or gambles as they should be known), buying a fairly nasty house in a fairly unloved inner city suburb actually turned out to return 8%, over 17 years, plus I had somewhere to live, saving me $6-10k/year. Of course there are costs in house ownership, and although it wasn't the plan, the gentrification of that suburb was pretty obvious in hindsight.. I also have a bunch of shares, and much of my stash was made during the GFC, when I had some sleepless nights after some brave decisions. Now I just sit on high dividend blue chips.
I actually found an investment advisor useful as he knows his way around the tax system, BUT he made no recommendations to change my basic approach. If you are less than 50 you probably don't need to talk to one every year, I'd have thought 5 years was more like it. Worth shopping around, the big end of town charges like wounded bulls. The little guy working for an industry fund was cheap but useless.
Mainly you need two things. A plan. And a job.
Now if I put my tin foil hat on, all these self funded retirees are going to have a pot of money the government would like to get its hands on. My guess is that income tax will be extended up until you die, if they can't think of any other method, and there will be bigger attempts to get people out of using public services.
OR....
One of your kids can develop a grave life threatening illness in their mid-20's and will force either you or one of your other children to drop out of the workforce to care for them for because the government disability payments aren't actually enough to live on... Even though the expected outcome is 7, the dice come up with snake-eyes occasionally, you know...
I was 16 in 1974, when I got my first real job and learned about SSI. As a high school kid who smoked pot it was clear to me I wouldn't see a dime of my SSI money.
I'm now 58 and unemployed for a few years (ever been over 50 and applied for a job? Good luck with that). I'm not gonna see a dime of my SSI money.
All I ask is the 400k+ I "donated" to the fund back, that would let me retire just fine.
The basic problem is this: we think that we can live half our adult lives (from 60 to 100) by saving 15% of our income (made from 20 to 60). We've been sold this as government policy--Social Security takes 15% of our income, and most government-run pension programs which replace Social Security takes the same. Most corporate pensions save a small fraction of that. And even folks like Dave Ramsay, who give advise on getting out of debt and saving for retirement uses 15% as his rule of thumb.
If you expect to live longer than 7 years past retirement (which was, when most retirement programs put into place, the actuarial lifespan for most retirees), then you may wish to consider saving more money--either directly or indirectly.
That's what my wife and I are doing--not because I expect to retire, but for the day when I am unable to work.
Dear God, don't invest in gold! If you look at the price of gold adjusted for inflation it's remained flat, flat, flat. Sure there have been spikes, but the two spikes we've seen so far have been based on speculative trading by people basically betting on the end of the world. And right now we're probably going to see a multi-decade long slide from gold's peak of nearly $1900/ounce down to perhaps a few hundred dollars an ounce.
Now if you really think we are coming to the end of the world and we're about to see economic armageddon, with Mad-Max style gas wars just around the corner, may I suggest investing in cigarettes and alcohol instead, stored in vast storage containers? Seriously, that'd be a better bet than gold...
it me
Did you mean:
If not, fake news.
There's going to be no retirement for Gen-X.
Who wouldn't want early retirement? It can be done, if you work for it, but it's still not guaranteed, and stereotype millennials don't want to work for it. With the growing gig economy appealing to millennials, I'm interested how many of them are even saving for retirement.
Chewbacon
The Bible is like Wikipedia: written by a bunch of people and verifiable by questionable sources.
This is despite 59 percent of millennials agreeing they will live much longer and will need to support themselves for longer than previous generations
This is the "you live longer, you need to work longer" mantra.
Indeed retirement systems need working people to support retired people (it can be the same person that works, saves, and retires in a capitalized system, or it can be the working paying for other retired people, in a socialized system).
But the key point is not how much work time vs how much retired time we have. It is about how much wealth produced by work and how much wealth consumed by the retired. And since worker's productivity is much higher that ever, we could support early retired persons without longer work period.
Of course, that assumes the wealth is not captured by some other agent...
Those that don't die in the wars will die way before 65 from the devastation of our environment.
The problem is, a "realistic view" is nearly impossible. You can't predict how long you are going to live, how much medical care you are going to need, and what might happen to social services such as Social Security and Medicare/Medicaid, and consequently, how much money is "enough."
Yes, I'm sorry, I shouldn't have mentioned gain, just savings.
However, your claim that gold will go down to a few hundred dollars an ounce contradicts your observation that gold's value is flat.
With a zero interest for money, continuous inflation and 'flat' (i.e.: a value compensating the inflation) gold value, it performs better than regular money.
And nobody was mentioning the SHTF scenarios you're bringing up here, I think, but in that case I'd suggest to invest in bullets.
"Trump!!", the new Godwin.
Considering that today people over 50 getting laid off for having out of date skillsets, it's anyone's guess what "employement" will mean in another 30 years.
to old for retraining an disability? to old for the company health plans an disability?
Will we see an under the table wink wink disability for people automated out of there jobs? say an trucker has truckers lung from the fumes or there bladder is messed up?
Retirement? Most American's don't have enough money to go on a long weekend vacation. You can blame it on that "outrageous" $5 a day starbucks habit, but the reality is most people just don't make enough money to do much better.
http://money.cnn.com/2017/01/1...
Aaaaand you get it! I have done this although at my salary it's a bit more being invested. What little Timmy the anonymous idiot doesn't get is that compounding interest WORKS. Two huge drops in the market and I'm still sitting on enough to retire.
This world is pretty shitty and I'm glad I didn't make the mistake of bringing children into it...
About the only reason I haven't thrown in the towel yet is because it would break my parents' hearts. Now my dad is gone and my mother is in her twilight years... once she's shuffled off, I don't have much reason to stick around. I'd like to pay off my debts, but I'm not too concerned about it. The banks have collected tons of interest off me and if I jump off a bridge they'll just have to suck it up.
Retirement? Ha. Sounds like a fate worse than death unless I win the lottery in the next 10 years.
Explained in detail 2:00 minutes in.
https://www.youtube.com/watch?v=KjWYHeg8_5I
No it DOESN"T perform better than regular money. when you are investing for such long periods, term deposits and bonds will have a far greater return than gold if you are looking for safe havens.
Aaaaaaand it's gone.
Can we just declare "Millennial" a slur already? It's used in an overwhelmingly negative fashion to stereotype and demean a specific group of people, and as an insult, thus it is being used as a slur
The reason a 'generation' eg: baby boomers 1945-1969 could retire earlier by aggregate is the cumulative savings or financial assets they were allowed to keep and accumulate. Over this period you had capitalism that was adding value, building stuff and investment reflected that. 17% of profit was financialised, the rest went to wages or expanding the core function of the business. Now 64% is financialised so growth is lower, economic output GAPS are wider, workforce participation is lower. FInancialisation becomes parasitic and slows growth at this level. Literally pigeonhole principle at work: train 100 pigeons to navigate their way to individual boxes. if there is only 80 boxes it guarantees 20 will miss out. Run this over many iterations and its simply a matter of fact that if there are always a shortage of boxes [jobs] there will be a larger distribution of non-finding boxes [non earning periods in a persons life] amongst the pigeons. [SOURCE FOR FINANCIALISATION] https://www.jacobinmag.com/201... Its mostly ideological not 'real resource constrained' that cumulative assets given to a generation SETS when they retire eg: Higher government spending ADDS to net financial assets claimed by the private sector. Larger compulsory retirement contributions keep workers working but also provides the choice to retire. Young people are not unrealistic they either ignorant of the issue entirely or understand to a certain extent the current system does not work and can be changed.
They seem to have unrealistic views about most things, never mind retirement, they are a detached generation.
I don't expect most people will be able to find work at age 60 thirty years from now.
Haha, Millenials.. ... your boomer and gen-x parents and grandparents sold you into slavery in the 80s to finance their BMW 3 series and in the 90s to buy a McMansion. Now you have to keep working until you die to pay for their old age care and keep up the charade that everything is endless 1950s post-war middle class prosperity.
I've accepted the fact that I will probably never actually retire per-se. At my current age(early millennial) and seeing how the deck has been sifted the past thirty or so years. It is harder than ever to accumulate the adequate amount of resources for a "comfortable" life if you are low on the totem. Especially under certain circumstances such as my personality, aversion to trusting people and lack of certified education or experience.
It's easy math, save 30-70 percent of your money and you can retire DECADES earlier. Look up MMM's blog.
The people here who are shouting about how you can't do it are literally being laughed at right now on their forums. Cut cable, live in a right-sized house, bike to work, go on 3rd party phone plans and use travel hacking. There are loads of people retiring in their early 30s on these types of forums making average or slightly above average salaries - no crazy lotto winners
Failing to do this, is no fault but your own. Though, not retiring AT all is insane. SS alone should cover the vast majority of your necessary expenses, even at the expected 75% payout in the 2030s with no program changes.
First World economies will have a clear choice by the middle of this century.
UBI
or
A very ugly alternative(discuss)
I mean, when you get trophies for participation at every turn, they expect to be handed shit. Fuck'em, let them starve. My daughters are well educated and will be fine when they retire. These lazy bastards will have jack squat and my kids won't give them a bloody dime of their tax money or otherwise.
I have some small savings and RRSP, and the Canadian government MIGHT give me a tiny stipend to live on if they force me out of work at 65+.
That said I don't think I could ever stop being creative and making things. I will always be looking for ways to make a living at it but it might be nice to not have that stress and simply make things I like.
I might also be the exception to the rule. At 25 I never expected to be allowed to retire. Our social assistance had just been freshly gutted by Mike Harris and previous gaffes. We had been told in no uncertain terms that we would not be getting the same retirement deal as our parents.
I think most of my generation prefers not to think about it. It's terrifying to think of not being allowed to work as a professional and make the same money, or not being able to, and having no safety net whatsoever.
My sincere hope is that our government will have at least a little compassion for us.
And I wish people would stop repeating it. It's one of those lies with just a little truth in it. Yes, tuition at private for profit Universities is affected by secured loan programs. That's not true for public Universities. The 538 blog has an excellent article on it but I'll save you the time and cut to the chase. We slashed federal subsidies to public Universities. That money had to be made up somewhere. College really is that expensive. We were hiding that expense to encourage a well educated population.
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
i'am a millenial and already retired .
Young people are stupid..... shocker....
Fuck you! lol
I'm happy to euthanise myself at 65/70 instead of living through old age and having to worry about big retirement savings. As long as I leave intelligent, productive and beautiful children, my objective in life will be complete anyway.
Go look at everyone you know 60 and higher. How many can still work. Ask the older ones what their medical problems are like post 60. its a lottery. Some will be able to work at that age and higher some will not. As a typical person you need to not put your head in the sand and realize you have to be prepared if you are medically unlucky in old age. I know the math is not with me for a pre 70 retirment but im doing my best to not be completely F'd if I have to. Oh and then these same think tanks are like "whine" "whine" "whine", why aren't consumers spending so we have a healthy economy. Gah who is being unrealistic here.