.

[diften]

.

[highflyingstache]

These numbers have floated around many times, stating that even up to 66% can't handle a $2000 surprise expense at a moments notice (if I remember correctly.)
It's one thing to remark how sad or irresponsible, but has anyone here considered the tax and burden we all will pay on such considerations? It's not so much the welfare state, but every time someone steals, we pay higher prices, when they use forms of wellfare, we pay or when they're irresponsible in so many different ways, we typically suffer little by little.
I recognize many a mustachian is personally removed from the general populace in that they consume little and perhaps interact in ways that don't be affected by such things, but as a member of society there's certainly still something to be said for the typically less discussed topics of peoples bad choices, no?

[marty998]

You can't mandate that people make good choices all of the time.

This is the price (or cost) of Freedom.

[Linea_Norway]

These numbers have floated around many times, stating that even up to 66% can't handle a $2000 surprise expense at a moments notice (if I remember correctly.)
It's one thing to remark how sad or irresponsible, but has anyone here considered the tax and burden we all will pay on such considerations? It's not so much the welfare state, but every time someone steals, we pay higher prices, when they use forms of wellfare, we pay or when they're irresponsible in so many different ways, we typically suffer little by little.
I recognize many a mustachian is personally removed from the general populace in that they consume little and perhaps interact in ways that don't be affected by such things, but as a member of society there's certainly still something to be said for the typically less discussed topics of peoples bad choices, no?

Yes, you are right. Society needs to look after these people by providing them a minimum support and food help. Here in Norway I have heard that more and more people collect the free food that is given to the poor. This also needs to be financed from somewhere. And as you mention, insurances go up when more people steal from houses and cars. Products become more expensive when more people steal from shops. I think that last this, shoplifting from other than food shops will not be an issue for a long time. Most of this stuff can be ordered cheaper on the internet, so why should we still keep physical shops? Warehouses, serviced by robots are perhaps better prevented from stealing, although I am not certain.

[zinnie]

You can't mandate that people make good choices all of the time.

This is the price (or cost) of Freedom.

You can't mandate it, no, but systems and expectations influence behavior, and good societies are generally set up to promote good behavior. (And a society of people one check away from ending up on the streets will become everyone's problem.) It's why some professions are required to sign on a code of ethics, and why in court you state out loud that you will tell the truth. Those small acts make people more likely to act ethically, and tell the truth. In the financial realm, of course, as pensions go away there has been good success with the opt-out 401k. I dont see anything wrong with promoting or encouraging better saving.

I'd like to see more personal finance education in schools too, including college. And I'd like to see businesses do a better job of offering training to employees. All I got in college was a mailbox full of credit card offers, and I wish if my comlany had personal finance meetings that weren't just run by the 401k investment company, it could have been beneficial for my coworkers.

Scary data in that article...

[Plugra]

I'd like to see more personal finance education in schools too, including college. And I'd like to see businesses do a better job of offering training to employees. All I got in college was a mailbox full of credit card offers, and I wish if my comlany had personal finance meetings that weren't just run by the 401k investment company,

As far as I can tell, there are entire industries that are profitable mostly because their typical customer has poor financial literacy and no math skills.  My 80+ year-old parents went for a 'financial planning' session with their name-brand broker, who almost sold them some annuities - it took me a spreadsheet and an hour of my time to see how brazen of a scam each of those annuities was, and I don't believe many 80 year-olds are in a position to do that math for themselves.  The meanest thing you can do to a car salesman is to do your homework before you show up, and then whip out a calculator when it's time to deal. I did that last time and the guy was practically peeing himself.

If more people had math skills a lot of these businesses would surely fold.

[Bumperpuff]

The retirement calculator in that article is terrible.  It won't let your savings exceed 40% and has super conservative growth predictions.

[Goldielocks]

Okay,  but isn't median household income something like $52k per year, which would generate about $2400 per month in social security payments?

If so, then the family with $52k per year, pre tax today, would receive $29,000 per year in retirement funding.   Given marginal tax rate differences, that may only drop their money for expenses by $18k.     If they now have a paid off home, medicare, that is a fairly small drop in monthly living costs after retirement.   

So the people with  an additional $25k or $50k saved up for a vacation, a car, of medical expenses are doing ok.   I noted that the survey was of currently working folks, and many only start saving in their final 5-10 years, (e.g., at age 50, with kids moved out and maybe the house paid off) which can easily accumulate that amount.

[slugline]

The retirement calculator in that article is terrible.  It won't let your savings exceed 40% and has super conservative growth predictions.

And of course, there's the also the classic mustachian criticism that it varies the "what you need" based on what you put in as your current income instead of asking about expenses.

[fattest_foot]

The retirement calculator in that article is terrible.  It won't let your savings exceed 40% and has super conservative growth predictions.

I can't even figure out what that calculator is trying to do. It seems to be focusing on age 58 for some reason (58 being the lowest point of "how much money" we need).

Every single number it gives is also almost double what my actual gross income is right now for some strange reason. Why exactly do I need $300k in income per year and a portfolio worth $4M when I'm aged 60, when I've never made even remotely that amount of money in my life?

[caffeine]

The retirement calculator in that article is terrible.  It won't let your savings exceed 40% and has super conservative growth predictions.

I can't even figure out what that calculator is trying to do. It seems to be focusing on age 58 for some reason (58 being the lowest point of "how much money" we need).

Every single number it gives is also almost double what my actual gross income is right now for some strange reason. Why exactly do I need $300k in income per year and a portfolio worth $4M when I'm aged 60, when I've never made even remotely that amount of money in my life?

My only guess is that this is savings not invested. For instance if you have a $40,000 withdraw rate & $1,000,000 stash not invested, it would last 25 years. If you have it invested, it will last much longer. They don't make the assumption that you have any good investments.

No, never mind. I have no idea what the calculator is doing.

[GrumpyPenguin]

Anyone else find it hilarious that you can't choose a retirement age less than 50 on CNN's retirement calculator? :D

[ambimammular]

And the savings rate maxes out at 25%.