Author Topic: Just another retirement article about people with no savings...  (Read 9060 times)

Kaspian

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These are getting a little dull!  Simply by the sheer volume of them coming out these days.

http://www.nytimes.com/2015/07/04/your-money/nearing-retirement-its-time-to-be-creative.html

Get your debt under control by 65 so your expenses are going to be as minimal as possible,” said David J. Jackson, a certified financial planner in Kansas City, Mo. “If you have no debt, you don’t need as much.”

By "65"?!!  Is he fucking joking or what?  Yeah, you won't "need much" because the average life of the American male is 76.  Have fun those last 11 years with no debt, no savings, living off Social Security and having to clean up after someone else's dog.  Given that 76 is an average, there's a good chance you won't even make it that long.  :(

People have gone crazy.

MoneyCat

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Re: Just another retirement article about people with no savings...
« Reply #1 on: July 09, 2015, 12:44:33 PM »
People are brainwashed into thinking they can't save.  If the average non-Mustachian person invested $10,000 a year for retirement at a rate of 7%, they would easily end up with over $1 million after 30 years.  For a person making $40,000 year, that's only a savings rate of 25%.  Very easily doable.  But people are told by advertising that they are supposed to be popping bottles at the club, driving huge luxury SUVs, taking vacations to exotic locations, buying fancy jewelry, etc. and they end up believing that retirement is impossible.

RFAAOATB

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Re: Just another retirement article about people with no savings...
« Reply #2 on: July 09, 2015, 12:46:52 PM »
Is it just me, or do we not see enough stories about poor old people?  Compared to the effects of smoking where we can see people older than their years struggling to breath, having a hole in their throat, and all sorts of nastiness, we don't see as much old people suffering in poverty caused by wasteful spending in their youth.

If working until you die is a valid choice, than the consequences of a debt laden lifestyle are not going to be devastating.  Will the bank take away the too big for your budget house? Yeah and then you live in a tiny apartment off of social security and medicare instead of a medium sized house in a retirement community.  And then someday you'll end up in a state run nursing home with no assets until you die, but you had a bigger house than I did when you were 30 so... fair trade?

Saving enough money to fund a luxurious lifestyle is a good idea, but until we see really struggling old people regretting the spending of years prior than living off credit and trying to outrun a debt typhoon probably won't be your downfall.

foobar

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Re: Just another retirement article about people with no savings...
« Reply #3 on: July 09, 2015, 03:55:02 PM »
These are getting a little dull!  Simply by the sheer volume of them coming out these days.

http://www.nytimes.com/2015/07/04/your-money/nearing-retirement-its-time-to-be-creative.html

Get your debt under control by 65 so your expenses are going to be as minimal as possible,” said David J. Jackson, a certified financial planner in Kansas City, Mo. “If you have no debt, you don’t need as much.”

By "65"?!!  Is he fucking joking or what?  Yeah, you won't "need much" because the average life of the American male is 76.  Have fun those last 11 years with no debt, no savings, living off Social Security and having to clean up after someone else's dog.  Given that 76 is an average, there's a good chance you won't even make it that long.  :(

People have gone crazy.

There is about an ~80% chance for a 65 year old man to make to 76. 76 is not the average life expectancy of 65 year old males. It is the average life expenctancy of males. The number for a 65 year old is ~83. Think about it for a minute if you don't realize why there is a big difference between those numbers.

FIRE me

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Re: Just another retirement article about people with no savings...
« Reply #4 on: July 11, 2015, 11:19:48 PM »
There is about an ~80% chance for a 65 year old man to make to 76. 76 is not the average life expectancy of 65 year old males. It is the average life expenctancy of males. The number for a 65 year old is ~83. Think about it for a minute if you don't realize why there is a big difference between those numbers.

Pretty much right on, regarding the 65 year old male. The number for a male who has his 65th birthday today is 84.4.

The older you are the higher your life expectancy. Because those who didn't make it to your age were (but no longer are, since they are dead) pulling down the average.

SS Life Expectancy Calculator:

http://www.ssa.gov/oact/population/longevity.html

Am I the only one who would actually like to know what year I will die? Everyone I talk to about pretty much runs away screaming from the subject. For example, if I knew I was going to die at age 75, I could (and would) quit my job today. 

Kaspian

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Re: Just another retirement article about people with no savings...
« Reply #5 on: July 13, 2015, 10:04:26 AM »

Am I the only one who would actually like to know what year I will die? Everyone I talk to about pretty much runs away screaming from the subject. For example, if I knew I was going to die at age 75, I could (and would) quit my job today.

It would be handy to know, for sure!  I'd just absorb it into my planning logic databank as relevant information while I'm sure others would like you said--completely freak out.

forummm

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Re: Just another retirement article about people with no savings...
« Reply #6 on: July 13, 2015, 10:46:01 AM »

Am I the only one who would actually like to know what year I will die? Everyone I talk to about pretty much runs away screaming from the subject. For example, if I knew I was going to die at age 75, I could (and would) quit my job today.

It would be handy to know, for sure!  I'd just absorb it into my planning logic databank as relevant information while I'm sure others would like you said--completely freak out.

I'd like to know too.

Although, SS will pay for intended living expenses, so the longevity risk isn't too much of a concern. Long term care is another story.

shotgunwilly

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Re: Just another retirement article about people with no savings...
« Reply #7 on: July 13, 2015, 10:53:18 AM »

Am I the only one who would actually like to know what year I will die? Everyone I talk to about pretty much runs away screaming from the subject. For example, if I knew I was going to die at age 75, I could (and would) quit my job today.

It would be handy to know, for sure!  I'd just absorb it into my planning logic databank as relevant information while I'm sure others would like you said--completely freak out.

I'd like to know too.

Although, SS will pay for intended living expenses, so the longevity risk isn't too much of a concern. Long term care is another story.

Human minds are too weak for such information.  We can't even fathom how the world would be if we all knew this information.  Your entire life would have taken a different course.

EricP

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Re: Just another retirement article about people with no savings...
« Reply #8 on: July 13, 2015, 12:10:18 PM »
Knowing what year you die would help financial planning a little bit, but there's still the huge variable healthcare expenses.  From Long Term Care to experimental cancer treatments, that is going to impact whether you outlive your money much more than the actual year in which you die. 

Sure, if you knew the year you died you could spend down aggressively, but if the last 2 years you get tagged with huge Nursing Home bills, then you're SoL and stuck in whatever Medicaid facility is nearby.

forummm

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Re: Just another retirement article about people with no savings...
« Reply #9 on: July 13, 2015, 12:48:17 PM »

Am I the only one who would actually like to know what year I will die? Everyone I talk to about pretty much runs away screaming from the subject. For example, if I knew I was going to die at age 75, I could (and would) quit my job today.

It would be handy to know, for sure!  I'd just absorb it into my planning logic databank as relevant information while I'm sure others would like you said--completely freak out.

I'd like to know too.

Although, SS will pay for intended living expenses, so the longevity risk isn't too much of a concern. Long term care is another story.

Human minds are too weak for such information.  We can't even fathom how the world would be if we all knew this information.  Your entire life would have taken a different course.

I think I would be OK if I new now. I'm not the typical person. I agree that knowing at age 5 wouldn't have been the right time to find out (unless it was dying at age 98 or something).

I think the only real problematic scenario for me is a shorter than expected life. If I were going to die in 5 years, a lot of that time might be spent figuring out what to do with the remaining time, and whether to tell DW, etc. I would have to decide whether to quit work or keep going on to save up for the baby. I think I'd still prefer to know.

forummm

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Re: Just another retirement article about people with no savings...
« Reply #10 on: July 13, 2015, 12:49:46 PM »
Knowing what year you die would help financial planning a little bit, but there's still the huge variable healthcare expenses.  From Long Term Care to experimental cancer treatments, that is going to impact whether you outlive your money much more than the actual year in which you die. 

Sure, if you knew the year you died you could spend down aggressively, but if the last 2 years you get tagged with huge Nursing Home bills, then you're SoL and stuck in whatever Medicaid facility is nearby.

You could also just get LTC insurance, or whatever optimizes the end of your life. You might also move to be near a good facility, etc. Knowledge is power if you know how to use it.

EricP

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Re: Just another retirement article about people with no savings...
« Reply #11 on: July 13, 2015, 02:22:52 PM »
Knowing what year you die would help financial planning a little bit, but there's still the huge variable healthcare expenses.  From Long Term Care to experimental cancer treatments, that is going to impact whether you outlive your money much more than the actual year in which you die. 

Sure, if you knew the year you died you could spend down aggressively, but if the last 2 years you get tagged with huge Nursing Home bills, then you're SoL and stuck in whatever Medicaid facility is nearby.

You could also just get LTC insurance, or whatever optimizes the end of your life. You might also move to be near a good facility, etc. Knowledge is power if you know how to use it.

Sure, but just knowing death date isn't going to help you too much.  You may be in LTC for 10 years or 6 months.  That was my main point.  Regardless, the knowledge of your precise date of death can only give you a few more percentage points in optimization.  There's still loads of variables that would require you to accrue relatively the same nest egg.

nobodyspecial

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Re: Just another retirement article about people with no savings...
« Reply #12 on: July 13, 2015, 05:11:15 PM »
Knowing what year you die would help financial planning a little bit
Quote from Terry Pratchett's discworld:
Wizards of course know when they are going to die. Which allows them to spend the last few hours drinking the contents of their wine cellars, and coincidentally owing quite large sums of money to their friends.


Susurrus

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Re: Just another retirement article about people with no savings...
« Reply #13 on: July 13, 2015, 05:30:16 PM »
Wow, I wouldn't be nearly as willing to know my death date as the rest of you seem to be. Maybe it's because I'm young (20), but I wouldn't want to live with that hanging over me. Even if I told myself not to think about it, I know it would bother me.

I think I'd like a 5 year warning, so I could get my affairs in order and make sure I got to finish my bucket list before I went.

forummm

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Re: Just another retirement article about people with no savings...
« Reply #14 on: July 13, 2015, 06:21:22 PM »
I think I'd like a 5 year warning, so I could get my affairs in order and make sure I got to finish my bucket list before I went.

I was thinking about this. If you're going to die anyway, do you really need to hit everything on the bucket list? It doesn't really matter if you miss stuff. You'll be dead so you won't know or care.

SwordGuy

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Re: Just another retirement article about people with no savings...
« Reply #15 on: July 13, 2015, 06:30:32 PM »
Is it just me, or do we not see enough stories about poor old people?  Compared to the effects of smoking where we can see people older than their years struggling to breath, having a hole in their throat, and all sorts of nastiness, we don't see as much old people suffering in poverty caused by wasteful spending in their youth.

If working until you die is a valid choice, than the consequences of a debt laden lifestyle are not going to be devastating.  Will the bank take away the too big for your budget house? Yeah and then you live in a tiny apartment off of social security and medicare instead of a medium sized house in a retirement community.  And then someday you'll end up in a state run nursing home with no assets until you die, but you had a bigger house than I did when you were 30 so... fair trade?

Saving enough money to fund a luxurious lifestyle is a good idea, but until we see really struggling old people regretting the spending of years prior than living off credit and trying to outrun a debt typhoon probably won't be your downfall.

There are plenty of stories about people with financial problems. 

Only none of them in mainstream media ever says it's the person's own damn fault they are in the mess they are in.  There's always a spin to make us feel like they are a helpless victim.

Bumbling Bee

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Re: Just another retirement article about people with no savings...
« Reply #16 on: July 13, 2015, 06:30:47 PM »
Am I the only one who would actually like to know what year I will die? Everyone I talk to about pretty much runs away screaming from the subject. For example, if I knew I was going to die at age 75, I could (and would) quit my job today.

A Wharton professor developed this mortality calculator: http://gosset.wharton.upenn.edu/mortality/perl/CalcForm.html.

forummm

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Re: Just another retirement article about people with no savings...
« Reply #17 on: July 13, 2015, 06:54:47 PM »
Am I the only one who would actually like to know what year I will die? Everyone I talk to about pretty much runs away screaming from the subject. For example, if I knew I was going to die at age 75, I could (and would) quit my job today.

A Wharton professor developed this mortality calculator: http://gosset.wharton.upenn.edu/mortality/perl/CalcForm.html.

Looks like I should plan for a 60 year retirement.

11ducks

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Re: Just another retirement article about people with no savings...
« Reply #18 on: July 14, 2015, 05:39:05 AM »
Yeah, mine came up with 92 year life expectancy. Wow. I'm interested to see what 2080 will look like!!

johnny847

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Re: Just another retirement article about people with no savings...
« Reply #19 on: July 14, 2015, 06:20:48 AM »
Knowing what year you die would help financial planning a little bit, but there's still the huge variable healthcare expenses.  From Long Term Care to experimental cancer treatments, that is going to impact whether you outlive your money much more than the actual year in which you die. 

Sure, if you knew the year you died you could spend down aggressively, but if the last 2 years you get tagged with huge Nursing Home bills, then you're SoL and stuck in whatever Medicaid facility is nearby.

You could also just get LTC insurance, or whatever optimizes the end of your life. You might also move to be near a good facility, etc. Knowledge is power if you know how to use it.

Sure, but just knowing death date isn't going to help you too much.  You may be in LTC for 10 years or 6 months.  That was my main point.  Regardless, the knowledge of your precise date of death can only give you a few more percentage points in optimization.  There's still loads of variables that would require you to accrue relatively the same nest egg.
Although I feel like if we do somehow get the tech to guess your death date, then companies who provide LTC insurance would also, and account for it in their premiums.

johnny847

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Re: Just another retirement article about people with no savings...
« Reply #20 on: July 14, 2015, 07:01:30 AM »
Am I the only one who would actually like to know what year I will die? Everyone I talk to about pretty much runs away screaming from the subject. For example, if I knew I was going to die at age 75, I could (and would) quit my job today.

A Wharton professor developed this mortality calculator: http://gosset.wharton.upenn.edu/mortality/perl/CalcForm.html.

Mustachian problem: it asks for how many thousand miles I drive in a year. I drive less than 1000 miles in a year.
Practically speaking this makes no difference because it later tells me eliminating driving would only extend my life expectancy by 0.02 years.

Fuzzy Buttons

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Re: Just another retirement article about people with no savings...
« Reply #21 on: July 14, 2015, 07:46:28 AM »
Am I the only one who would actually like to know what year I will die? Everyone I talk to about pretty much runs away screaming from the subject. For example, if I knew I was going to die at age 75, I could (and would) quit my job today.
A Wharton professor developed this mortality calculator: http://gosset.wharton.upenn.edu/mortality/perl/CalcForm.html.

Apparently the biggest benefit for me would be if I started drinking more.  That gives me another 1.5 years.  Maybe I'll change my morning cardio into a morning mojito.  :)

Sam E

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Re: Just another retirement article about people with no savings...
« Reply #22 on: July 14, 2015, 08:12:47 AM »
Am I the only one who would actually like to know what year I will die? Everyone I talk to about pretty much runs away screaming from the subject. For example, if I knew I was going to die at age 75, I could (and would) quit my job today.

A Wharton professor developed this mortality calculator: http://gosset.wharton.upenn.edu/mortality/perl/CalcForm.html.

Fascinating stuff. I never would have guessed it would tell me to drink to increase life expectancy... More exercise, less driving, and 2-3 drinks per day would apparently add 3 years to my life expectancy.

Fuzzy Buttons

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Re: Just another retirement article about people with no savings...
« Reply #23 on: July 14, 2015, 08:22:37 AM »
Am I the only one who would actually like to know what year I will die? Everyone I talk to about pretty much runs away screaming from the subject. For example, if I knew I was going to die at age 75, I could (and would) quit my job today.
A Wharton professor developed this mortality calculator: http://gosset.wharton.upenn.edu/mortality/perl/CalcForm.html.
Fascinating stuff. I never would have guessed it would tell me to drink to increase life expectancy... More exercise, less driving, and 2-3 drinks per day would apparently add 3 years to my life expectancy.
It also says I can add 0.12 years to my life if I stop having sex with my girlfriend.  I intended to ask her just what she's doing that is shortening my lifespan.  :(

johnny847

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Re: Just another retirement article about people with no savings...
« Reply #24 on: July 14, 2015, 11:00:43 AM »
Am I the only one who would actually like to know what year I will die? Everyone I talk to about pretty much runs away screaming from the subject. For example, if I knew I was going to die at age 75, I could (and would) quit my job today.

A Wharton professor developed this mortality calculator: http://gosset.wharton.upenn.edu/mortality/perl/CalcForm.html.

Fascinating stuff. I never would have guessed it would tell me to drink to increase life expectancy... More exercise, less driving, and 2-3 drinks per day would apparently add 3 years to my life expectancy.
I've seen other studies that say it's not the drink itself but the mental health benefits of meeting friends when going out for drinks.

Cookie78

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Re: Just another retirement article about people with no savings...
« Reply #25 on: July 14, 2015, 11:18:32 AM »
Am I the only one who would actually like to know what year I will die? Everyone I talk to about pretty much runs away screaming from the subject. For example, if I knew I was going to die at age 75, I could (and would) quit my job today.

A Wharton professor developed this mortality calculator: http://gosset.wharton.upenn.edu/mortality/perl/CalcForm.html.

Life Expectancy: 94.12 years

Expected date of death is June 12, 2072.

"If you do not have any sexual partner, your life expectancy would be 0.09 years longer"

...Nope! Not worth it.

RetiredAt63

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Re: Just another retirement article about people with no savings...
« Reply #26 on: July 14, 2015, 11:32:50 AM »
I am going to die young! For me that means before 90+.   However, since it was geared to the US, I had to calculate income in US$, calculate mileage in miles, and could not put in a state of residence.  Plus he has grains as one of the 5, and grains are not nice to me, so I only had a 4 there. 

And more seriously, it did not seem geared to an older crowd, it was all about work and nothing about retirement, or community activities, or other things that keep people going.

EricP

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Re: Just another retirement article about people with no savings...
« Reply #27 on: July 14, 2015, 11:59:15 AM »
Am I the only one who would actually like to know what year I will die? Everyone I talk to about pretty much runs away screaming from the subject. For example, if I knew I was going to die at age 75, I could (and would) quit my job today.

A Wharton professor developed this mortality calculator: http://gosset.wharton.upenn.edu/mortality/perl/CalcForm.html.

Fascinating stuff. I never would have guessed it would tell me to drink to increase life expectancy... More exercise, less driving, and 2-3 drinks per day would apparently add 3 years to my life expectancy.

For me it said "drinking 2-3 drinks per day would add -.09 so I would check to see what yours says.  Just some poor programming I guess that throws that recommendation out there.

Kaspian

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Re: Just another retirement article about people with no savings...
« Reply #28 on: July 14, 2015, 12:38:31 PM »
83.  ...Which probably seems early but is fine with me.  Grandpa lived until 98--he said it "sucked".

Zamboni

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Re: Just another retirement article about people with no savings...
« Reply #29 on: July 14, 2015, 01:17:35 PM »
^ ;-) at grandpa! One very old lady did once tell me that life was getting to be a drag because it is uncomfortable to travel around at her age.

Quote
Is it just me, or do we not see enough stories about poor old people? 

Not just you; I agree there are not enough stories about poor old people. The reason that articles like the one in the OP even exist is that so many people are facing retirement with little or no savings and big debt. It's trying to give those folks some practical ideas.

But anyone looking around can see old people who look absolutely miserable working in minimum wage jobs. So you have to have a hole in your head to not catch one. And therein lies the problem: too many holey heads.

Of course, continuing to work is a nice idea (that apparently a lot of people have according to that article), but it is not always even realistic. I have one relative who loved her job but just had to involuntarily retire at 63 due to heart and other health problems. Now her spouse, who was thinking he could retire soon, is looking at working until 70, which he really doesn't want to do but they can't afford their mortgage if he doesn't work. They don't want to move; believe me I suggested it. It's all I can do to resist screaming "WHY do you still have a mortgage!" For the second time this month (first resistance exercise was when talking to my Dad's wife.)

RE lifespan: I do want to know exactly when I will die. Because right now that darn Wharton calculator is saying my mean life expectancy is near 100, so I have to plan for my 4% safe withdrawal to last that long. Which is a bummer. Once again, I wish I was a wizard.

Bumbling Bee

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Re: Just another retirement article about people with no savings...
« Reply #30 on: July 14, 2015, 07:27:36 PM »

Life Expectancy: 94.12 years

Expected date of death is June 12, 2072.

"If you do not have any sexual partner, your life expectancy would be 0.09 years longer"

...Nope! Not worth it.

Sure it would only be an extra month, but it would feel like another 50 years.