Posted on 08/16/2010 7:18:41 AM PDT by Publius804
America's baby boomers—those born between 1946 and 1964—face a problem that could weigh on the economy for years to come: The longer it takes for the economy to recover, the less money they'll have to spend in retirement.
Policy makers have long worried that Americans aren't saving enough for old age. And lately, current and prospective retirees have been hit on many fronts at once: They have less money, they earn less on what they have, their houses aren't rising in value and the prospect of working longer to make up the shortfall has dimmed significantly in a lousy job market.
"We will have to learn to make do with a lot less in material things," says Gary Snodgrass, a 63-year-old health-care consultant in Placerville, Calif. The financial crisis, he says, slashed his retirement savings 40% and the value of his house by about half.
Banks, home buyers and bond issuers are all benefiting as the U.S. Federal Reserve holds short-term interest rates near zero to support a recovery. But for many of the 36 million Americans who will turn 65 over the next decade—and even for the 45 million who have another decade to go— the resulting low bond yields, combined with a volatile stock market, are making a dire retirement picture look even worse.
Low yields present retirees with a difficult choice: Accept the lower income offered by safer bonds, or take the risk of staying in the stock market. Either way, their predicament could put a long-term damper on the consumer spending that typically drives U.S. growth.
(Excerpt) Read more at online.wsj.com ...
We haven't had reasonable policies for thirty years. The housing bubble and all the other bubbles didn't start in 2009. This federal govt. has been gorging itself on the nation's wealth for decades and promising things it knew it couldn't deliver. Please, don't try to equate this with dems. The GOP has been part of the problem for decades.
Who said anything about investing in US Treasuries? Hell, even China is selling theirs! There are a lot of things you can invest in without going through Wall Street or Bond Brokers. Food and guns come to mind.
I think there is a problem in that people are living longer, and some can work longer, but I’ll tell you, we live in S. FL and I see LOTS Of elderly who likely could not work. While 65 is probably a little unreasonable (altho not for everyone, since some people really are elderly at 65) I can’t imagine lots of people being able to work until they died of old age. So, your mention of death panels is appropriate.
Multiply your plight by two, and you see mine.
Halving the population doesn’t bode well for boomers.
I’ve never figured out what there is to do when one retires.
“We haven’t had reasonable policies for thirty years. The housing bubble and all the other bubbles didn’t start in 2009. This federal govt. has been gorging itself on the nation’s wealth for decades and promising things it knew it couldn’t deliver. Please, don’t try to equate this with dems. The GOP has been part of the problem for decades.”
You are correct that we have long abandoned fiscal responsibility. Entitlement problems certainly did not start in 2009. However, conservatives have asked for change for decades. We finally had a somewhat conservative government in 2005. Bush asked for some modest changes and was totally rejected.
The problem that Republicans face is electability. There is no competition for free money. Government spending is considered a free good, almost limitless in ability to transfer wealth and buffer society from market fluctuations. We had a conservative Congress from 1995 to 2000 that had made some positive changes. Almost every postive policy has been undone since 2009. Democrats have exploded government spending, regulations, and promised new levels of taxation. If we could have elected a conservative president in 1996, different policies would have been enacted.
Ping list for the discussion of the politics and social (and sometimes nostalgic) aspects that directly effects Generation Reagan / Generation-X (Those born from 1965-1981) including all the spending previous generations are doing that Gen-X and Y will end up paying for.
Freep mail me to be added or dropped. See my home page for details and previous articles.
***The entire social-welfare-state construct - handouts for the idle, medical care, schooling - is going to prove to be a failed experiment within the next 50 years. ***
Darn right! The Welfare voters who voted for Obama are going to be shocked when there’s no money for their health care.
Just look at the articles from all across the nation, you can probably do a quick search on FR and find a few hundred of them from just the past couple of weeks. I'm not making it up.
You should be extremely thankful if your home increased in value by that much - you haven't lost a chunk of your life's savings like literally millions have across the nation. If my home gained 250 percent in value over the next 6 years, I'd be the happiest damned man on the planet.
We bought a modest house for 161,000 back in 2000, using the money from my parent’s home that I inherited and my DH’s house here in MI.
The lemon is now worth 120,000. Along with all the kids college funds and savings are pretty well wiped away.
We have dropped our Directv, killed our cellphones, planted a garden, picked and stored veggies and fruits and limped along in our ten year old cars. We homeschool so there isn’t much education expense. We can’t cut too much more to rebuild any retirement.
I have “Welcome to Walmart” or “Do you want fries with that?” in my future.
“Except that due to “fractional reserve lending” you’re enabling the central banks to print more money.”
Silver and gold.
My mother always told me that social security was meant to supplement one’s savings, not replace them. Didn’t anyone else receive this message?
Explain why my home’s value rose 23% since last year.
Do you see a drop there? I don’t. We didn’t buy more than we could afford but the rapid increase in values is killing us.”
Looks like its time for you to sell, those rate of return are likely the best you will ever see if your life on any investment, that is, if you are telling the truth.
Thank you for the encouragement!
My kids are learning lessons that others may not learn. How to plant, how to find U-pick farms, how to process strawberries (how freezing them with yogurt doesn’t really taste good!), that Mom and Dad love them more than ‘things’ and most importantly, that God doesn’t always give us what we want but He always gives us what we need.
Even if that’s leftover rice with powdered milk and sugar for breakfast.
You are absolutely correct. We are rich. Not in money, but in what is important.
You bet!
And it was the other Texas president, LBJ (Born 1908) that created the "Great Society" socialist programs like Medicare, Medicaid, war on poverty etc....
You bet...The "Great Generation" that said gimme a bucks worth of regular, while buying new homes in the 1950's for what the boomers pay *per month* in mortgage payments, on one income, got in early in the ponzi SS scheme, and drained it dry....
I still believe that the number ONE issue facing America is our turn away from God to our own ways. We think God is on our side, but the truth is that we need to be on HIS side and we’re not. In James 4 it says “you have not, because you do not ask and when you do ask you do so with selfish motives”...you cannot love the world and love God.” (paraphrased a bit there)...We are spiritually BROKE and in desperate need of the love and saving grace of Jesus Christ in our hearts FIRST.
I’ve been guilty of being so angry and screaming at the television over what’s been going on during the Obama administration, but the deeper issue is the greatness of our character is built on our values and they have been eroding away from Godly values for a long time. The BIBLE was the book most read by Americans in the 1700s. They taught spelling words like salvation, justification, repentence, etc in the first grade during those early years.! Then we allowed Darwinism to infiltrate our Harvard Law school dean/studies, etc. and from there it’s been a slip, sliding away from the truth.
Wow! A really smart person would grab that profit, retire, and move to one of the many, many places that real estate is really cheap, and getting cheaper by the day.
A home's "value" is whatever a willing, ready, and able buyer will pay for it; not what the local assessor says it is worth.
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