How about: if you think you can afford to retire, think again because too many are ill-prepared for retirement.
Correct, even the wealthy pay to Social Security until their wages top $185.000 BUT YOU PAY NO FICA OR MEDICARE ON INVESTMENT INCOME.
The Wage Earner and the Business Owner pay the Social Security tax but the wealthy investor who’s income is from stocks pays nothing.
If you correctly view Social Security as a Tax instead of a Retirement Account (and what retirement ever existed that upon creation paid recipients who never paid in a cent) then you have to conclude that this is an extremely regressive tax. Being a Flat Tax, which as a percentage of income burdens the middle and lower incomes and then you add a Maximum Contribution, it’s clearly designed to benefit the wealthy.
My point is that if we’re ever going to solve the impending “Social Security/Medicare Shortfall Crises” then we need to face the reality that this a Tax to support the Elderly and Indigent and treat it the same way we treat Income Tax.
A sharing of the costs among ALL income earners, no exemptions, no maximums, a forced minimum retirement savings and a basic minimum benefit that allows Grandma (and eventually you) to live in dignity and receive basic medical care.
And for any who object, I’m gonna send an email to each of your Grand Ma’ s, Bubby’s, Nonna’s, Abwhellas’s. etc. to let them know that their Honey Buchkins doesn’t love them anymore! 
We have a temporarily high number of elderly citizens. As we die off, the amount paid by Social Security to us will drop. We need to determine how to handle this temporary imbalance.
@bing, you are the grandparent getting the notices from @Beancounter.
A simplistic statement that does not take in to account the real world. There are many people who just don’t have much left over after these costs: housing-food-children’s clothes-utility bills and other everyday expenses.
Instead of a rich jerk saying little girls only need one or two dolls how about saying billionaires only need two jets or yachts and have them pay more into Social Security since they avoid taxes anyway.
The birthrate in the US is below replacement rate and has been dropping for a while. The bigger concern is the working youth paying into the system being close to the rate the boomers are exiting the system. The exit is higher than those entering but close to the crossover point.
Maybe you should do some research first. 44% of people in this country barely make a living wage (or below a living wage) and don’t have enough money for any type of investment. Oh, I’m sure you’re going to show examples of people wasting money instead of investing. But they don’t fall into that group. In order to invest you first need money to invest. How do you do that when you barely have enough to live on. The holiday season is coming. My wife, kids and I have been volunteering at soup kitchens for YEARS. You should try it sometime and see all the hard-working families who don’t have enough money give their kids a decent holiday meal or presents. And you think these families have money to invest?
+1
On the news last night, they showed the plight of an elderly woman. She had worked in HR at Enron for many years, and–just like everyone else–she lost her job, and her 401k became virtually worthless because it was based on Enron stock. So, she went back to college, became a Social Worker, and–eventually–she retired from that job.
Now, she is only able to secure part-time employment, and the combination of her part-time pay + her Social Security payment totals $3,500 per month. As a result of sharp increases in grocery prices and gas prices, her monthly expenditures for housing and everything else has equaled $3,500 for the past couple of months. She said that she has no idea what she will do if inflation remains as high as it is currently, and she stated that she will probably never be able to retire.
Maybe enlighten us on how you achieved your six figure income, the real estate properties, and corvette, im sure some of us could learn a thing or two from a true winner. Laughing as i write my check to the mission.
If you read between the lines of our laws, you would see that paying yourself first, I.e. saving for retirement should be one’s first move—even if income is inadequate to meet expenses, and debt must be incurred to remain afloat. Here’s why. If you don’t save for retirement, you’ll complete your working years, and end up with nothing. On the other hand, if you contribute to your employer’s retirement plan (401k or SIMPLE IRA) and also fund a Roth IRA, that money is 100% out-of-reach to creditors (for consumer debts). If you complete your working years with money saved in a “qualified retirement account”, including an employer-sponsored plan and/or self-directed IRA, that money cannot be touched by your creditors—even with a judgment, and is 100% exempt if you must declare bankruptcy.
I listen to the Ramsey Show once in a while, 95% of the callers earn more than me, a lot more but they are broke. The majority earn $100,000 to $200,000 and spend all of it.
Grocery budget of $2,000/month, owe $40,000 on each car etc. Those two expenses exceed my income, however I spend less and managed to save for retirement.
High rent area? Groceries and gasoline haven’t changed much in my area; $300/month for food, $100/month for gasoline. Zero dollars for restaurants.
You are likely to get accused of being simplistic or not doing your research.. i sold the car i had for 15 years and still miss it. Im driving the car ive had for ten years.
Everyone i ever hired i tell to start putting money in their deferred comp account, even if it is only $25 a pay.day. In 10-20 years they will have some fu money. Some listen, some dont.
I remember the day the big boss stopped by and was quitting. He had just talked to the folks holding his retirement account. Had $80k 30 years ago and talked about hiw wonderful it was. I got started the next week.
That $80,000 is equivalent to $246,000 today. I hope he had more retirement money available.
Excellent move on your part to start saving in a tax deferred account at work at an early age. I maxed out my contributions every year a 401K or 403B was available.
Not everyone has the same opportunities as I did. It’s extremely short sighted to think they do. You’re of the ilk that thinks everyone who’s poor is poor because they didn’t work hard or try hard enough in life. As I said - you should actually talk to these people and listen to their stories instead of sending a check to ease your conscience and MAYBE you’ll learn something. Although I doubt it.
There are MILLIONS of people who are barely putting food on the table and cloths on their back and you expect them to invest in a 401k. I met one family where both parents are working 70+ hours a week in multiple part-time low paying jobs just to make put food on the table. We have homeless camps here in NH and MA with families who’s parents work full time jobs.
$25 is a lot of money for people who are trying to put food on the table.
Fifteen years ago, I was talking to a coworker who was self employed for 20 years and had no retirement savings. He lost his shop during the recession and his house was foreclosed on.
Being in his late 40’s he had a lot of catching up to do. He asked how much I contributed to my 401K account, I answered: 20% of my income.
He then asked; but how much per paycheck? $25? $50? Obviously 20% of my paycheck is a lot more than $25. His gross income is similar, roughly $2000 for two weeks, he should be able to calculate the deduction. Many people have never given much thought into saving for retirement. $25? Really?
He sustained an injury and transferred to a different department for a while. I don’t know where he works today. Many people in my profession don’t make it past the age of 55 - 60. Don’t wait until age 60 to start saving for retirement.