Serious question: if you didnt save enough or run out of retirement money...

[adelaster]

I try not to obsessively worry about this. I can say that unless things do a rather miraculous roundabout I do not expect to get a dime back of the social security investments I have and will make in my lifetime. Highly doubt there will be health coverage either. Try not to think about it.

Things are not what they were, and as people live longer it will cause more issues. People in my family tend to die young, so I doubt I have to fuss. That's a bummer too though because I really would like to own a place with a garden and a porch before I kick it. As far as caring for my own parents, that thought distresses me. I don't have the money, and I can't afford a space to share. It's really depressing thinking about this.

Elder neglect and abuse is a rising issue. If young people can't afford or obtain housing and healthcare while being able bodied workers, the plight of those too infirm or elderly to work is going to get even uglier. As of right now I think a lot of people simply aren't retiring, or continue to work even though they aren't truly fit to be doing so. It's sad.

I can say removing any money for savings will be a last last last resort for me. I also see a lot of the things people once took for granted (homes, children, good education, fresh food, medical care) becoming more and more of privleges and exceptions.

 

[gotomu212]

My grandparents spent less and less as they aged. They didn't go out, didn't travel, and also ate less ( as appetites diminished-still healthy but not large meals). Other than food, toiletries, and utilities they just didn't spend. They were all lucky not to have medical issues.

I think the whole ideal of travel, hobbies, lush retirement villages is a fairly recent marketing hype. Like any situation where your income drops, your lifestyle has to drastically adjust.

 

[tzolkin]

Thanks guys for taking the time to comment. We had recently been going thru all of our retirement acct info ( that we won't need for some time) but when I heard that about people not having enough put aside, I started to wonder!! I don't know much at all about medicare/caid. I know our financial advisor expressed concern once over if social security would still be available.

The sad reality is that most people have absolutely no financial plan and will not have the money they need for retirement.

I think the new American "dream" is to live beyond your means and spend everything you make. The average personal savings rate for millennials is -2%... yes negative. And the rate for those age 45-54 is only 5.7% If you consider that some people save 25% or more, you can see how many people are just going further into debt each year.

 

[adelaster]

The sad reality is that most people have absolutely no financial plan and will not have the money they need for retirement.

I think the new American "dream" is to live beyond your means and spend everything you make. The average personal savings rate for millennials is -2%... yes negative. And the rate for those age 45-54 is only 5.7% If you consider that some people save 25% or more, you can see how many people are just going further into debt each year.

This isn't true for everyone. A lot of people have no money to save after cost of living expenses. Commuting home from work right now but can update this later with data & sources.

 

[MIGrandma]

I think many families are just barely getting by, even if both parents are working. Things cost so much more than they used to. My oldest granddaughter (24) and I were just talking about this the other day. She recently purchased her first home, and has already started a retirement fund. We were talking about the cost of vehicles and I told her about our first 4-wheel drive pickup truck (Chevrolet) that we purchased brand new in 1975 - it cost $4,000. Now how much are they? At least 10 times that, or more. It's ridiculous.

DH and I have a retirement fund that we put $$ into yearly, and we have a life insurance policy we can cash in (I think after we turn 65). Farmers don't generally "retire" though. His Dad is 80 and still helps on the farm during planting/harvesting seasons so I can see DH still doing that at that age as well. He is also a crop insurance adjuster and probably won't fully retire from that for a long time either (some adjusters are in their 80's and still working - not because they have to, but because they choose to as they enjoy it and I can see DH being just like that. He likes to keep busy most of the time.

Hopefully we'll be able to draw a little social security too, but who knows.

People need to live within their means. Our home is paid for, as is our farm, and we have just a couple years left to pay on our vacation property then we will basically be debt free. I'm sure it helps if you can go into retirement being totally debt free. We could always sell our vacation property if we had to. And do a reverse mortgage on our home as well. Hopefully we won't have to, but nobody has a crystal ball to see what the world is going to be like in another 10-20 years.

 

[adelaster]

I think many families are just barely getting by, even if both parents are working. Things cost so much more than they used to. My oldest granddaughter (24) and I were just talking about this the other day. She recently purchased her first home, and has already started a retirement fund. We were talking about the cost of vehicles and I told her about our first 4-wheel drive pickup truck (Chevrolet) that we purchased brand new in 1975 - it cost $4,000. Now how much are they? At least 10 times that, or more. It's ridiculous.

DH and I have a retirement fund that we put $$ into yearly, and we have a life insurance policy we can cash in (I think after we turn 65). Farmers don't generally "retire" though. His Dad is 80 and still helps on the farm during planting/harvesting seasons so I can see DH still doing that at that age as well. He is also a crop insurance adjuster and probably won't fully retire from that for a long time either (some adjusters are in their 80's and still working - not because they have to, but because they choose to as they enjoy it and I can see DH being just like that. He likes to keep busy most of the time.

Hopefully we'll be able to draw a little social security too, but who knows.

People need to live within their means. Our home is paid for, as is our farm, and we have just a couple years left to pay on our vacation property then we will basically be debt free. I'm sure it helps if you can go into retirement being totally debt free. We could always sell our vacation property if we had to. And do a reverse mortgage on our home as well. Hopefully we won't have to, but nobody has a crystal ball to see what the world is going to be like in another 10-20 years.

Super impressed by your granddaughters home purchase! Where I live the median cost of a home is $250k and rising, and this is supposed to be a more affordable portion of the country.

 

[tzolkin]

This isn't true for everyone. A lot of people have no money to save after cost of living expenses. Commuting home from work right now but can update this later with data & sources.

I certainly don't think everyone buys into the mentality of living beyond your means, but that doesn't mean that it isn't pervasive in the rampant consumerism and dismissive attitudes toward debt that our culture promotes.

I have lived and worked in non-profit organizations in extremely poor rural areas, so I understand that some people simply do not have the means to cover basic expenses (and therefore cannot save). However, I have also lived and worked in financial education/advising in more affluent areas. Many people who do have the ability to save and get ahead financially are still living "paycheck to paycheck" because they view all of their expenses as "necessities" since that's what everyone else has/does.

 

[runwad]

It's a sad state of affairs. Most people just think they are going to work forever until they don't. In my experience older workers are the first companies let go. I'm worried about an older sibling. She and her husband save next to nothing. Unlike others I do believe Social Security will always be around, maybe not in it's current form but you're going to get something I think.

Young people don't think they're ever going to get old and then when you get old it's too late to do anything about it. It's the wise person who plans for their later years.

 

[tvguy]

Pretty limited options.
Government assistance, assistance from their church, move in with children or other family, or someone willing to take them in and help support them.
I am amazed that some people have zero money saved for retirement.
I am also amazed at how much debt some Seniors take into retirement.
How you live your life in your youth can impact how you have to live your life in retirement.
My mom's Social Securty check covered all her expenses, with about $400 left over. Her pension, annuity and minimum IRA distributions were her mad money.
Looks like my Social security benefits will be exactly 80% of my current take home pay. I won't need to draw much out of 401Ks and IRAS to make up that 20%.

 

[longboard55]

Based on my experience most my siblings and siblings in law will call me. They could use my parents savings but they already cleaned that out. I will be moving to Bolivia

 

[Simba's Mom]

Running out of retirement money is Mom's biggest fear. She gets a very small Social Security check, and that's from when Dad worked-she wasn't eligible until Dad died. And it's small because he'd spent most of his time as a teacher, got a pension, and took the 100% while he was alive. So NADA for her. Then when he died-no insurance. Thank goodness she has a small Social Security check now, a house that's paid off, and a little savings. She and Dad never planned, so now she lives in constant financial fear.

 

[Grumpy's Gal]

I'm beginning to wonder what a solution would be? I'm not in favor of mandatory retirement savings but.....would that work? any ideas? Anyone know how other cou ntries handle retirement? this is kind of facinating in a weird sort of way.

 

[tvguy]

I'm beginning to wonder what a solution would be? I'm not in favor of mandatory retirement savings but.....would that work? any ideas? Anyone know how other cou ntries handle retirement? this is kind of facinating in a weird sort of way.

There is no solution.
In a free country you are free to decide what is best for you, no matter what the consequences

 

[runwad]

I'm beginning to wonder what a solution would be? I'm not in favor of mandatory retirement savings but.....would that work? any ideas? Anyone know how other cou ntries handle retirement? this is kind of facinating in a weird sort of way.

In a way they are trying to do that with 401k accounts. They automatically enroll you and you have to opt out if you don't want to participate.

At my work they automatically increase your saving percentage yearly if you are below a certain percentage. I'm not sure of the actual numbers because I put 20% in my 401k so it doesn't effect me.

 

[Monykalyn]

I'm beginning to wonder what a solution would be? I'm not in favor of mandatory retirement savings but.....would that work? any ideas? Anyone know how other cou ntries handle retirement? this is kind of facinating in a weird sort of way.

Starting with more actual real life classes on saving, budgeting etc. And that financial advisors can help everyone regardless of income level. But part of the problem is so many companies choosing to enrich CEO's instead of investing in employees-matching 401k, pension, decent living wages etc. Back in early 90's when I started working even part time retail jobs had 401k match. Now-only one place I've worked past 20 years (healthcare) had that. And between the years I left and came back to that particular job the matching declined from 5% to 3%. And my husband's field has gone from pension, insured regular employees with a small salary plus commission to fully independent contractors-more money potentially but NO benefits-and that seems to be the norm for a lot of fields now.

I think DH and I are also fortunate in that we had parents who planned for retirement and passed those lessons along-If no one teaches you these things it is easy to just not think about it until too late. Our financial advisor-the first time we sat down with him and told him our retirement goals was skeptical-until he saw our savings, 401k etc. Key is putting money away when you start working. Even if it is just $20/paycheck.

 

[Skippy918]

My MIL has some retirement savings, and lives off her social security check. It still hasn't cliqued with her that she needs to be careful with her spending. She likes to buy stuff. She also has credit card debt too. When fil died her income went down by half. Dh helps her manage her money.
My parents saved for their retirement so I am not worried about them.
I opened some ira's while I was still in college and working. Every company I have worked at, I have contributed to the 401k. Social security will likely not exist by the time I'm 65.
We are in a position to save. Those who have minimum wage jobs and living paycheck to paycheck or are poor, retirement savings is probably the last thing on their minds. They are worried about getting food on the table or paying bills.

 

[amberpi]

I've only really been working for 15 years - I've got a fully funded retirement and hard assets with no dependents. I'll get a healthy inheritance, but at this point, I'm playing with house money, so I just hope to outlive my folks so they're ok. Everything else? Gravy.

ETA: the only reason I have that incredibly leg up is that I got my MBA at 21 with no debt because of my folks. I didn't have a silver spoon, but a really amazing start because of my family. I can say I've always done it, and I have, but the groundwork was laid for success.

 

[low-key]

public housing

 

[Colleen27]

I think the new American "dream" is to live beyond your means and spend everything you make. The average personal savings rate for millennials is -2%... yes negative. And the rate for those age 45-54 is only 5.7% If you consider that some people save 25% or more, you can see how many people are just going further into debt each year.

I'm not sure that's anyone's dream. I'm just a hair too old to be a millennial and most of my friends spent their 20s working low-wage service jobs, usually more than one at a time, paying back student loans and living with roommates or parents. Their negative savings rate wasn't because of rampant consumerism; it was because they couldn't find jobs that pay enough to live on, much less save on. Few of us have 401k matches. None have pensions. But it is hard to worry about retirement savings when there's a Edison shut-off notice in the mail or an insurance rate hike that threatens your ability to afford the car that gets you to work. And the backhanded generational insults, that younger generations are irresponsible because they're not saving when can't afford rent on their own at the ages our parents and grandparents were buying homes and starting families is a bit ridiculous. It ignores every broad economic trend of the last 40 years - stagnant overall wages, health care and housing dramatically outpacing inflation, education costs skyrocketing at the same time post-secondary credentials have become essential to being even lower middle class, etc. - and puts everything down to individual choices, as though if gen X and the millennials were just smarter or less selfish we'd have robust wage growth, affordable health care, and no need for student loans.

 

[Happyinwonerland]

There is no solution.
In a free country you are free to decide what is best for you, no matter what the consequences

Except in this free society, those consequences become some one else's burden. People want to work their whole lives and not save, claiming free choice, but then cry "I've worked hard my whole life ans I deserve someone to take care of me now that I can't work" and in our society we help them. We don't let our elderly starve to death or go homeless. But the younger generation ends up picking up the tab.