Part of me wants to move back to the US to retire, but the national health plan here is so so good that it’s going to be hard to justify returning to the healthcare nightmare that is the US for my “golden years,” when I’m most likely to need healthcare…
Who knows where healthcare will be in the future, @marvin100. Unless you are planning to retire in a few years, the healthcare landscape could be totally different. I think the employer based healthcare system is so antiquated that something needs to change.
Yeah, that’s totally true, @doschicos , and I’m hopeful that things in the US get better. I’m definitely paying close attention!
We have had some disappointing changes compared to original projections, but we always lived below our means and will do OK. Sadly we know other families in tougher situations. None of them will go hungry though. It breaks my heart to read about senior citizens that need to choose food vs meds vs rent.
“45 percent of baby boomers have zero retirement saving” - Wow, do you think that could be true? I’d believe low retirement savings… but zero sounds scary.
@colorado_mom , I believe it. I remember one family who had no access to $2000 to get their car fixed without borrowing. They were employed without interruption, and had not had any medical disasters. They just spent too much.
In the past year, we’ve helped two in-laws who could not come up with the $5K they each needed for their children’s legal troubles. Both are close to retirement and have no savings.
Yep. Know a 60 year old whose parents co-signed for his apartment lease, then gave him money for a down payment on a car to replace one that was beyond economical repair. No unemployment or medical catastrophes, just can’t or won’t save. If you met him you wouldn’t think “loser,” you’d never really know unless you were in the middle of his life. Hope that his union pension and SS carry him through.
Union pension and SS sounds good to me. They may have combined value of over $1M. He may also get decent inheritance if his parents are in a position to help out.
In that case maybe his problem isn’t that he did not save but that his parents lived too long. 
The inheritance will be gone within a year, and he’ll be back where he was. The answer to a 60 year old being broke is not a big infusion of money. He wouldn’t be broke at 60 if he could handle money. Some people are just like that. Pension and SS at least come every month forever.
As an investor and saver, I’d love the thought of being able to have invested my SS contributions myself and retire with that nest egg available instead of the periodic payments. But the reason to have SS as a monthly payment is that there are many who could never have managed to save it along the way had it been available to them.
I absolutely believe 45% don’t have retirement savings. Some Boomers still have pensions and most of the next generation does not, so I think the percentage without retirement savings will grow even larger.
I’ve been in public accounting for 30 years and I’m still amazed at how people do, or do not, manage their money. That often has little to do with the level of earnings.
I remember a decade ago, my CPA explaining to me that he’d had to work out a budget for a childfree couple making $500k (back then!). Once again, no medical drain, unemployment, etc. They just didn’t understand that the money was finite. SMH.
Lack of personal responsibility is the root of many of our national problems. If everyone who had access to employer subsidized healthcare would actually buy it, very few would remain without care. The problem is that people want the nice house and nice car before they can afford it and forego necessities like healthcare and then expect the rest of us to pick up the tab because we were prudent with our money. Sure, there are still many that need help and we can do a lot to help the truly needy if we actually had others held accountable for their own poor decisions.
The same goes for savings. Many people, especially on sites like this, do a poor job of saving for retirement. Financial experts will tell you to manage your savings and retirement before attempting to save for your kids’ college. We tend to act with our emotions and undermine our futures to make things easier on our kids. Then we are surprised when we don’t have ‘enough’ for retirement. This is above and beyond those who simply cannot tell themselves no.
Since pensions have become less prevalent, 401K plans have risen. The problem with them is that they are optional and too many people want the money now and don’t look to the future. If the money set aside for social security was invested (even in low to no-risk securities) each individual would have considerably more retirement income than what will come out of Washington.
Social security runs at deficits now though, right? Pretty much out to the horizon (until it becomes insolvent if nothing else). So there is no money to invest. Every dollar paid this year in social security taxes is needed to pay benefits (and that isn’t enough). Could have done that in the past when there were surpluses but SS was always a pay as you go system to my recollection.
Yes, the cc pool could have invested and had more…but that’s not what would happen for the majority of Americans. They would’ve spent it all right then and they would have none when it came to time to retire.
I am seeing this happen with people opting for much cheaper high-deductible health insurance. People don’t save the premium difference and they are really struggling when they get hit with high medical bills. I realize that’s just a part of the health care crisis, but it’s the same type of “if it’s front of me, spend it now” mentality.
What I meant was rather than having SS, we could apparently have a mandatory savings plan. You actually have full ownership the way you do with your 401K, but use the dollars currently collected as a payroll tax and matched by the employer portion of the tax. I would rather have it all be optional and hold people accountable, but if we have to engage the government to force us to save money, at least do it efficiently and in a way that helps the overall economy by making those dollars available in the market.
@Torveaux, the only thing worse than most people’s savings behavior is their investment behavior. Study after study shows that most people over-trade, buying high and selling low, and would do massively better just investing in an index fund. They are driven by fear and greed.
SS, like a good SPIA (in SS’s case, it’s a multiple premium immediate annuity), benefits from mortality credits.
Allowing people to get their hands on the money and invest it themselves would just lead to millions not having even the barest safety net to fall back on. There would be a huge outcry to provide these people something so they don’t starve, and we are right back where we started from.
If instead our SS taxes were treated like contributions to a pension plan and responsibly invested, we would all be getting 3-4x the benefits we will likely get from SS, or the taxes would be much lower. There is a very good chance that I will not collect as much in benefits as I have paid in over the years (counting both my and my employer’s contribution), giving me a negative return on the “investment” I’ve been making for over 40 years. Our kids certainly won’t.
But - SS was never intended to be a pension plan, it has always been a straight transfer from taxpayers to other people. It is funded via a payroll tax and eligibility and benefits are based on work history, which sort of makes it feel like a pension, and it has been sold as such by politicians, but it’s not.
It has always been primarily a pay-as-you-go plan, and because politicians are involved it has been expanded far beyond its original purpose, to the point today that 1 in 6 of us are collecting benefits. FICA taxes are sort of like tuition - they’ve been increasing far faster than in inflation for decades, and show no signs of slowing down. 
And I fully expect the benefits we will get to be subject to even more means-testing than they are now, and my kids will have to pay even more in taxes than we did.
Living below one’s means does allow to build up a reserve/emergency fund. It’s a nice feeling and allows us to sleep well at night.
I have a relative who has always earned much more than us but always has his money spent before he receives it. He always feels broke and hasn’t sent either of his kids to college yet!
A lot of it is a mindset, IMHO. They’ve never been unemployed or had huge medical or other bills.