Skip to comments.The Extinction of Retirement. Is It Going the Way of the Dodo Bird?
Posted on 06/18/2011 6:53:46 AM PDT by SeekAndFind
For the better part of a century, the foundations for a semi-comfortable retirement for many Americans have rested on the financial pillars of rising real estate and equity prices, positive real interest rates on savings, the continued solvency of public and private pension plans and the reliability of national entitlement programs (Social Security, Medicaid). But in the last few years, the economic sands have fundamentally shifted and these pillars are no longer sturdy, some have cracked completely. For many Americans, the traditional idea of a comfortable retirement filled with golf carts, cruises and fishing trips is going the way of the dodo bird.
Over the last decade incomes and job growth have stagnated, causing savings rates to drop. According to Jim Quinn, author of The Burning Platform, 60 percent of retirees have less than $50,000 in savings. Such sums won't last very long, especially when consumer prices are up 3.6 percent, import prices are up 12.5 percent and commodity prices are up 35 percent year over year. What's worse, any savings placed in a bank will pay next to zero interest and will likely not even pay for the fees associated with the account. With cash savings essentially non-existent, the other pillars of income take on paramount importance. But these former bastions of financial security are being washed away by a torrent of red ink.
For years, the essential Ponzi-like structures of Social Security and Medicare were concealed behind positive demographics. But once taxes collected from current payers fall short of the required distribution owed to current recipients, the ruse will be laid bare. That day is now here. With insolvency a real and present danger, at last a consensus is now forming that Social Security must be structurally altered if it is to survive.
But according to the Social Security Administration, in 2008 Social Security provided 50 percent of all income for 64 percent of recipients and 90 percent of all income for 34 percent of all beneficiaries. With these numbers, it's not hard to see how even small cuts will spark big protests. Now, try cutting the close to $20 trillion prescription drug program and the $79 trillion Medicare entitlements and watch the political sparks fly! However, given the realities, it's hard to see how the program can escape deep cuts -- Paul Ryan has it correct.
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It’s now called “Going Galt”.
“$20 trillion prescription drug program”
My new retirement plan.....
The Obama Retirement Plan: “I will work till I am 90.”
Only 46 year old Congressmen who take pictures of their weiner and post it on the internet can afford to retire today.
Some may now understand why big families were the norm in the past. Your family was your retirement. When you got too old to work, you went to live with one of your children.
Families have been getting smaller, and more dispersed.
The golden years are not going to be so golden for some.
People don’t want their health care cut because of fear of their lives or major problems. I wonder how much health care money goes to “less important” items such as Viagra or vastly overpriced comfort items and medications.
How about legislation that carefully avoids the scary cuts and focuses on the comfort items.
Then there’s the problem of way-overpriced items such as a $18,000 pacemaker (a friend got one of those but of course didn’t pay for it with their own money), or a $5,000 knee replacement (the mechanical part) that a hospital buys at that price (seems mighty high) and sells to the patient for $10,000. I know this example is true because a friend works for a company that makes joint replacements.
What, you expect prisoners on death row to pay for their OWN sex change operations? You are so cold-hearted!
Of course with older people staying at work a lot longer, I know this makes the gov’t happy and corporate executives. It will make it harder for younger people to succeed and they can be paid much cheaper wages but still expected to work hard like putting in a lot of unpaid overtime.
Democrats believe in putting a lot of people to work but what is not mentioned, people will be working for dirt cheap wages that barely sustain them. Of course this makes bankers happy since people have little or no wealth, they would need credit much more ! Not a road to prosperity but a road to slavery and be easily controlled by those in charge.
Actually, the typical Corporate Retirement Plan (for the workers) is “Work until you are 90, or until we can replace you with younger workers.”
The ObamaCare Retirement Plan (for the un-waivered masses)is “Don’t worry, we’ll make sure you don’t live that long.”
The Repubicrat One-Party Retirement Plan (for the Little People) is “We’ll make sure you won’t want to live that long.”
The entire concept of “retirement” is just another utopian progressive concept from the 20’s that lasted only a couple of generations before it played itself out.
in all reality, the combination of the future is going to be working as much as one can, together with living with off of other living family members, together with the other “pillars” is going to have to do the trick. problem is, those first two pillars (continuing to work, family) are not something that current folks are ready for. it is going to require a massive cultural change over the next decade and decades.....
The title of your post made me laugh, not because I found it funny in a comedic way but much more so as gallow’s humor. Retirement?? Let me put it to you this way. The gathering storm coming this way will make the story of Noah seem like stopped up toilet bowl by comparison.
It’s because the American people began to vote wrong in the 1930s, when FDR promised a balanced budget.
How many people in their 20’s, 30’s or even 40’s even consider what it costs to turn 70 or 80 and plan for it? Not very many. Along with that, how many of them know where our government spends their Social Security and Medicare tax money? Do people know that the government owes Social Security over $2 Trillion that they borrowed and have no intention to pay it back?
The Reality-Check Retirement Plan:
Live off our own savings, or live in borderline poverty on the dole.
My mom is scheduled for a knee replacement. I went with her to talk to her Ortho about it.
He spent 4 years in college and worked hard to get good grades to get into med school. Then he spent 4 years in med school. Then 2 more years in med school for specialty and surgery. Then 6 years in residency. 16 years of schooling. Not to mention the continuing education he does.
What about the Anesthesiologist?
The cost of the medical facilities?
The list goes on.
Have a repair done on your car. I bet the repair costs twice as much as the part.
Same with home repairs or remodeling. The labor will be at least the price of the material.
“For the better part of a century, the foundations for a semi-comfortable retirement for many Americans have rested on the financial pillars of rising real estate and equity prices,...”
From the beginning, this diatribe shows that the author has not fully understood what has happened to the American family.
It was not until the 1970’s, when the wives income was included in the family borrowing power, that the real estate
BOOM started. At first it was seen as freedom to grow financially. Now, it has torn apart the fabric of the family.
0bama has done away with retirement by making everyone UNEMPLOYED. How do you retire from unemployment?
True enough. Most families today do NOT resemble “The Waltons”. I know the Waltons were a fictionalized idealized family from the ‘30s, but, it was common back in the day for extended families to live together like that. Today, due to cultural changes, it’s very uncommon. I wonder how many younger people are ready to welcome Grandma to live with them. It’s something outside of their frame of reference.
It’s also something that the young people might resist as interfering with their own freedoms. The way some young people are, they resist having to be responsible for other people in their family, because they think the government should take care of them if they have problems, or can’t afford to live on their own. They would complain of the cost and inconvenience of living with Grandma.
I’m not going to be able to retire and have already accepted I must work for as long as I can.
Ain't it the truth. I take home about 60% of my gross pay. If the taxes weren't so high, maybe I could save to finance my retirement instead of saving to finance Weiner's retirement.
RE: have already accepted I must work for as long as I can.
Many people have concluded that. Only one problem ... even though it is theoretically illegal, America is rife with AGEISM.
Try looking for another job when you get laid off in your late 50’s....
If your boss is kind and willing to hold on to you, congratulations. You work in a very rare business.
They’ve got to save the stock market, so they’re taking away the other options.
The whole concept of retirement was created during the great depression to usher older workers out of the workforce and decrease the unemployment rate.
It's a ruse that benefits companies because they get to rid themselves of their most costly employees, and by the government which gets to trumpet artificially low unemployment numbers as proof of their omnipotence.
Agreed. And businesses before major outsourcing abroad will cut the 50+ staff and keep the 25-45 crowd, bringing in a few contractors to meet the work load peaks. It isn’t necessarily “you’re gray, go”, it’s the salary after years of slow raises pricing you out of the market.
Exactly right. Some people can. Some people will. Heck, maybe I will. It would be lovely to sit on the beach, or travel, or any of that. But the fact is that that concept is very recent and has not proven terribly practical.
An awful lot of people are going to have to adjust their thinking. Working until you get sick and die is the old fashioned way, and I suspect it is making a comeback.
He is counting future liabilities that are mandates of the program, much as accepted accounting procedures would require of a private pension/medical plan.
Without the accounting gimmicks, the national debt is closer to $100 trillion (not 14).
“At 65 years of age should people in general believe they are entitled to a thirty to 35 year holiday or not. ... hrmmm ... Tough decisions. “
It’s not that simple. In order for jobs to open up for young people just starting out and maybe raising a family, people have to retire. If you raised the retirement age 10 years it would have a very bad effect on the younger people in terms of unemployment. You would have to have a real high growth rate, or else very slowly increase the retirement age.
Also, the average age at death in the United States:
So if you retire at 65, you only have 10 years (on average) till you die.
“...I wonder how many younger people are ready to welcome Grandma to live with them...”
At the Repeal house, it is the other way round.
The underemployed and unemployed adult children contribute what they can; while Grandma and Granddad help watch/raise the toddlers.
Those years will reduce as Obamacare comes online. Those of us who make it to 65 in the coming years, will be fortunate.
If Obama has anything to do with it, you will be shipped out on an ice floe long before you reach 90.
Or $30,000 for an angiogram with no other procedure such as a stint? Just a one morning out patient procedure.
Complex equipment, yes, requiring skills, yes and so forth but $30,000? I wonder.
Retirement, not bloody likely. I don’t see it as a realistic thing even if a person were 60 with $4 or 5 million. I know that sounds absurd but who wants to live an existence of more perpetual uncertainty?
You're right. And wives went to work because of birth control. One thing leads to another.
I think multi-generational living is becoming more common in our area, and not just because it has a lot of people from other countries. A lot of people in our area move into a their parent’s house, for mutual benefit. The houses in this area have become really expensive, and the elderly parents need company and assistance. The children have the benefit of the good schools in the area and knowing their grandparents well.
Also, I think, absent some really good interest rates, it is unreasonable to expect to live well without working for 25 years on what you earned in your first 35 years of adulthood. Especially considering that older people are healthier and work is not so physically debilitating as it was a couple of generations ago, they are able to work and would find it kind of fun.
I think the trend will be toward retirement from “career” work and transitioning to caring for grandkids or ‘light’ work of the sort you don’t stress about when you leave the workplace. The thing everybody should really save for is those last couple of years of needing in-home nursing or a skilled nursing facility, so family members aren’t having to do more than they can handle in caring for you.
As to employing the young, well, I think we better stress entrepreneurship because people may or may not offer our kids a job. They may have to create their own.
*** With insolvency a real and present danger, at last a consensus is now forming that Social Security must be structurally altered if it is to survive. ***
But, but the government promised us everything would be A-ok! Here is the promise from 1964!
“The program is designed so that contributions plus interest on the investments of the social security trust funds will be sufficient to meet all of the costs of benefits and administration, now and into the indefinite future—without any subsidy from the general funds of the Government. Both the Congress and the Executive Branch, regardless of political party in power, have scrupulously provided in advance for full financing of all liberalizations in the program.”
And here is where your money went! Read and weep!
THE OLD AGE PENSION CHECK
Roy Acuff & His Smoky Mountain Boys - 1939
When our old age pension check comes to our door,
We won’t have to dread the poor house anymore.
Though we’re old and thin and gray,
Good times will be back to stay,
When our old age pension check comes to our door.
When her old age pension check comes to her door,
Dear old grandma won’t be lonesome any more.
She’ll be waiting at the gate,
Every night she’ll have a date,
When her old age pension check comes to her door.
Grow a flowing long white beard and use a cane,
‘Cause you’re in your second childhood, don’t complain.
Life will just begin at sixty,
We’ll all feel very frisky,
When our old age pension check comes to our door.
Powder and paint will be abolished on that day,
And hoop skirts will then be brought back into play.
Painted cheeks will be the rage,
And old maids will tell their age,
When their old age pension check comes to their door.
All the drug stores will go bankrupt on that day,
For cosmetics, they will all be put away.
I’ll put a flapper on the shelf,
Get a grandma for myself,
When her old age pension check comes to her door.
There’s a man that turned this country upside-down
With his old age pension rumor going ‘round.
If you want in on the fun,
Send your dime to Washington,
And that old age pension man will be around.
Nah, no ice due to global warming.
At least us conservatives may find a warm bed and three meals at the re-education camp.
“He spent 4 years in college and worked hard to get”
The $5000 marked up to $1000 is for the part alone. Why did you bring up the doctor’s educational history?
The doctors probably have to pay way too much for their education.
Wonder if patients found cheaper alternatives to the American system, and thus the American system lost business. Do you suppose they would then charge less? That’s how the free market works every time.
Maybe an alternative medical system needs to be formed in America that would handle certain problems at a lower cost. That might be a great idea that can’t happen now because the establishment has rules that prevent it.
Another alternative would be more do-it-yourself medicine, where you would go to the internet or somewhere for guidance and then do it yourself, or with the help of friends.
whoa..you are so right.
At least I know how to make soup and bread and hang up laundry...ha.
It used to be people in their twenties, working or college, lived with their parents or got a “room’ somewhere until they got married and rode the bus.
NOW they all want an apt with all the HDTV,Rooms to Go furniture, etc. or they “shack up”.
My mother had to work, she worked in my father’s office and as a secretary before that. A lot of mothers worked, and many, many couples did not have a stay at home mom.
the boom came about because of the relative “cheap” homes people could buy and the country had boomed after WW II..AND people used to live way more frugally and save for their homes.
“Same here. After I resolved myself to that fact, I vowed to make some changes. If I have to work until death, I am going to make it as comfortable as possible. No more 24/7/365 toiling...I will do enough to pay the bills and add to savings, but since I will never have the golden years others do, I will take some of that leisure time now. I’m not going to bust my bones just to pay more Social Security taxes that I will never see. I’d rather sit down with a nice beverage and a good book...a “retirement moment” here and now.”
Very wise advice and I’m grateful that you shared. I have a few more years of butt busting but hope to downshift after that.
So if we figure in labor, I think the price is typical of a cost AND labor ratio.
Now as far as other points, such as "The doctors probably have to pay way too much for their education."
I'd prefer my Drs not having their Md from the University Of New Delhi or the Molefi Kimbwandènde Owomoyela School Of Voodoo.
Todays Drs spend 4 years at a normal university, getting their gen ed, just like everybody else. With tuition, books and board, lets say $40K a year. Then 6 more years of specialized schooling. Thats 10 years JUST from school. Thats $400K. Think thats too much school? Why does 1/4 of the drs fee go to cover his/her MALPRACTICE insurance? How much DO YOU PAY in Oops Insurance at your job, so that nobody takes your house, car and childrens future, because you made a SIMPLE mistake?
OH!!! No simple mistakes in medicine??? Yeah thats right. A Drs balls are on the anvil every time he sees a patient, whether "snifles" or a "minor scratch".
You want lower cost medical? How many Drs are getting ready to retire, or not continue with med school, because of the lower pay of Obamacare.
There are all types of books and websites on DIY med advice, or alternative medicine. BUT...It sounds like what you want, is the Dr "coaching" you and your buddies through setting a bone or a fixing Steve Austins bionic arm. Meanwhile, who gets the blame when something goes wrong??? You want the benefits without the cost. Hey don't worry, Obama and company have agreed to take care of that for you. FREE healthcare for ALL.
There are no doubt rules that benefit "the establishment". BUT...there is a reason people come to the US for healthcare, when their own countries have FREE healthcare. There is a reason students from ALLOVER the world, come to the US to study medecine.
Maybe you'd like an alternative healthcare system, where its illegal to get an expensive operation or proceedure, even if YOU PAY out of your pocket, when government healthcare deems it so.
I'm not naive to believe that ALL in the medical field are altruistic, and do so solely for societies benefit.
Insurance companies have changed the face AND cost of medecine in the US. No doubt. But don't forget, its people wanting golden insurance programs, from their employers, that they themselves don't bear the cost of, that has driven the pharma r+d. People want a GUARANTEE that nothing bad can or will happen to them, no matter the cost...
to SOMEONE ELSE.
You yourself are describing that you want all the advantages that modern US medecine has wrought, but only want to pay for strictly what you use, but want the GUARANTEE that full medical is available when you want or need it. You love the fact that something like Polio, today is virtually eradicated, that YOU DON'T NEED your dr to treat you for that. BUT...At what cost yesterday, for someone else? For the Drs involved in the research and development?
Hey I'm just a dumb construction worker.
I'm skilled labor. When its hot and sweltering out, I get the call.
When its bitter a-- cold out, with the wind blowing, dropping temps to below zero, I get the call.
When its raining and the job HAS TO GET DONE...thats right...I get the call.
When the job is high up, and you feel your butt pucker...I GET THE CALL.
When the job needs to get from point A to point B, in a PROFESSIONAL manner...thats right...I GET THE CALL.
When 40 feet of 16" pipe weighing TONS, needs to be rigged and moved and inched into place, WITHOUT damaging millions of $$$ equipment...I GET THE CALL.
Now, someone wants me do a "simple" project for them. But they want it free, or they'll "DO ME THE FAVOR" to give me a little extra spending money, and offer me what the local handyman charges.
I'm sorry, you want handyman quality, call a handyman. You want professional quality, you call ME.
And who does the handyman call when he gets in over his head, or is unfamiliar with something??? ...Thats right...I get the call.
And when the handyman screws the pooch on the project, and his "workmanship" needs to be tirned into "craftsmanship"...I get the call.
AND STILL...people want to pay handyman prices.
ITS NO DIFFERENT in the medical field. People want Ben Carson quality and assurance...BUT...at LPN prices.
BINGO, we have a winner.
My older sister worked, and I kept her kids. But, MOST wives in the 60’s still had control of their families.
Houses did not become expensive until 2 incomes allowed couples to move up. After our wonderful government removed red-lining from trash neighborhoods, and loans to those who could not pay, the whole scam became PYRAMID SCHEME looking for more support from the bottom of the market.
This was a crash created from the beginning. Our government needs to leave our businesses and our families alone.
“I didn’t know that it was JUST the cost of the implant marked up. Your post didn’t say that”
Yes it did. I wrote “or a $5,000 knee replacement (the mechanical part) ...”. Do you think $10,000 after the hospital markup for the knee replacement hardware is excessive?
Medical costs in America could be reduced by the higher-paid people throughout the medical industry (doctors, scientists, professors, engineers, administrators) working for less pay. The result would be no change in the quality of medical care, but more money available for citizens to do what the want with.
But who wants their pay reduced? Don’t look cost-reduction ideas from the medical industry.
You say “people want to pay handyman prices”.
In the case of medical care that’s not true. People know that the price for medical equipment and services is often incomprehensibly high (e.g $4000 for a 20 minute breast biopsy or a malpractice settlement $40 million). People know that medical costs are way out of whack, period.
You sound like someone whose medical costs are paid for by someone else. That, by the way, is a reason medical costs are so high — we get an outrageous bill but don’t care because someone else pays it.