Don't Save for Retirement?

**kork13** · 10-04-2022, 09:18 AM

Bah. It's more an observation of general trends than anything else. And tucked away at the very end of the article are the two massive assumptions that the entire premise relies upon: (1) a person's expenses & income are low early on, high in middle age, then low again in retirement; (2) Social security will continue unchanged. Both assumptions are trash. This study also discounts as meaningless human behavior & habits, which is a ludicrous position to take.

Yeah, controversial all right... While the observations may be sound, the recommendation that everyone should assume they will fit into those norms is irresponsible at best, if not deceptive.

**riverwed070707** · 10-04-2022, 11:33 AM

I just don't see any benefit that could come from people taking this advice. We know buying "things" doesn't create happiness, so why would not saving during your low earning years maximize happiness? We also know that creating healthy spending and saving habits at an early age, sets you up to be more successful later in life. If I'm 25 and making $25k/yr (as the article suggests, but is a crap wage for someone with 8-10 years in the workforce), finding a way to put away a couple hundred a month and seeing a savings account grow is going to give me skills and tools to use when I finally get that $50k/yr job and have the means to start saving more.

Low wage earners shouldn't save either because SS is progressive?! What's the backup plan???

Overall feels like a garbage article intended to keep people struggling which is really disappointing to see from Marketwatch.

**LivingAlmostLarge** · 10-04-2022, 11:46 AM

I actually don't disagree with some assumptions. One low wage earners do not need to save to replace what they make. But what is considered low wage? Below 50% median income. But the reality is that those people are struggling to survive to begin with so they likely aren't saving period. Maybe they should check what percentage of those in the bottom 50% of incomes are saving period?

Now then going to the top 50% of incomes, what percentage of those are saving? Sorry but if you are in the top 20% of income i'm pretty sure that not saving during your 20s is going to end very, very badly. It's not a one size fits all answer. Lower wage earners do have more replaced by SS. They do not need to save, but they probably aren't to begin with. Higher wage earners do need to save but are they?

**ua_guy** · 10-10-2022, 04:17 PM

I’m going to take a controversial position even though I’ve saved since I started working.

I’ve seen two recessions in my lifetime so far, the collapse of a housing market. And, if I had to guess, democracy in America is on its last leg. Truth has been eroded at a fundamental level for healthy functioning, and my faith in “markets” has eroded substantially. There is manipulation in the market, more than there has ever been. This is not the same market that benefited the generations before us.

The chances I won’t live long enough to retire, or that what I save won’t be worth anything are both non-zero chances. I’m unwilling to assign a weight to those chances currently, but the view now, from age 40, is still very unclear.

The article focuses on the young, however it says nothing about the impending stress that SS is about to endure when the largest and oldest generation saddles it in short order. This is a generation which is rocketing at old age and doesn’t have adequate savings by our standards here at SA. Let’s also acknowledge that the current market has set people who rely on it for retirement, on edge.

Save, don’t save. Maybe more non-traditional ways need to be considered. Or maybe we need to stop believing in this idea that we need to work ourselves to death, only to fall over dead shortly after with a bunch of money in the pot.

**LivingAlmostLarge** · 10-12-2022, 09:01 PM

Originally posted by ua_guy View Post

I’m going to take a controversial position even though I’ve saved since I started working.

I’ve seen two recessions in my lifetime so far, the collapse of a housing market. And, if I had to guess, democracy in America is on its last leg. Truth has been eroded at a fundamental level for healthy functioning, and my faith in “markets” has eroded substantially. There is manipulation in the market, more than there has ever been. This is not the same market that benefited the generations before us.

The chances I won’t live long enough to retire, or that what I save won’t be worth anything are both non-zero chances. I’m unwilling to assign a weight to those chances currently, but the view now, from age 40, is still very unclear.

The article focuses on the young, however it says nothing about the impending stress that SS is about to endure when the largest and oldest generation saddles it in short order. This is a generation which is rocketing at old age and doesn’t have adequate savings by our standards here at SA. Let’s also acknowledge that the current market has set people who rely on it for retirement, on edge.

Save, don’t save. Maybe more non-traditional ways need to be considered. Or maybe we need to stop believing in this idea that we need to work ourselves to death, only to fall over dead shortly after with a bunch of money in the pot.

We haven't seen the real impact of not working and living solely based on SS. So many people I've posted here a lot the 401k only started in the 1980s. These people still had pensions. So people working then in the 1980s were able to retire with smaller pension and employer provided health care etc. We haven't seen people working for 30 years say those who started in 1990s with ONLY 401ks (honestly I think you need to look at those starting in 2000s to really tell), and see how retirement is going to treat them.

I'm in my 40s and I started in 2000. I'm the tail end of the Generation Xers. Most of my friends are Xers. Most do not have pensions, though a few do. Xers are the majority who started in 1985 on working with a 401k. And most you will see do not have $1m saved in a 401k. Many of my contemporaries in their 40s think they have a lot and consider $100k/$200k a lot in a 401k. I want to tell them...you are living on $100k/year now and you think having $100k at 45 is enough to retire one? Not going to happen. Not even close. The reality hasn't even set in. Most of my contemporaries will say their parents in their late 60s/70s have pensions. Majority do and they are doing great these boomer parents of ours. They don't have huge cash investment accounts because between SS and Pensions and health plans they are set.

But look at people between 40-60 now boomers, how many really have $500k saved for retirement? And the average household income is $75k so I guess if you have $500k saved and SS average $2000 plus spouse $1000 = $3k you might be able to eek out a living with $500k. But I think people who make $75k likely don't have $500k. Those with $500k are those people who were making $120-150k while working and when they stop the shock to their lifestyle is going to be awful. Anyone living on above $100k and having to fund that themselves without a pension?

**disneysteve** · 10-13-2022, 07:08 AM

Originally posted by LivingAlmostLarge View Post

Anyone living on above $100k and having to fund that themselves without a pension?

Yep. That's us. Completely self-funded.

**LivingAlmostLarge** · 10-14-2022, 07:23 PM

Originally posted by disneysteve View Post

Yep. That's us. Completely self-funded.

But we've seen the stats that not so many have a pension

Don't Save for Retirement?