The Retirement Crisis? Will You Be Affected?

imagesHey Boomers have you joined the ranks of the retired yet?  Are you living the good life and enjoying the hell out of your golden years? Are you out there living the dream, travelling, relaxing on long ocean cruises, kicking it at 5 star resorts on far off islands, getting in a lotta golf or maybe crisscrossing your way across the nation in your big, shiny motor homes, taking in the sights. Oh yeah the good life. The life we’ve long dreamed about. We’ve worked most of our lives to get here and now we’ve arrived! Or have we?

Much like our socioeconomic structure there are different levels of retirees. At the top are what I refer to as the one percenters, the golden year retirees (65 -85 ) who, through hard work and shrewd financial planning are living the exceptionally good life, the kind of lifestyle most golden year retirees can only dream of. Next are those retirees who experience the good life only as much as their pensions and Social Security allow. Many of these retirees have learned to work a budget so things works out okay, They vacation and travel but not on as grand  scale or as often as the one percenters, but still enjoy a piece of the good life.

Sadly, some at this level are really struggling. Even with a pension and Social Security they simply can’t make it. No travel, cruises or far off resorts for them. They are out there toeing the line, barely able to make ends meet. Some have even found it necessary to return to workforce to survive. For them the golden years seem more punishment than reward. Like those retirees at the lowest level who have no pensions and rely solely on their Social Security, they will never know the good life that they always dreamed of.

Retirement Fund

Retirement Fund

Many people have no empathy for these down on their luck retirees and believe they have only themselves to blame. Had they planned better, saved more, and made better investments they wouldn’t be in the shape they’re in today. Perhaps these people have a point, perhaps not. Sure there are retirees out there who squandered away their savings, lived beyond their means and are now paying the price in their old age, sure, but there are a whole lot more who are victims of simply being under-prepared for retirement. What they thought would be enough for retirement simply wasn’t. The economic collapse of 2008 didn’t help things any and soaring costs and pricing didn’t either. They entered the happy world of retirement only to find out the hard way that they weren’t financially prepared for what awaited them.

Do you for one minute think that those hard working retirees ever believed that in retirement they would be forced to cutback, lower their standard of living and even rely on their families, charities, and the government for help in making ends meet. That’s not the retirement they looked forward to, no way, no how. I gotta tell you friends there’s a retirement crisis brewing in our country and if it isn’t addressed soon it’s going to get a whole lot worse, sooner than you might think. According to the latest findings released by the National Institute on Retirement,(I had no idea there was such an institute) more than a third of non retired people ages 18 to 65 and over, have absolutely no pension or retirement savings. zilch, nada!

Not surprisingly the 18 – 29 year old’s made up 50% of the group, but then who wants to save money in their 20’s right? There’s still plenty of time. The 30 – 44 year old group fared a bit better with only 28% savings and pension less, while the 45 – 70+ crowd made up nearly 40%, of the unprepared. And as they continue to retire unprepared or under prepared the effect will be devastating. Our national economy will nose dive as millions and millions of affected families stop spending. Optimistic studies show that 25% of retirees today are not making it and forced to rely on some form of family or government assistance. By government assistance I’m not talking about Social Security.  Soc. Sec. is not a form of government assistance or benefit, it is our money. It upsets me every time one of those fools on the hill refers to social security as a federal benefit credit. It’s no such thing. Some analyst believe that the 25% figure will quickly double and then some. When that happens we’re in real trouble.

So how do we avert disaster and get this thing turned around? Yes, obviously we need to begin saving for retirement immediately and at a much younger age. But how do we stress the importance of acting quickly? How do we get working Americans to stop thinking about living for today and begin planning for tomorrow? How indeed. We are a consumer society saturated with advertising that perpetuates the live for today lifestyle. I see it, I want it, I buy it. Can Americans really change their evil ways and put their spending craziness behind them? Can they begin to sock that money away instead? Whatever happened to saving for a rainy day?

For many retirement is right around the corner. changes need to be made. One study goes so far as to suggest mandatory savings that is electronically taken from your paycheck each week. A forced savings plan sounds a bit Orwellian to me but it may be the only way to approach this growing problem quickly. Another suggestion is to make retirement money untouchable until after retirement. Right now if you want to dip into your savings plans, assuming you have one, you can! Sure there are penalties for such actions but people willingly pay the penalties to get at their money. Many Americans, especially the young, simply can’t save, the temptation to spend is just too great. At the rate we’re going now researches estimate that as many as four out every 10 workers will have to lower their standard of living in retirement, some severely.

There is no quick fix available. In order to get a handle on the retirement crisis people need to be educated. They need to understand what potentially awaits them and be retrained to see the importance of saving for the future. If this attitude adjustment doesn’t occur soon we’re in for some very tough times ahead. It’s up to you. I was never good at savings, but fortunately for us my wife and I both have decent pensions, coupled with our meager social security we’re doing alright. We’re not living the dream to the fullest like the one percenters, but we are still living the dream.  Could we be doing better? Absolutely, but we also could be doing a hell of a lot worse. When your time arrives I sure hope you find yourself on the right side of retirement.In the meantime begin saving, retirements right around the corner.

Just a thought…


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