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>Over time, the shape of your nest egg would resemble a bell curve, growing in the early years, and then declining as inflation required you to withdraw more mo
by tsotha 16y ago
>Over time, the shape of your nest egg would resemble a bell curve, growing in the early years, and then declining as inflation required you to withdraw more money to maintain a lifestyle equivalent to $300,000 in 2010. The $12 million would finally dwindle to $934 when you turned 100.
My bank is offering savings accounts that pay, like, .01% these days, so it's not so much a bell curve as just the right half of a bell curve. You can get a bit more interest from investments, but your risk goes up too. It would suck to be 50 after 15 years of not working and find you don't have any money. Would you even remember how to tie a tie?
Anyway, the big wild card is health care. Nobody will insure you as an individual if you have a health problem, and the bills you can rack up at the hospital are almost open-ended. I went in for just a couple days last year and they billed my insurance $26k.
It's not at all clear to me the changes the Democrats made last year will survive the next. I'd want at least 4-5 million in the bank just to feel secure on medical.
- avibryant 16y agoAs a Canadian (though currently living in the US), that last sentence is both astonishing and scary.
- tsotha 16y agoAdmittedly, I'm a bit more conservative than most. But for me this amount would have to cover twenty years of potential problems.
- Bricejm 16y agoOver the last 30 years mortgage rates have decreased and with that savings rates (the less it costs to lend money, the less you pay to purchase money). An emphasis was placed on creating wealth in home equity and the stock market vs. saving from your job/paycheck, and living off interest in retirement. Unfortunately it's hard to turn things around (deflation causes depressions) and we have to accept that it's going to take time. Our generation will never see the increase in home prices the way our parents and their parents experienced. The same goes with the stock market. We're overextended and it will take time for things to even out. Being rich is having the amount of money that allows you to live the life you wish to lead. It's going to be more difficult for our generation to reach that point, but you can never go wrong with saving and preparing for retirement.
- jaxn 16y agoNot to mention the health care bill that the Boomers will generate. One way or another I think our generation will end up footing the bill for the extended lifespans of the Baby Boomers.