Generation X and Y: Do you plan on retiring? - Page 3 - Tilted Forum Project Discussion Community

Willravel · 04-22-2008, 08:38 AM

Quote:

Originally Posted by 37OHSSV

My attempts to understand your statement have utterly failed. You seem to imply that the president, and no presidential candidates other than the Democratic ones are interested in maintaining the viability of SS. Only liberals can save it, apparently.

Social security is, by it's very nature, something that goes with Dem philosophy and against GOP philosophy. It's not fiscally conservative at all, so it tends to split right down the middle.

Clinton never tried to privatize SS.

samcol · 04-22-2008, 08:44 AM

Quote:

Originally Posted by willravel

Social security is, by it's very nature, something that goes with Dem philosophy and against GOP philosophy. It's not fiscally conservative at all, so it tends to split right down the middle.

Clinton never tried to privatize SS.

I don't understand what the fear of privatizing it is. The Federal Government has already failed terribly at managing it. For example the hundreds of billions it has raided from social security. The Democrats started this program off on the wrong foot from the beginning.

The plague of social security rests on the shoulders of Democrats. They started it and haven't fixed it.

Willravel · 04-22-2008, 08:48 AM

Quote:

Originally Posted by samcol

I don't understand what the fear of privatizing it is.

http://www.socsec.org/publications.asp?pubid=503

samcol · 04-22-2008, 08:56 AM

Quote:

Originally Posted by willravel

http://www.socsec.org/publications.asp?pubid=503

I don't even agree with privitization, but are any of those really worse than robbing $600,000,000,000 from social security or the fact that it will bankrupt in just 30 years.

Cynthetiq · 04-22-2008, 08:56 AM

Quote:

Originally Posted by willravel

http://www.socsec.org/publications.asp?pubid=503

taking just one point there

Quote:

REASON #4: Privatization has been a disappointment elsewhere.

Advocates of privatization often cite other countries such as Chile and the United Kingdom, where the governments pushed workers into personal investment accounts to reduce the long-term obligations of their Social Security systems, as models for the United States to emulate. But the sobering experiences in those countries actually provide strong arguments against privatization.

A report this year from the World Bank, once an enthusiastic privatization proponent, expressed disappointment that in Chile, and in most other Latin American countries that followed in its footsteps, "more than half of all workers [are excluded] from even a semblance of a safety net during their old age."

Other cautionary points made in the World Bank report and other studies about the experience in Chile:

Investment accounts of retirees are much smaller than originally predicted-so low that 41 percent of those eligible to collect pensions continue to work.

Voracious commissions and other administrative costs have swallowed up large shares of those accounts. The brokerage firm CB Capitales calculated (see english language discussion by Stephen Kay here) that when commission charges are taken into consideration in Chile, the total average return on worker contributions between 1982 and 1999 was 5.1 percent-not 11 percent as calculated by the superintendent of pension funds. That report found that the average worker would have done better simply by placing their pension fund contributions in a passbook savings account.

The transition costs of shifting to a privatized system in Chile averaged 6.1 percent of GDP in the 1980s, 4.8 percent in the 1990s, and are expected to average 4.3 percent from 1999 to 2037. Those costs are far higher than originally projected, in part because the government is obligated to provide subsidies for workers failing to accumulate enough money in their accounts to earn a minimum pension.
In the United Kingdom, which began encouraging workers to divert payroll taxes to personal investment accounts in 1978, many citizens were victimized by poor investment choices as well as unscrupulous brokers. The national government was left with substantial new administrative expenses, lost tax revenues, and responsibilities to bail out some failed private pension plans. Indeed, the problems were so wide-ranging that even the most enthusiastic supporters of private accounts now say that the United Kingdom simply did not do it right.

A British government commission headed by Adair Turner reported in October 2004 that Britain had been living in "a fool's paradise" by thinking it had solved its pension problems. According to pension experts at the Organization for Economic Cooperation and Development (OECD), the Adair Turner report has sounded alarm bells. "What looked like a very good idea from a financial perspective in cutting costs has put pensioner poverty, which had been all but eradicated, back on the agenda."

By this very point then isn't ROTH IRA, IRA, 401(k), and 403(b) in jeopardy? It's private, it's managed by the owners who make bad decisions. Yet, I know people who's retirment programs listed above which are doing much better than any contribution they have listed in their SSI account.

Willravel · 04-22-2008, 09:00 AM

Cynth, wouldn't you want a Roth IRA that was inflation-proof?

Yakk · 04-22-2008, 09:08 AM

Quote:

Originally Posted by samcol

I don't understand what the fear of privatizing it is. The Federal Government has already failed terribly at managing it. For example the hundreds of billions it has raided from social security. The Democrats started this program off on the wrong foot from the beginning.

The plague of social security rests on the shoulders of Democrats. They started it and haven't fixed it.

In 1980, social security was in good shape, right?

In 1992, social security was in horrible shape, right?

In 2000, social security was in better shape than in 1992, right?

In 2008, social security will be in worse shape than it was in 2000, right?

I'm just checking if we agree on the basic facts of the matter.

Cynthetiq · 04-22-2008, 09:48 AM

Quote:

Originally Posted by willravel

Cynth, wouldn't you want a Roth IRA that was inflation-proof?

Sure and I would also wish that I had a Porsche 911 GT2 in my parking garage with the requisite buxom blonde mistress.

But I'm dealing with reality based information. All the contributions you make to the investment vehicles I mentioned all outperform SSI if people are attentive to their holdings. Nowadays, there are many retirement funds that are pegged with proper aggressive holdings based on retirement date minimizing the risks.

Just because I'd like something to be "recession proof" doesn't mean that because it's private means it isn't or can't.

Willravel · 04-22-2008, 10:02 AM

Quote:

Originally Posted by Cynthetiq

Sure and I would also wish that I had a Porsche 911 GT2 in my parking garage with the requisite buxom blonde mistress.

That's a social security program we can all get behind.

Quote:

Originally Posted by Cynthetiq

But I'm dealing with reality based information. All the contributions you make to the investment vehicles I mentioned all outperform SSI if people are attentive to their holdings. Nowadays, there are many retirement funds that are pegged with proper aggressive holdings based on retirement date minimizing the risks.

Just because I'd like something to be "recession proof" doesn't mean that because it's private means it isn't or can't.

The risk of having a recession or inflation damage your investment is there when your investments are private. Social Security is supposed to be an investment without those risks.

samcol · 04-22-2008, 10:16 AM

Quote:

Originally Posted by willravel

That's a social security program we can all get behind.

The risk of having a recession or inflation damage your investment is there when your investments are private. Social Security is supposed to be an investment without those risks.

How is that possible? Social Security is in US dollars. The dollar is no longer pegged to the Gold standard. Social Security will and is being affected by inflation. That's what my question was earlier. Can any retirement program possibly keep up with the inflation we've seen since 1933 (besides outright speculating which is basically gambling)? The only thing I know of is hard assests like land or precious metals.

That's why I'm sticking with gold for savings/retirement.

Yakk · 04-22-2008, 10:33 AM

Quote:

Originally Posted by samcol

How is that possible? Social Security is in US dollars. The dollar is no longer pegged to the Gold standard. Social Security will and is being affected by inflation. That's what my question was earlier. Can any retirement program possibly keep up with the inflation we've seen since 1933 (besides outright speculating which is basically gambling)? The only thing I know of is hard assests like land or precious metals.

Yes? Just buying the DJIA will kick the crap out of inflation from 1933 to say 2002. If you where smart and diversified internationally you could be doing even better.

Land, to the start of the current bubble, gave worse returns than the DJIA.

Gold moves randomly, fueled by speculation more than demand.

Quote:

That's why I'm sticking with gold for savings/retirement.

That's gambling.

I understand you benefit from talking up your bet to other people, but things that have far less value than their marginal utility to people don't make good investments at any time.

genuinegirly · 04-22-2008, 10:43 AM

Quote:

Originally Posted by kurty[B]

... I imagine I would become more of a consultant, and still work, but more and more would travel for pleasure and have longer periods of time off between working.

This is pretty much what Dad does, and he loves it! He travels for work, then travels for fun with Mom. Mom still works, but part-time in a job that she loves.

Quote:

Originally Posted by kurty[B]

If I'm single. A bike, a journal, and a sense of adventure will take me wherever I want to go.

Sounds like an ideal retirement. What makes you think the most important person in your life wouldn't want a similar lifestyle?

samcol · 04-22-2008, 11:02 AM

Quote:

Originally Posted by Yakk

Yes? Just buying the DJIA will kick the crap out of inflation from 1933 to say 2002. If you where smart and diversified internationally you could be doing even better.

Land, to the start of the current bubble, gave worse returns than the DJIA.

Gold moves randomly, fueled by speculation more than demand.

That's gambling.

I understand you benefit from talking up your bet to other people, but things that have far less value than their marginal utility to people don't make good investments at any time.

On the short term gold markets are speculative or gambling, on the long term gold does nothing but go up in relation to US dollars. I'm not buying gold to try and make money, I'm buying it to maintain value. And my point is I don't see any of these retirement accounts with the ability to keep up with inflation. Sure you'll see the dollars in your account racking up with intrest, but the buying power of those increases doesn't out weigh the devaluing dollar (short of risky speculation).

100 years ago I could buy a nice middle class house for about 100 Double Eagle Gold Coins (approx. 1 ounce gold, $20 dollar face value). Today I could buy a similar middle class home at today's standards for the same 100 Double Eagle Gold coins. The home from 100 years ago was $2000, today that home is closer to $100,000.

Gold has held it's value for thousands of years. Fiat currencies don't. I don't see how gold is a gamble.

Cynthetiq · 04-22-2008, 11:03 AM

Quote:

Originally Posted by willravel

That's a social security program we can all get behind.

The risk of having a recession or inflation damage your investment is there when your investments are private. Social Security is supposed to be an investment without those risks.

Someone has to pay for that increase or lack of risk. It doesn't just poof out of nowhere.. Otherwise I'd have that Porsche key in my pocket right now...

:checks pockets: nope...

Quote:

Originally Posted by samcol

On the short term gold markets are speculative or gambling, on the long term gold does nothing but go up in relation to US dollars. I'm not buying gold to try and make money, I'm buying it to maintain value. And my point is I don't see any of these retirement accounts with the ability to keep up with inflation. Sure you'll see the dollars in your account racking up with intrest, but the buying power of those increases doesn't out weigh the devaluing dollar (short of risky speculation).

100 years ago I could buy a nice middle class house for about 100 Double Eagle Gold Coins (approx. 1 ounce gold, $20 dollar face value). Today I could buy a similar middle class home at today's standards for the same 100 Double Eagle Gold coins. The home from 100 years ago was $2000, today that home is closer to $100,000.

Gold has held it's value for thousands of years. Fiat currencies don't. I don't see how gold is a gamble.

Don't you have to convert the gold into a fiat currency at some point in time? You can't just take a coin 1 ounce gold and just use that to pay for your groceries and or medical bills.

samcol · 04-22-2008, 11:41 AM

Quote:

Originally Posted by Cynthetiq

Don't you have to convert the gold into a fiat currency at some point in time? You can't just take a coin 1 ounce gold and just use that to pay for your groceries and or medical bills.

Yes you would, unless the confidence in the dollar got so low that people started using the barter system again or accepting gold and silver coins outright.

If I bought an ounce five years ago at $350, I could sell it for well below spot of $920 today and still be better off compared to savings accounts or banking systems.

On another note, buying real government issued gold coins from pre-1933 have advantges over bullion. They basically have three different values, 1. the face value 2. the gold melt value and 3. a collector value. Even if gold goes down, there were so only so many gold coins minted in that time so they maintain a collector value as well.

Yakk · 04-22-2008, 11:59 AM

Quote:

Originally Posted by samcol

On the short term gold markets are speculative or gambling, on the long term gold does nothing but go up in relation to US dollars. I'm not buying gold to try and make money, I'm buying it to maintain value. And my point is I don't see any of these retirement accounts with the ability to keep up with inflation. Sure you'll see the dollars in your account racking up with intrest, but the buying power of those increases doesn't out weigh the devaluing dollar (short of risky speculation).

100 years ago I could buy a nice middle class house for about 100 Double Eagle Gold Coins (approx. 1 ounce gold, $20 dollar face value). Today I could buy a similar middle class home at today's standards for the same 100 Double Eagle Gold coins. The home from 100 years ago was $2000, today that home is closer to $100,000.

Gold has held it's value for thousands of years. Fiat currencies don't. I don't see how gold is a gamble.

Sure, and if I bought 2000$ in stock 100 years ago, I would be able to buy 7 houses today at 2% real interest rate.

The value of gold has collapsed at a number of times in history. Spain had a huge inflationary collapse of a gold currency, for example.

In the period where it hasn't been used as a currency (the last 30 years), it has behaved pretty much randomly in real-value, somewhat correlated with other resources.

...

5 years ago:
1 USD = 0.92630 EURO
Today:
1 USD = 0.63070 EURO

Hey look! It went up 46%, clearly Euros are a great investment. I'll just buy Euros, and have them sit around, and earn 8% return per year.

...

Or, I'll invest in things that are denominated in Euros, like bonds that produce a return, and earn 8% plus the return on the bond.

Yes, the US currency is tanking. That doesn't mean all securities or bonds are tanking.

04-22-2008, 09:00 AM	#86 (permalink)
Willravel ... a sort of licensed troubleshooter.	Cynth, wouldn't you want a Roth IRA that was inflation-proof?