Retirees Become More Conservative, Frugal

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Muser apparently likes to get 7-8% mortgages and high taxes to produce a grest US economy. The tax and spend ( in reverse order) mentality is a primary reason we, personally and collectively, as a nation got ourselves in the economic fix we now have. Blaming Republicans, seemingly makes some folks feel good, but overlooks the real cause of economic strife: personal economic responsibility.
Bob M.

Bob Marks of MT 7:48PM July 22, 2009

Since when are retirees with $100,000 in investable assets considered "relatively affluent"? If you apply the standard formula of withdrawing no more than 4% a year from your assets to avoid outliving your savings, a retiree with merely $100,000 would have a whopping $4,000 a year income to live off. It's no wonder they might feel insecure about their retirement! Anyone writing about retirement needs to understand the realities associated with the actual costs involved. While $100,000 might seem like a lot of money to a younger saver, the reality is that even $1,000,000 yields only $40,000 a year at 4%. Given that only Government workers and teachers get defined benefit pensions any more, $40,000 plus social security income results in a pretty tight budget for most couples.

Frank of MA 2:25PM July 22, 2009

Interesting article, but what does it mean for those still in the work force? Truth is, most already retired are benefiting from both social security and a traditional pension. A traditional pension plan being one that comes with the guarantee of a certain amount of earnings or a percentage of the retirees last salary? I don't call market based pension plans traditional, instead they are creating a retired working class that must work to make ends meet. Often working well into their 80's or 90's with major health ailments and all. I saw a man that had to be in his 80's pushing shopping carts at a supermarket. I watched him for about ten minutes and noticed that he could only push about two carts at a time and it took him forever to get them out of the lot before he shuffled back for two more. I don't think he does it just to keep busy or fit. He's working because he has to, and this will become reality for most of the working class, unfortunately.
Niche Who?
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Niche Who? www.nichewho.com of NJ 10:44AM July 17, 2009

is that the traditional vehicles of safety---Treasury bonds and bank CDs--are not paying returns commensurate with the price inflation experienced by older people.
Older people should be literally "having a fit" about the still-rather-Republican Fed buying treasuries and maintaining a -0- Fed Funds rate---using "out-of-thin-air funny money" to compete with their real money.
Holding taxes and interest rates too low too long is why we have a series of bubbles and bursts in things like stocks, houses and commodities. Your five-year or more safe investments ought to be paying at least 6%---and you will not have a sustainable economy in the USA until they are.
But this would allow mortgage rates to go up. Yes, it would. Home mortgage rates should never have been under 7-8%. That's why you got the house price bubble---and burst.

Muser of NM 10:30AM July 17, 2009