Retirement saving
July 23, 2012 1 Comment
Interesting Op-Ed in the Times about how bad Americans do at retirement planning. Loved this quote:
So it’s not surprising that denial dominates my dinner conversations, but it is irresponsible for Congress to deny that regardless of how much you throw 401(k) advertising, pension cuts, financial education and tax breaks at Americans, the retirement system simply defies human behavior. Basing a system on people’s voluntarily saving for 40 years and evaluating the relevant information for sound investment choices is like asking the family pet to dance on two legs.
The author paints a pretty depressing picture and it was getting me worried till I read this:
Third, understand that you need to save 7 percent of every dollar you earn.
Hey, I do that! (Or pretty close). I would not be smart enough to do it on my own, but NCSU see to it that I automatically contribute 6% of every paycheck and they throw in another 6.84%. Not to mention, I’ve got way more job security than the average bear. Anyway, a lot of interesting issues with retirement planning well worth reading about.
About Steve Greene
I don’t buy that the main reason people don’t save enough is due to lack of expertise rather than lack of motivation.
I don’t think there are millions of people out there thinking, “Wow, I’m saving a ton of money, but I’m losing it all due to poor investment choices.”** They’re just not saving.
It’s not comparable to pulling your own teeth or doing your own electrical wiring. It’s like sticking to a diet or exercise regimen. Diligence and delayed gratification are far more important than expertise.
** Ignoring, in this case, people for whom the lottery is an investment choice