Some recent consumer trends concern us. After a few years of fiscal responsibility that makes the Tea Party drool, consumers are ready to shop again. Our concern is not that consumers feel comfortable enough to shop, but that with stagnant wages, high unemployment and a lackluster economy, consumers are overextending themselves, again.
Category: Make Money
We recently read “The Greatest Retirement Crisis in American History” in Forbes by Edward “Ted” Siedle. In it, Sidle argues, as the title eludes, that we are about to experience the greatest retirement calamity in our nation’s history. He suggests we are in wave one of up to four waves caused by retirement planning shortcomings. The first wave, which recently started, forces retirees back to work. “Welcome to Wal-Mart.” The second wave delays retirement for most. The third wave cancels retirement for most and the fourth wave financially ruins most senior citizens.
America is the J. Wellington Wimpy of nations, as its government and its people will gladly pay its creditors on some elusive Tuesday in the future for everything it wants today. An economy based purely on consumption cannot stand. An overemphasis on consumption eventually eats up nations like hypocrisy and racism, ironically, ate up Paula Deen. History is replete with examples of empires falling, in part, because of the financial instability of their debt.
Americans are not saving enough for retirement and are putting anything and everything ahead of this inevitable stage of life. Whether this is the fault of instant gratification, America’s anti-savings policies or because retirement seems too far in the future to plan for today is up for debate. Regardless of the reason, Americans are postponing saving for retirement and missing out on the three money magic tricks of investing.
CNBC reported yesterday that the 2014 Retirement Confidence Survey, produced by the non-profit Employee Benefit Research Institute and Greenwald & Associates, shows that American workers are more confident in their ability to retire comfortably because of recent stock and housing market gains over the last few of years.
In the comment section, I said, as I often do, “A home is not a retirement plan.” This garnered comments, which I appreciate. Comments inspire me and make me think. One commenter said that a home can be part of a retirement plan. They included the example of northeasterners who sell their homes and move to a smaller, less expensive home down south. They often pay for their new home with cash and then have money left over. Another commenter said that it is nice to have a free place to live in retirement, rather than a place to rent.
I do not believe this is entirely accurate.