Why are we so bad at saving?

[MrMarv]

Actually, the government has been lying to us about inflation for ages!!!!

Conveniently opening their monthly reports with 'Excluding food and energy prices.'....is a total crock!!!!!

Since these blockheads have stuck everybody with this megacolossal ethanol hoax/fiasco/swindle/outrage/con job, on top ofwhich they've banned offshore drilling in over 70% of the nation's combined shorelines, and a very weak dollar, is it any wonder that gasoline is $3.79 a gallon here in LA, and undoubtedly headed much higher????

 

[bdcp]

My guess would be that most of those saying they won't be able to retire have parents saying the same thing. Both of my sons have 401K's with their jobs. My 24 yr old has a degree and lives on his own and puts away something like 7% into his company's plan (large federal contractor). My 22 yr old lives with us and goes to school and has a part time job at CarMax and puts away 5% into that plan. Both companies have matching plans. They have seen both DH and I put money into our 401K's forever (also matching plans as well as our own private accounts) and they think that is what you do. A large percentage of people in our age group (45-55) don't do any saving for retirement either, so it's not a generational thing. If you put money into a 401K plan it does not change your take home pay that much because as pretax money it lowers your taxable income.

Oh and those that put being debt free ahead of saving for retirement are doing it backwards. You have to continue to put money away for retirement while paying off debt, even if it takes you longer, the goal is to have enough to live on when you retire. Money grows over time, being just debt free with very little saved really won't give you much of a lifestyle after you retire. If you have well funded retirements you should be able to continue paying off debt such as mortgages, which most financial planners tell you to have due to additional tax writeoffs even later in life if you can. You have to make your money work for you and not be afraid of it.

 

[eliza61]

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Oh and those that put being debt free ahead of saving for retirement are doing it backwards. You have to continue to put money away for retirement while paying off debt, even if it takes you longer, the goal is to have enough to live on when you retire. Money grows over time, being just debt free with very little saved really won't give you much of a lifestyle after you retire. If you have well funded retirements you should be able to continue paying off debt such as mortgages, which most financial planners tell you to have due to additional tax writeoffs even later in life if you can. You have to make your money work for you and not be afraid of it.

This is pretty much what we do, I try to max out (as much as I can) my 401K while I'm paying down my debt. I know some of the TV financial gurus say not to do this, but no way I'm stopping.

Thanks every one for the responses. When I read the article it may me feel a little sad. Mainly because there use to be a time when people counted on enjoying themselves when they retire. Remember when people use to talk about travelling and relaxing when they "get old" Now so many of us (general "us") worry about just surviving. sort of sucks the joy out.

 

[hsmamato2]

I don't really see a problem with # 2 and 3. If she is 18 and is driving by herself sometimes she probably needs a cellphone. My kids have Ipods that they got for birthday/Christmas. When did they become an ultra-luxury product?

Cellphones on expensive plans and ipods are a problem IF the family is struggling financially in other ways- A cellphone with a prepaid card(read:cheap) can be useful for a teen(my ds has one) and ipods are GREAT- but they're usually accessories that kids have to impress their friends.....like,a cheap mp3 player for 10 bucks works just fine...but imagine the "average" teen going for that when their friends have ipods/phones...etc.....
The title of this thread says it all..... as a culture WE parents are teaching our kids (in general) how NOT to save. WE parents are teaching our kids that they are entitled to things that are wants. Perhaps b/c our generation was taught this by our parents.
(not me,I would've LOVED those parents )
So....if a family has no savings,no emergency funds,but fun little 'toys'-yes,that's a part of the general problem.B/c little toys just grow into big toys!
FWIW,ds-teen has a cheap cell to use only when needed(it was free) a cheap mp3 player b/c it works fine,and when he wants the 8gb ipod(which he does) he'll SAVE his money to get it.
He's also cursed with parents who drive old 100k cars(but they look fine),don't carry cc debt ever,and shop used stores.... but he also gets 2-3 trips a year to various places,most notably,WDW! Yesterday we calculated together the cost of a "family plan" cell phone with all the fun perks for him.....he decided that1200.00 a year could be put to much better use than on 'toys.'(like that oh-so important Disney trip )