It’s great to have optimism, as it’s more fun to think of the upside to a situation than to think of why something won’t work. When it comes to money, it can be helpful at times to avoid negative thoughts and simply focus on the possibilities of different jobs, business ventures, and potentially even investments.
Actually, I think that’s probably true in life as well. A can-do attitude is forward thinking, and focuses on possibilities rather than limitations.
But the thing is, I think we need to think of the problems and limitations of different situations. There are big risks sometimes if things don’t work out the way we hoped. This applies to retirement savings, as it’s important not to have our head in the sand and just hope that things work out. We need to take an active role in saving for retirement, take it seriously, and realize that there will be nobody to bail us out.
I wonder if I’m in the minority with that viewpoint, based on some stats I came across in a recent article in the WSJ, via Yahoo. According to that post, 3/4 of Americans between the ages of 45 to 64 have less than $27,000 in their retirement accounts.
Actually, a full 1/3 don’t have any retirement savings at all! Even if someone is at the low-end of that range, 45, it wouldn’t be fun to have zero retirement savings. It would be tragic for someone in his or 60s to be broke.
I wonder how someone gets to that point. To be sure, there are likely many people who had truly unfortunate circumstances to get to that point. Things such as major health issues, job losses, divorce, accidents, and things of the like could decimate someone’s finances.
But you have to think that it’s not all a series of unfortunate stories that make up the whole picture. Surely there are millions upon millions of people out there that simply didn’t take retirement savings seriously. How that happens is remarkable, but it’s true. Some people apparently can’t engage in forward thinking, which is too bad really.
Recent news of the “my RA” retirement vehicle is interesting, and a nice step toward getting more people to save for retirement. Nothing spectacular, but at least it’s something.
But really, there is no program that I know of that can be counted on to truly save anyone. Actually, I think it’s more profitable and even safer to not count on anybody or anything to bail you out.
Frankly, I think that while I might be helpful to some people, I can’t expect or count on anybody helping me out. You can’t control other people, or be blindly optimistic as I rambled on about earlier. Best to take individual accountability for your own finances, don’t you think?
I wonder what goes through the minds of those who are in that age bracket who has zero savings as a result of not paying attention. My guess is that they simply don’t think, or maybe just assume that things will somehow work out in the future. As if there is some safety net to catch their future financial fall.
Being under that age bracket, I don’t want to be anywhere that situation when in that bracket. No way. That’s just scare to think about, honestly. Best to be independent and be your own safety net. There truly is no other safety net other than yourself.
No government program will really bail you out. No mystery benefactor will likely emerge. Don’t expect your spouse to provide for you. Don’t think that your kids will want to take care of their parents in old age either, or will necessarily be able to. Hopefully so, but you just can’t count on it at all. You may not get any significant financial inheritance from parents, if anything at all.
Bottom line is that for each of us, our ship won’t magically come sailing in.
Rather, being personally accountable and being our own safety net seems like the way to go most of the time. Seems quite liberating actually, since you’re able to control your own actions much more than those of others!
My Questions for You
Do you believe that you are your own financial safety net, or do you expect to count on others (and/or their money) to be there for you in the event you have a time of financial need?
What are your thoughts on the idea that 3/4 of Americans between 45-64 have less than $27,000 in retirement funds?