From: mongiovg (mongiovg@stjohns.edu)
Date: Fri Mar 28 2003 - 12:47:45 EST
Good points, Jerry. I suspect most financial planners would consider a 7% yield to be a little on the conservative side. You're right that CURRENT yields are lower, but for a person in his 50s right now, I don't think it's unreasonable to think that things will be "back to normal" in 15 or 20 years. Of course, one never knows. As to social security, I'm working on the supposition that the financial planner is advising people in higher income brackets (that's why he takes a million as the absolute minimum), who will receive the maximum social security benefit, which I gather is in the neighborhood of $1400 a month, a few thousand shy of the $20,000 ballpark figure I tossed out. You are right that the Bushites are determined to deep-six social security. Who knows how that will turn out. I've pretty much given up hope that ordinary bourgeois decency & common sense (let's not even talk about true progessive change) will triumph over reactionary lunacy. I was supposing that the financial planner's starting point was the present institutional configuration. The interesting thing, for me, is that the planner's mind-set excludes people outside the upper-income demographic: most ordinary folks, who are unlikely ever to amass a nest-egg of a million dollars, aren't even on the radar screens of those who advise on retirement planning. That is, people who really can use the advice are ignored in favor of fat cats who are gonna be all right whether they get the advice or not. Hey, I'm beginning to see a pattern here! Best regards, Gary >===== Original Message From <glevy@pratt.edu> ===== >Re [8684]: > >> A million bucks would probably yield about $70,000 in income per year, >> which would be supplemented by another $20,000 or so of social >> security. Since most WORKING people don't bring in that kind of money, >> you've gotta wonder what's behind the estimate. The million dollar >> figure presumes a fairly affluent lifestyle: that's what you'd need to >> live like a middle-manager or a university professor after you stop >> working. Astonishing how the whole "what you need for retirement" >> discourse operates on the assumption that no income groups below that >> level exist or matter. > >Hi Gary. > >I agree with some of the points that you make above, but: > >a) the claim that $1 million can be expected to yield $70K/yr >interest assumes that the rate of interest on savings or the >rate of return on investments will increase to a much greater >extent than current rates; > >b) the claim of $20K/yr in social security benefits over-estimates, >I think, the amount of SS/yr that can be expected to be received >by most working people. There is, of course, a further issue for >younger workers: will SS exist at all by the time they had planned >to retire or will it be cut to such an extent that the retirement >age will have been effectively raised? > >In solidarity, Jerry
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