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Viva La Raza!
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since 2005 i've been saving up money instead of splurging it away. ive saved up a nice amount of money since, at one point paying off a then new car within 25 months. on june and july i splurged quite a bit. i did not tap into my savings but i did not put anything into them either. and it was fun. however i feel very guilty about it and am now back to being a cheapskate.

but it got me thinking: is it worth it to save your money? a lot of my coworkers (many are in their 40s-50s) have no savings and no plans on how they will survive after retirement. is it better to just have fun with your life and spend your money or is it better to save for your retirement? the average person cannot do both and even saving money now will hardly allow you to support yourself for retirement. whats the point of saving if you will be struggling when youre in your 70s-90s?
 

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a lot of my coworkers (many are in their 40s-50s) have no savings and no plans on how they will survive after retirement.
I knew a woman in that age group who was in that position of minimal savings and several years ago she married a retirement plan, though I assume she introduces him as her husband rather than as a retirement plan. You're right there are too many people who have failed to save & invest for retirement, making it appear their plan is to die on the job.

While retirement plans have been hit by a bear market, there were many who missed that bear since they didn't bother to participate in their 401k, 403b, or 457 plan at work nor contribute to an IRA.

is it better to just have fun with your life and spend your money or is it better to save for your retirement? the average person cannot do both and even saving money now will hardly allow you to support yourself for retirement. whats the point of saving if you will be struggling when youre in your 70s-90s?
How much is this average person you speak of, who can't afford to save because living costs so much, earning?

First, I acknowledge that there most certainly are those that legitimately don't earn enough to pay basic living expenses and still have money left over to save and invest. I state this to avoid the obvious response I will get regarding any comments I dare to make.

Now for all the people who don't fall into that first group: there are also a lot of people who simply waste money. Have you ever seen Suze Orman's "can I afford it" segment on CNBC in which she says "DENIED!" to a great many requests by people who want to buy all sorts of frequently very costly luxuries despite the fact that they don't have the money to afford it? We see Starbucks all over the place, so I can only presume that somebody actually buys expensive coffee there. If any Starbucks customer tells me they can't afford to save I may just have to smack them upside the head. If anybody driving a luxury car tells me they can't afford to save they need a smack upside the head. If anybody buying a big screen flat panel TV tells me they can't afford to save they need a smack upside the head. It's truly stunning how much needless stuff is bought by people who claim to be too poor to save any money -- and it's all stuff that I somehow manage to live without!!!

Retirement planning is exceedingly difficult for two reasons:

1. You don't know how long you're going to live. I had a grandfather who was died at age 38. I had a brother who died at 45. Any retirment planning was clearly wasted in those cases. But then I have a great grandfather who made it to age 86, pretty damn good for a guy born in 1886. Without knowing your expiration date, planning becomes a shot in the dark. Do you want a plan that assumes you'll make it to 100 for a very high level of certainty that you'll never outlive your money, or is assuming age 90 or 85 good enough for you?

2. Future market returns & inflation rates are unknown. One can run simulations to figure out how long a given amount of money should last based on historical returns, but the future may or may not look anything like the past. Even if you look at history you see that when you retired had a HUGE impact on how long your savings would have lasted. If you retired in Jan 1973 you could have run out of money by 1982. If you retired in December 1974 (after a bear market that cut investments in half) the same investment amount still would not have run out. The best financial planners can say is something like there is an 85% chance that your money will last till age 90 based on historical data that may or may not even be close to what the future brings.
 

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Chimpoleon
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Life was a lot more boring/depressing when I didn't spend my money and just put it away in savings -- my savings has reached the point where I'm happy with what I have saved, and now live a paycheck to paycheck lifestyle -- its kind of exciting to see if I'll be able to afford food the day before payday -- last time I had $4.30 in my account, and before that I had $2.30 :)

oh how I can't wait for payday this week -- lol
 

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It seems I save money then my house sucks it up. I just spent a total of $4300 for a new furnace and water heater. Though for the furnace I can take that 30% tax credit the government is offering for putting in a high efficiency furnace. Next year if I still have a job it will be a new roof.
 

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Viva La Raza!
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Discussion Starter #7
How much is this average person you speak of, who can't afford to save because living costs so much, earning?
id say $30-40k a year. people making this amount may be able to save some but it will hardly be enough to support retirement age. im wondering if its even worth it to save for retirement?
 

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I put a bunch of money into a 401K and I too wonder if its the right thing to do. So many people die way too early so what is the point?
 

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id say $30-40k a year. people making this amount may be able to save some but it will hardly be enough to support retirement age. im wondering if its even worth it to save for retirement?
If I made $30-$40k in a year, I'd be able to save a **** load. But I'm a single 25 year old guy. Any single person who makes that much money a year and can't seem to save any...has a problem.
 

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If I made $30-$40k in a year, I'd be able to save a **** load. But I'm a single 25 year old guy. Any single person who makes that much money a year and can't seem to save any...has a problem.
I saved enough to buy a house and new truck. I then had enough money saved up in two years after buying my house to pay the rest of what I owed on my house. I also paid off my truck. It is nice not having to make payments to the bank. I rather use the money to pay for maintenance on my house. I just spent $4300 getting a new furnace and water heater put in. The furnace was 45 years old and water heater approaching 20 years. Next year it is new shingles.
 

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I forgot to mention, whenever I buy anything at all, I ask myself "do I NEED this or do I WANT this".

If I will die if I don't have it, then I need it. (food, toothpaste, soap)

If I will NOT die if I don't have it, then I want it.

I do buy "want's" when it's justified. When I want a new TV I don't buy it if my old one works fine. When my old TV (35" Toshiba bought in 1995) goes, I'll buy a new one.

I buy reasonable gifts for family on holidays and birthdays.

Living like this made it so I didn't have to worry about money even when unemployed.
You sound just like my dad. Growing up my father had a very good Union factory job and my mom had a good job as a nurse, but if you look how we live you would thought we were poor. My dad bought old junker cars and worked on them all the time, we had used tv, hand me down furniture, old house, etc. Dad always kids and says if Ronald Reagan was standing in front of him he would give him a big kiss on the forehead for showing his errors of his ways. Meaning after Reagan was inaugurated dad was thrown out of work for three years due to the crashing farm economy. Before being laid off dad just lived pay check to pay check, living on credit, etc. When he got laid off he cut up the credit cards, started to really watch what he spent. He continued this after getting called back to work. He continued to live like this to this day. He was able to send both me and my brother to college. Now he has plenty of money and has been retired since late 1990's. He is also building a simple small house on 30 acres of forest land.
 

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I saved enough to buy a house and new truck. I then had enough money saved up in two years after buying my house to pay the rest of what I owed on my house. I also paid off my truck. It is nice not having to make payments to the bank. I rather use the money to pay for maintenance on my house. I just spent $4300 getting a new furnace and water heater put in. The furnace was 45 years old and water heater approaching 20 years. Next year it is new shingles.
Nice. You should hire someone to do the shingles. They aren't my idea of fun lol.
 

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taking a break from SAS
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but it got me thinking: is it worth it to save your money? a lot of my coworkers (many are in their 40s-50s) have no savings and no plans on how they will survive after retirement. is it better to just have fun with your life and spend your money or is it better to save for your retirement? the average person cannot do both and even saving money now will hardly allow you to support yourself for retirement. whats the point of saving if you will be struggling when youre in your 70s-90s?
It's not so black and white. You can save a portion of your income (say 10 or 15%), invest it and spend the remaining for fun. You will have to compromise on what you can buy but that is life. By saving a little along the way, beginning at a young age, you can build up a nice nest egg and still have fun once you retire.
 

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Nice. You should hire someone to do the shingles. They aren't my idea of fun lol.
I am going hiring someone. My roof is too high and steep. I am planning on hire the contracting company that scoops the snow off of my roof every winter. They do roofs and chimney's in the summer. They are a little more expensive, but they do an excellent job. Many people here hire them to do chimney's and roofs.
 

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I save most of my money. Very rarely do I just go and start spending it on things I don't really need. In the past year I managed to pay off a good chunk of my student loans and my car loan.

I still have a huge amount to pay in student loans. I think I might die before I pay that off...it's a lost cause, lol.
 

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Saving is smart. I wish I had saved
I have about $12 to my name right now.
I'm amazed I survive as comfortably as I do..
But yes, keep saving. That's admirable.
You wish you had? You are 20 years old. Why are you talking in past tense? As if you couldnt start saving now. You have only been an adult for two years. :roll
 

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Viva La Raza!
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Discussion Starter #19
If I made $30-$40k in a year, I'd be able to save a **** load. But I'm a single 25 year old guy. Any single person who makes that much money a year and can't seem to save any...has a problem.
yep. problems such as rent/mortgage, utilities, gas, food...things add up very quickly. 30-40k is hardly anything
 

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Chimpoleon
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If I made $30-$40k in a year, I'd be able to save a **** load. But I'm a single 25 year old guy. Any single person who makes that much money a year and can't seem to save any...has a problem.
hehe according to this I have a huge ****ing problem then :b -- although I'm sure I could go back to the frugal lifestyle if I wanted too -- but at 25, its time to live a little for me.

Why do things I like cost so much :(
 
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