Monday, July 25, 2005

Personal Savings at All Time Low...

This past Sunday the Washington Post ran a series of stories about the drop off in personal savings and investment in IRA and 401K retirement plans. They report that personal savings is at an all time low. Also, fewer people are making contributions to retirement plans. This has Congress worried and they plan on passing some legislation to make it easier for people to save for retirement. How the heck can they make any easier?? How hard is if for someone to open an IRA and contribute money to it each year? Walk up to your payroll office and ask for a 401K-enrollment form at work. We need Congress to make this easier for us? Once again Congress refuses to do anything meaningful and now want to try and make a very easy task even easier. Yea right!

This is a serious situation and I fear that many people are not going to have any money for retirement. What do you do if don’t have a 401K or IRA and no pension at work? Social Security will not be enough to survive and that’s all they will have to live on. Far too many people have no knowledge of what it takes to live in a budget and save money. They don’t feel the need to start saving for retirement until its too late. They have run up huge debt on credit cards and use the equity in their home to pay them off. Not only will they not have any money for retirement, they wont have a home to live in. Many of these people make good salaries and are just very irresponsible with their money. I fell that we will start to see this decline of the standard of living for retired people in the very near future.

Another thing that upsets me is that Congress says in the future they may need a means test to determine if you qualify for Social Security. That will mean that my wife and I may never see a dime in Social Security because we have worked hard and saved in IRA and 401K accounts and paid in are whole lives. We will be left out to be sure the people who have lived irresponsible lives are taken care of. Each year people get a summary letter from the Social Security Administration that shows what he or she would get in benefits and also a report showing how much they made each year. I think that if means testing becomes a fact, it should factor in the salaries people made in their working years. A person should not be allowed a full benefit if they squandered all their money instead of being responsible…


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