So few of us are saving $$. What future is there for us?

[Bonobo]

Americans, and increasingly other countries, even like Japan who ALWAYS saved, simply do not have the wherewithal to do so anymore. We live on borrowed money and borrowed time and there will be decades when we cannot earn money even if we want to (as a result of illness, caring for others, etc.)

We live heedless and powerless to secure our future. If something doesn't change, I don't know what kind of shit we are facing. If there is not some kind of massive societal shift, we face a dark future. So many, many, many, many of us. Especially given our increased lifespan.

I think much of it is seriously beyond our ability to change. Society has changed to one where we do not have the means to save for our decrepitude... what will happen to us all?

Seriously, I want to see what you all think. What will happen to these massive,massive numbers?

Will there be a change?

[lovemydog]

1. I too am interested.

Thanks for the post Bonobo.

I've wondered the same myself.

If people are paying less into social security won't they get less out of it?

I too feel there should be a massive societal shift.

I hope some smart people will post some positive stuff in this thread.

[Bonobo]

2. Me too. I don't feel qualified to discuss it terribly well from a realpolitik POV, but...

As a student of history, anthropology and from a big lens, I am deeply worried and think that big shit is headed towards a massive fan.

[olddots]

3. Its breaking down

No parts to fix what was made to not be fixed .I would be be optimistic if I was a pessimist .

Too cheerful ?

[Art_from_Ark]

4. Ronald Reagan forced Japan to impose a 20% tax on all savings interest,

in a misguided (par for the course with Reagan) attempt to "get the Japanese to spend more" by taking away an incentive for saving. The tax has remained in place ever since, with the result that even with the paltry interest paid on Japanese savings these days (barely enough for me to buy a can of soda every 6 months), the government will still take its 20% cut (meaning that I have to wait a year to buy my soda).

[Bonobo]

5. Wuh? I didn't know my savings interest was being taxed!

Having said that, with a savings interest rate as paltry as Japan's that amounts to almost nothing anyway. Ha ha ha ha ha, cough, cough, cough, cough... Ugh.

[Art_from_Ark]

6. Check it out next time you go into a bank

It's most apparent when you look at a prospecetus for a foreign currency CD. For example, I was looking at a New Zealand dollar CD a while back that was claiming to pay 5% interest. However, upon reading the fine print, I saw that that was the APY, but the CD was only for 6 months, meaning 2.5% interest-- but that was before the 20% tax, so the net interest was 2%. However, because it was a foreign currency, there was a transaction fee coming and going, which amounted to-- you guessed it-- 2%. The only way to make any money out of that would be if the NZ dollar had gained against the yen at maturity. So essentially, the depositor would have been taking all the risk, while the bank and government would be getting their cut no matter what.

[Bonobo]

7. Between that and the demand for Japanese businesses to save 50% of their annual net

for estimated tax payment of the next year AND the crippling regressive consumption tax. it is not surprising why the economy cannot recover.

[Art_from_Ark]

8. Here's an explanation of the 20% savings interest tax

預金にはいくつかの種類がありますが、普通預金、定期預金、貯蓄預金、変動金利定期預金など、いずれも税率は一律20％（国税15％＋地方税5％）。例えば、1000円の利子がついたら、1000円×20％＝200円で、1000円のうち200円を税金として納めなければなりません。

http://allabout.co.jp/gm/gc/20970/

[Adrahil]

10. Well, that was completely clear! ;) n/t

[Art_from_Ark]

13. Translation:

All interest from passbook accounts, CDs, savings plans, variable rate CDs, etc., is taxed at a flat rate of 20% (15% national tax and 5% local tax). For example, the tax on 1000 yen in interest is 200 yen (that is, 1000 X 20%).

[Adrahil]

15. Thanks! Like most Americans, I'm useless if it's not in English....

... And at 48, learning a new language is taking forever (studying French atm).

[Bonobo]

12. Thanks, even my wife did not know about it! nt

[historian]

9. I have saved what used to be considered a nice pile of money

but the closer i reach to retirement the less impressive it looks. If you don't have millions you are going to have a sorry retirement. Every turn you make you are taxed, unless you are a Romney who legally parks his money outside of the US. something the rest of us cant do. Inflation which according to the government is 3%, is eating up the rest. Incidentally the government statistics re inflation do not take into account energy or food!

[The2ndWheel]

11. We live in a global society that is based on more people doing more things

Our civilization is built around that single premise. That there will be more people, and that they will be doing more, all the time. That will create more jobs, and more tax money. Yet, increasingly, each individual person is needed less.

As long as the money is circulating, a few people here and there can save, and everything is good. If more and more people start saving/not spending, then nothing works. Then they have to force people to spend their money, by making saving not worth doing.

Aging populations. Environmental issues. It's going to be an interesting century.

[Orrex]

14. My plan is to work untill my death and then to be cremated in a cardboard box

Already have the box picked out and everything.

You know, just like 99% of the 99% are doing.

[Bonobo]

16. Let's face it...

We will be lucky if we are ALLOWED to work until our death.

Much greater chance of becoming ill or incapacitated and having to eat our meager savings up and then still being unable to work. Then we will be fucked and may wish we were dead.

God forbid the burden we may become on our children.

[LiberalEsto]

25. Or discarded because you're over 50

or over 55

or over 60

and/or you earn too much and the company can hire several kids fresh out of college to replace you AND save money by giving them greatly-reduced benefits

or you earn too much money and the company can save money by slithering around the regulations and hiring several non-citizens on H1-B visas to take your place, paying them far less and giving them no benefits at all.

[KingCharlemagne]

19. Or you can follow the advice of a Turkish (Communist) poet. (His biography

makes for some bracing reading itself but may help point the way forward):

On Living

I
Living is no laughing matter:
you must live with great seriousness
like a squirrel, for example—
I mean without looking for something beyond and above living,
I mean living must be your whole occupation.
Living is no laughing matter:
you must take it seriously,
so much so and to such a degree
that, for example, your hands tied behind your back,
your back to the wall,
or else in a laboratory
in your white coat and safety glasses,
you can die for people—
even for people whose faces you’ve never seen,
even though you know living
is the most real, the most beautiful thing.
I mean, you must take living so seriously
that even at seventy, for example, you’ll plant olive trees—
and not for your children, either,
but because although you fear death you don’t believe it,
because living, I mean, weighs heavier.

II
Let’s say we’re seriously ill, need surgery—
which is to say we might not get up
from the white table.
Even though it’s impossible not to feel sad
about going a little too soon,
we’ll still laugh at the jokes being told,
we’ll look out the window to see if it’s raining,
or still wait anxiously
for the latest newscast . . .
Let’s say we’re at the front—
for something worth fighting for, say.
There, in the first offensive, on that very day,
we might fall on our face, dead.
We’ll know this with a curious anger,
but we’ll still worry ourselves to death
about the outcome of the war, which could last years.
Let’s say we’re in prison
and close to fifty,
and we have eighteen more years, say,
before the iron doors will open.
We’ll still live with the outside,
with its people and animals, struggle and wind—
I mean with the outside beyond the walls.
I mean, however and wherever we are,
we must live as if we will never die.

III
This earth will grow cold,
a star among stars
and one of the smallest,
a gilded mote on blue velvet—
I mean this, our great earth.
This earth will grow cold one day,
not like a block of ice
or a dead cloud even
but like an empty walnut it will roll along
in pitch-black space . . .
You must grieve for this right now
—you have to feel this sorrow now—
for the world must be loved this much
if you’re going to say “I lived”. . .

~Nazim Hikmet

[LiberalEsto]

26. wonderful poetry nt

[Blue_Tires]

28. +1

[NBachers]

21. The advantage of dropping dead at work is: someone's there to deal with it

Plus, you open up a new job slot for some other poor schlub- as long as they don't terminate your position with you.

There's plenty of cardboard back in the cardboard bin, and they won't deduct much from your final paycheck to pay for it.

Hopefully, "ancillary expenses" won't run into the negative, so your descendants won't be charged for them.

[Octafish]

17. You have to have money in the present to save for the future.

Today, living costs so much, most people don't have anything left over to save.

PS: What Orrexx said.

[KingCharlemagne]

18. For your reading pleasure (and further consideration):

The collective wealth of the world's 80 richest people matches the wealth of the poorest 50% of the population.

http://www.marketplace.org/topics/wealth-poverty/doing-numbers-super-rich#ixzz3Q1dLpUry

[closeupready]

20. Over time, I've become VERY pessimistic about the future.

I always was kind of the optimistic sort, but the scale of corruption in our democracy is so vast and overwhelming, that I can no longer feel good about the future of our country. I'm not completely down on it, but that is the direction things are heading, as I see it.

[Ms. Toad]

22. I've been saving for retirement since I was in my teens

My tastes are modest. We've never had cable. We bought a home about half the size we could afford (according to those pushing us to buy more). Didn't get a cell phone until ~2003, and then shared a dumb phone between 3 of us until 2008, then 3 dumb phones. Got my first smart phone last year - on a $0 monthly payment plan. We drive cars which are 12 years old (at the youngest).

All else being equal, I'd sacrificed enough to save for a comfortable retirement. But things aren't equal. My spouse and daughter ended up with chronic illnesses and unable to work - my spouse for 10 years now, and she is only now approaching retirement age - so now my (60% lower as of a year ago) income is supporting both of them.

I'm now looking at not retiring until 72 (if they'll keep me) so that I can max out my defined benefit plan, to partly offset the double ding I get because I have the plan in the first place. ($0 income is figured into my Social Security for each year I contributed to a defined benefit plan - so I already take a hit on my SS benefits and on top of that, my SS benefit (based on 15 years at max payment +25 years at $0 payment) is reduced a second time because I will be receiving income from a state sponsored plan based on the years I contributed to the state plan. One hit or the other - hitting me twice is not cricket.)

But - for all my grumbling, I'm better off than most. I was lucky enough to always have employment that paid well enough to allow me to be able to save if I sacrificed the present for the future. I have never, since I was 12, been voluntarily unemployed. I know that is a luxury many don't have. My sister has nothing in the bank - and her work is much more physical than mine (house cleaning and cosmetology). Because both are tipped and she - like most tipped employees - didn't report a substantial portion of her tips, her SS income will be proportionately lower. Her body has taken a beating & she will have no choice but to work as long as she lives.

And my daughter - at 25 (a time when I already had several thousand dollars banked towards retirement) has not yet finished school or started working because her illness makes her too unpredictable as an employee - and as a student. .

[randome]

23. Financial communes. Find neighbors or relatives to trust and pool all your money into one account...

...for everyone's (modest) use.

Or help your children be wildly successful.
[hr][font color="blue"][center]There is nothing you can't do if you put your mind to it.
Nothing.[/center][/font][hr]

[Orsino]

24. For the same reasons, the dollar is doomed.

Not only are we unable to save, but what we save will be rendered worthless when the aristos blow it up. The same aristos that are paupering us now. Because we are afeaid to regilate them.

Funny how that works.

[Maedhros]

27. By now, everyone has seen this graph:

Reagan's vaunted method for boosting the economy was to provide easy consumer credit to compensate for stagnate wages. This was the beginning of the end of "saving" in America.

Working Americans now live in a gigantic, nation-wide, corporate-controlled Company Store.

[Bonobo]

29. I'm disappointed but not surprised... There are no answers to this scary question.

The numbers are so overwhelming. So few will be able to support their old age.

We're going to fall to pieces if something doesn't change. That's what I think.

Every man for himself or let's all work together...

I for one would not want to be in a society where the people don't get along and are consumed with fear and loathing for each other.