SBu
DP Veteran
- Joined
- Sep 2, 2013
- Messages
- 1,523
- Reaction score
- 636
- Location
- Washington State
- Gender
- Male
- Political Leaning
- Centrist
Which sort of personal savings do you think would work? Not the stock market, it can fluctuate too much and that isn't what retirement accounts to which should be subject. A home? by the time you finish paying for it, you have bought it 2 or three times over give or take a few interest points and years on the note. depending on inflation it is most likely a push and you'd need to buy a new place to live.
I don't know why you think SS will not be there for you, true some on the extreme right are doing their best to keep reform from stabilizing the program, but the problem is not unlike the egg passing through a snake. The Baby Boomer generation came about by a very rare occurrence, the end of WWII with millions of service men coming home- unlike Germany, England and the USSR. Like gas, once the Baby Boomers pass through the system a far more normal pattern will be set in place.
Post #47.
You assume that SS will survive the baby boomer rush.
To address your first point, you're wrong. Stocks are an excellent place to put your money (including mutual funds, ETFs, etc.). Your savings account interest rate is usually somewhere around .1 to .3 % return these days depending on how much you have in it and who it's with. CDs are around 1 to 3% depending on the year (and that is for 7 year investment that you can't touch). Bonds which are low return but stable. Stocks and their derivative products historically return about 7-8% on average. Last year alone saw 30%+ returns. So over time, stocks are the best choice. The saying goes, poor and low middle class invest in savings accounts and CDs, high middle class and rich invest in stocks...and there's a reason why they do. If you're not invested in stocks in some way, you are shooting yourself and your retirement in the foot.
Home...generally it's not a super awesome investment (unless there's a bubble). You're right there. However, the alternative is that you rent and get nothing out of it, so I would rather own a home. I bought at the bottom of the market when interest rates were 3.25%. It happened to be an awesome investment for me, but you're right that it is market dependent.