Quote:
Originally Posted by CliffFletcher
Yeah, it would probably do some good to offer those financial literacy courses. But these kind of long-term and lifestyle decision often come down to pretty deeply-ingrained personality traits. For a lot of people, planning for 30 or 40 or 50 years down the road is impossibly remote, and the consequences of bad planning too abstract.
And let's keep in mind that the retirement planning we're expecting people to undertake today is a new thing. It's unlikely our grandparents or great-grandparents worried much about this stuff. They were typically looking at 5-15 years of retirement (none of my grandparents made it past 70). And many of them had employee pensions. People starting in the workforce today can expect to live to around 90. Planning for 20-25 years of retirement - without an employee plan - is a whole different kettle of fish, and not something we really have any cultural experience with.
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Absolutely. In fact I would argue that your numbers are drastically understated. The idea of retirement - as our parents knew it - is over. If young people today have any intention of actually 'retiring' they better plan on having enough money to be able to live off the income and not touch the principal, in perpetuity. And that means pretty substantial savings.
This is why I continue to argue that we need to get people to save substantially more than they are saving now. We need to not only encourage savings, but make it mandatory, as many other countries have done.