Retirement Planning - Lessons Learned

[kenmac]

A minimum wage not indexed to inflation just pushes low earners further into poverty.

I feel that pain !

 

[Steppenwolfe]

the book watership down warns of big govt and dependence, as do many others.

Love that book. Richard Adams...

 

[Fuddy1952]

 

[Torvy]

A minimum wage not indexed to inflation just pushes low earners further into poverty.

A minimum wage indexed to inflation leads to hyperinflation.

You cannot artificially increase wages to magically change the basics laws of supply and demand.

 

[goeduck]

A minimum wage not indexed to inflation just pushes low earners further into poverty.

Which came first, the chicken or the egg?

 

[California]

A minimum wage indexed to inflation leads to hyperinflation.

You cannot artificially increase wages to magically change the basics laws of supply and demand.

Shouldn't SS indexing be identical in that hyperinflation effect, as minimum wage? How are they different?

-
bah. typo corrected.

 

[KennyG]

The minimum wage is a bit of a red herring. According to the official US statistics, 247,000 people in the US made the Federal minimum wage in 2020. That's one out of every 635 workers. There should be a minimum wage to protect workers but it should be set locally (because of the huge differences in cost of living around the US) and have provisions for entry level workers and trainees. The current approach probably results in lots of unintended consequences.

 

[KennyG]

Shouldn't SS indexing be indentical in that hyperinflation effect, as minimum wage? How are they different?

Because SS is funded by current payees, in theory it should be unaffected by inflation. However, Congress has added benefits that were not originally included and has both added increases over inflation and decided not to reduce benefits when there was deflation. Also, the plan never envisioned the baby boom and the current low birth rate, as well as the significant increase in lifespan.

 

[Torvy]

To add to KennyG's point...many other wages are directly or indirectly indexed to the federal minimum. In other words, when the lowest paid workers get more, everyone above them wants (and gets) more because their work is more valuable than the minimum or entry wage. That rolls all of the way up and actually broadens wage disparity rather than the narrative that higher minimum wages shrink inequality.

SS, by contrast, is not driving up competition for wages. Workers cannot just stop working at any point and make more money on SS. There would be slight upward inflationary pressure, but it is minimal by comparison.

 

[ultrarunner]

Vehicles certainly a roller coaster the last 18 months with significant appreciation across all lines.

Average new car is over 40k now and used way up... several that lease have made out very well purchasing and reselling at lease end.

Last June brother needed to replace family car and paid 22k for new loaded Nissan Rogue.

Nissan had tons of inventory as rental fleet orders cancelled.

To buy same today 15+k more...

And don't forget $5 a gallon gas is everywhere now in SF area... AND few are complaining as long as they can fill up!

 

[ultrarunner]

SS, by contrast, is not driving up competition for wages. Workers cannot just stop working at any point and make more money on SS. There would be slight upward inflationary pressure, but it is minimal by comparison.

Unless your spouse passed and you get his which is more than you were earning working...

 

[Frankenkubota]

Love that book. Richard Adams...

such a shame it isn't used in schools they way it could be.

someone gave it to me when i was very young and that part where the rabbits lived in a warren that was protected by the farmer got my attention.

once in a while the farmer makes a withdrawal, a rabbit goes missing and NO ONE speaks of that rabbit...... ever again.

made a huge impression on me. if you allow someone take care of you....they own you!

 

[Frankenkubota]

Life does seem to have less stress and maybe expectations overall are lower...

In addition to no worries over medical or retirement don't forget abundant vacation time each year. I think the lowly apprentice gets 42 holidays the first year.

Pay is over 14 months... an extra month pay August for vacation and extra month December for Christmas...

Im sure things are changing but a lot of friends are nurses with a few doctors there.

They were amazed at procedures medicare covers at advanced age and even little things like handicapped parking at the time common here..

The regulation is heavy... don't think you can open a flower shop unless you completed study in such.

It was hard for me to adjust building a home there because labor would not be available so often due to holidays and suppliers closed... no evening run to home Depot or even the grocery store..

sounds like you "have been there" in terms of dealing with, or living with, the euro policies.

i laugh now but try to go into a ceos office in the usa, he's behind schedule, and tell him, you can't build the rest of your hospital because some of the material is coming from europe and......

everyone is gone for the next 6 weeks! EVERYONE

mr ceo says......i dont give a chit, and don't believe it... get my stuff here, you are holding up a 400 million dollar project.

sorry big shot, wait.

french minister of something or other begged his french countrymen to change their vacation policy, told them how much damage it did to the economy etc.

he was taking the entire month of july off, sounds like a politician.

k sara sara.

 

[Frankenkubota]

brought a tear

god i love that book

thx

was that art garfunkel?

 

[Torvy]

Unless your spouse passed and you get his which is more than you were earning working...

But one-off random situations do not make a huge impact on the economy. Driving up wages across the board also drives up prices. The inflation makes the dollar less valuable and the poor get poorer. That does not even take into account the marginal wage earners who lose their jobs or have hours cut back due to increased costs. But, by all means, boost the minimum wage so we can pat ourselves on the back and tell ourselves what great people we are because we 'care' about the poor.

 

[Steppenwolfe]

such a shame it isn't used in schools they way it could be.

someone gave it to me when i was very young and that part where the rabbits lived in a warren that was protected by the farmer got my attention.

once in a while the farmer makes a withdrawal, a rabbit goes missing and NO ONE speaks of that rabbit...... ever again.

made a huge impression on me. if you allow someone take care of you....they own you!

Agreed. Read that book when I was in HS, 1975 I guess. I've read it many times over the years, it never gets old. I've always fancied myself as a Bigwig kinda guy...

 

[Steppenwolfe]

brought a tear

god i love that book

thx

was that art garfunkel?

Way back there was actually a movie made, maybe late 70's. BBC did a series in the last couple years that was very popular. The Brit's are way into Watership Down. Great video!

 

[DieselBound]

A few impressions of the Reddit post from a grouchy old man:

Putting 35,000 lbs of boxes onto a conveyer doesn't seem like that big a deal to me. I've certainly done a lot harder jobs in my life.

I keep hearing that we have so many unfilled jobs because they are bad jobs and people deserve better jobs. It used to be that if you were unemployed, you took whatever job was available and kept looking for a better one. I guess it doesn't work that way anymore.

Yeah, but "back in the day" one was likely able to see a doctor (and pay for one).

When I was growing up, even when my folks were struggling (I spent one winter helping my dad sell kindling), I don't ever recall any issues of being able to see a doctor.

I regularly do a LOT of physical work (I REALLY need to back off- I'm finding that at my age it's no longer such a great thing), but I am doing it KNOWING that I generally don't have to do the same thing day in and day out (and, perhaps, have to do it in order to pay mortgage/rent AND raise kids), AND, I have medical insurance.

The world's resources are declining (low-hanging-fruit is getting higher) while the world's population is increasing.

I've argued against support for low housing rents and such, stating that local employers ought to be forced to pay supportive wages. If you look close enough far too many businesses have externalized their low wages.

 

[DieselBound]

A minimum wage indexed to inflation leads to hyperinflation.

You cannot artificially increase wages to magically change the basics laws of supply and demand.

NEWS FLASH: Inflation is essentially the cost of perpetual growth on a finite planet. Growth WILL lead us to and over the edge. No matter how efficient we are, how "hard working" we are, how "inventive" we are, as long as we push growth (which is what gets most of us "retirement" funds- pensions, "returns" etc.) we are pushing toward hyperinflation (the breaking point).

As "savvy" as so many "economists" might be, they're operating on top of a false premise (perpetual growth on a finite planet is possible).

So, there is NO "solution" as long as there's growth. One's position on how to shuffle the deck chairs mostly only identifies one's sense of empathy...

 

[goeduck]

Driving up wages across the board also drives up prices. The inflation makes the dollar less valuable and the poor get poorer. That does not even take into account the marginal wage earners who lose their jobs or have hours cut back due to increased costs.

Exactly. And don't forget that there is a "tipping point" when wages go up enough that businesses can afford to automate tasks or streamline products/processes so they do not need as many expensive workers.