not so golden: wealth gap lasts into retirement

[xchrom]

http://hosted.ap.org/dynamic/stories/U/US_WEALTH_GAP_ROCKY_RETIREMENT?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2014-08-03-11-50-58


This July 8, 2014 photo shows William Kistler at work in his office in Denver. Sixty-three-year-old William Kistler views retirement like someone tied to the tracks watching a train coming: It’s looming, it’s threatening and there’s little he can do.“There is not enough to retire with,” said Kistler, a Golden, Colorado, resident who said he is unable to build up a nest egg for his wife with his modest salary helping seniors navigate benefits. “It’s completely frightening to tell you the truth. And I, like a lot of people, try not to think about it too much, which is actually a problem.”(AP Photo/Ed Andrieski)

William Kistler views retirement like someone tied to the tracks and watching a train coming. It's looming and threatening, but there's little he can do.

Kistler, a 63-year-old resident of Golden, Colorado, has been unable to build up a nest egg for himself and his wife with his modest salary at a nonprofit. He has saved little in a 401(k) over the past decade, after spending most of his working life self-employed. That puts him far behind many wealthier Americans approaching retirement.

"There is not enough to retire with," he said. "It's completely frightening, to tell you the truth. And I, like a lot of people, try not to think about it too much, which is actually a problem."

With traditional pensions becoming rarer in the private sector, and lower-paid workers less likely to have access to an employer-provided retirement plan, there is a growing gulf in the retirement savings of the wealthy and people with lower incomes. That, experts say, could exacerbate an already widening wealth gap across America, as more than 70 million baby boomers head into retirement - many of them with skimpy reserves.

[SammyWinstonJack]

1. ...

[Abouttime]

2. Something has to be done

It's blatantly unfair that trillions are sitting in untaxed private retirement accounts owned by a few while the majority of us have nothing but social security and Medicare or continuing to work till we drop dead. This is an area where reform is needed, at the very least we should demand that these accounts be used to shore up social security by converting them to government bonds with a modest rate of return. It's a win-win for everyone involved.

[LondonReign2]

3. What untaxed private retirement accounts are you referring to?

[brooklynite]

4. My untaxed private retirement accounts get taxed when I withdraw the money...

...or are you suggesting they should be taxed twice?

Seriously, you're welcome to raise my Income and SS taxes based on need, but saying "there's a big pot of money; let's take some" isn't the way tax policy works.

[LondonReign2]

7. Well, it sounds like

he'd like to take my personal retirement account, put it into the social security general fund, and pay me a government bond rate. That's why I asked for clarification.

[Abouttime]

8. Exactly

Put the money into bonds, when you retire you are able to withdraw the money. If your money runs out you collect social security, in other words a means test. We could raise benefits for those without pensions or IRA accounts and shore up social security for future generations.

[LondonReign2]

9. So let me get this straight

You want to take my money, the money that I've set aside for my personal retirement? You want to confiscate that, correct? That's the policy you are advocating?

I have a counter-proposal. We'll take Abouttime's possessions, all of them, and we'll put them in a fund. Oh don't worry, we'll pay you a nice, low, government bond rate of interest for you to live on. So, you know, if you have possession worth $100K, we'll just take those and pay you about $3,000/year for you to live on. Sound like a good idea, doesn't it? Oh, and of course, you don't have any of those possessions anymore.

[Abouttime]

10. You're sounding like a republican

I said nothing about your possessions or personal property, I was only talking about untaxed IRA accounts. Putting them into bonds would benefit everyone including the owner of the account.

[LondonReign2]

11. Ummm, no

So you think only Republicans dislike the idea of you or anyone else confiscating personal possessions? Because my IRAs ARE my possessions and personal property. And they will be fully taxed upon withdrawal. (Other than the portion I've converted to a Roth IRA and already paid taxes on).

So you seem to have no problem grabbing my possessions, why don't you want your personal possessions subject to the same treatment? It would "benefit everyone, including" you. Or by disliking the idea are you "sounding like a Republican"??

[Abouttime]

13. What got us into this mess is the "me me mine mine" attitude so common today

Most people work their asses off until retirement not having enough money to even get by paycheck to paycheck, very few have the luxury to stash unneeded dollars into tax free savings like IRAs.
You don't find it unfair that most Americans retire with no savings, no IRA, no pension while a lucky few have wealth accumulated in tax free accounts?

[LondonReign2]

14. If that is so,

why do you have a problem with us taking YOUR assets for this purpose?

[Abouttime]

16. ?

Where did I say that?
I have very few possessions, I'm not materialistic. In fact I've given most of my possessions away after I sold my house.

[joeglow3]

12. I have to disagree with you

My wife and I are Democrats. When we got our first jobs, both of us maxed out our 401(k) contributions (15% for me and 20% for her). We didn't make a lot, but figured we were used to living off of crap. We have always made it a point to live WAAAAY below our means.

I am 37 and got my first cell phone a year and half ago (had nothing before then). We had never purchased a television (all were inherited tube television) until a few years ago.

I am all for helping out the less fortunate, but if you think I would support taking what I have sacrificed for and giving me a "modest" return, you are crazy. And I think you will find a LOT of Democrats agree with me.

[Laelth]

5. k&r for the truth, however depressing it may be. n/t

-Laelth

[marmar]

6. K&R

[jwirr]

15. We have extended family that is facing the same problem. They want to retire in

AZ but do not have as much money as they thought they were going have. Had good jobs all their lives and now will get about half of what they are used to living on. They do own their own home and some of the toys middle class people often have. The house will sell so they can buy in AZ but that is all.

I have trouble feeling sorry for them because my SSA is about a 3rd of what they are going to get. However, I knew from the beginning that I could not dream about retiring to some dream world so I live very frugally.

I am hoping that they do not invest is this new life and find out that it is not what they thought it would be. One housing bubble in AZ due to climate change will wipe them out. Then they really will be poor.

I suspect many workers are wondering what it was they paid into these retirement funds for all these year.