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Subject:  Re: Don't worry about boomers killing the market Date:  8/3/2006  10:59 AM
Author:  2old4bs Number:  52924 of 88532

"Everbody loves their grandparents, until it's time to pay the nursing-home bill. Those older generations, that are becoming so despised, made your lifestyle possible."

To a degree, I agree. But gratitude and payback should not equal a blank check.

No, not a blank check. However, during much of the 'boomers' working years we were paying fed tax rates that topped out at 48%. That left a heck of a lot less in 'take-home' income to save.

In addition, only 15% of income up to a $2K/year max could be invested in a TIRA. There were no Roths, and no 401Ks. That left only 'taxable' accounts. There were no online brokerage houses and most brokers wouldn't take small accounts, and those that did usually robbed the small investor blind. The majority of 'poor' folks used passbook savings accounts and savings bonds as their primary savings tools, and the interest rates for those were pathetic. Some more sophisticated folks used CDs and did better.

But believe me, it was no picnic.

In the mid 70's the 'average' salary for a bookkeeper in NYC was $14-15K/year. With taxes all in take home was about $9-10K. Out of that had to come all savings and living expenses--the equivalent today of doing that on about $34,000. Most working people today (particularly in NYC) couldn't live on that net, much less save anything. The proof of that is the almost nil current savings rate even though folks are taking home a much bigger chunk of their paycheck.


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