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Subject:  Re: Bond Fund Investor Stupidity Date:  1/12/2013  3:08 PM
Author:  globalist2013 Number:  34658 of 35593


But take a step back and review what has happened in this country since the late '70s and the passage of ERISA. Most workers used to be able to count on a Defined Benefits pension upon retirement. What are the numbers these days of those who are eligible? Most DB plans have been converted to Defined Contribution plans, and the typical structure and match for those plans is pretty crappy. Most workers need not only capture whatever match might be available to them and shelter whatever wages they can, but contribute the max to an IRA each year. In other words, between the enforced savings of paying SSI and Medicare taxes, most workers also need to be saving the max allowed by 401k/403b plans and the max allowed for yearly IRA contributions, or a savings rate in the neighborhood of 20% to 25%, not the 3% to 5% commonly reported as the median savings rate. Then, having gathered those assets, they need to put them to work.

You're right. Most aren't going to save or invest, and they will have to work until they die, or they will depend on the government