re: Nearly Half of All US Families Have Zero Retirement Savings

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Nearly Half of All US Families Have Zero Retirement Savings

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the government will bail you out.

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Government is, in large part, the culprit.

E.g., Social Security is a program forcing those same workers you're addressing to lend the US Government money at extremely low rates for 45 years. The government may or may not pay 1¢ of it back depending on when the lender's life ends.

Conservatively, the combination of SS and Medicare cost the median household about $500K in retirement savings after all benefits are paid out. But like the lib I was addressing, most of the Americans you're criticizing think Social Security is a great program. Just like they think they're being ripped off by not receiving big tax refunds this cycle.

Here is a post from a few days ago addressing a lib on the topic . . .

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{Social Security} is a lending program . . .

But if you ever do actually get curious and run the numbers, you'll find the average predicted lifetime ROI for SS AND Medicare COMBINED for someone retiring today runs barely over 2%.

Meanwhile, the average government lending instrument (e.g., T-bills) during the same contribution period would have conservatively averaged about 4.5%. In the instance of a 4.5% ROI, residual savings at death after an equivalent benefit payout would exceed SS/Medicare by about $500K for median income Americans. That is half a million extra they could pass on to their kids.

Again, the calculations are based on standard government instrument rates. Market portfolio-based ROI would be much higher.

As you revel in wealth inequality discussions, let's frame it in those terms. SS/Medicare leaves the average household about $500,000.00 poorer than would otherwise be the case. SS/Medicare are sizable contributors to the wealth gap.

LINK

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