Reply to Do you make $400,000 a year but feel broke?

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]I think that's what's wrong with this society.  So many people see maxing out 401 and 529 as luxuries and not necessities!  Heck, I don't think maxing out 401k is enough at 17.5k a year. [/quote]
Good point - in a system where pension plans no longer exist for the vast majority of people, your savings rates are absolutely necessary.  People who think maxing out your 401k is a luxury are in for a rude awakening in retirement (which will often culminate in them needing government assistance if they live long enough to see a nursing home or have medical problems).[/quote]

I think you are remembering back to a golden at of pensions and financial prudence that never existed. We don't max our 401k, and, while it would be nice, I don't feel like we need to, financially. Once we pay off the mortg and student loans, our expenses aren't that high.[/quote]
It's easy to say your expenses are low when you're young and healthy.  The wild card is really your health in retirement.  I've seen it unfold both ways - people with low savings who stayed healthy into old age, and people with low savings who didn't.  Having gone through the latter, I would not feel comfortable winging it like you're saying, as medical expenses can hit hard and fast in your 70s and 80s.

As for pensions - I know many retirees who have pensions of ~$3k per month off of jobs that paid about $50k annually.  Those days are definitely over.  It would cost about a million dollars to by an annuity that pays the same, so that's the delta that exists for workers today.[/quote]

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