Is Saving For Retirement For Everyone?

I couldn't resist reviving this thread because it interests me.

You have asked a very good question, so I did a little research on pension/retirement plans, when did they come about and why. Now this is based on persons not saving money for retirement because of privately owned businesses.

Before the 1870s there were no pension/retirement plans, people actually worked in family-owned businesses until they died. My thought is that those businesses were carried on by the heirs, and so on up until 1875 when American Express started a 'savings' program for its employees so that they would have something to rely on if they were hurt or ill and unable to work.

So I asked myself, if families have survived without a pension/retirement plan back then, why are we so consumed with having one now? Almost demanding our employers to provide that safety net for us.

My mind is racing on this. I know - today is not like 'yesterday', but if you think about it... if we all had family-owned businesses like 'yesterday' would we be better off without a pension/retirement plan? I'm just saying...

 

You really did your research! LOL

I used to work in the insurance field and we were required to learn about retirement funds, annuities, etc... I also seem to attract a lot of retired friends, so I may be able to answer your questions.

Retirement plans are very much important for everyone. The reason that it was not need back in he hey day is because standards of living and cost of living was lower. Also, during those times (and yes you were right) mass majority of the business' were taken over by the children and the children would take care of their parents financial needs. Now a days, that is not possible. Standards and cost of living is rising where as income is not. Most children these days go on to their own fields of business and a large portion of individuals end up in elderly homes rather then being cared for by their children. Here is a little article in the New York Times that talks about the history of Senior Citizens a bit

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. So because of all this before, retirement was not needed. Now it is. I hope that explains it a bit.

 

Retirement is something everyone of a legal age to work should fund for themselves. The cost to live nowadays compared to back when has increased. Everything has risen and will continue to do so. Government programs won't be around much longer if they continue to get abused and nothing happening about it. Its safe to say that retirement should almost be forced upon anyone working whether they be self employed or working for someone else. It only makes sense to me.

 

Every one must think that they too will soon grow old and for this reason alone that you have to save for your retirement. You cannot always think that your children will take care of your expenses for you... because if you really love your children, you want them to enjoy and manage their own lives on their own and not to be come a burden to them.

 

I agree with the past few posts that, in theory, everyone should save for retirement, and that retirement saving is for everyone. As someone else mentioned, in the 1870's, the model was based on the fact that if you were too old or sick to work, your kids would support you. That is flatly not possible for most people now. Moreover, people died a lot younger back then.

Something people haven't mentioned that I also think is important, though, is that some people in today's society flatly do not make enough to save anything for retirement. It is hard to see what those people should do. While some people like to say that anyone can save if they reduce their cost of living, for a minimum wage worker with 2 kids making less than $20,000 per year even though they work multiple jobs, it may not be possible to save for retirement and also keep a roof over everyone's clothed and fed head. I view this as a large problem that is only partly resolved through social security, especially as social security as it is now is unlikely to remain solvent.