Big Income Losses for Those Near Retirement takes a look at some interesting data, including data on median income drops due to the too-big-too-fail credit crisis recession.
The post also includes data showing the only groups with income increases as those 65-74 years old and, 75 and over which is surprising. 25-34 took the 2nd largest drop decreasing 8.9%.
Another interesting tidbit is the percent of people over 65 with jobs. In 1960 20% of those over 65 had jobs. Which pretty much decreased steadily to 10% in 1986 and then has increased steadily to 17% in 2011.
Related: USA Individual Earnings Levels: Top 1% $343,000, 5% $154,000, 10% $112,000, 25% $66,000 –
Looking at Data on the Value of Different College Degrees – 60% of Workers in the USA Have Less Than $25,000 in Retirement Savings – Credit Card Regulation Has Reduced Abuse By Banks
I find it disheartening that it is necessary to take out a loan to pay for vocational school after graduating from middle school (this is in Indonesia but the same thing happens all over in those countries that are not the most wealthy). Indonesia has been doing extremely well economically (which many people do not realize).
Kafita already graduated from junior high school and wants to go to vocational school.
So essentially she is paying for high school. I sure hope it is financially beneficial. This is the kind of investment in the economic development of a country that I wish governments could make. If not, I sure wish the super rich would give money to fund this kind of education instead of giving trust fund babies millions for conspicuous consumption.
It is disgusting how spoiled brats are such vapid people that they do what they do, while so many hundred of millions of kids lives could be changed with the most wasteful spending these trust fund babies that our politicians keep giving massive tax breaks to. Our politicians should be ashamed of themselves. And so should the spoiled brats.
I’m really too lazy for any ongoing budgeting. This is the model I have used: write down your big expense (rent, car payment, required student loan payment…). Get the total take home pay each month subtract your big expenses. If that is negative you better do something else (make more money, get rid of big expenses).
Big monthly expenses:
- Rent: $900
- Car payment + insurance: $300
- Cash (miscellaneous spending food, gas, cloths, books…): $450
- Utilities+ (heat, electricity, phone, internet…): $250
Take home pay: $2,800.
That leaves $900/month ($2,800 – $1,900). Decide how to allocate that – toward your IRA, saving to buy a house or take a vacation, eating out (above what was allocated above for cash), pay off debt (if you have it…), build up an emergency fund, save to buy a new MacBook Pro with Retina display…
If I decided to allocate $300 to my IRA (or increase my 401k) I would just set that up automatically each month. Then say I decided to put $400 toward other savings I would have that go to my savings account each month. And I decided I could use the $200 to pamper myself I just leave that in my checking account and what is in checking is what I have to spend.
I just don’t spend more than that. Just like when I was in college I had little spending money. I could spend that. I couldn’t spend any more, I didn’t have it. If I were to go over (I never did), but if I were to have (say my credit card bill exceeded my checking account balance), I would have had to reduce my cash the next month. I reality I would have something like $2,000 extra in the checking account so no bills would be a problem (and just view $2,000 as 0).
In 6 months see where things stand. Is it really working? Did you mess up and forget some expenses… If you need to adjust, do so. Re-examine every 6 months (or every year, if you are doing pretty well).
Take a portion of each raise (50% maybe) and devote it to personal finance goals (paying off debt, retirement savings, building up emergency fund, saving for big purcahse, investing, give more to charity…); don’t just use it to increase spending. Use no more than half (or whatever level you set) of the raise to increase your current spending.
Related: Personal Finance Basics: Avoid Debt – Investing in Stocks That Have Raised Dividends Consistently
After several poor months for job creation (adding well under 100,000 each month) we have some good news. Total nonfarm payroll employment rose by 163,000 in July, with the unemployment rate at 8.3%. Since the beginning of this year, employment growth has averaged 151,000 per month, about the same as the average monthly gain of 153,000 in 2011.
The change in total nonfarm payroll employment for May was revised from +77,000 to +87,000, and the change for June was revised from +80,000 to +64,000. Which means the total job gains for this report is 157,000 (163,000 +10,000 [for May] and -16,000 [for June]).
One of the continuing severe problems (since the credit crisis bubble burst) has been long term unemployment. In July, the number of long-term unemployed (those jobless for 27 weeks and over) was 5.2 million. These individuals accounted for 40.7% of the unemployed (a high figure historically).
Given all the problems created by the financial system failure (created over the last 15 years – in the USA and Europe) it is actually fairly amazing that we have been adding jobs nearly as much as we have. But climbing out of the huge whole we created for ourselves (by continually re-electing those that allowed the too-big-too-fail financial mess – and those we elect continue to reward their friends that created the mess instead of fixing it) is a huge task. It requires much better job creation than we have had this year.
Adding 150,000 jobs a month would be decent if we hadn’t created such a huge problem that digging out of it requires much better results. Moving back above that average is much better than being below it, but we really need to bring the new jobs created above 200,000 for a couple years to make a serious dent in the problems created earlier.
Related: USA add 117,000 Jobs in July 2011 and Adjusts Previous Growth in May and June Up 56,000 More – USA Unemployment Rate at 9.6% (Sept 2010) – Unemployment Rate Drops Slightly to 9.4% (Aug 2009) –
Over 500,000 Jobs Disappeared in November 2008
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Enjoy the 36th edition of the Curious Cat Investing, Economics and Personal Finance Carnival. This carnival is different than many blog carnivals: I select posts on those topics from what I read (instead of posting those that submit to the carnival as many carnivals do). If you would like to host the carnival add a comment below.
- The Apple (Used) Premium? by Daniel Mrdjenovich – “In short, if the Apple product you desire is available refurbished, you are in luck. Refurbished Apple products seem to be a rare case of a great deal with very limited downside. If you can’t find a refurbished version of the product you are looking for, you have a more difficult dilemma. A 17% discount on a used Apple device is a nothing to sneeze at but it’s not enormous either.”
- The fiscal cliff and rationality by James Hamilton – “Although the risks are real, the rational thing to expect is that the actual fiscal contraction next year will be significantly more modest than what is implied by existing law. But the cumbersome process of getting to that outcome will once again exact its own unique toll.”
- Idle corporate cash piles up by David Cay Johnston – “newly released IRS figures show that in 2009 these companies held $4.8 trillion in liquid assets”
- Case Shiller Home Price Indexes Surge – “The real estate market news keeps getting a little bit better as Standard & Poor’s reported big increases for the Case-Shiller Home Price Indexes in May, both the 10-city and 20-city indexes rising 2.2 percent for the month on an unadjusted basis after gains of 1.3 percent in April.”