As we age, do we get Poorer?

V

Vicky

Member
Location
Pennsylvania, USA
As we age do, we get poorer?

I heard it growing up, and now it feels like I am experiencing it. I saved and dreamt about the day I retired. Now it’s here. 2-yrs into my retirement I feel like it’s getting harder to make my finances meet the bills. All those dreams of traveling in retirement yrs felt to the waistline. I need that money to pay for bills, a car to get me to the senior centers, for the constant increases of health ins, up keep (repairs) to my home because senior centers cost more than I can afford, etc. It seems like the only ones who travel are those who have double incomes coming in (married/living with someone). Same with those who live in senior retirement communities.

Social Security checks increase with the Cola, but everything else goes up as well. Instead of staying at a steady in/out flow of money, it seems like I am getting poorer.

(just venting here) Who is calculating this Social Security increases? Don’t they realize that people depend on SS to stay living? They need to increase the SS payouts a lot more than what they do to maintain a steady income flow. (end of venting)

Does anyone else feel this pain of growing poorer as we age?
 

I don't mind not traveling, since I never liked it anyway.

My SS check does not meet the bills. I average moving around $500 /month from savings to checking to supplement SS. That's when things are going well. When they're not - like when a house repair or any unexpected expense comes up - that means taking more from savings. I'm glad I got almost 5% interest on CDs this past year, but rates are already being cut.

People complain about the high cost of groceries, and I see all the increases, but I can work around that a whole lot more than the other things you mentioned like the cost of upkeep on cars and health insurance; house insurance which are relentlessly increasing.

Undoubtedly, couples are doing better than those of us living alone. It's still somewhat true that two can live as cheaply as one.
 
Inflation and time are definitely the enemies of most retirees.

I’ve been retired for nineteen years and this latest round of breathtaking inflation really brought home the challenges of living on a relatively fixed income.

I’m in what the pundits refer to as the maintenance phase of retirement where spending drops to the most basic living expenses.

I could still live comfortably on social security if I gave up my car, something that I’m considering for health reasons more than financial reasons.

I find it easier to live in a modest apartment with a more predictable monthly cost as opposed to owning a home.

I also tend to scrimp on what many people consider basic needs to free up money for a few frugal luxuries that are important to me.

I’m fortunate that I have additional income from savings and investments that allow me to keep pace with inflation, at least for now.
 
Last edited:
My bucket list on travel to see stuff is full and done. I mostly just go to my Lake home in the summer
for a different life. Payments like taxes and stuff keep going up. SS Cola is a joke but it is what lawyers
do. Fudge on the real-world costs and quibble about wrecking the fund as soon as possible. ... :coffee: ...
They stole the fund in the early 60's, wrecking its future, the wreckage was 7 predicted decades ago.
Most likely looking at Bank % interest payments on savings is the purely educational experience one needs
to know what's happening. It fueled runaway government spending you know legalized crime.

You know, you are supposed to save your hard earned pay a better way! The young adults aren't getting married.
 
Last edited:
We're staying about the same so far but that's because my husband has been investing for years. Right now, he's looking at starting to use a new app that incorporates AI in its research system and that may improve things and save time on the research he has to do on stocks. We also don't spend outrageously.
 
That Lady in PA said:
SS alone doesn't pay all the bills.
Click to expand...
It was supposed to. The basis for passing the SS program was to prevent seniors from becoming poor after retirement. That was FDR's objective.

I know some people don't believe it, but things went wrong when the feds used SS reserves to fund other programs. In reality, seniors today should be getting an average of 3 thousand every month just in SS benefits. Instead, I think the average is about 1700.
 
Last edited:
Vicky said:
As we age do, we get poorer?

I heard it growing up, and now it feels like I am experiencing it. I saved and dreamt about the day I retired. Now it’s here. 2-yrs into my retirement I feel like it’s getting harder to make my finances meet the bills.
Click to expand...

I'm very worried that it is going to become much worse in the next few years (inflation then recession). But on the other hand, the stress of it all will probably shorten my life so I might as well keep spending as if there is no tomorrow.

If you have any option of downsizing, that really worked well for me. I'd watched a YouTube of Dave Ramsey advising someone to downsize to a 100k condo that had new appliances, and although I did not achieve that good of deal when I downsized from a house to a condo, I did manage to go from scraping by precariously to having breathing room.

Also, apparently we can expect our retirement spending to follow a U shape, spending extra in early retirement for travel/fun, then not spending much at all for 10 yrs or so, then spending more to cover extra household help etc in our latest years. So, hoping that works out because I'm exceeding the 4% rule in these first years in order to go on trips a few times a year.

My attitude toward senior discounts has changed a lot, at the start of retirement I felt like it was practically cheating to get the discount, but now a couple years into retirement I really appreciate the discounts.
 
That Lady in PA said:
Social Security is but one leg of the three-legged stool.
So, yes, SS alone doesn't not pay all the bills. Fortunately there are other streams to fill in the gap.
Click to expand...
This is key.

The Three Legged Stool:

Leg 1, Social Security
Leg 2. Pension
Leg 3. Savings/Investments

When Pensions went away was when all the trouble started.

SS was only meant to give a dignified retirement.
 
wisenior said:
This is key.

The Three Legged Stool:

Leg 1, Social Security
Leg 2. Pension
Leg 3. Savings/Investments

When Pensions went away was when all the trouble started.

SS was only meant to give a dignified retirement.
Click to expand...
Is your Social Security like our Canada Pension Plan? Here, each worker pays an amount (dependent on income level) out of every pay cheque and the employer matches that. It builds over the life of the worker and at retirement, you can start your payments as early as the age of 60. Our CPP is considered one of the world's top rated pension plans and the government recently did something to further stabilize it for decades to come plus it's untouchable by the federal government. Completely separate from revenue. So how do you accumulate SS?

We also get Old Age Security payments every month once we turn 65 and that is the same amount for everyone. And then of course, investments whatever those may be.
 
Last edited:
HoneyNut said:
I'm very worried that it is going to become much worse in the next few years (inflation then recession). But on the other hand, the stress of it all will probably shorten my life so I might as well keep spending as if there is no tomorrow.

If you have any option of downsizing, that really worked well for me. I'd watched a YouTube of Dave Ramsey advising someone to downsize to a 100k condo that had new appliances, and although I did not achieve that good of deal when I downsized from a house to a condo, I did manage to go from scraping by precariously to having breathing room.

Also, apparently we can expect our retirement spending to follow a U shape, spending extra in early retirement for travel/fun, then not spending much at all for 10 yrs or so, then spending more to cover extra household help etc in our latest years. So, hoping that works out because I'm exceeding the 4% rule in these first years in order to go on trips a few times a year.

My attitude toward senior discounts has changed a lot, at the start of retirement I felt like it was practically cheating to get the discount, but now a couple years into retirement I really appreciate the discounts.
Click to expand...
Your 3rd paragraph above, about spending expectations in retirement, has been my experience: I'm now 78, and I spent more in the beginning, now much less, and I sincerely hope I won't have much caregiver expenses later.
 
Debrah N. said:
Is your Social Security like our Canada Pension Plan? Here, each worker pays an amount (dependent on income level) out of every pay cheque and the employer matches that. It builds over the life of the worker and at retirement, you can start your payments as early as the age of 60. Our CPP is considered one of the world's top rated pension plans and the government recently did something to further stabilize it for decades to come. So how do you accumulate SS?
Click to expand...
Same way. The problem is, our congress made certain the federal gov't could use SS reserves for other projects, many of which are of no benefit at all to seniors.
 
Debrah N. said:
Is your Social Security like our Canada Pension Plan? Here, each worker pays an amount (dependent on income level) out of every pay cheque and the employer matches that. It builds over the life of the worker and at retirement, you can start your payments as early as the age of 60. Our CPP is considered one of the world's top rated pension plans and the government recently did something to further stabilize it for decades to come. So how do you accumulate SS?
Click to expand...
I'm not sure how you meant "accumulate", but we don't accumulate SS, as I understand the word. In our working years, a payroll tax is deducted from our checks called "FICA", for positions that are eligible, and (yes) the employer is required by law to match the employee's deduction. Then when we retire, a formula is used by the SSA to determine our benefit amount, generally based on the years of highest earnings.

SS is not considered a pension plan in the sense that one previous poster used the term pension plan. I think he meant pension plans funded by employer, as a benefit. I'm sure he'll correct me if I misunderstood.

Some employers still have pension plans, some match employee 401K contributions, and some employers do nothing for their employees (other than matching their FICA deduction).

This post has been edited from what it originally said.
 
Last edited:
MACKTEXAS said:
I'm not sure how you meant "accumulate", but we don't accumulate SS, as I understand the word. In our working years, a payroll tax is deducted from our checks called "FICA", for positions that are eligible, and (yes) the employer is required by law to match the employee's deduction. Then when we retire, a formula is used by the SSA to determine our benefit amount, generally based on the years of highest earnings.

SS is not considered a pension plan in the sense that one previous poster used the term pension plan. I think he meant pension plans funded by employer, as a benefit. I'm sure he'll correct me if I misunderstood.

Some employers still have pension plans, some match employee 401K contributions, and some employers do nothing for their employees (other than matching their FICA deduction).

This post has been edited from what it originally said.
Click to expand...
I just meant that our CPP is accumulated over the course of our working life. And it sounds pretty much like your SS. From what I've been hearing lately, the main difference is that our CPP is entirely separate from government operations and our government isn't able to 'cut' our CPP in order to save money or reapply to pay other bills.

And every citizen gets Old Age Security regardless of whether they worked or not (about $725 a month). It's an automatic 'government pension' that is received when one turns 65. Then for those who don't have CPP, to top up their OAS, they usually qualify for Guaranteed Income Supplement which can go up to about $1000 a month. So someone who's never worked (a stay at home wife for example) would received about $1725 month. Obviously not a lot, but I guess if a couple people for example lived together and they both received OAS and GIS, they'd maybe be able to rent a little apartment together and get by.

Anyway, thanks for the explanation. I've always wondered about how your SS is calculated.
 
My pension has a COLA that starts at 1 percent and gradually goes up to 5% per year after you are retired for 15 years. My SS will go up a lot with the new WEP bill that was passed. I’ll be able to live comfortably without using my savings. The last few years have been tight and earning an extra 8k/ year really helped.
 
mrstime said:
We got richer........the kids grew up and left home, meaning we could save a bit and enjoy what we had.
Click to expand...
As did we... We started maxing out our 401Ks so when I retired my pension check was a little bit more than my take home pay. DW will be about the same come November when she retires. My SSD covers most of the regular expenses, and have a nice nest egg too.
 
mrstime said:
We got richer........the kids grew up and left home, meaning we could save a bit and enjoy what we had.
Click to expand...
I'm feeling extremely fortunate. Retired for 30 years now we have more coming in than going out.

The why of that.

My wife & I worked for companies that pay a pension. That was in place then they implemented a 401k program. Thanks to a Fidelity account agent the 401k's instead of drawing on those at age 59 1/2 converted them into self directed & traditional IRA's. Then Social Security kicked in. Prior savings & the one time federal tax free sale of our 5 bedroom home on 8 acres of land that gave us enough money to pay cash for our retirement home & not need to draw on the money generated by our IRA's.

The end result deposited monthly. 2 pension checks 2 social security checks, a total of 4 checks from MRD. I can say we don't sit at home hoarding money
 
Debrah N. said:
Is your Social Security like our Canada Pension Plan? Here, each worker pays an amount (dependent on income level) out of every pay cheque and the employer matches that. It builds over the life of the worker and at retirement, you can start your payments as early as the age of 60. Our CPP is considered one of the world's top rated pension plans and the government recently did something to further stabilize it for decades to come plus it's untouchable by the federal government. Completely separate from revenue. So how do you accumulate SS?

We also get Old Age Security payments every month once we turn 65 and that is the same amount for everyone. And then of course, investments whatever those may be.
Click to expand...
The Canada Pension Plan Investment Board is the second largest investment group in the world. By investing in world wide industries, mining companies, railways, shipping fleets, commercial real estate, and diamond mines, the CPP is totally funded for the next 46 years. Yep, the current CPP has enough money in it to pay out every Canadian who will draw that pension, until the year 2070.

Unlike the US Social Security plan which is restricted to only investing in US Government funds, the CPP Investment Fund has no such restriction. Because of the world wide nature of the CPP investment program, we Canadians are not worried that the CPP will "Run out of money ". JIM.
 
ANDY ROONEY’S THEORY OF LIFE

The most unfair thing about life is the way it ends. I mean, life is tough. It takes up a lot of your time. What do you get at the end of it? A Death. What’s that, a bonus? I think the life cycle is all backward.

You should die first, get it out of the way. Then you live in an old age home. You get kicked out because you’re too young, you get a gold watch and you go to work. You work forty years until you’re young enough to enjoy your retirement. You do drugs, alcohol, you party, you get ready for high school. You go to grade school, you become a kid, you play, you have no responsibilities. You become a little baby, you go back into the womb, spend your last nine months floating and you finish off as an orgasm.
 
jimintoronto said:
The Canada Pension Plan Investment Board is the second largest investment group in the world. By investing in world wide industries, mining companies, railways, shipping fleets, commercial real estate, and diamond mines, the CPP is totally funded for the next 46 years. Yep, the current CPP has enough money in it to pay out every Canadian who will draw that pension, until the year 2070.

Unlike the US Social Security plan which is restricted to only investing in US Government funds, the CPP Investment Fund has no such restriction. Because of the world wide nature of the CPP investment program, we Canadians are not worried that the CPP will "Run out of money ". JIM.
Click to expand...
Well, trying not to get too political here, it should give you some comfort that Alberta has been notified that they're only getting 20-25% (not 53%)of the CPP if they decide to proceed with their harebrained plan. I could go on at length on this because I've tried to keep up on what's happening, but that's all I'm going to say.
 

You must log in or register to reply here.

Back
Top