Thank goodness we have a Democrat in the White House. What a difference to the lamestream media that makes. Otherwise, America’s seniors would be facing a serious crisis. Is there any wonder they are staying in the workforce, if they can. Squeezing the already squeezed new college grads …
But how brutal is it…
The ingredients of the crisis are already here. Interest rates on bonds, CDs and money market accounts — staples of the retirement crowd’s portfolio — are at historic lows. (I’m always shocked to see what banks are touting. Really? 0.35% — that is, 35/100 of a percent — on a money market? 0.90% on a CD? Yep.) Stocks are nothing to write home about, still well below their highs of five years ago. As for those real estate investments? Forget about it.
The squeeze is real. Some years ago, when earning say 5% on your money was realistic, a $360,000 portfolio of CDs would produce $18,000 a year in interest — that’s $1500 a month. Couple that with an unexceptional Social Security payment of about the same amount, and that’s $36,000 a year, $3,000 a month. Nothing fancy, but enough to get by.
Now change that 5% to 0.9% and you’re earning $3,240 per year, or about $270 a month. Add that to $1,500 a month in Social Security and you’ve got $1,770 a month to live on; just $21,240 a year. That’s a brutal 41% cut in income. And it is why many senior citizens around the country are drawing down savings to make ends meet. What choice do they have ….
Isn’t it weird how that the seniors eating dog food meme from media days gone by, doesn’t show up today. I know it’s tough, watching people struggle in our community.
