Friday Reading: Baby Boomers Will Retire

By Harry Sit

Are Baby Boomers Actually Right Where They Should Be For Retirement Savings? by Michael Kitces at Nerd’s Eye View

Michael argues that it’s natural to save less when one is young and save more later in life. He’s on to something. I also wrote last year Baby Boomers Can Retire After All. In addition, self-funding one’s own retirement only started in the last generation or two. Throughout history people always retired; their kids took care of them. This is still happening today in many countries. It’s not a burden on your kids; it’s just normal.

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Too gloomy a view by Steve Utkus at Vanguard Blog

Along the same line but from a different angle, the director of Vanguard’s Center for Retirement Research reached the same conclusion about baby boomer’s retirement.

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Best Cash Back Credit Cards, August 2012 by FMF at Free Money Finance

The list includes one card I use frequently and another card I only use occasionally. Shall I say great minds think alike? The card I use the most is not on the list but I will keep it a secret.

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Social Security Strategies with Different-Age Spouses by Mike at Oblivious Investor

The more you read about Social Security, the more you realize how inequitable it is. Two couples earning the same combined income and paying the same amount of Social Security taxes will receive vastly different amounts in benefits depending on the age difference between spouses and whether the older spouse earns more or less between the two of them. It makes no sense at all.

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Municipal Bonds Not as Safe as Thought? Hardly by Jared Kizer at Multifactor World

I have munis through Vanguard’s muni bond fund. I think they are just fine. For someone in a high tax bracket, having munis in a taxable account frees up valuable space in tax advantaged accounts for stocks. When bond yields are low, bonds have become more tax efficient than stocks.

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How much will bond funds fall if interest rates rise? by The Investor at Monevator

Low interest rates aren’t unique to the U.S. They are just as low in the UK. Investors there have to be concerned about bond prices as well. I heard you can get 1-year bank e-bonds (equivalent to a CD here) at 3%. I wonder why people bother with longer term bond funds at 1.6% yield then.

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The Biggest Reason Why California Is Bankrupt by Conor Friedersdorf at The Atlantic

I blame this phenomenon on the success of The Huffington Post. Conor at The Atlantic put a new, much more attractive title on an article published by a newspaper in California. It said California’s population grew 9% over a 10-year span. The California state government also grew its employee headcount by 9%. However, the government’s payroll costs grew 42%. Conor inferred that must be the biggest reason why California is bankrupt. Hmm, something is missing here. Hint: the "i" word.

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Posted on August 31, 2012 under News. Keywords: , , , , , .

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