Our stupid modern retirement system

Eric Garland Uncategorized Leave a Comment

NPR tells us, surprising absolutely nobody, that Americans are worried that they haven’t played the retirement game well, and haven’t horded enough cash, bonds, securities and real estate to make it in retirement.

Let’s review some past forms of life in our senior years:

Period 1: Neanderthal Era – 1946: You live in a small family unit, either in a roving band or within a village/city of some sort. When you get older, your kids do the work and bring home the food and you take care of their little kids. When their kids get to teenage years, they take care of you. You die surrounded by people you know.

Period 2: 1946 – present: Everybody attempts to navigate global capitalism with the goal of hoarding masses of wealth by age 60. Ten percent of the population start with wealth to begin with. You, in the other ninety-percent, start work immediately or go to college, which is so expensive it requires interest-bearing loans. You begin working. To get to work you need cars, which are so expensive they require interest bearing loans. You need to live somewhere you buy a home, which is so expensive it requires interest-bearing loans. You begin having children and engage in the practice of buying many, many items for your home.

You keep buying new cars and homes while attempting to save for your children’s education, the cost of which is exceeding wage growth by a factor of 2.5. Your children either begin working or leave for university (with a good chuck of your cash), likely moving to their own dorm/apartment/home.

Your kids either stay in town and  begin working or leave for a big city, where they will attempt to buy a home, which is so expensive it requires interest-bearing loans, etc. You or your spouse gets sick, requiring additional healthcare expenditures, which are increasing in cost 2.5 times ahead of wage growth. You give all of your remaining cash to people living in New York, a group of Yale and Princeton graduates competing through mathematics to see who can siphon the most value out of the economy the quickest. You watch the stock market numbers to see if these Ivy League grads are making you money through their shorting-margin positions on calls on the CDS of the option…or something.

If you have enough principal assets to be able to take six vacation a year while living in someplace warm and can simultaneously afford gold-plated health insurance to pay all health expenses, YOU WIN. For the other 90%, YOU LOSE!!! Your only hope is that your kids are playing this game and winning.


And this is if you don’t have any diseases, divorces, business failures, or global economic failures! What a great system!

When the rules are written this way, is it any surprise that people are worried? Wouldn’t you be?