Money / budget expressions that bother me

[luuknam]

I wonder why they don't mention that interest rates on savings account specifically are very low right now. That's not the only explanation, but I'd bet you see more money in saving accounts of they were paying 5%, for example.

 

When they were paying 5% on savings accounts, inflation was higher, so I don't think it'd really matter. I have over $1000 in a checking account where (afaik) I'm getting 0% interest. I'm sure that if the interest rate was higher, I'd move it to a savings account, but regardless, having $1000 in an easily accessible emergency fund seems like common sense if at all possible. Especially if you're in a HCOL area (which we're not, fwiw, nor do we make anywhere near six figures), because you need more of a buffer because your burn rate is so much higher in a HCOL area if you lose your job or w/e.

[Bluegoat]

Well, yeah, I get that pension funds use investments. I just wouldn't see it as my investment income, if that makes sense, if it's not up to me what to do with the investments.

 

But it does still qualify as a kind of investment income, and it will still be a fixed income, especially if it isn't indexed.

[idnib]

When they were paying 5% on savings accounts, inflation was higher, so I don't think it'd really matter. I have over $1000 in a checking account where (afaik) I'm getting 0% interest. I'm sure that if the interest rate was higher, I'd move it to a savings account, but regardless, having $1000 in an easily accessible emergency fund seems like common sense if at all possible. Especially if you're in a HCOL area (which we're not, fwiw, nor do we make anywhere near six figures), because you need more of a buffer because your burn rate is so much higher in a HCOL area if you lose your job or w/e.

 

Yes the low rates are coupled with low mortgage rates and low inflation, but i think the low interest rates on savings accounts makes it more painful to pull money out of the market and park it in a savings account. It causes me to want to keep a minimum for bills and emergencies in there, anyway. Beyond that, I keep money elsewhere.

[luuknam]

Yes the low rates are coupled with low mortgage rates and low inflation, but i think the low interest rates on savings accounts makes it more painful to pull money out of the market and park it in a savings account. It causes me to want to keep a minimum for bills and emergencies in there, anyway. Beyond that, I keep money elsewhere.

 

The thing is though, that if you make six figures, $1000 for emergencies should be a 'minimum'. It's easy to have emergencies adding up to $1000 happen to you in under a month, even without losing a job. Cash flow problems aren't fun. The amount of lost interest on $1000 is not that huge.

[TechWife]

I am aware that there are limits, but I am also aware of many people over retirement age who can and do work, both part-time and full-time.  My grandmother worked part-time into her 80s.  On her feet, as a retail sales clerk.  She never had a driver's license, but she walked to the bus stop.  She loved her job.

 

It's actually very good for people's physical and mental health to get out and do stuff.

 

 

I am fully aware that there are many people who can do this, however, most can't. My mother loved her job too, but once her arthritis became bad enough to require a knee replacement in one knee, she could no longer stand long enough to do her job. Loving her job, loving being around people and a desire to be working doesn't mean any of that was possible. 

 

People can "get out and do stuff" even if they aren't able to work. Family and social activities can be tailored around the needs of the people participating, work cannot. 

[idnib]

The thing is though, that if you make six figures, $1000 for emergencies should be a 'minimum'. It's easy to have emergencies adding up to $1000 happen to you in under a month, even without losing a job. Cash flow problems aren't fun. The amount of lost interest on $1000 is not that huge.

 

True. I definitely don't think all people who have the ability to save are doing enough of that.

[poppy]

I am fully aware that there are many people who can do this, however, most can't. My mother loved her job too, but once her arthritis became bad enough to require a knee replacement in one knee, she could no longer stand long enough to do her job. Loving her job, loving being around people and a desire to be working doesn't mean any of that was possible. 

 

People can "get out and do stuff" even if they aren't able to work. Family and social activities can be tailored around the needs of the people participating, work cannot. 

 

My dad's retired and has LOTS of friends with jobs that can be tailored. People in their 70s. He works at an H&R block.  He tells them what hours he wants to work.

His friend drives cars from one state to another for a car dealership, intermittently, when he wants to.   Another one does occasional work at a golf course scheduled around his grandkids schedules.

There are a few other old guy jobs I can't remember right now.........

All discretionary, intermittent income, of course, not money to live off of, but these are also jobs received from years of networking at churches and clubs and golfing and what-not that a 25 year old might not have access to . They're also only able to be taken because the employee has fixed income to rely on; it's not a second job on top of a full time job. These are guys whose other priorities are "watch tv, play golf, visit buddies".  

[Reefgazer]

It's not just knees, either.  It's osteoarthritis in the back and hands, early stages of dementia that mean a person can't work a job, vision problems that preclude driving, hearing issues that can't be solved with a hearing aid, medications that make the elderly sleepy or weak, the inability to stand for an extended period of time, and even social security rules that prevent a person from making over a certain amount without losing benefits.  These are things the vast majority of younger people don't deal with.  It's hilarious that these common sense problems are even being argued about.

I am fully aware that there are many people who can do this, however, most can't. My mother loved her job too, but once her arthritis became bad enough to require a knee replacement in one knee, she could no longer stand long enough to do her job. Loving her job, loving being around people and a desire to be working doesn't mean any of that was possible. 

 

People can "get out and do stuff" even if they aren't able to work. Family and social activities can be tailored around the needs of the people participating, work cannot. 

 

[SKL]

Yes the low rates are coupled with low mortgage rates and low inflation, but i think the low interest rates on savings accounts makes it more painful to pull money out of the market and park it in a savings account. It causes me to want to keep a minimum for bills and emergencies in there, anyway. Beyond that, I keep money elsewhere.

 

As far as spending in the moment due to relative returns, I also think it's partly about the limited amount of time we have to raise our kids.  Maybe it's my old age, but I always feel like this time is fleeting and if I can do something to improve my kid's future life, I would like to do it.  The fact that the future is uncertain makes me even more willing to invest in them today.  If our money got cut off tomorrow, or if I died suddenly, at least they would have a start on a good education, good health, maybe even some job potential.

 

Plus, of course, they keep growing.

 

Another factor is the number of hours we work.  I seriously don't have time to browse thrift stores.  I used to, years ago.  I'm still wearing some nice thrift store finds.  But now, it's difficult to find time for us all to shower, forget store browsing.  :p  Most of our stuff comes from Amazon.  Maybe when I don't have to juggle kids and work, I'll be inspired to look for fabulous finds again.  :P

Edited September 29, 2016 by SKL

[SKL]

It's not just knees, either.  It's osteoarthritis in the back and hands, early stages of dementia that mean a person can't work a job, vision problems that preclude driving, hearing issues that can't be solved with a hearing aid, medications that make the elderly sleepy or weak, the inability to stand for an extended period of time, and even social security rules that prevent a person from making over a certain amount without losing benefits.  These are things the vast majority of younger people don't deal with.  It's hilarious that these common sense problems are even being argued about.

 

Not all jobs require physical agility, and most people never go senile.

 

Many people remain as a paid consultant after retiring from their regular career.  Usually this involves more sitting than moving.

 

Of course there are many people who can't work past 67, or past 57 for that matter.  Neither of my parents is currently employed (or likely to be again), due to health reasons.  But it is also silly to ignore that there is a fairly large number of older Americans who choose to work, or *choose* not to work.  And again, I support the choice either way, but for many it is definitely a choice far past age 67.

 

Being unable to work is different from acting financially helpless because Social Security has kicked in.  We certainly earn our retirement, but if things were different and we *needed* to keep working - or if we wanted to buy something badly enough - many of us could and would.

Edited September 29, 2016 by SKL

[TechWife]

It's not just knees, either.  It's osteoarthritis in the back and hands, early stages of dementia that mean a person can't work a job, vision problems that preclude driving, hearing issues that can't be solved with a hearing aid, medications that make the elderly sleepy or weak, the inability to stand for an extended period of time, and even social security rules that prevent a person from making over a certain amount without losing benefits.  These are things the vast majority of younger people don't deal with.  It's hilarious that these common sense problems are even being argued about.

 

I think there may be people on this board who think that they know elderly people, when in fact, they simply know older people. My parents are 86 years old and I've seen them go through quite a bit in the past 15-20 years. The difference even one year or one health event makes can be quite startling. 

 

Not all jobs require physical agility, and most people never go senile.

 

Many people remain as a paid consultant after retiring from their regular career.  Usually this involves more sitting than moving.

 

Of course there are many people who can't work past 67, or past 57 for that matter.  Neither of my parents is currently employed (or likely to be again), due to health reasons.  But it is also silly to ignore that there is a fairly large number of older Americans who choose to work, or *choose* not to work.  And again, I support the choice either way, but for many it is definitely a choice far past age 67.

 

Being unable to work is different from acting financially helpless because Social Security has kicked in.  We certainly earn our retirement, but if things were different and we *needed* to keep working - or if we wanted to buy something badly enough - many of us could and would.

 

 

I am not ignoring it, but I think that you are ignoring that many of these people who are working are doing so with significant effort. They could be working through the pain of arthritis, for example. Their jobs could be leaving them so tired that they don't have the energy for family and social interactions. Put bluntly, working can compromise quality of life. To think otherwise is ignorant. By way of example,  I know someone who worked a professional job during her career and when she retired she worked a part time retail job for "spending money" in her late 60's.  That job caused significant damage to her feet and legs and she has borne the consequences of it for many years now. They won't go away. If she had worked retail at a younger age, it most likely wouldn't have caused that damage. It was a combination of her age and the type of work that caused the damage. She has told me more than once that she wishes she hadn't taken that job because the collateral damage has been great. She's in her seventies now, so she likely has twenty years or more to live with the consequences of that decision. Her situation is not unique. 

 

I think you are uninformed of the effects aging has on a body and the effect that working has on an aging body and mind.  Just because someone can work, doesn't mean that it's in their best long term interest to work from a physical and mental standpoint. Life is much more complex than that. 

[TechWife]

 

Many people remain as a paid consultant after retiring from their regular career.  Usually this involves more sitting than moving.

 

 

 

Wow, all that sitting would be unbearable for someone with arthritis. You see, the more you sit, the more painful it is to move when you finally do move. In addition, someone who has arthritis in their back cannot sit for long periods of time, either (your spine is a series of joints, when each joint has arthritis, it is very, very painful). Working at a job that doesn't appear to be physically demanding can be quite detrimental to someone's health in the right circumstances. Things are not as clear cut as you think that are. 

[SKL]

I am aware there is a range.  I'm 50 myself, I have plenty of experience with older people in my life & at my jobs.  I'm also not stupid.

 

However, for many people SSI gives them the option to choose or not choose to work full or part time.  It does not automatically mean "fixed income."

 

Think of the politicians and the kind of demands upon them.  It is very normal for active politicians to be over 67.  Same for people in high levels of corporate management, entertainment, and also people active in charities (both on & off the payroll).

Edited September 29, 2016 by SKL

[TechWife]

Not all jobs require physical agility, and most people never go senile.

 

 

 

I'm sorry for the multiple posts, but I just keep thinking back on this post. Did you know that senility is not the only cognitive issue elderly people face? Hearing and vision problems affect cognition. Tiredness affects cognition. The older people are, the slower their processing speed can be. Aging is a very complex process. 

 

It might be of benefit to you and your family members for you to start to read up on the aging process. It doesn't look at all like it does on those AARP commercials.  

[Greta]

The thing is though, that if you make six figures, $1000 for emergencies should be a 'minimum'. It's easy to have emergencies adding up to $1000 happen to you in under a month, even without losing a job. Cash flow problems aren't fun. The amount of lost interest on $1000 is not that huge.

 

I agree so much with this!  I know it's frustrating that savings accounts basically earn zero interest.  But I don't think of my emergency fund as an investment.  I think of it more as an insurance policy.  It's not growing, but it's not going to shrink or disappear either.  Not earning interest on it is still a whole lot better than being forced to take money out of the market at a time when its value is lower than when you invested.  So we keep a pretty hefty emergency fund that is completely separate from our investments, and more stable than they are.  (I'm not saying any of this as some sort of self-professed financial expert - ha!  I'm far from it!  But my husband is a good money manager, and I've learned a lot from him.  God bless him, I'd be completely broke if it weren't for him.)

[TechWife]

 

Think of the politicians and the kind of demands upon them.  It is very normal for active politicians to be over 67.  Same for people in high levels of corporate management, entertainment, and also people active in charities (both on & off the payroll).

 

Sixty seven is young. Just ask someone who's ninety and they'll tell you all about it. My uncle was full of stories about his "running around years." He was referring to his sixties, when he already had heart and vision problems. 

 

Working in your sixties does't mean you aren't doing significant damage to your body and mind. The long hours a politician or business person  works do take a toll on their health. There's a reason that presidents leave office looking significantly older than they did when they entered office. That same effect is felt by others in high demand careers as well. 

[poppy]

I'm sorry for the multiple posts, but I just keep thinking back on this post. Did you know that senility is not the only cognitive issue elderly people face? Hearing and vision problems affect cognition. Tiredness affects cognition. The older people are, the slower their processing speed can be. Aging is a very complex process.

 

It might be of benefit to you and your family members for you to start to read up on the aging process. It doesn't look at all like it does on those AARP commercials.

Most people on this board have parents just like you do, or at least have some elderly relatives. The implication I'm getting from your posts is that you think the idea that someone who is retired might possibly be capable of work is absurd.

[TechWife]

I agree so much with this!  I know it's frustrating that savings accounts basically earn zero interest.  But I don't think of my emergency fund as an investment.  I think of it more as an insurance policy.  It's not growing, but it's not going to shrink or disappear either.  Not earning interest on it is still a whole lot better than being forced to take money out of the market at a time when its value is lower than when you invested.  So we keep a pretty hefty emergency fund that is completely separate from our investments, and more stable than they are.  (I'm not saying any of this as some sort of self-professed financial expert - ha!  I'm far from it!  But my husband is a good money manager, and I've learned a lot from him.  God bless him, I'd be completely broke if it weren't for him.)

 

Every time I have to do something with the customer service representative at the bank, they are amazed that we have some money in an old fashioned savings account. They always want to sell me some type of investment to get me to move it. They look at me very puzzled when I ask them how I would access the money to pay for something like a replacement air conditioner or an emergency medical bill. The concept of having a reasonable amount of easily accessible funds it lost on many people. 

[TechWife]

Most people on this board have parents just like you do, or at least have some elderly relatives. The implication I'm getting from your posts is that you think the idea that someone who is retired might possibly be capable of work is absurd.

 

No, not at all. It is absurd to think that them working is either easily done or  isn't without consequence. 

 

FWIW, my parents worked as long as they were physically capable because they needed to do so to make ends meet. If they could work now, they would be willing to do so. 

Edited September 29, 2016 by TechWife

[SKL]

Sixty seven is young. Just ask someone who's ninety and they'll tell you all about it. My uncle was full of stories about his "running around years." He was referring to his sixties, when he already had heart and vision problems. 

 

Working in your sixties does't mean you aren't doing significant damage to your body and mind. The long hours a politician or business person  works do take a toll on their health. There's a reason that presidents leave office looking significantly older than they did when they entered office. That same effect is felt by others in high demand careers as well. 

 

We are all different.

 

I'm pretty sure I never said that all 90-year-olds can go out and get a job.  There is a very large age span during which people collect social security.  For some it starts at 62.  (Actually for some it starts younger than that - my aunt has been on it since her 20s because she is a widow with a disabled son - though her son has been in full-time residential care for about 40 years now.)

 

Working before or after age 67 may or may not be damaging to the body or mind.

 

NOT working before or after age 67 may or may not be damaging to the body or mind.

 

[poppy]

Every time I have to do something with the customer service representative at the bank, they are amazed that we have some money in an old fashioned savings account. They always want to sell me some type of investment to get me to move it. They look at me very puzzled when I ask them how I would access the money to pay for something like a replacement air conditioner or an emergency medical bill. The concept of having a reasonable amount of easily accessible funds it lost on many people.

We keep our savings in an investment account but in cash. Still liquid, still accessible, earning a teeny bit of interest.

 

 

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[Greta]

Every time I have to do something with the customer service representative at the bank, they are amazed that we have some money in an old fashioned savings account. They always want to sell me some type of investment to get me to move it. They look at me very puzzled when I ask them how I would access the money to pay for something like a replacement air conditioner or an emergency medical bill. The concept of having a reasonable amount of easily accessible funds it lost on many people. 

 

 

Interesting - it sounds like this approach/philosophy of investing perhaps does account for significant chunk of that statistic regarding how few people have $1000 in a savings account.  

 

So how do most people pay for the kind of emergencies that you mention here?  Credit cards?  

[Greta]

We keep our savings in an investment account but in cash. Still liquid, still accessible, earning a teeny bit of interest.

 

 

Sent from my iPhone using Tapatalk

 

 

Something like a money market account?

[poppy]

No, not at all. It is absurd to think that them working is either easily done or isn't without consequence.

 

FWIW, my parents worked as long as they were physically capable because they needed to do so to make ends meet. If they could work now, they would be willing to do so.

My husbands grandfather still works doing light duty as a sexton at his church and volunteers at Habitat for Humanity projects .... They asked him to stop climbing ladders when he hit 90 but otherwise he is fully engaged. Sitting more would probably eat away at soul.

 

 

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[SKL]

Speaking of easily accessible savings, I think most people handle this via credit card, since you have roughly a month to pay it off without interest.

 

I have an online account that earns a little interest and lets me move funds to my checking account in 2-3 days.  The interest rate used to be a lot higher, but now it's not much.  Enough to keep me fed on beans if I lived alone.  :P  But who knows, maybe it will go back up.

 

I also have some retirement savings in more "market" oriented accounts.  I don't put much stock in them though, because crazy things happen.

 

I have a paid-off house and car.  To me, those are more valuable than any savings.  With a roof over our heads, all kinds of other things can change and we'd still be OK, assuming the nation's food supply doesn't disappear.

 

I hope that when I retire, I will be able to live off Social Security anyway.  I am a simple person.  But who knows what will happen....

[TechWife]

Something like a money market account?

 

Now this is an interesting question. What I described as an "old fashioned savings account" is actually a money market account. It seems "old fashioned" to me, but perhaps it is not. Because we keep a minimum balance, it doesn't have any fees and earns a very small amount of interest (less than 1%). Banks reps constantly want us to move the money to an investment product with a higher yield. 

[Seasider]

....the aging process. It doesn't look at all like it does on those AARP commercials.

This is true.

[Arcadia]

So how do most people pay for the kind of emergencies that you mention here? Credit cards?

Our checking accounts has enough cash to buffer even though we would have paid using a credit card. We actually closed our savings account during recession to have less accounts to deal with.

 

Our Wells Fargo checking requires a minimum of $1.5k while Citibank requires $3k unless we do direct pay deposit in which case minimum is waived.

[Reefgazer]

You don't have to have multiple health issues to be unsuited to work. Most elderly may never get dementia, but most also have at least one serious physical problem. You don't need to be on your death bed to t be able to work; it just takes one of the things I posted to do that. Oh, and that's assuming an employer doesn't age-discriminate. This whole thread is ridiculous, IMO.

 

 

y

Not all jobs require physical agility, and most people never go senile.

 

Many people remain as a paid consultant after retiring from their regular career. Usually this involves more sitting than moving.

 

Of course there are many people who can't work past 67, or past 57 for that matter. Neither of my parents is currently employed (or likely to be again), due to health reasons. But it is also silly to ignore that there is a fairly large number of older Americans who choose to work, or *choose* not to work. And again, I support the choice either way, but for many it is definitely a choice far past age 67.

 

Being unable to work is different from acting financially helpless because Social Security has kicked in. We certainly earn our retirement, but if things were different and we *needed* to keep working - or if we wanted to buy something badly enough - many of us could and would.

[poppy]

Now this is an interesting question. What I described as an "old fashioned savings account" is actually a money market account. It seems "old fashioned" to me, but perhaps it is not. Because we keep a minimum balance, it doesn't have any fees and earns a very small amount of interest (less than 1%). Banks reps constantly want us to move the money to an investment product with a higher yield.

Kind of like McDonalds: do you want fries with that? I think they have to ask.

 

I was at a store the other day and the clerk did not ask my if I wanted a store card- but I could see her checking off on the cash register that she did, plus she marked y to 'did you ask for email y/n'. I was grateful she was a liar to that machine. It was so pleasant to just buy something without being harangued.

 

 

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[SKL]

Maybe people don't understand that when I say "some" or "many," that does not mean "all" or "most."

[Greta]

Now this is an interesting question. What I described as an "old fashioned savings account" is actually a money market account. It seems "old fashioned" to me, but perhaps it is not. Because we keep a minimum balance, it doesn't have any fees and earns a very small amount of interest (less than 1%). Banks reps constantly want us to move the money to an investment product with a higher yield. 

 

 

Same here - we use a money market account for our savings too.  I just wasn't sure if that's what Poppy was referring to or if she had found something better!  

[idnib]

The thing is though, that if you make six figures, $1000 for emergencies should be a 'minimum'. It's easy to have emergencies adding up to $1000 happen to you in under a month, even without losing a job. Cash flow problems aren't fun. The amount of lost interest on $1000 is not that huge.

 

 

I agree so much with this!  I know it's frustrating that savings accounts basically earn zero interest.  But I don't think of my emergency fund as an investment.  I think of it more as an insurance policy.  It's not growing, but it's not going to shrink or disappear either.  Not earning interest on it is still a whole lot better than being forced to take money out of the market at a time when its value is lower than when you invested.  So we keep a pretty hefty emergency fund that is completely separate from our investments, and more stable than they are.  (I'm not saying any of this as some sort of self-professed financial expert - ha!  I'm far from it!  But my husband is a good money manager, and I've learned a lot from him.  God bless him, I'd be completely broke if it weren't for him.)

 

 

Every time I have to do something with the customer service representative at the bank, they are amazed that we have some money in an old fashioned savings account. They always want to sell me some type of investment to get me to move it. They look at me very puzzled when I ask them how I would access the money to pay for something like a replacement air conditioner or an emergency medical bill. The concept of having a reasonable amount of easily accessible funds it lost on many people. 

 

 

Interesting - it sounds like this approach/philosophy of investing perhaps does account for significant chunk of that statistic regarding how few people have $1000 in a savings account.  

 

So how do most people pay for the kind of emergencies that you mention here?  Credit cards?  

 

 

Just quoting some relevant discussion....

 

We keep our emergency funds in a money market account which would take 3-4 days to transfer funds to our checking. We don;t have a traditional savings account, although our kids do. We keep more than $1k in our MMA, but we tend to think of it as savings for a job loss or to pay a credit card bill used in an emergency. If we had an immediate car problem, home repair, a major medical problem, etc. we would use a credit card to pay at the time, and our insurance helps us from having to pay too much up front. 

 

For the $100k+ crowd, I think it's much less likely that they will need $1000 cash with less than 3-4 days notice. How many people who have that income don't have insurance and credit cards with some room? Some, of course, but I bet it's less than the percentage of people cited in the article as not having $1k in savings. 

 

The real problem I think is when one is under-insured, your credit doesn't have $1k of room, and/or one has less than $1k of savings in an easily accessible account. That's extremely stressful.

 

I guess I find the article to be a bit click-baity because I doubt that everyone who says they don't have $1k in a savings account doesn't have a backup plan. They could have asked that question as well, or maybe they did but didn't report it because it's not as galvanizing.

[Scarlett]

Kind of like McDonalds: do you want fries with that? I think they have to ask.

 

I was at a store the other day and the clerk did not ask my if I wanted a store card- but I could see her checking off on the cash register that she did, plus she marked y to 'did you ask for email y/n'. I was grateful she was a liar to that machine. It was so pleasant to just buy something without being harangued.

 

 

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I am with you on that.

 

Sadly she will probably get fired if she gets caught lying  to the machine (aka leaving the customer in peace).

[Scarlett]

Yes this entire thread is ridiculous to me too.

 

I thought everyone knows that 'fixed income' generally refers to the elderly or disabled who live on modest retirement or ss.  And it is still considered fixed even if they get a $17 per month increase ----because $17.

 

I think the real issue in the original post was the nerve of the mom asking for the OP to give away her washer and dryer to ANYONE and go buy a new set that she wasn't planning on buying atm.  

 

I mean....really if the OP wants to do that that is her business and would be a kindness....but personally I would prefer to decide who my used appliances go to.  I don't need my mom telling me who she thinks needs it most.  I might ask around.....but just an unsolicited suggestion with judgment is not cool.

Edited September 29, 2016 by Scarlett

[Bluegoat]

I'm really surprised that people think the elderly working is so viable. 

 

Yes, most elderly people in their 60's still can work, and often want to, and even through their early 70's.  After that though, health problems start to take a real toll and people really start having to drop out of the workforce, even if they are living to 90.  People who live that long are likely to have a good 15 years where they can't really work without it being pretty uncomfortable, if they can manage it at all.  It isn't a few people, or even half - most people who don't drop dead of something like a heart attack or stroke are going to have a period of being utterly unable to work.

 

And really, the people most able to keep working are often the ones who don't have to and can choose not to.  People who do some kind of office work, doctors, accountants, and so on.  Those jobs don't tend to run down the body and they make good money too, even pt.  And people with those skills often have really good pensions and savings.

 

People who are in manual labour tend to retire with less physical ability to carry on their work - I have uncles who were a butcher and a carpenter, and both were starting to find their jobs physically demanding before they reached retirement age at 65.  But they didn't have the same level of pension or savings as someone like an accountant or doctor - there would both more likely need to supplement.  And probably that would mean in some kind of job that would not earn as much, would need possibly to be ft, and would not be as skilled since they would need to do something different than they were trained in.

 

So - the people most likely to have a longer period of not being able to work much at all are the ones who are often most likely to need to supplement income.

[regentrude]

Every time I have to do something with the customer service representative at the bank, they are amazed that we have some money in an old fashioned savings account. They always want to sell me some type of investment to get me to move it. They look at me very puzzled when I ask them how I would access the money to pay for something like a replacement air conditioner or an emergency medical bill. The concept of having a reasonable amount of easily accessible funds it lost on many people. 

 

If you pay with a credit card, there would be time to liquidate other assets between paying for the emergency and the credit card bill being due.

[poppy]

I'm really surprised that people think the elderly working is so viable.

 

Yes, most elderly people in their 60's still can work, and often want to, and even through their early 70's. After that though, health problems start to take a real toll and people really start having to drop out of the workforce, even if they are living to 90. People who live that long are likely to have a good 15 years where they can't really work without it being pretty uncomfortable, if they can manage it at all. It isn't a few people, or even half - most people who don't drop dead of something like a heart attack or stroke are going to have a period of being utterly unable to work.

 

And really, the people most able to keep working are often the ones who don't have to and can choose not to. People who do some kind of office work, doctors, accountants, and so on. Those jobs don't tend to run down the body and they make good money too, even pt. And people with those skills often have really good pensions and savings.

 

People who are in manual labour tend to retire with less physical ability to carry on their work - I have uncles who were a butcher and a carpenter, and both were starting to find their jobs physically demanding before they reached retirement age at 65. But they didn't have the same level of pension or savings as someone like an accountant or doctor - there would both more likely need to supplement. And probably that would mean in some kind of job that would not earn as much, would need possibly to be ft, and would not be as skilled since they would need to do something different than they were trained in.

 

So - the people most likely to have a longer period of not being able to work much at all are the ones who are often most likely to need to supplement income.

The point of this thread was never meant to be 'those elderly on a fixed income should work!' More , that the idea of fixed income as applying wholly and only to the elderly is not entirely accurate.

[goldberry]

Regarding the washer/dryer: the idea of people out there buying new things when the old thing still works is always surprising to me.  I know plenty of people do.  It just surprises me still.

 

When we moved into our new house, our TV was really small for the space it was now in. DH really wanted a new one to fit the bigger space.  :D  My response of course was that when this one dies we'll get a bigger one.  Fortunately for DH, his brother bought us a new larger one as an anniversary gift.  And also because he wanted to watch the bigger one when he was here at our house. ;)

 

My friend recently got a handed down washer and dryer from her MIL.  The one handed down was only about 3-5 years old.  MIL just wanted an "upgrade".  

 

I think I live in a different world sometimes!  We are not poor by any means, but replacing a washer/dryer just for an "upgrade" is not a reasonable purchase to me.

[Scarlett]

Regarding the washer/dryer: the idea of people out there buying new things when the old thing still works is always surprising to me.  I know plenty of people do.  It just surprises me still.

 

When we moved into our new house, our TV was really small for the space it was now in. DH really wanted a new one to fit the bigger space.  :D  My response of course was that when this one dies we'll get a bigger one.  Fortunately for DH, his brother bought us a new larger one as an anniversary gift.  And also because he wanted to watch the bigger one when he was here at our house. ;)

 

My friend recently got a handed down washer and dryer from her MIL.  The one handed down was only about 3-5 years old.  MIL just wanted an "upgrade".  

 

I think I live in a different world sometimes!  We are not poor by any means, but replacing a washer/dryer just for an "upgrade" is not a reasonable purchase to me.

 

 

Me either!  Sometimes I feel like the couple on that Gas company tv ad where they are advertising rebates if you buy gas appliances...The couple dances around when their stove stops working because they get to buy a new one.  They crack me up....LOL.....but usually I just weep that I have to spend money.

[Arcadia]

Regarding the washer/dryer: the idea of people out there buying new things when the old thing still works is always surprising to me. I know plenty of people do. It just surprises me still.

When we bought our washer and dryer, our boys were two under two. Crib bedsheets and baby blankets were easy to hand wash and air dry. Now that our boys are 10 & 11 and DS11 wears size 16/18 pants/jeans, hubby would like a bigger capacity washer so that we don't need to run a load as often. Our dryer is double the load capacity of our washer. So the bottleneck is the washer.

Edited September 29, 2016 by Arcadia

[TechWife]

If you pay with a credit card, there would be time to liquidate other assets between paying for the emergency and the credit card bill being due.

Yes, but liquidating assets before they mature usually comes with a financial penalty.

[SKL]

Me either!  Sometimes I feel like the couple on that Gas company tv ad where they are advertising rebates if you buy gas appliances...The couple dances around when their stove stops working because they get to buy a new one.  They crack me up....LOL.....but usually I just weep that I have to spend money.

 

Yeah, I don't get it either.

 

Funny thing, whenever I buy a big ticket item, I always get a bunch of solicitations to buy another one.  You know, like I just bought a Honda, I need to ask myself whether I want a new Toyota.  Since these ads are paid for by professional marketers, there must be a point, but I'm not feeling it.

 

I don't know how old our stove is; it was here when we moved into our house 21+ years ago.  It hasn't worn out its welcome yet.

 

We did have to buy a new washer/dryer some years ago.  The fridge didn't come with the house, so it's 21 years old, though it does have some broken parts and leaks.  It might be time to look into a new fridge.

 

But really, for most appliances, we would not need to replace them suddenly without warning.  The fridge being the exception.  Looks like the kind we have would cost a little less than $1,000 to replace.

Edited September 29, 2016 by SKL

[Bluegoat]

The point of this thread was never meant to be 'those elderly on a fixed income should work!' More , that the idea of fixed income as applying wholly and only to the elderly is not entirely accurate.

 

I don't know that anyone ever said that only the elderly ever lived on fixed incomes.  Anyone living off some kind of limited investment income or pension is.  It could be a kid with a trust fund though in that case we would probably say "maybe you should also get a job".  But lots of people with disabilities or sometimes carers for family members, or people who can't find a job are on a fixed income.

 

And yes, there are other people, who work, who are effectively in the same situation in terms of income  though we might not call it the same thing because the reasons are different.

 

But none of that means there is no such thing as a fixed income or that it isn't a real limitation.

[Bluegoat]

Me either!  Sometimes I feel like the couple on that Gas company tv ad where they are advertising rebates if you buy gas appliances...The couple dances around when their stove stops working because they get to buy a new one.  They crack me up....LOL.....but usually I just weep that I have to spend money.

 

It's rare these days when things run out so quickly, but sometimes new can be more efficient to a degree that makes it worthwhile.

[luuknam]

Interesting - it sounds like this approach/philosophy of investing perhaps does account for significant chunk of that statistic regarding how few people have $1000 in a savings account.  

 

So how do most people pay for the kind of emergencies that you mention here?  Credit cards?  

 

I'm not real sure how they looked at money in checking accounts. If you make six figures, you'd get >$4166 twice a month (minus whatever taxes). Obviously, you'd have certain fixed expenses, but your checking account would likely be >$1000 a lot of the time. Which isn't the same as having $1000 saved, if you're not making sure there's that much in it at all times. But a lot of the time, a 3-digit emergency could just be floated by eating rice and beans instead of eating out and delaying some random purchases such as clothes and gadgets until after the next paycheck. Or, if it's too close to the end of the month, delaying the emergency expense until the next paycheck (works for a lot of 'emergencies', like the broken A/C mentioned).

 

I'm sure a lot of people use credit cards too.

 

[luuknam]

Funny thing, whenever I buy a big ticket item, I always get a bunch of solicitations to buy another one.  You know, like I just bought a Honda, I need to ask myself whether I want a new Toyota.  Since these ads are paid for by professional marketers, there must be a point, but I'm not feeling it.

 

1) People might buy several appliances when they move (first house, or house without gas when you've got gas appliances, or the buyer wanted to buy the appliances too and the seller thought "sure, why not get new appliances", etc).

 

2) People like their kitchens to look pretty with matching appliances and the like.

 

3) People might replace several appliances if they drastically improved their financial situation and finally have the ability to upgrade all those appliances that were on their last legs.

[EMS83]

Actually, keeping a "floor" in checking is exactly what we're working toward.  Zero based budgeting, except our "zero" is $1k, $1.5k, whatever.  It's just taking longer than we like.  Our credit card was our emergency fund, but it's maxed out.

[SKL]

I'm not real sure how they looked at money in checking accounts. If you make six figures, you'd get >$4166 twice a month (minus whatever taxes). Obviously, you'd have certain fixed expenses, but your checking account would likely be >$1000 a lot of the time. Which isn't the same as having $1000 saved, if you're not making sure there's that much in it at all times. But a lot of the time, a 3-digit emergency could just be floated by eating rice and beans instead of eating out and delaying some random purchases such as clothes and gadgets until after the next paycheck. Or, if it's too close to the end of the month, delaying the emergency expense until the next paycheck (works for a lot of 'emergencies', like the broken A/C mentioned).

 

I'm sure a lot of people use credit cards too.

 

I would just note that nowadays, people can designate their paycheck to go into multiple bank accounts, as well as 401K, health / education savings accounts, whatever.  They might still need to wait a short period and possibly incur fees if they had an immediate expense bigger than the amount they put in their checking account.

 

But yes, people in that kind of financial condition can usually use a credit card to get around that.

[mommyoffive]

Yeah, I don't get it either.

 

Funny thing, whenever I buy a big ticket item, I always get a bunch of solicitations to buy another one.  You know, like I just bought a Honda, I need to ask myself whether I want a new Toyota.  Since these ads are paid for by professional marketers, there must be a point, but I'm not feeling it.

 

I don't know how old our stove is; it was here when we moved into our house 21+ years ago.  It hasn't worn out its welcome yet.

 

We did have to buy a new washer/dryer some years ago.  The fridge didn't come with the house, so it's 21 years old, though it does have some broken parts and leaks.  It might be time to look into a new fridge.

 

But really, for most appliances, we would not need to replace them suddenly without warning.  The fridge being the exception.  Looks like the kind we have would cost a little less than $1,000 to replace.

 

We get those adds after we buy a car for a new on too.  odd

 

Appliances are not built to last long any more though.