Re: Am I missing something here about planning for retirement???

Viking wrote:
> Pundits say to expect only 7% return from the market these years. OK.
> Inflation runs at, say, 3.5% (a low estimate given what's happening to
> oil). OK, that leaves a return of 7% - 3.5% = 3.5%. Say taxes and fees
> (broker/fund/etc) take part of that, leaving your yield at 3%.
>
> So say that you want to invest for retirement, and can put away $500
> a month, or $6,000 a year. OK. Say you decide you'll need $1,000,000
> in today's dollars to retire. OK, that means you should use the
> inflation-adjusted annual return of 3% to get there.
>
> So how long will it take before you can retire?
>
> If you invest $500 a month, it'll take you 60 years to reach
> $1,007,606.
>
> 60 years???
>
> At 40 years, more or less the maximum length of time for most working
> people, you'll only have $465,949.

"These years" don't extend for 40 years. So yes there are predictions
of expected returns, but for the near future. Who knows what the
medium and long term brings?
>
> If you're fortunate enough to be able to invest $1,000 a month
> (significantly more than the average person can afford), investing
> $12,000 annually at an annual rate of 3% will take you 42 years to get
> to $1,013,767.
>
> That's 42 years, if you can invest $1,000 a month, which most people
> can't. How many people do you know who invest $1,000 a month for
> retirement?
>
> So tell me: is the market way a bust as far as saving for retirement
> goes for the vast majority of people??? Am I missing something? How
> are people going to be able to retire?