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December 2, 2014

Jonathan Tobin: Defending the Right to a Jewish State

Heather Hale: Compliment your kids without giving them big heads

Megan Shauri: 10 ways you are ruining your own happiness

Carolyn Bigda: 8 Best Dividend Stocks for 2015

Kiplinger's Personal Finance editors: 7 Things You Didn't Know About Paying Off Student Loans

Samantha Olson: The Crucial Mistake 55% Of Parents Are Making At Their Baby's Bedtime

Densie Well, Ph.D., R.D. Open your eyes to yellow vegetables

The Kosher Gourmet by Megan Gordon With its colorful cache of purples and oranges and reds, COLLARD GREEN SLAW is a marvelous mood booster --- not to mention just downright delish
April 18, 2014

Rabbi Yonason Goldson: Clarifying one of the greatest philosophical conundrums in theology

Caroline B. Glick: The disappearance of US will

Megan Wallgren: 10 things I've learned from my teenagers

Lizette Borreli: Green Tea Boosts Brain Power, May Help Treat Dementia

John Ericson: Trying hard to be 'positive' but never succeeding? Blame Your Brain

The Kosher Gourmet by Julie Rothman Almondy, flourless torta del re (Italian king's cake), has royal roots, is simple to make, . . . but devour it because it's simply delicious

April 14, 2014

Rabbi Dr Naftali Brawer: Passover frees us from the tyranny of time

Greg Crosby: Passing Over Religion

Eric Schulzke: First degree: How America really recovered from a murder epidemic

Georgia Lee: When love is not enough: Teaching your kids about the realities of adult relationships

Cameron Huddleston: Freebies for Your Lawn and Garden

Gordon Pape: How you can tell if your financial adviser is setting you up for potential ruin

Dana Dovey: Up to 500,000 people die each year from hepatitis C-related liver disease. New Treatment Has Over 90% Success Rate

Justin Caba: Eating Watermelon Can Help Control High Blood Pressure

The Kosher Gourmet by Joshua E. London and Lou Marmon Don't dare pass over these Pesach picks for Manischewitz!

April 11, 2014

Rabbi Hillel Goldberg: Silence is much more than golden

Caroline B. Glick: Forgetting freedom at Passover

Susan Swann: How to value a child for who he is, not just what he does

Cameron Huddleston: 7 Financial Tasks You Should Tackle Right Now

Sandra Block and Lisa Gerstner: How to Profit From Your Passion

Susan Scutti: A Simple Blood Test Might Soon Diagnose Cancer

Chris Weller: Have A Slow Metabolism? Let Science Speed It Up For You

The Kosher Gourmet by Diane Rossen Worthington Whitefish Terrine: A French take on gefilte fish

April 9, 2014

Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?

Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Kim Giles: Asking for help is not weakness

Kathy Kristof and Barbara Hoch Marcus: 7 Great Growth Israeli Stocks

Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease

Sabrina Bachai: 5 At-Home Treatments For Headaches

The Kosher Gourmet by Daniel Neman Have yourself a matzo ball: The secrets bubby never told you and recipes she could have never imagined

April 8, 2014

Lori Nawyn: At Your Wit's End and Back: Finding Peace

Susan B. Garland and Rachel L. Sheedy: Strategies Married Couples Can Use to Boost Benefits

David Muhlbaum: Smart Tax Deductions Non-Itemizers Can Claim

Jill Weisenberger, M.S., R.D.N., C.D.E : Before You Lose Your Mental Edge

Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease

Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear

The Kosher Gourmet by Marlene Parrish A gift of hazelnuts keeps giving --- for a variety of nutty recipes: Entree, side, soup, dessert

April 4, 2014

Rabbi David Gutterman: The Word for Nothing Means Everything

Charles Krauthammer: Kerry's folly, Chapter 3

Amy Peterson: A life of love: How to build lasting relationships with your children

John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet

John Ericson: Why 50 million Americans will still have spring allergies after taking meds

Cameron Huddleston: Best and Worst Buys of April 2014

Stacy Rapacon: Great Mutual Funds for Young Investors

Sarah Boesveld: Teacher keeps promise to mail thousands of former students letters written by their past selves

The Kosher Gourmet by Sharon Thompson Anyone can make a salad, you say. But can they make a great salad? (SECRETS, TESTED TECHNIQUES + 4 RECIPES, INCLUDING DRESSINGS)

April 2, 2014

Paul Greenberg: Death and joy in the spring

Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?

Mayra Bitsko: Save me! An alien took over my child's personality

Frank Clayton: Get happy: 20 scientifically proven happiness activities

Susan Scutti: It's Genetic! Obesity and the 'Carb Breakdown' Gene

Lecia Bushak: Why Hand Sanitizer May Actually Harm Your Health

Stacy Rapacon: Great Funds You Can Own for $500 or Less

Cameron Huddleston: 7 Ways to Save on Home Decor

The Kosher Gourmet by Steve Petusevsky Exploring ingredients as edible-stuffed containers (TWO RECIPES + TIPS & TECHINQUES)

Jewish World Review

The biggest retirement myth ever told

By Morgan Housel





Don't wax nostalgic for the past, understand it. More importantly, do something constructive


JewishWorldReview.com | One of the darkest risks facing America is that so few of us are prepared for retirement.

It's shocking, really. According to ConvergEx Group, "Only 58 percent of us are even saving for retirement in the first place. Of that group, 60 percent have less than $25,000 put away ... a full 30 percent have less than $1,000." According to Nielsen Claritas, Americans age 55 to 64 have a median net worth of $180,000 -- less than they'll likely need for health care spending alone during retirement.

I recently asked Joseph Dear, chief investment officer of CalPERS, one of the world's largest pension funds, whether America was ready for retirement. Without delay, he snapped: "No!"

We have a retirement problem. A very serious one that shouldn't be discounted.

But it is nothing new. Same as it ever was

The notion that these challenges are new -- that there was some golden era when Americans were prepared to kick up their feet and enjoy retirement in financial security -- is a myth. By some measures, retirees are in a better position today than at any other time in modern history.

Let's start with something simple. The entire concept of retirement is unique to the late-20th century. Before World War II, most Americans worked until they died.

For most of us, I think the nostalgic sense of America's golden era of retirement is set between the 1950s and the 1990s. That, we often hear, is when workers had pensions and were able to retire with security. But as much as twice the percentage of men were still working into their elderly years back then compared with today.

The truth is, the 20th century was brutal for most elderly. As Frederick Lewis Allen writes in his 1950 book, "The Big Change": "One out of every four families dependent on elderly people and two out of every three single elderly men and women had to get along in 1948 on less than $20 per week ($193 in today's dollars)."

There are a couple of reasons for this. First, those retiring in the 1940s, 1950s and 1960s were in their prime earning years during the Great Depression. Not exactly fertile ground for saving.

More importantly, Social Security used to pay out much smaller benefits, even adjusted for inflation.

When Ida May Fuller cashed the first Social Security check in 1940, it was for $22.54, or $374 in current dollars. Today, the average monthly benefit in real (inflation-adjusted) terms is more than three times larger. Since payouts are set with a calculation based on wage growth, not just price inflation, real Social Security benefits have risen consistently over the last half-century.

But hold on, I hear you say. Didn't workers have private pensions to rely on in previous decades?

Some did, yes. But only a minority. There has never been a time in American history when the majority of retirees took in income from either a private or public pension (outside of Social Security). Nothing close to it, in fact.

Nevin Adams of the Employee Benefit Research Institute tells the story: "Only a quarter of those age 65 or older had pension income in 1975 ... The highest level ever was the early 1990s, when fewer than 4 in 10 (both public- and private-sector workers) reported pension income."

Mr. Adams continues: "In other words, even in the 'good old days' when 'everybody' supposedly had a pension, the reality is that most workers in the private sector did not."

Here's what's really interesting. In 1975, 15 percent of all income reported by those 65 and older came from pensions, according to Adams. By 2010, that figure actually increased, to 20 percent.

The bottom line, Adams writes, is that "even when defined benefit pensions were more prevalent than they are today, most Americans still had to worry about retirement income shortfalls."

As a matter of fact, retirees had a lot more to worry about in past decades than they do today.


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The Census Bureau's measure of poverty -- based largely on how much of a household's income is devoted to basic food necessities -- for those age 65 and up has plunged since the 1960s, continuing to fall even during the financial crisis.

By this metric -- and I struggle to think of a more complete measure of financial well-being than poverty -- those age 65 and up have never been in better financial shape.

What about age?

The most common rebuttal to what I've presented so far is likely that we're living longer today than we were in the past. So, even if retirees have higher incomes and more security today, they need it because they have to finance a longer retirement.

There is some truth to this, but probably less than many assume.

While there has been tremendous progress in life expectancy over the last century, most of the gains have come to the young.

According to the Centers for Disease Control's actuary tables, someone born in 1950 could expect to live to age 68.2, while someone born in 2010 could expect to live to 78.7.

That's extraordinary: An extra decade of life expectancy gained inside of two generations.

But the gains have been much smaller for those who survive into their retirement years. A 65-year-old in 1950 could expect to live 14 more years, while a 65-year-old in 2010 could expect to live another 19 years. The gains continue to diminish from there. A 75-year-old in 1980 (the earliest we have data on for that age group) could expect 10.4 more years of life. Today, they can expect another 12 years -- a gain of a mere 1.6 years.

Just like the good old days

Let me clearly state what these statistics do not show. They do not show that Americans are prepared for retirement, or that there is no retirement crisis.

There is a retirement crisis. But there always has been one.

The lack of savings is a grim problem that will affect millions of Americans for decades to come. But that's nothing new.

Most retirees will have to cut back on their standard of living. But they always have.

Many will be reliant on Social Security. But that's been the case for decades.

"When all is said and done," Adams writes, "we're all still challenged to find the combination of funding -- Social Security, personal savings and employment-based retirement programs -- to provide for a financially satisfying retirement."

"Just like in the 'good old days.'"

(Morgan Housel doesn't own shares in any of the companies mentioned in this article.)

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Morgan Housel, a columnist at The Motley Fool, is a two-time winner, Best in Business award, Society of American Business Editors and Writers and Best in Business 2012, Columbia Journalism Review.


Previously:


He's rich, smart and old: Listen to him

Admit it: No one has any idea what's going on

Gold collapse: The start of something big?

BAD NEWS: EVERYONE IS RIGHT!

Twitter: The carnival barker of investing

Warning: Don't waste your capital being fooled by profit prophets

25 important things to remember as an investor

New paradigm for both drivers and car companies

Biases that make you a bad investor

Nine financial rules you should never forget

Gaining from financial destruction

How to read financial news

Housing: Partying like it's 1925

A rebuttal to student loan horror stories

CONGRATULATIONS: We just saved half a trillion dollars

End this crazy tax: It will boost the economy

Medicare: A dangerously good deal

Economic future looks bright

The Biggest Threat to Your Portfolio (It's Not What You Think)

Bond Market Bull Run dead at 30



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