Average net worth of Americans -- this is a joke, right?

[steveo73]

@steveo - I take it you mean when *unfunded* pensions are on the way out? In the UK, anyway, funded pensions (i.e. defined contribution pots invested in stocks and shares) have risen sharply because of auto enrollment by the government.

In Australia everyone who works should be contributing to Super without getting to touch it. It adds up to about 10% of your salary. I think it's going to rise to 12%. That money though goes into a pool of money invested by super companies in like you state stocks and bonds as well as other assets. The super companies are predominantly very good in that they invest predominantly in low cost index funds and charge low fees. These companies won't be providing set pensions going forward. You will be able to spend based on what you have saved and the returns made.

In the past though people received pensions. My dad for instance gets about $50k per year from his pension. These pensions are funded out of government funds - i.e. taxpayers. These pensions have to go as the government simply cannot afford to fund this in an ongoing capacity.

I assume that we are basically stating the same thing but let me know if we aren't.

[Ydobon]

We're saying the same thing, definitely.

[El Duderino]

Zalo, I was also really surprised by how low the figures were, so it's not just you. And that was even taking into account your 'this is a joke, right' part of the subject before clicking the link.

As Dragline and sclass have said, I'm giving people too much credit and just sort of assume that since they don't complain about money all the time, they're doing fine and prospering. I guess being that optimistic about their ability to keep their shit in order is a mistake.

This probably applies to a lot of stuff though. I see advertisements all the time and think to myself, 'Who the hell is that going to work on?' Well, the average idiot, of course.

For example, walking past a SuperDry store today, I saw they've got a new clothing line sponsored by Idris Elba. In my opinion, that's Idris selling/cashing-out on his fame and while I understand why he might do that, it lowers my opinion of an actor I liked because he's allied himself with a over-priced tacky brand. No big deal, life goes on. It's certainly not as douchey, poseur and unintentionally funny as Johnny Depp's hilarious Sauvage cologne with Dior. Maybe it's just me because I've spent a lot of time walking through the bombardment of advertising and in-your-face-ness of duty free shops lately. But anyways, based on this conversation about NW, I'm probably dramatically underestimating the number of average idiots in super-dry clothing who are moist with anticipation to pay £15-£35 for a simple t-shirt from SD with the letters 'IE' silk-screened on it. (link if you think I'm kidding) ...or £450 ($645) for a leather jacket. Good lawd!

[Egg]

It's certainly not as douchey, poseur and unintentionally funny as Johnny Depp's hilarious Sauvage cologne with Dior.

I had a sniff of that last time I went through Duty Free. I don't actually use cologne, but I thought it smelt nice. Whether there's a link between those two things, I don't know...

[Sclass]

For example, walking past a SuperDry store today, I saw they've got a new clothing line sponsored by Idris Elba. In my opinion, that's Idris selling/cashing-out on his fame and while I understand why he might do that, it lowers my opinion of an actor I liked because he's allied himself with a over-priced tacky brand. No big deal, life goes on. It's certainly not as douchey, poseur and unintentionally funny as Johnny Depp's hilarious Sauvage cologne with Dior. Maybe it's just me because I've spent a lot of time walking through the bombardment of advertising and in-your-face-ness of duty free shops lately. But anyways, based on this conversation about NW, I'm probably dramatically underestimating the number of average idiots in super-dry clothing who are moist with anticipation to pay £15-£35 for a simple t-shirt from SD with the letters 'IE' silk-screened on it. (link if you think I'm kidding) ...or £450 ($645) for a leather jacket. Good lawd!

This Superdry place is outrageous. My jaw dropped. Idiot consumers. WTF!

[oldbeyond]

A lot of market liberals around here constantly go on about how great things would be if social programmes were abolished and taxes were lowered. A glorious nation of savers! Seems to me looking at real world data(both here and in other countries) that the likely outcome would be a spike in sales of SUVs, vacations and new kitchens coupled with very modest savings. Basically, a lot of americans seem to be as broke as the average swede, without the social safety net to back it up. But in the long run I guess we're all dead...

[steveo73]

A lot of market liberals around here constantly go on about how great things would be if social programmes were abolished and taxes were lowered. A glorious nation of savers! Seems to me looking at real world data(both here and in other countries) that the likely outcome would be a spike in sales of SUVs, vacations and new kitchens coupled with very modest savings. Basically, a lot of americans seem to be as broke as the average swede, without the social safety net to back it up. But in the long run I guess we're all dead...

I'm more of a market liberal than a socialist but you are 100% correct. People in general have no idea when it comes to saving for their futures.

[Peanut]

@el Duderino: But that jacket is worth every penny. On him, anyway

And actually I don't think he primarily did it for the money. It's more about establishing himself as an aspirational man of style... so maybe he'll be the face of Dior next year after they get tired of the vampire milksop they've got.

@thread: Back to the topic, I agree some people really don't need much savings when they have a pension they will collect. For example, 60k/yr for a firefighter is worth 2 mil in the bank.

And one thing notable to me about various measures I've seen is just how much money is concentrated at the top. You need millions to break into the top 5% in net worth after 30. You need to earn over 150k to break into the top 10% of earners, etc.

[JeanPaul]

The US and UK are uniquely bad, but other countries aren't great: http://piketty.pse.ens.fr/files/capitalisback/F140 (ignore the crappy y-axis)

[Ydobon]

The US and UK are uniquely bad, but other countries aren't great: http://piketty.pse.ens.fr/files/capitalisback/F140 (ignore the crappy y-axis)

Wow - the Japanese really like saving!

[SimpleLife]

Most people are morons. Once you've been a landlord it REALLY sets in. I am amazed some of my prospective tenants can figure out which shoe goes on which foot.

There is a reason most of these people are broke as a joke. I showed one of my rentals to a guy and his two apparent room mates; he tried to talk real big about how he has his own house, telling me what to do. Turned out he was crashing on the couch of his cousins house. I declined to rent to him on account of his stupidity and arrogance, not to mention bad credit he neglected to mention.

[TopHatFox]

@SimpleLife, if I were to be honest with myself, I'd wholeheartedly agree that the average person acts in a way which seems counter-intuitive to me and you; but then, is it because they are genetically less intelligent, had different access to education, or simply value different factors than us? For example, I know one person that is readily in debt, but is rather adept at memorizing and performing quotes from their favorite sitcoms.

I also know that placing negative labels on the majority of humanity (the 80 of the 20) is often detrimental to my state of mind; it instills a sense of anger, superiority, and frustration in my way of thinking and interacting with people. Instead, I try my best to practice patience while learning and sharing what I can with each human. I further surround myself with the people that offer a similar--or especially, higher--level of appropriate value, competence, and inspiration.

[SimpleLife]

@SimpleLife, if I were to be honest with myself, I'd wholeheartedly agree that the average person acts in a way which seems counter-intuitive to me and you; but then, is it because they are genetically less intelligent, had different access to education, or simply value different factors than us? For example, I know one person that is readily in debt, but is rather adept at memorizing and performing quotes from their favorite sitcoms.

I also know that placing negative labels on the majority of humanity (the 80 of the 20) is often detrimental to my state of mind; it instills a sense of anger, superiority, and frustration in my way of thinking and interacting with people. Instead, I try my best to practice patience while learning and sharing what I can with each human. I further surround myself with the people that offer a similar--or especially, higher--level of appropriate value, competence, and inspiration.

I came from the absolute BOTTOM. Success is a choice. Yep, I got loans to go to undergrad. I had enough money to pay that money back before I even graduated before finishing my program. Why? Because I put in the work to learn skills that built my IT career. Now, I own an ass ton of real estate, and am paying for my MBA program in cash.

Yet I see broke prospective tenants with bankruptcies and they drive cars nicer than mine, have the latest phones, clothes, and go out dinning all the time then go back to their low end job after partying it up. The difference is I was teaching myself skills to get a higher paying job and a degree while they were living it up. Now I'm the landlord, and I'm still living frugal to invest in income producing assets, while they party every weekend.

[Scott 2]

If you both get hit by a bus tomorrow, that tenant who parties every day will feel justified in their choices.

I can appreciate the mentality that leads to saving nothing. If you don't believe you'll live past XX, or you know the government's going to take it anyway, better to consume now!

[Spartan_Warrior]

Maybe it's just me, but there seems to be an inherent disconnect between the reality that most people are morons and the idea that success is a "choice" (implicitly, a choice that even morons can make and/or execute).

[GandK]

Maybe it's just me, but there seems to be an inherent disconnect between the reality that most people are morons and the idea that success is a "choice" (implicitly, a choice that even morons can make and/or execute).

It's not just you. The older I get, the more I feel this way. I don't think I'd go so far as to call most people morons, but a surprisingly high number of the people I brush up against in my daily life are incapable in some way. Incapable of restraining themselves, or of planning and executing, or of finding the information they need when they need it. The criminal cases that my husband handles alone make me worried about Average Joe's prospects. (And those are just the handful of people who got caught.) Both socially and financially, that leaves the rest of us planning for their success, too.

[EdithKeeler]

t's not just you. The older I get, the more I feel this way. I don't think I'd go so far as to call most people morons, but a surprisingly high number of the people I brush up against in my daily life are incapable in some way. Incapable of restraining themselves, or of planning and executing, or of finding the information they need when they need it. The criminal cases that my husband handles alone make me worried about Average Joe's prospects. (And those are just the handful of people who got caught.) Both socially and financially, that leaves the rest of us planning for their success, too.

I was remarking on that to a coworker just recently--we see this in our job all the time. I am constantly amazed how at how HELPLESS some people are when faced with a crisis. Their car is wrecked, and they have no idea how to even rent a car; a person's house has minor water damage from an incident and they are completely clueless what to do about repairs. You don't know how many times I hear "I think I'm hurt, what should I do?" Um, go to a doctor? Never mind that the don't have any financial cushion whatsoever to deal with something that comes up. It's not "smarts" that's missing--it's just simple common sense, and this expectation that "someone (else) needs to do something."

I've always been one of those people where, if things weren't going my way, I tried to fix it however I could, or make what needs to happen, happen.

And it doesn't seen to have a socio-economic basis (ie, it's not the "poor people who've had handouts") or even an age basis but it seems rampant everywhere.

[OxtheTank]

If you both get hit by a bus tomorrow, that tenant who parties every day will feel justified in their choices.

I can appreciate the mentality that leads to saving nothing. If you don't believe you'll live past XX, or you know the government's going to take it anyway, better to consume now!

True true, can't only live in the future! One of the best mental shifts for me has been changing WHAT I want. I LOVE a good Texas sunset complete with a whole pallet of colored clouds, a warm day to bike the trails, a stop at my plot in the urban garden, a meal I cooked with my own still and refined by my own experiment. It is extremely helpful when trying to meet aggressive savings goals to not feel like it is sacrificing the present. If anything, I feel more in the present now than ever!

[HopeForTheBest]

I'm surprised net worth was positive for folks under the age of 25 with so much student debt. I'm not on the ERE path either. According to filling this calculator out [moderator: link deleted] I'm about 10 times ahead of the average in my age range(I'm 33). But I'd say I'm on pace to retire when I'm 60 to 65. Nothing too sexy about that. But I won't have to worry where my next meal is coming from.

I have a grandma who retired with 100,000 dollars and social security and she makes it work and wants for nothing so I also think that its just a matter of living within your means.

[Farm_or]

@Steveo - Very interesting the Australian style of social security. A similar structure, often tagged as "privatization" of social security in the US is a frequent re-occuring campaign topic.

The mistake we made was allowing greedy, spend happy, and often corrupted politicians get their dirty hands in our SSI fund!

The media uses the term "entitlement" loosely. It was originally money that you put in that makes you entitled to take it out. They have warped the definition to cover anybody who feels the need to use YOUR money. Be careful to guard against that.