Wednesday, October 10, 2007

Money Magazine's 13 Retirement Myths

Ah, the myths of building a nifty retirement. All thirteen of them. Some are obvious, like you don't have to be rich to successfully save for your retirement. Some are depressing, like a million bucks is a fine amount to retire with if you have an, um, austere lifestyle. And then there's the strange myth about Boomers crashing the stock market. The stock market? Who cares about the stock market, what about Social Security for chrissakes? Oh, they get to that. Another myth.

Then we have the depressing part for those not-so-nine-to-fivers with PiggyBankBlues. It's a myth that you don't need a pension, but only because you need a 401k! Yikes. Time to open a Solo 401k- My Money Blog recently did a great post on it. If you file a 1099, it's a fantastic way to increase your retirement savings. (Talk to your accountant first!)

My favorite myth is "Short-term market swings don't matter":

    In any 10-year period since 1926, you'd have made money in stocks 97% of the time; over 20 years you'd be ahead 100% of the time... When you're far from retirement, you can tough out even devastating bear markets, buying low while you do.

3 comments:

Mrs. Micah said...

The article was both frightening and comforting. Depending on what money's worth, I'm sure Mr. Micah and I could live on today's $60,000/year. I mean, we live on a lot less now. But then the million then will be worth less than it would be now, hence the need to save more anyway.

PiggyBankBlues said...

i know, i was reading it like "great!", and then i'd go to the next one and it was more like "oh, crap..."

SavingDiva said...

Thanks for the heads up! I really liked this article. It just really hits home saving early and keep on saving!