Is Something Wrong Here?

Blank Statistic:
Out of 100 people who starts working at the age of 25, by the age 65:

* 1% are wealthy
* 4% have adequate capital stowed away for retirement
* 3% are still working
* 63% are dependent on Social Security, friends, relatives or charity.
* 29% are dead.

Close to home:
Yesterday my sister and I were having a conversation about a “friend”. (We’ll call her, “Harriet”.)

In the conversation, my sister started telling how, Harriet was always in a bind, and never had enough money to pay her bills.

Now, I found this interesting because Harriet had a full-time job (that’s she’s had a few years) plus she’s been in the workforce since I can remember (30+ years). So, I asked my sister, “How can she not have enough money to pay her bills? What does she do with her money?”

My sister then said, “If Harriet works 40 hours (plus some overtime) every week, barring any emergencies, she would be $50-$60 short on her living expenses. Sometimes, she can’t even afford to get her prescriptions.”

So after further digging, I found out Harriet only has the “basic” living expenses- rent, utilities, food, gas- plus cable. Now truthfully, that doesn’t seem like a lot, but something just didn’t make sense to me.

Why would someone keep working at a job that leaves you “in the hole” every month? Well, there’s a logical explanation. Harriet is set to retire in a couple of years. So, she’s want to “hang on” to draw her retirement benefits.

We all know the retirement pay is only a percentage of your regular pay, so I just naturally assumed that Harriet was going to retire from Job A and seek work at Job B. Apparently, that’s not the plan. She plans to fully retire.

Is Something Wrong Here? Am I the only someone who sees disaster on the horizon?

At full pay and benefits, you are coming up short. How are you going to manage to make ends meet with less income? Well, apparently that’s the million dollar question— still unanswered.

I hope Harriet has a lot of good (rich) friends and knows a lot of charities. Because without a different plan, she’s going to need them.

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About Admin

Erika C. Harris, founder and owner of ECHolman Group, started selling insurance as a way to supplement her income as a classroom teacher. As time passed, she noticed how uninformed/misinformed consumers were about insurance and the vital role it plays in financial security. Being passionate about both, education and money management, she decided to pursue a full-time career in financial services, with the sole purpose of teaching clients how to take control of their finances. Over time, the her agency started teaching about the role of insurance, as well as other tools- such as real estate and business ownership- as an integral part of a financial plan. Understanding how important a business is to a family’s livelihood (be it their own or their employees’), she decided to take the next step. Her agency (along with a network of partners) educate business owners on how to successfully operate their businesses and they educate consumers on how to use insurance along with real estate and business ownership as tools for building wealth.

Posted on December 14, 2010, in Uncategorized. Bookmark the permalink. 2 Comments.

  1. Hi Erika,

    Those are some interesting statistics and it’s sad that there are a lot of people like Harriet. Hopefully there’s way for her to get out of her financial problems. There’s plenty of seminars and webinars she can go to so that she can find different ways to invest and enjoy her golden years. Especially for the fact that you know her and you’re in PM. Thanks for the share!!

    Sherman

    • I agree, there is a way out of it, but you have first acknowledge there’s a problem. She’s in denial. I, and others, have offered “solutions” but in her words “… that stuff don’t work! I can’t do that!” And we both know, if the mindset isn’t there, there isn’t much anyone can do—— expect pray she changes her mindset:)

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