Is This The American Dream?

american dream

In my previous life as a “financial guy”, I used to do weekly recruiting presentations, attracting new reps into my financial services agency.

I did it every single week on Tuesdays, at 7:30pm at our office for over 10 years. And every Saturday, for about 4 years. Although it’s been a decade since my last one, I can still probably do most of it by heart :).

One of the slides I did showed some depressing statistics about what happens to people in United States, at the ripe age of 65, when they’re supposed to be enjoying their “golden years.”

According to the Department of Labor, out of 100 people at age 65:

  • 54 are depended on others in addition to Social Security
  • 36 are still working some kind of a job because Social Security is not enough
  • 5 are dead
  • 4 are doing ok financially or better
  • 1 is rich

That’s pretty depressing don’t you think?

In fact, if we had around 100 people in the room, I would point out that only 5 of you are going to be doing ok or better financially. The rest will either be dead, dead broke or still working.

And if there were less than 100, than it’s possible that none of you in the room might make it financially. Which is true by the way.

Anyways, these stats are from the 90’s, but here are some fresh new statistics from Motley Fool:

retirement savings

  • The average American retires at age 63.
  • The average retirement lasts 18 years, but many last much longer.
  • You’ll need $1,060,751 in savings if you expect to draw $5,000 per month for 30 years, assuming 6% annual investment returns and 2% inflation. Depending on how much income you expect from your savings, adjust this amount higher or lower to come up with your retirement “number.”

Americans know they won’t have enough money, but still won’t save. The vast majority of those in the prime of their careers are aware they have a problem with their retirement savings. They’re right.

  • The average 50 year old has $42,797 saved. If you look at the retirement “number” from the previous section, it’s easy to see that this isn’t even close.
  • The average net worth (assets minus debts) of a 55-64 year old is $45,447.
  • 45% of Americans have saved nothing for retirement, including 40% of Baby Boomers.
  • 38% don’t actively save for retirement at all.
  • 20% of Americans tap into their 401(k) assets early, either through a loan or withdrawal.
  • 80% of Americans between the ages of 30 and 54 believe they will not have enough saved for retirement.

social security statsA little about Social Security, which should be a supplement, not your only income source in retirement.

It was never intended to be a sole retirement plan, but a supplement to other sources of retirement savings. Still, many Americans end up dependent on it.

  • 36% of American adults over 65 are completely dependent on Social Security.
  • 63% are dependent (but not necessarily completely reliant) on Social Security, relatives, friends, or charity at age 65.
  • Social Security is running out of money, and will only be able to cover 77% of promised benefits beginning in 2034.

So… the bottom line is – unless you are proactive about securing your future, no one else is going to do it for you.

But you already know that, don’t you? Otherwise you wouldn’t be reading this.

The way I see it, there are 2 ways to get there.

1. Pay yourself FIRST – save and invest like crazy.

2. Start a business.

You should do #1 either way. But being in business for yourself you stack the odds of making more money in your favor.

It’s easy to say “pay yourself first”, but it ain’t so easy to do. Not when everything costs a lot of money. And especially if you have kids.

While most people say – “I can’t afford this”, as an entrepreneur you have the luxury instead to ask – “HOW can I afford this?”

And while the world says that 8 out of 10 businesses fail in the first year, that’s only part of the story. The other part is that every successful entrepreneur has failed more than once before hitting a home run. But with your own business at least you have that chance.

Every day you get to walk up to the plate and pick up the bat. How many times you take a swing is totally up to you.

One of my all time favorite success quotes is…

“You’ll miss 100% of the shots you don’t take.” – Wayne Gretzky

So take as many shots as it takes, because you don’t need to score that many to win the game of money.

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Vitaly Grinblat has over 20 years of experience in sales, marketing and advertising. Including running his own financial services agency for over 10 years. Since 2005, he has created a number of information products online, as well consulted with and designed advertising campaigns for private clients, generating over $10,000,000 in sales.

Currently Vitaly is involved in a number of businesses and projects including creating marketing campaigns for a large publication company, running an e-commerce business, a nutraceutical company and Success Thread.

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