From: Barbara Lamar (email@example.com)
Date: Sat Feb 16 2002 - 12:03:57 MST
----- Original Message -----
From: "Robert J. Bradbury"
> ... If so
> we will be bumping average longevity from ~75 to ~90 within
> this decade, or ~15 years / decade.
Whether this happens or not, it makes sense to save some part of one's
income for retirement and self-insurance.
>"The no-brainer strategy to becoming wealthy". It requires
> taking $100-$1000 and depositing it in a savings account or
> mutual fund and never withdrawing any funds from the account
> until the annual increase in the account value exceeds what
> one reasonably needs to live in the world ...
But this is the general idea behind retirement accounts. The puzzle to me is
that everyone isn't doing this anyhow. Not merely making a one-time deposit
but putting a portion of all revenue into conservative long term
investments. This isn't a particularly good time for CD's or savings
accounts, but there are still some low-risk mutual funds that are providing
acceptable rates of return.
> It would seem that Extropians/Transhumanists should be the first
> to recognize the paradigm shift and adopt this strategy. But
> I don't see any evidence that any of these individuals that I
> know have done so.
Depending on whose figures you believe, the US had a negative savings rate
for a while. The ratio between savings and debt seems to have increased
since September, 2001. But I suspect this represents more of a decrease in
new consumer debt rather than actual savings. It would be interesting to
know whether Extropians on average save more than the population in general.
The chart below shows the personal savings rate in the United States by
January, 1990 through September, 2001. The personal savings rate measures
as a percent of after-tax income. It declined steadily throughout the 1990's
low of 0.4% in September, 2000, as consumers spent proportionately greater
of their incomes. Low interest rates, expanded credit availability, and a
general confidence in a strong U.S.
economy are among the forces behind this declining trend.
During the past few months, however, the rate has increased sharply,
climbing to 4.7% in September,
2001. This provides evidence that many people are responding to the
increasing economic uncertainty by
curtailing spending and increasing their savings.
Hard to say what effect the Enron collapse has had/will have on behavior,
other than to encourage people to diversify their retirement plans. But the
fact remains that most people in the US don't *have* retiremet plans or if
they have one, it doesn't contain nearly enough to live on. In an effort to
encourage savings, the US Congress increased the annual amount people over
the age of 50 can contribute to their IRA's and 401(k)'s.(the Restoring
Earnings to Lift Individuals and Empower Families (RELIEF) Act of 2001).
Small biz owners (less than 100 employees) note: there are provisions in the
act that apply specifically to you.
So the "interesting question" is "Why
> is this the case?"
To speculate about the underlying causes would require a book; but the short
answer is that most people are in debt up to their eyeballs and have zero
left over each month after paying living expenses and debt service.
> Possible explanations I can think of are:
> a) We don't really believe lifespan extension of more than 1 yr/yr
> is feasible
This may be true, but there's more to it than this, since people aren't
saving even for "normal" retirement years.
> b) We believe the NanoSantas will make all wealth creation strategies
I've sensed this attitude among some of the younger list members.
> d) We belive the singularity will so totally disrupt things that
> all wealth creation strategies are irrelevant.
I myself believe this to some extent. At the same time, this reinforces my
attitude that flexibility is the way to go. While I wouldn't advocate living
a life of miserable penury in order to accumulate more money in savings,
having some money set aside could be extremely helpful, as you say.
> Who wants to join the
> "I-Will-One-Day-Be-A-Millionaire Foundation?"
> and is willing to walk their talk?
Why would a Foundation be necessary or desireable?
Law Offices of Barbara Lamar
San Marcos (512) 392-4108
Austin (512) 627-8837
FAX (512) 754-8105
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