May 21st, 2019 1:44 AM by Eric Willner
Radio Show Notes 5.20.19 Monday: Saving vs. Investing? (Part 1) Real Estate is The Answer!
By Eric Willner, Host of America’s longest running Radio Show about Real Estate
Read a summary of the show below or
Saving vs. Investing? That’s the question. Real Estate is the Answer. The Real Estate Show is going to show you why! Among oldest Americans, one in five dies broke. For those who died at a younger age, the numbers were even worse. That’s why understanding Saving vs. Investing is critical, and why the biggest financial worry for anyone saving for retirement is “Will I outlive my savings and die broke?”
Unfortunately, there of been many surveys, a lot of research, and countless studies that point to dismally low levels of retirement savings, and anemic rate of savings, which is why most American households have a reason to be concerned. Most Americans do NOT understand the distinction between Saving vs. Investing.
One such report on Saving vs. Investing, and how so many Americans die broke comes from an analysis by the Employee Benefits Research Institute which was based on data from the university of Michigan’s Health and Retirement Study. It concluded that of those 85 years old or older, roughly 1 and five had no assets, other than a house. Other than a house! Yes, that’s right, nothing except for their home! A forced savings. And an investment. Were it not for real estate, they would have died it absolutely broke. It was the forced savings, and the fact that real estate is a great “automatic” investment, that they had anything at all.
The Saving vs. Investing picture gets worse for those who died single at 85 or older. Roughly a quarter had only some equity in the house, on average about $83,000. One in six had nothing! And the one in 10 died with an average debt of around $6000. That’s leaving a legacy with a minus sign. I hope that lights a little fire in your motivation to understand the difference of Saving vs. Investing. I especially hope that this puts a magnifying glass on why owning real estate is not only the path to homeownership, but it is also the path to a better retirement – and yes, a better legacy.
I could go on and on with the research and the statistics. MIT economist found that Americans die with “virtually no financial assets“. They concluded that a lot of folks really don’t have much of a financial cushion by the time they get to the end of their lives. Furthermore, for many retirees, the end of life comes with major medical costs they can wipe out any savings accumulated. But most had a little savings to begin with. They did not understand Saving vs. Investing.
What’s more, it is particularly disconcerting when you put it in to the perspective of how much money you earn in your lifetime. For example, a person who makes $10 per hour (approximately minimum-wage), and assuming no raises for their entire career, if they only worked a 40 hour week, they would earn $400 per week. If they worked 50 weeks out of the year, they would earn $20,000 per year. If they worked an average career of 40 years, that means that they would bring in $800,000. Now I must add, no one goes an entire career without earning a raise. I don’t know anyone who never worked over 40 hours or worked substantial overtime. I also know a lot of people who don’t take vacations and work 52 weeks out of the year. So it’s easy to see that most of us will earn over $1 million in our lifetimes, and yet do not know Saving vs. Investing.
In fact, do exactly the same mass at $20 per hour on average during a career, and still a relatively low number in the reality of today. $20 per hour times 40 hours per week times 50 weeks per year equals $40,000 per year. $40,000 times 40 years would equal $1.6 million in lifetime earnings. Yet we have the statistics above. Most people have very low financial assets at the end of their life and have been bumping along with low assets throughout most of their retirement. It doesn’t have to be that way! Together we can change that! And yes, I am definitely going to talk real estate. That’s because real estate is by far, the best solution to this problem. And it starts with homeownership. And that’s why I am going to keep referring to our special website www.90dayfreshstart.com – regardless of credit scores, or down payments. Go check that website out now, And tune back in again tomorrow for a continuation of today’s incredibly important topic: Saving vs. Investing.
Do these things, and transform your retirement years into the income source you dreamed of. Find out more on today’s episode and learn more about Real Estate Investing and learn HOW by listening to The Real Estate Show with Eric Willner , Live every weekday morning at 8 o’clock (EST) on Florida’s Money Talk Radio station WSBR AM740, FM 96.9, and FM 103.9. You can also hear us on the free apps: iHeart Radio and TuneIn. Recorded Rebroadcasts are available 24/7 on Facebook. Please share our Facebook updates.
Also listen to the rebroadcasts on demand on Facebook.com/TheRealEstateShow
Then check out these EXTRA cool resources:
90DayFreshStart.com for The Steps to Homeownership for Everyone
TimeToFixMyCredit.com for Financial Education and Credit Improvement
AutomaticLandlord.com for Landlording and Real Estate Investment
MackBuysHouses.com for a fast cash offer on Real Estate
MackSellsHouses.com for great deals on Real Estate Investments
MackBargainHouseHunters.com to Partner on Real Estate Deals
Eric Willner is the Host and Founder of The Real Estate Show, an informative show about how to buy, own, and improve real estate the right way. You can reach Eric Willner at Eric@Ericwillner.com or 888-595-7779.
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