Songs with the word “Believe” in the title.

Tune in today, January 4th, to Volume 106, 7 PM East, 4 PM West.

Phone #: 844-6-VOLUME, 844-686-5863

Twitter: @lefsetz or @siriusxmvolume/#lefsetzlive

Hear the episode live on SiriusXM VOLUME: siriusxm.us/HearLefsetzLive

If you miss the episode, you can hear it on demand on the SiriusXM app: siriusxm.us/LefsetzLive

Kids between 18 and 25 are on the internet making money. Between You Tube Channels, Tik Tok, Instagram and of course Only Fans, they are making either enough money to support themselves, or they are making bank, as many women on Only Fans are doing. According to the NY Post, Only Fans Stars make 270 times more than the average worker. Yes, they are showing their goods and performing sex scenes that would make Debbie from Dallas blush, but they’d rather do that then work at Subway. Can’t blame them. It’s safe prostitution from the comfort and security of their own home. Big $$$.

Then you have the girl on Youtube who plants a camera in front of slot machines that she plays and records her wins. She plays nothing but high limit slots, betting $100 per spin in the more glamourous casinos around the country and records her huge jackpot wins. She makes $40-50k per month from You Tube.

Meanwhile, my business is tied to advertising, and I just had the worst year in the last 6 years. Many small businesses and even big ones have closed now that the government money has run out and people don’t want to work. Talk about trickle down economics!

Keith Michaels

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Excellent insights but the biggest thing of all is the number or rich and super-rich people GLOBALLY.

Yes, they buy up all the properties and don’t live in them for one reason- they have to have somewhere to put their money! And, they don’t care about anyone except themselves and other rich people they want to impress. The shallowness is pathetic.

That’s why NFTs are so popular. And the market keeps roaring. They have to put their money somewhere.

But they have no hearts. They are everything we hated in the 60s. And it all took off with Reagan, Thatcher, and “greed is good”.

John Parikhal

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Great snow here in Sun Valley but we are short handed too, and for the first time, we are facing a housing crises too, for the workers.
Pretty large Hispanic community here. Wonderful folks. Incredibly hard working, landscaping, stone work, construction workers. Industrial as all hell and yes, they vote Republican.

John Hummer

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First off it’s ludicrous as the Vail Corp owns Heavenly and yesterday there wasn’t a parking space within a mile of the Tram or the chair going up Gun Barrel.

Now we’re talking $200.00 a fucking day for a day ski pass this year.

The lines are forever and it’s “Hatchet Hill” on the mountain with people who can’t ski and there must be at least 30-40,000 people on the mountain yesterday.

3/4ths of them are not season pass holders! So that means they made a cool 6 Million Dollars yesterday.

And they want to pay them the Mc Donalds everyday worker pay rate?    KRAZY!

Val Garay

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Well yes, of course.

And it’s not just the eVail Empire (I wish it was, but it’s not) – there are trails here at Deer Valley that have huge mounds of previously man-made snowgun snow plus six feet of natural snow over the past 10 days, trails still not opened.  Despite record holiday crowds.  It has to be a shortage of workers, presumably to either wage issues or COVID positive tests.  And, yes, the lack of employee or even affordable workforce housing is definitely part of it – in every ski town this winter.  Restaurants are shortening hours, closing 2 or even 3 days a week – not enough workforce.  Resort executives are out from behind their desks these days, helping out on the front lines of customer service.

Oi…

Toby Mamis

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It’s so interesting that in the span of a couple of days, you bemoan how you fear a Xi in power here in the States, then wonder how to change the corporate greed in America.

We need a Xi. Yes, he’s a maniacal psychopath who’s wrong about a lot of things, and he’s a danger to free speech around the world. But he gets one thing very right: He sees that Chinese companies were siphoning profits for themselves, and not paying the people their worth. And he would not stand for it. Hence Common Prosperity. High profit margins will not be tolerated, and this will lead to a more prosperous Chinese people over time.

As long as institutional Wall Street investors reward stinginess towards US employees (and what will make them realize this will be harmful to society until they can buy the wreckage for a song?), then nothing will change. We need someone in power to put their hands firmly on the throats of business and say, “No. You will not withhold profits from the people.”

You know corporate executives are cutthroat and only speak languages of money and power. And sometimes, you need to speak to them in a language that they understand.

Take care,
Michael Ball
Kensington, MD

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As a 66 year old career corporate marketer educated sociologist this is dead on. Reminds me of our late sixties but we sold out. Not sure this young group is ever going back.

Renee Emmett

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I feel similarly.  After watching that Ted Koppel piece a while back, I was so depressed.  Not mad, not ‘incensed,’ but exhausted and defeated.  It’s a goal to keep plugging away, to try and get to a more humane place in this country, citizen by citizen.  God willing.

Chris Schmidt

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But what of Citizens United? Dark money organizations are buying elections now. Creating communes or kibbutzim is the only way, it seems. Many of my Millennial peers feel this way. This is the best option we’ve got. Screw the system, we’ll make our own.

CANCEL STUDENT DEBT!!!

– M.C. Eshed

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Just left beaver creek.  Where many of the lifts were not open.    35 years never saw larkspur closed until now .  I am  right of you but also thought DONT LOOK UP was great . Could have been been either party playing the bs game at the top.   System is broken . If Biden is your savior we are all in trouble.

John Huie

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Even the Post Office has ceased drug testing for newbies…

Dave Smith

Healdsburg

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Thought you might be interested in reading this opinion piece from the Globe and Mail here in Canada. Terrifying to think about:

“The American polity is cracked, and might collapse. Canada must prepare – The U.S. is becoming increasingly ungovernable, and some experts believe it could descend into civil war. What should Canada do then?”

https://www.theglobeandmail.com/opinion/article-the-american-polity-is-cracked-and-might-collapse-canada-must-prepare/

Ken Kelley

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Your analysis of the ski resort worker shortage leaves out a crucial element that led to the current employment situation, government interference in the form of seasonal worker visas kept wages artificially low. Ski resorts used to be financial centers for communities and that included employment. However, instead of raising wages with profits, inflation etc resorts elected to keep wages suppressed with the government-provided handout of the H2 and H2b visas. This meant that residents no longer looked to the resort for employment and it made it difficult for new arrivals to establish roots or move beyond a ski bum level of subsistence. The wages are still artificially low and have not risen to what the demand would dictate because they are starting so far behind. For example: Does anyone think that $15/hour reflects what a ski patroller in the west should be getting with all the training and avalanche mitigation they do?

Tag Gross

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25$ isn’t going to cut it for those 19-34 years old, the age group where that service worker base comes from

Home traders saddled up in 2020-2021 and turned their stimulus and bumped up unemployment benefits into playing with house money – bartenders are up 150k or more with the FAANGs and Tesla since March 2020

Until the equity bubble bursts,

Dennis Pelowski

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Housing.  It’s all about housing at Mammoth, Park City, Tahoe, etc.  If they can’t find an apt. an hour from the resort, it’s 90 minutes away.   And the resorts are hiring without housing so they show up and leave after a few weeks.  Anything near the hill is $5-7k a month.

A friend ran for Park City Mayor in the last cycle and this was his number one item. As always, a long time local won the race who’s only interest is in vanity projects like a film center.

Not to mention the transportation troubles at the resorts like PC, bumper to bumper on the road with a 10% ridership on buses.

Sad to see.

Lesley Bracker

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I truly enjoy reading your newsletter every week.Thank you for expressing a valid point about how the workplace dynamic has changed within the last two years and how people are opting to stay home.It is true that many will not return to work and that companies across various fields are understaffed. I have several friends that are business owners and have complained that they simply cannot find employees that are “hungry” these days and are willing to put in the same amount of effort and hard work into their job. For many of these employers, it seems to be a common problem within the last two years. A lot of the younger kids in their 20’s just want to stay home because they want to focus all of their energy on becoming “influencers” on their social media instead of going after starter jobs and growing at a company. I have personally been told this by a handful of them.They quickly learned that if they stick it, they have the potential to make money from ads on their Tik Tok and on their Youtube channels, etc. As a musician, I have nothing against either platform. I think that they are wonderful promotional tools and can be used to reach audiences. However, it seems that as an artist, it is simply just not enough to create great music with integrity and work hard as a live performer. Now, we need to evolve into Tik Tok experts or go through the sausage factory of singing competition shows in order to compete with the market and build a fan base. I often ask myself if Freddie Mercury, Michael Jackson, or Bob Dylan would have done American Idol or The Voice. In my humble opinion, artists are supposed to be system busters and disturb the peace rather than cooperate and comply with the streamlined  process of being a vocal technician on a TV Show. Is rebellion not the entire essence of what Rock and Roll is and the very fabric that makes an artist? I understand that we must evolve, and use these platforms to our advantage, but  true grit and artistry maybe the casualties that we may lose along the way… Just thinking out loud.

Best,

Ana Cristina Cash

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Great email, Bob. Here’s an article that parallels all of this:

“Western ‘Zoom Towns’ Take Aim at Short-Term Rentals”

https://www.pewtrusts.org/en/research-and-analysis/blogs/stateline/2021/12/23/western-zoom-towns-take-aim-at-short-term-rentals

Micah Hulscher

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A lot of us locals saw the Stevens Pass mess coming.

Despite being an outdoorsy hub for the country, Washington State only has a handful of developed ski areas within 3 hours of a major city. And none of them have the real estate holdings/ski town/resort development that you’d find in Tahoe / Colorado / Sun Valley / WY or MT. They are all bare bones, day resorts with no room for expansion. Some have an RV lot. That’s about it. Most don’t even have enough parking spaces for full capacity.

It’s clear that Vail’s acquisition of Stevens was just a quick way to sell Epic passes to thousands of affluent Seattle outdoor enthusiasts. There were no other local resorts they could acquire… it was the no-brainer option to tap into our market. It worked, in spades. They sold a ton of passes to people who never would have acquired “a season pass” before. The problem is there’s just not a lot a corporation like Vail can do to improve or develop anything to return their investment. All they can do is cut costs (which they’re clearly doing) and encourage passholders to try their other resorts. First canary in the coal mine was the Stevens mountain bike park: Took years to develop, had lots of local goodwill (the only lift served bike park in the entire state), and they never even bothered to open it during the summer. That’s a small segment of the outdoors market, but now we’re seeing the full effect.

The other problem seldom mentioned when it comes to these mega passes: Ski bums used to take a shitty, near-minimum wage job to get free ski passes and cheap pro-form (at cost) gear. 20 years ago, a good pass at a ski resort cost a $1000+ / year, easily. Day passes were under $50. A season pass never paid off unless you skied 30+ days and/or worked for the resort. Now that day tickets are ridiculously pricey ($200+ at some resorts per day) and Epic passes are a paltry $600-ish and payable via installment plans over the summer, the math is totally off. Why make that winter commute to work at a Vail resort, get paid peanuts and be treated like crap when you can deliver a few weeks for Amazon or Uber Eats in the summer from the comfort of your own car and swing a pass? No loading chairs in the freezing cold or cleaning shitty bathroom stalls in some resort basement to earn your pass while getting minimum wage. It’s no wonder they can’t find anyone willing to work. They need to pay competitive rates and treat employees well, and they haven’t been. The non-Epic and mom & pop ski areas in WA (which do all pay better, have a good reputation, and offer easier commutes for the locals) are nearly 100% operational, even with COVID.

It’s clear we probably won’t get any new ski resorts built in our country, esp. with climate change making it the shiitiest of long-term investments. I just hope they can figure out this mess – or sell Stevens off quickly – so Seattle-ites can enjoy it for the next 10-20 years (or however long there will be low-elevation snow in N. America) the way it used to be.

All of this is a mere microcosm to bigger issues plaguing our country, but I’m a Seattle skier not an economist, so this hits close to home.

Jason

—

Jason Verlinde
The Fretboard Journal / The Truth About Vintage Amps podcast

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Great piece!  The country needs some Organizers.

All the best in 2022!

Craig Fuller

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Do you know about the Rivian EDV that Bezos has invested so heavily in? He ordered 100,000. 10k/year for a decade. They are autonomous-ready.

Everyone at Amazon is merely a training paradigm for automation. The drivers are teaching the robots how to do their routes. In 20 years there will be no humans at Amazon.

Ever been to an Amazon facility? They are gigantic. Right now in Portland, two stages of a three-stage build are complete.

We really need to create a publicly owned union that controls all the robots and redistributes the money they make to the humans they displace. This is the only way to prevent violent anarchy in the near-future.

This is why I keep saying that America needs to convert itself into a Technocratic Social Democracy. I truly believe this eventual outcome is a certainty. Technology is going to erase capitalism.

I’m all for it. We are in a race against time. We need this cultural paradigm shift before the failed economic systems of old cause another violent civil war. We need to embrace MMT (Modern Monetary Theory) as a stepping stone to robot slavery. The huge question is who are the ethicists in control of the robot programming?

Kieron McKindle

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It’s ‘minimum wage’ not ‘mandated wage’. Employers can pay as much as they want, they just can’t pay less than the minimum. If they want to hire people, if they want a viable business, they may have to pay people more. Or they can buy some robots – that’s actually not science fiction anymore.

Kind regards,
Rob Whittaker

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Recent Washington Post Headline:
“One in three Americans surveyed believes violence against the government can be justified.” Is this the logical next step? If so, God help us all.

Dr. Jack M. Casey
Affiliated Faculty
Communications Studies
Emerson College
Boston, Massachusetts

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This email you sent touches a nerve… Out riding the lifts at Park City the subject of why so little is open came up from tourists multiple times today. As a Park City native I witnessed the switch from growing up in a ski town, to living in a ski town after the whole Vail takeover of PCMR and the subsequent diminishing value it has brought with it.

Before Vail: PMCR Lift operators were better trained and knew how to still operate fixed lift chairs for skiers/boarders so they could run full speed. PCMR was not afraid to tell beginning skiers where they needed to go. Meaning to avoid certain lifts before they had enough experience to ride lifts that served harder terrain. PCMR would open when there was enough snow – even if it were prior to Thanksgiving. PCMR would stay open as long as there was enough snow – even if it were post Easter.

PCMR brought in people on special visas to work the ski season by the droves – when housing was affordable for the season.

Things worked. Fun was had. Skiing/boarding was great.

After Vail: The first thing that happened was Vail attempted to trademark the name Park City. The people & businesses of the city fought back and Vail dropped that effort.

PCMR/Vail opens at thanksgiving (though this year there was no snow and it was too warm to make any). PCMR/Vail closes at Easter. While they’ve stated they’ll stay open an extra week this year, that remains to be seen.

PCMR/Vail lifties are not as well trained anymore. It’s painfully obvious in how they tend to run the fixed lift chairs. Rarely clearing them of snow and/or holding them as skiers sit down. They never, NEVER explain to an inexperienced rider that they should go learn at First Time (a beginners lift in Park City). Often they can be seen in the lift cabin staring at their cell phone, not paying attention to lift operations.

The resort still brings in people on visas to work resort jobs, but housing is in real short supply now and super pricey so they don’t seem to get the same influx they used to.

As a reference to what you wrote: some developer bought the house next to mine that had been there for 70 years then tore it down. Couldn’t get an easement he wanted and sold it to another developer who had zero history of the area. The city allowed him to split it into two half sized lots and is erecting two cheap, cut corners, multi-million dollar homes (my sister is an award winning architect who saw some of the construction and mentioned it would get red tagged in CA and have to be redone. However, Park City’s building department is looking the other way and allowing it to happen – I want to feel bad for the people who buy these expensive junk homes, but I won’t). There is no way these things will get rented to resort workers and chances are they will sit empty for most of the year like many of the other homes around me in Park City. Yet somehow we’re still crowded.

PCMR/Vail has roughly half the mountain open and was charging $230/day for a pass this past week and a half. Normal price is roughly $170/day for the full mountain. So Vail is gouging their customers. In a way I can understand why people that pay this much want to parade around town and the mountain acting like kings and queens.

PCMR/Vail recently started “requiring” masks on gondolas. However, much like last year, the reality is very different. There are signs saying as such, though the lifties don’t care to enforce it and Vail won’t pull someone’s pass for fear of losing a customer. So people get in the gondolas, sans mask and proudly announce they’re unvaccinated. It’s insanity. Then they have the gall to ask where the locals, like myself (wearing an N95 to protect me from them), prefer to ski on the mountain. My answer is usually to point them somewhere I won’t be on the mountain.

The crowds at PCMR/Vail were horrendous with a less than half open mountain in the last month. Lift line times that rivaled the old era prior to high-speed chairs (30+ minutes). But now with high-speed chairs and a half open mountain, now it’s 30 minute lines and all those people that high-speed chairs can put on the runs as well. Like fish in a barrel type situation on the mountain with people who aren’t looking where they’re going.

At PCMR/Vail very few people adhere to, or possibly even know, the skiers/boarders code. Which means people stop anywhere they please on a run to grab a selfie or wait for a friend. Yet if you get to close to someone in an attempt to avoid hitting them when they do something stupid, they get real pissy. Is it any wonder why so many of these people need helmets to ride now?

It’s extremely sad to see the downward spiral of the town and the resort in real time since 2015. It went from being reasonably affordable to outright laughable. Part of the problem is the AirBnB garbage. The town council would like to curb it, however, the state has hamstrung cities from being able to do anything. Plus it now includes phony shell corps spending millions on little ski shacks and renting them out privately for stupid sums of money.

The real charm of what brought people here, has left in the last 7 years. No more affordable spots to live for seasonal workers. Insane traffic on streets not designed to handle it. And general diminishing quality of life that, as you mentioned, isn’t the same any more.

I wonder how long Vail can continue to promote the charade of PCMR and winter sports in general. Especially if they refuse to pay people appropriately to work and stay focused. Currently the only thing Vail corp is getting right – the price of the Epic Pass.

Jody Whitesides

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I Lived Through Collapse. America Is Already There. | by indi.ca | GEN
https://gen.medium.com/i-lived-through-collapse-america-is-already-there-ba1e4b54c5fc

moi-meme

(Please click through and read the story at the above link. It posits that democracy has already ended in the U.S., we’re waiting for a catclysmic event, but it probably won’t come. The writer talks about being in Sri Lanka during its civil war. He points out that life goes on, you may not feel it, but the institutions are being gutted while you’re partying.)

Dear Bob, I agree with all your comments.  While I am not a financial planner as a C.P.A. I discuss these sorts of issues often and I fine 2 common mistakes:
1. folks assume they will be in a LOWER tax bracket when they retire, the taxation of social security generally levels this out and often people might be in a HIGHER tax bracket when they retire and the BIG ONE
2. People underestimate how long they are going to live (to your point).  I have folks in my office often with parents in their 90’s – let me tell you need a LOT of fucking money if you retire in your late 60’s and live another 30 years!!!!   Income is down and expenses are up!!

On another note, I’d bet money EVERY advisor around Bruce Springsteen was begging him to get his catalog sold before 12/31.  The threat of increased long terms cap gains rates and the elimination of the weird and special ability of songwriters to declare their sale as a long term cap gains:

Songwriters: Here’s a Tax Loophole Just for You…

all the advisors of song writers I’m sure said the same thing on 2021: “IF you are EVER going to sell your catalog, don’t wait, do it NOW!!!”

Peter Riley

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Long time reader, first time writer (this topic is near and dear to me, so I felt it was the right time). After spending 16 years in the music biz (mostly at Atlantic and Sony) I became a financial advisor because I saw an enormous lack of education around financial topics at all levels of the industry (music execs, artists, writers, producers). I became a resource for that information because I saw colleagues mismanage their money, go into debt, lose income because they didn’t fully understand their group benefits, etc… and I didn’t want that to happen to anyone else.

Taxes, income protection, investing, managing debt, retirement planning, maximizing social security…. All EXTREMELY important, but most folks aren’t paying attention until it’s too late. The biggest excuse I hear is “these are rich people’s problems”, but that’s not the case AT ALL. You don’t need to be a millionaire, or have a business manager, to be educated and have a plan for these areas. In fact, I’d argue it’s even more important for the rank and file execs, and the writers/artists/producers who aren’t making a boatload of money yet. These folks would have a tougher time paying for basic monthly expenses if there’s ever a big tax/debt payment owed, or they can’t work for a month or two (god forbid longer).

A word to the wise for any of your readers who earn an income… don’t wait! There are advisors out there willing to talk about these topics. And some of us don’t charge for our time, so no there’s no excuse. I’ve had the opportunity to educate many clients from the music industry over the years, from CEOs and owners of labels to those just starting out. And I’ll tell you what I tell each of them (paraphrasing Benjamin Franklin)…FAILING TO PLAN IS PLANNING TO FAIL.

Wishing you and your readers much success in 2022!

Andrew Feigenbaum

Financial Advisor

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Bob so right on. Not there yet but as a pension actuary it’s a no brainer to defer as long as possible (plus these folks who take at 62 then also get to deal with having benefits clawed back if they still work and make over a not too high threshold).

In any event most of my clients are pure type A personalities, and retiring early is not in their DNA. Have a client who I know has more than enough in his small business and retirement savings to stop working (and literally use cash in the fireplace to keep warm and not be in a bad position). Stu is 85 and what keeps him alive and in the game is keeping his little business going.

Best

Mike Wyatt

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Those of us old enough to have been raised by parents who grew up during the Great Depression had instilled in us the belief that you did what you had to do to get by and if that meant working a shit job for shit pay until something better came along then so be it. Key to that thinking was the firm belief that something better would indeed come along if you just stuck with it.

I was deeply influenced by the economic insecurity I felt growing up and so put a premium on job security and a pension, which is why I saw the lower pay potential of a career in federal government as a reasonable trade-off for a reliable pension that would last a lifetime.

We live in a different world now. The kind of pension and job security I had is a thing of the past. People are no longer convinced that sticking with it will necessarily lead to success. Anti-work is now a thing.

I accept that time has passed me by and that I couldn’t thrive in today’s economy. The idea of working in a room at home as opposed to going into the big city seems very bleak  to me. Imagine an entire generation that will never know the pleasure of having a favorite place for lunch.

But this is the only world my grandchildren will know. They are all pretty smart. They will figure it out.

George Laugelli

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I look forward to your emails each week. Thanks for posting the article about social security. I am a Registered Investment Advisor, a fiduciary to my clients. I subscribe to Kotlikoff’s MaxiFi software and my job is to help my clients maximize their retirement income.

It is still an uphill battle but should they get the opportunity, my clients get it. In fact, the most difficult aspect of the process is to show people that dipping into their next egg to bridge the gap before age 70, so they can maximize the inflation protected social security benefit

Keep on telling the story. Much appreciative.

Rick Shrier

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I’m not a idiot for taking SS 1 month after turning 66 per my discussions with my accountant

I’d like to see you try to get by on what I was making the last 3 years. You couldn’t

I choose to live my life after 45 years in the Music Biz.  Not to kid myself that the $ was going to turn

So disappointed in you Bob for saying Everyone taking SS before their 70 is a idiot

Kevin Sutter

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Bob, I’m 66 and working part time. I decided to defer my social security for a year, but haven’t been able to make my monthly nut — even working 3 days a week. What planet do you live on where you can call everyone who doesn’t wait til 70 to collect SS an imbecile? And in the very same column you write, ” And sure, people are cheap, but they’ve also got a limited amount of money.”

C’mon man.

Dave Rubien

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Money is a taboo subject to discuss in our society. We have socially acceptable ways to let people know we are affluent or successful. But actually revealing how much you have and what you do to invest it?  It seems like the financial community has a vested interest in keeping us from shining any light on this subject.  Yet money – whether you have it or don’t have it – has an extraordinary influence on our lives. I have always thought it would make an interesting book to study how money influences peoples’ attitudes about everything in their lives.

Lori Turoff

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Actually, recently advisors are talking about 2.6% (asset drawdown).

Tom Armstrong

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They should make financial literacy part of high school curriculum. It’s the only way to have the best shot to educate the most people about financial issues. That way those whose parents don’t teach them, those with parents who are bad role models on financial issues, and everyone else, including those who could be rich and famous one day or not would have the opportunity to learn about this important topic.

Neal Bookspan

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Hey Bob, I applied for social security at 62, but don’t consider myself an imbecile
Sure I’m going to receive less for the rest of my life, but when you are on the brink of not being able to pay your mortgage and as a result losing your home you have to make hard decisions that are right for you at the moment.
As you mentioned, you have been broke in the past, so maybe you too, might have taken the 700.00 per month to your future detriment.
Still a homeowner in Washington

Howard Wolen

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Another great article. Once again your message resonates with me.
A few thoughts:
The name of my first book, if I ever get around to writing it:  “For all the wrong reasons.”

A realization after working with many rich people:  “Rich People can Afford to be Stupid!”

Social Security expert (cost: $200) told my wife and I that there were two reasons for me to delay taking SS benefits until age 70 1/2.           A. Survivor Benefits. Most likely men will die before their wife’s die. My wife took her benefits at 64 ($2,000) and I took 50% of her benefits or $1,000.  My $2,500 in benefits grew to $3,600 at 70 1/2. If I die my wife can take the higher of her’s or my benefits.  Expert said: $1,100/month or $13,200/year could make a big difference to the survivor.  As Courtney said: do the math!
Together wife and I would have $4,500 that would be reduced when I died to $2,500 (not allowing for increases and assuming I didn’t delay until 70 1/2) a reduction of $2,000 (44%) vs a reduction of $900 (20%) if I delayed.
Expert also said:
B.  Where can you invest your money and get a guaranteed 8% return which is the rate you will earn per year if you delay.  Better to live off your savings conservatively earning less than 8% and not guaranteed (assuming you have savings) then take SS early.
In the end, retirement is all about cash flow.  Expert said: people always say they will downsize but when the time comes, they don’t want to downsize to bring their expenses in line with their incoming cash flow.  They refuse to make adjustments so they are living within their means.  They refuse to grow up and be honest with themselves.
The road less traveled is about being “financially” responsible (living within your means) and delayed gratification (don’t buy it until you can afford it).
While growing up I would ask my father to buy me many things. His answer was always: ask yourself, do you really need it?  Answer was always no, so we (I) learned to live without.

I had lunch with an accountant who was a dear family friend during the 1990 recession. I said Don there is nothing worse than during down times not thinking that things will get better.
He said there was one thing worse. During good times not thinking that things could get worse.

Best wishes in the new year.
Bob Edwards

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I was listening until I hit the part “sells Maximize My Social Security software,” You CAN leave money on the proverbial table by waiting until full retirement date…my best friend since 7th grade ( we’re both 66) has plenty of $ and has bought into this bullshit about waiting until full retirement age to collect. He may have even paid for the same software, as he is wont to do..BUT he has the advantage of having enough $ to be stupid. I on the other hand do not so I started to collect SS at the age of 64 1/2…..Every personal situation is different.

All the best,

Chris O’Shea

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Thanks for the advice.

Just last week I said to my wife ” I wish my father told me to invest in homes, land something.  Living in Florida and he didn’t know to do it.  Or maybe he did & just didn’t have the bucks.

and as a rock n roll garage band drummer I blew through money while in H.S. and college and yes, never became a rock star.  great memories and had a corvette (but nobody told me to keep it and don’t drive it).  LOL!

I took SS at 67 – after open heart I did think I’d be here today and that my days were numbered.

but I have a good doc and still kicking at 74 1/2 -  that 1/2 is important.   And oh btw, still working.  which I love but what sucks is I pay tax on my SS but I don’t care as I’m still afraid politically it won’t be around if it gets in the wrong/right hands.

And my wife knows how to save thank g-d.

stay well and keep grooving

Steve Hass

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Thank you for sharing! Financial literacy is so important. I grew up in a middle class family (single/divorced mother, 4 kids -I’m the youngest). Now that I’m an adult, I can see so many ways our family and countless others were misinformed about money. Many people know how to make ends meet (which is an important skill!) but don’t know how to invest, budget and plan for their future. Not to mention salaries are low for a lot of people, so they focus on keeping food on their plates, a roof above their head and a few bills paid. And government programs are dwindling.
Thankfully, information is more available now… it doesn’t solve for everything, but it helps.

Léna Lgd

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Great post as always – the article below offers a viable roadmap.

https://www.financialsamurai.com/when-to-take-social-security/

Tim Greco

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Re: 29% being astronomical, it is…and it’s also about what the S&P returned this year. Could’ve bought SPY on Jan 1 and never looked back. Of course, everyone thinks they’re a genius during a bull run up. You’d think the house of cards has to collapse sooner or later, but this makes 13 straight years of insanity.

Daniel Kellner

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Hey Bob,

Wonderful and timely.

Anytime that you write and link lessons / thoughts to your mother or father it is 5 star.

Alan Cassidy

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thank you for this…

Denise Mello

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Great piece on social security. I, too, went broke one time.  Hopefully never again.  I hope a lot of people read through your piece and grasp it.

Toby Mamis

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Yes, you don’t know when you’re going to die or what condition you’ll be in as you age. Shit happens.

When it comes to money you follow the basics – save 10% of your pay, put it in an index fund (S&P 500 works), or use your firm’s 401K especially if they do some sort of match. 18% of the 122 million US households are millionaires. The Thrift Savings Plan has over 6 M participants. TSP is the worlds’ largest savings plan for US Govt employees and this is only 33% of the total.

When it comes to one’s health it’s nutrition and exercise. You don’t go to fast food places, or eat processed foods. You watch portions, limit alcohol. We control what goes into our mouths, ears and eyes. So choose carefully.

IT’S ALL ABOUT CASH FLOW. Can you afford it or not, and do you have a stash for when stuff breaks. Period!

It isn’t that hard. And if you’re not paying attention you’ll be fleeced.

Courtney Love is NOT typical. She came into prominence due to marrying Curt. And yes, being a musician is not the road to a stable financial platform. My son can play and has chops and so its a hobby as he enjoys paying his bills and living in his own place.

All the wealth advisors are playing the FUD card. Fear, uncertainty and doubt. They prey on peoples’ uncertainty. There was this woman, a financial advisor, who lived in my hood who told my wife about how the short and long term bond rates were crossing over and this was a bad thing. Complete bullshit. She was playing the long con knowing that one day I would die before my wife and she was positioning herself as the go to advisor. I told my wife don’t ever go near her. She knows nothing. Oh, yeah, worked for Wells Fargo – and she had no problem with that. No morals.

Terrance Moran

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A Big Thanks and an Agree…

Jim Eaton

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Great article and good and needed advice for your readers.  Managing money is a skill which few posses or appreciate.  I’m not one for mandates, but financial management and cooking/nutrition are essential skills for your mental and physical health and should be taught in schools.

And it is not uncommon for successful folks to go broke.  If you made it once you are in much better position to make it back again as long as you have time.

Too many make small but frequent financial mistakes that compound over a lifetime, but the skillful and disciplined enjoy the compounding of small and frequent wins.  Health and wealth, and one without the other isn’t neatly as valuable.

Stay safe,

Ed Kelly

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Thanks, Bob.  I am in my 62nd year and wanting to slow down in the law rat race.  Figured I would just tap the social security and with retirement savings, all would be well.    The problem is the more you make, the more you spend.  So those fortunate ones who make decent money have to worry that retirement is going to leave them short, no matter how much we may have saved.   Tough problem.  And your posting captured it perfectly.

Happy New Year…

Andrew Zacks

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I resented being called an imbecile for applying for Social security at 66. I worked for the man for 30 plus years and I deserve it. Whether I die at 69 or 99. I still deserve my payout. You are completely wrong Bob!!  You should retract.

David Bodnar

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I am one of the imbeciles that took social security before 70.

I took it at 63.

I was going to wait till 66 as that calculated out to be most beneficial if I live to 80.

After reading numerous articles that showed waiting till 70 would take 12 years to catch up to taking it at 62 I decided to jump in.

You might want to do some more research.

My SS has already funded some new skis!

Philip Beliveau

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Yes, most people overspend their income. It takes restraint and self-discipline to save.

One other piece of advice. It is far more likely that you will become disabled before you die, and will require some form of assisted living or skilled care, either at home or in a facility. The best advice I ever received was to purchase long term care insurance. Regular health insurance and Medicare don’t cover the costs for assisted living. It can quickly deplete your savings. Quickly. If you can afford it and can be underwritten for it, purchase it as soon as you can.

My father could not be underwritten for it but he purchased it for my mom in her 60s. She’s now 96 and has required assisted living care at home for more than a decade and 24/7 around the clock care at home for the past 5 or 6 years. Her policy pays for almost all of it and the costs are not cheap. It has allowed her to receive assisted living in her own home, which she prefers, kept her from having to live in an assisted living facility. And also taken a financial burden off of her kids to pay for her care. Best investment my dad ever made.

I was lucky to be healthy enough able to get underwritten for long term insurance when I was 60. Gives me tremendous piece of mind. I recommend it to everyone.

Barry K. Herman, MD, MMM

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Asians tend to put their fortune in real estate which generally yields good returns. That worked back in the days. However, if you have been following real estate prices in metropolitan cities like Hong Kong, Tokyo, Taipei or any commercial or industrial/tech focused cities in Singapore, China, Korea, India etc , You would know what’s happening in the US or UK is now happening in these developing countries. I can’t recall which publication but according to the article, a judge in Asia who has been practicing law in the legal field for 20-30 years said recently that he couldn’t even afford buying a place near the courthouse in the city. The prices are just outrageous. Most Gen X-Z and Millennials cannot do it on their own without help from family eg help with down payment or mortgage.

Shirley  Wu

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Excellent letter, Bob! Thanks!

Samuel Jones

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Hi Bob.  I love your blog.  Please remember to think and do research before name calling.  I’m one of those “imbeciles” (your words) taking social security at full retirement (66) rather than waiting until 70.  My father died at 57 and his father died at 57 too.  I’ve done the math.  And cumulative SS payments, whether low or high cross paths at around 78-80 yo.  So if you live longer, yes, waiting until 70 makes sense because you will get more.  But what if you die before 78?  And no, I don’t expect that SS will pay for everything. My point is that not everyone is an imbecile who doesn’t think exactly like you do.

Jon Brooks

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Thanks for this.  It ties into your recent email on the WSJ money management nightmares as we age.

Planning?  While most of us never expected to get this old.  I didn’t plan much because my dad died when he was 38 (I was 10) and my mom was 62 when she died.

When you see how tenuous life is at such an early age, it affects you.  You really DON’T expect to live to be very old, genes don’t lie.  You live life differently, in the moment.  I had to get out, see everything, go places.  The idea was to squeeze the most out of life.  A stable, measured life may make living to be 95 easier but it isn’t very appealing.  My mom made some real money but she lived for the moment.  Money was just a means to do more living.  You don’t save or plan, you go for it.

But you know that you go for it at your own peril.  I think we’ll see more people hit an age they didn’t expect to reach and simply say; when the money is gone is when I will check out or I’ll wait until my health impacts the quality of life to a degree I find unacceptable.

John Brodey

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So true. Was recently discussing with various groups of friends … everyone is different (& sometimes the ones who need the best info seem to have the least)

Wallace Collins

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Hey Bob, I don’t think any of your readers expect you to know how the other half live but you should know enough by now to realize not everyone takes social security early because they’re “imbeciles.” There are a lot of factors involved where people have no choice whatsoever and they’re then forever screwed whether they know or not. I just wanted to point that out because you’re not usually so insensitive.

Dustin Edelhertz

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There’s a lot to unload in this letter.

As one of those “imbeciles”, I took my Social Security as soon as I could. I watched two of my brothers, (that paid into the system all of their lives). wait. But, they didn’t see Stage 4 cancer coming down the pike. They didn’t get a fucking cent out of the system. Too young for Medicare, working shit jobs sans medical insurance and NO Obamacare, they couldn’t even afford to catch the Big C in it’s early stages.
One had prostate cancer. That’s treatable!

So please excuse my imbecility for getting what I can out of the system while I am still above ground.

You were, to me, (a son of a single working mom with 7 kids), a child of privilege.You attended college. What were you schooled as? A lawyer?
Well…what can a poor boy do? ‘Cept to sing for a rock and roll band. That’s me. I was nearly good enough to almost play a frat party.

You’re doing okay, though. But, for those of us on Social Security and still on the bottom, we still HAVE to work and most of us will…until we die. Or get too goddamn sick to do so. Guess what jobs we can get?

“Mooch” off of our kids? You must not be a parent. Those kids, in many cases, are still living with us!

And here you are telling us about how the hell the privileged can’t get up to the top of a mountain, only to slide back down it.

Then again, my enjoyment is baseball. That dying game you wrote of in a recent letter. You know…that unpopular game that has the freak of a Japanese kid that can hit a 100 mph fastball and strike out hitters, (in the same game), with a 100 mph fastball.

The Occupy movement could have worked, by the way. Had some dude, that said he promised to “fundamentally change the way Washington worked”, been the revolutionary he professed to be on the campaign trail and supported the people in that park and all of the ancillary protests that sprang up all over the country…nay, the world, maybe we wouldn’t live in the shithole country we’ve been since Reagan. Maybe there would have never been Trump in the White House or a rampant, seemingly unending, pandemic.

Make no mistake…There will be no revolution without guns. That’s so damn un-American, it hurts. The vast majority of liberal/progressive Americans, with higher education or not, are just too damn stupid and self-centered to pull one off.

But, the morons who succumb to the cult of Trumpism, know that. They are locked and loaded and coming. Not for your guns, (because we don’t need guns. We have ideas.), but for your country.

Now…what was that about ski-lifties?

Scott Sechman

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Highlight of my day being called an imbecile!

Gary Berlak
Fresno

There’s a great story in the “Financial Times” entitled “Courtney Love explains why you’ve got to do the math – As part of the FT Financial Literacy and Inclusion Campaign, the musician shares her story about making – and losing – a fortune.” Please read it, it’s no longer behind a paywall: https://on.ft.com/3JwZe8G

My father was an outsider, never a member of the group, he was analytical and skeptical, and I learned his lessons through osmosis. Then again, thinking back, we used to call it “The Morris Lefsetz Philosophy,” when he rendered his financial wisdom, told us how the world worked, they certainly didn’t teach these lessons in school. Then again, they did teach Home Economics, but this was back in the sixties, before girls played Little League and boys took Home Ec. Ergo, I never learned to cook. And my mother was uninterested in cooking, it was an obligation in between her participation in cultural affairs. And my father was a gourmand, we ate out on a regular basis, however mostly in hole-in-the-wall finds that ultimately became a feature of “New York” magazine’s “Underground Gourmet.” So I can order, but I cannot make.

I thought people knew about money, but they don’t.

And conventional wisdom about money is about as good as conventional wisdom about politics. There are authorities, and you should listen to them, not your buddy who pontificates like they know everything. I was just told that this couple made 29% on their money last year. That’s astronomical. But then I asked them what their money was in…stocks, bonds, cash…they had no idea. Some billionaires just told them to invest with this guy and they did. Did this financial advisor ask them whether they wanted high risk or low risk or…? They had no answer to that question. I have a friend who got nearly ten million dollars in a divorce settlement, put it in high risk investments during the first internet run-up, that’s right, before the dot.com crash, and lost all of it, each and every penny, died broke living in her sister’s house.

If you read the Courtney Love article you’ll learn that her mother inherited millions and lost it all in a few years. Managing money is a skill, and most people don’t have it.

Just like they know nothing about Social Security.

On May 9th of last year, “The Wall Street Journal” did a story entitled “The Biggest Mistakes People Make With Social Security – One of the most common and costly: worrying about dying too soon.”: https://on.wsj.com/3pLjFH2

Unfortunately, this article is still behind a paywall. But I pay in excess of $500 a year for the “Wall Street Journal” and read it cover to cover, that’s how I saw it, that’s how I know this. So if I was a zillionaire rock star… But I’m not. That’s what the financially savvy middle class doesn’t realize. Sure, if they made the money of a rock star they wouldn’t blow it, but they could never become a rock star and earn that money! Becoming a rock star involves a plethora of risk. You’re flying without a net. And most people don’t succeed. If you go to college and enter the traditional working world your odds of economic survival are greatly increased, but you will never be a rock star. The choices of the musicians I know, the experiences they’ve had…getting their cars repossessed, getting their stuff stolen without insurance… The list is endless. Bad decisions on parade. Would never happen to me. Then again, I would never take that risk, get it?

So I read this article back in May, and it stuck in my brain, I just Googled and found it. Because I’m constantly having arguments with people saying that Social Security is their money, and if they die early the government gets to keep it. As for me… I don’t care if I die with money in the bank, or if I’m upside down on Social Security, I just fear the opposite, running out of money, which I already did once, it’s amazing I survived. If you’re broke all you can think about is money 24/7, you can’t get ahead. As for the concept of the “starving artist”… Let me tell you, most of these people are just starving, they’re not artists, they’re not going anywhere. And I believe we should have a better safety net for these people, but that’s a different topic.

So since this “Wall Street Journal” article is behind a paywall, I’m going to reproduce, for the public benefit, the #1 biggest mistake people make with Social Security:

“1. Worrying about dying too young

Many clients file for Social Security benefits earlier than necessary because they fret about not living long enough to get all their money back from the government program.

They have it all backward, according to Boston University economist Laurence Kotlikoff, who heads a firm that sells Maximize My Social Security software, which helps people determine when to start collecting their benefit.

Social Security is longevity insurance, he says. That is, it offers protection against running out of money as we age. People don’t do break-even calculations when they buy home insurance, because they are protecting themselves against a catastrophic event like a fire. They shouldn’t do them with Social Security either, he says.

‘We can’t determine when we’re going to die,’ he says, ‘We have to focus first and foremost on the worst case, as if we’re going to live forever. Living a long time is a financial disaster. It may be good personally.’

That message is getting through to more Americans. The percentage taking Social Security as soon as they are eligible—at age 62—has roughly halved in the past 15 years, to about 25% in 2019. Even so, only about 6% of Americans claiming Social Security in 2017 were age 70, according to the Center for Retirement Research.”

I could amplify the foregoing, but I think it’s clear on its surface.

As for Social Security, I can’t believe I’m even writing about it. It’s for old people, but now all the baby boomers are old. And unlike their parents, most weren’t responsible, they didn’t put money away for retirement. Or else they had unforeseen financial hardship. In any event, it’s a rare person I know who is prepared for their retirement years. They think they can work forever, but they don’t want to, and the dirty little secret is you can tell people you feel like forty all day long but your body doesn’t know that. Do you know old people? They’re not perfect health specimens. Their bodies creak, they’re in pain and then there’s the third rail, mental impairment/decline. I hung with Freddy Moore every day for two years. He was one of the most happening people in the L.A. music scene of the late seventies and early eighties, with his bands the Kats/Nu-Kats and Boy and… Freddy’s just 71, but he’s got dementia, he’s in a facility. Could happen to you. So please live life to the fullest, don’t say no when you can say yes. However, just the opposite may be true. You could live to a hundred, clear-headed. Then what? Do you have enough cash to live on? The rule of thumb is to live on 4% of your retirement assets. Actually, recently advisors are talking about 3%. So stay within your means, don’t blow it all on frivolous items. Like a depreciating asset, like a car.

As for what other people are doing… That was another thing my father always said… “If everybody else is jumping off a bridge, should you?” That other person might be wealthy. They might not have a job but inherited cash. Or they might be living far beyond their means and the crash is just around the corner. You’d be stunned who was rich and famous in the past who is living in a one bedroom apartment today, struggling. Fame doesn’t mean you’re rich, and it certainly doesn’t mean you’re smart with your money.

My father died at 70. The Big C got him. He dotted all the i’s and t’s but it made no difference. Meanwhile, our closest family friend did not. Was saved at the last minute by medical miracles again and again. But he and his wife lived past ninety. He’d had a good job, he’d gone to Harvard for graduate school. Thank god their kids did well enough to shtup them money to survive.

And then there was another friend, who went to Harvard undergrad. Who owned his own pharmacy. He and his wife got a reverse mortgage, and then they outlived their money and survived on the cash of their children.

I don’t have any children, whether they’d take care of me or not.

And everybody’s situation is unique. But one thing’s for sure, you’ve got no idea when you’re gonna die, hell, the Who sang about dying before they got old and now Roger and Pete are over seventy. It’s great to live in the moment, but the future keeps coming, please be prepared.