- Dec 18, 2010
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Does anyone find it odd that we have historic low interest rates at the same time baby boomers are retiring?
So what if the banks are paying low interest rates?
http://www.usatoday.com/news/opinio...29/seniors-obama-republicans-media/57410976/1
Seniors that depend on interest payments from their savings are being hammered by low interest rates.
How much money are the banks saving by not having to pay good rates of return on savings?
In other words, you save for decades to have a nice retirement, then the banks strangle the return through low interest rates.
So what if the banks are paying low interest rates?
http://www.usatoday.com/news/opinio...29/seniors-obama-republicans-media/57410976/1
Some years ago, when earning say 5% on your money was realistic, a $360,000 portfolio of CDs would produce $18,000 a year in interest — that's $1500 a month. Couple that with an unexceptional Social Security payment of about the same amount, and that's $36,000 a year, $3,000 a month. Nothing fancy, but enough to get by.
Now change that 5% to 0.9% and you're earning $3,240 per year, or about $270 a month. Add that to $1,500 a month in Social Security and you've got $1,770 a month to live on; just $21,240 a year. That's a brutal 41% cut in income. And it is why many senior citizens around the country are being forced to draw down savings to make ends meet.
Seniors that depend on interest payments from their savings are being hammered by low interest rates.
How much money are the banks saving by not having to pay good rates of return on savings?
In other words, you save for decades to have a nice retirement, then the banks strangle the return through low interest rates.