Quote:
Originally Posted by Rain Man
On my recent big trip, about half the people on one of my ships were doing a six-month "world cruise", which cost about $200,000 for a couple. That's a chunk of change. Most or all were retired, since that's the only way to get six months off to travel.
I was listening to how people became affluent enough to afford such a trip, and two reasons were far and away the most common. People either worked for government or (in the past) a large company that offered defined-benefit pensions, or they owned and sold a business. Those were far and away the most common reasons. The pension people were not C-suite types who made big money, but my impression is that they felt secure with the pensions and didn't feel a need to manage risk to a retirement portfolio.
The other reason that I heard to some degree was people who merely had a high-wage job, mostly doctors. I met a couple of people who had legacy family money, and one couple who invested early and hard into crypto and made a bunch of money, but those were exceptions to the rule.
The loss of defined-benefit pensions is a major factor in people feeling less secure about retirement, in my opinion. I'm not sure there was ever a time where a majority of workers got them, but they're rare now. You pretty much have to work in government to get them.
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It's a trade off. If you are not in government or work for a company that doesn't offer a traditional Pension Plan, you most likely are earning substantially more money, 20-25%, in the private sector. Unfortunately not everyone understands the difference and then saves a large portion of that for retirement. Those that do can usually take a portion of those assets and purchase lifetime income that gives them certainty they will not out live their assets. The remaining assets can be invested more aggressively at this point for legacy assets or for travel and other wishes as they know their main expenses are covered.