1 - Of the 43% of Americans that have calculated the amount of assets needed for retirement, only 3% of that group believes an accumulation of at least $2M will be required (source: USA Today).

2 - If the price of a gallon of milk is $3.89, then a barrel of milk would cost $163.38 (1 barrel equals 42 gallons). The price of a barrel of oil closed last week at $96.32.

3 - The average retired American couple will receive a monthly Social Security benefit check of $1,761 in 2008, equal to an annualized total of $21,132 (source: SSA).

4 - 1 out of every 29 mortgages in the USA was delinquent with their required monthly payment at the end of the 3rd quarter 2007. At the end of 2005, the ratio was 1 out of every 48 (source: Equifax, WSJ).

5 - The average cost for 1-year of college education at an in-state public college is $13,589 for the 2007-08 school year (tuition, fees, room and board). The total 1-year cost has increased 6.5% per year over the last 30 years. If that same annual rate of inflation continues into the future, then a 5th grader today will ultimately pay $100,000 for his/her 4 years of public college education durig the years 2015-19 (source: College Board).

6 - The average before-tax income for US households that have a net worth of at least $1 million (not counting the equity in ther primary residence) is $209,000 (source: Money Magazine).

7 - The top 1% of Americans (ranked by gross income) earn 21% of all income in the USA (source: BusinessWeek, IRS).

8 - The Pension Benefit Guranty Corporation took over 110 failed pension plans in the 2007 fiscal year, up from 94 in 2006 but less than the 120 termainated pension plans in 2005 (source: PBGC).

9 - The richest person from China’s 1.3 billion citizens is Yang Huiyan, a 26 yr old woman who graduated from Ohio State University in 2005. There are only 14 Americans worth more than Yang’s $16 billion net worth. Her family made their money in REAL ESTATE (source: Forbes).

10 - 52% of American households have saved $25,000 or less for retirement (source: AARP).

11 - Only 8% of workers are saving at least 15% of each paycheck for retirement (source: Principal).

12 - There are 22 million American workers that have access to employer-sponsored 401(k) plans and have chosen not to participate (source: ICI).

13 - Inflation has increased the level of prices in the US +81% over the last 20 years, an annual increase of +3%. Which means an individual retiring in 1987 on a fixed-income would have only 55% of the purchasing power today that he/she originally had (source: Dept. of Labor).

14 - Although the gross value of the average American’s primary residence makes up 29% of a households total assets, the value of an average American’s home equity is equal to only 19% of the household’s total net worth (source: Federal Reserve).

Also, as much as we aren’t a big fan of the 401(k) for number 12, we’d rather one participates in it if they aren’t doing anything else with their money. As far as number 14 is concerned, that 19% would be a great number if it was being used to invest with as opposed to rolling in other debt.

Pretty scary stuff….wouldn’t you agree?

Paul F. Carag
Mortgage Planning Specialist