Working and saving isn't enough when you consider expanding life expectancies, the unbridled rise of healthcare and other living expenses, and mediocre stock market returns adjusted for inflation.
1. Outdated Social Security and Retirement Planning System
2. Accelerating Burden of Healthcare Costs
3. The Actual Cost of Living Rises Faster Than Headline Inflation
4. Risk-Adjusted Stock Market Returns Net of Inflation Are Insufficient
Outdated Social Security and Retirement Planning System
Average life expectancies have expanded. Your retirement will last decades.
Accelerating Burden of Healthcare Costs
In the last 10 years, healthcare costs have grown 47% while average wages have risen only 33%.
The Actual Cost of Living Rises Faster Than Headline Inflation
For over 30 years the government has manipulated the Consumer Price Index to control social security and other entitlements.
The Chapwood Index offers an alternative view of the real cost of living.
Risk-Adjusted Stock Market Returns Net of Inflation Are Insufficient
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U.S. Life Expectancy 1930 from statista.com
U.S. Life Expectancy 1950-2022, https://www.macrotrends.net/countries/USA/united-states/life-expectancy, retrieved 2022-07-14
KFF Employer Health Benefits Survey 1999-2021
Bureau of Labor Statistics Consumer Price Index for All Urban Consumers (CPI-U) U.S. City Average
Bureau of Labor Statistics Median Usual Weekly Earnings of Wage and Salary Workers
https://chapwoodindex.com/. Five-year average is for 2015 – 1st half 2019. COVID-19 prevented data collection 2020 - early 2021.
S&P 500 data from http://www.moneychimp.com/features/market_cagr.htm
FTSE Nareit Equity Apartments data from https://www.reit.com/data-research/reit-indexes/monthly-property-index-values-returns