Include Retirement Costs in the Cost of Living
Often when discussing poverty and the cost of living, people refer to the general needs of humans.
Most of all, we usually mention food, clothes, shelter, and healthcare.
While those four general categories tend to cover the vast majority of what any given human needs, they do not cover everything.
Namely, we often fail to mention the need to secure one's retirement.
For example, if a working man earns enough income to pay for just his current food, clothes, shelter, and healthcare, we cannot truthfully call that man self-sufficiently non-poor, because that man will one day lose his ability to work.
He needs to earn enough now to pay for his living expenses later, when he retires.
To accurately measure the cost of living, we must include the cost of maintaining a proper retirement fund.
These retirement costs could come in many forms, just as housing costs can come in many forms (e.
g.
rent vs.
mortgage payments).
For example, a person may own a retirement account in a bank or a 401K.
In another example, a person may buy some type of retirement insurance, where the person pays a fee to a company during the person's working life, and the company pays the person for the remainder of their life after retirement.
In yet another example, some cultures make it so the younger generation of a family takes care of the older generation of that family; the costs remain essentially the same.
When calculating a general cost of living, we can of course find the basic price for the general costs of securing one's retirement.
In other words, we do not need to worry so much about each specific way to secure one's retirement.
In analogy, we use a general cost of food to calculate the cost of living, we do not worry about the specific store from which any given person may buy their food.
Most of all, we usually mention food, clothes, shelter, and healthcare.
While those four general categories tend to cover the vast majority of what any given human needs, they do not cover everything.
Namely, we often fail to mention the need to secure one's retirement.
For example, if a working man earns enough income to pay for just his current food, clothes, shelter, and healthcare, we cannot truthfully call that man self-sufficiently non-poor, because that man will one day lose his ability to work.
He needs to earn enough now to pay for his living expenses later, when he retires.
To accurately measure the cost of living, we must include the cost of maintaining a proper retirement fund.
These retirement costs could come in many forms, just as housing costs can come in many forms (e.
g.
rent vs.
mortgage payments).
For example, a person may own a retirement account in a bank or a 401K.
In another example, a person may buy some type of retirement insurance, where the person pays a fee to a company during the person's working life, and the company pays the person for the remainder of their life after retirement.
In yet another example, some cultures make it so the younger generation of a family takes care of the older generation of that family; the costs remain essentially the same.
When calculating a general cost of living, we can of course find the basic price for the general costs of securing one's retirement.
In other words, we do not need to worry so much about each specific way to secure one's retirement.
In analogy, we use a general cost of food to calculate the cost of living, we do not worry about the specific store from which any given person may buy their food.
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