READER’S FORUM

I began reading, with interest, “Taylor Remade” (Money Make-Over, Nov. 5). What a disappointment to read statements that seemed to show disrespect for the Taylors and their effort to provide for their children’s future.

While reading the article, my emotions ran from respect for the Taylors to anger at the seeming attack on their past effort and lack of recognition for the discipline it took to save an amount of money that isn’t far short of the savings goal suggested by your advisor.

It is a fact that parents need to have life insurance and a will, and it’s true that ideally they should be putting more aside for retirement and college, and that Lorie could probably be making more money by working elsewhere.

But what was overlooked is that most parents in Southern California are struggling with the here-and-now and mothers like Lorie want to be “available if the kids need” them.

Statements like “irresponsibly living paycheck to paycheck” and “living within your means is living with integrity,” are insulting to parents who are striving to provide a strong educational foundation and irreplaceable childhood memories for their kids. The suggestion to stop extracurricular activities for the children as a cost-saving measure is not acceptable to families with a goal to raise well-rounded children that have learned discipline, teamwork and self-esteem through organized sports and activities.

In reference to the Taylors’ need to “make some big sacrifices,” Judith Martindale is quoted as saying: “But they aren’t living in reality; if they keep going the way they are going, they won’t have anything.”

She seems to overlook the fact that although some changes are warranted, the Taylors may be depositing their investment in something longer lasting than retirement, and that the children’s current education may prove to be more valuable than future considerations for college. Not every child is college bound, nor should be. I understand that Ms. Martindale was expected to provide the family with insight for a “money make-over,” but her comments and those of Debora Vrana could have been tempered with some recognition of the effort already made by Warren and Lorie Taylor.

LINDA CHRISTIANSON

Culver City

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I don’t know what calculator Victoria F. Collins uses to analyze Frank Cramer’s (“The Means to an End,” Money Make-Over, Oct. 29) financial situation.

Mr. Cramer has no spouse or children. He is now 59 years old and wants to retire in three years even though he has no pension. He currently has a nest egg of $145,000 and will continue to add to his 401(k) plan annually for those three years. Ms. Collins says that Mr. Cramer underestimates the amount of money he will need for retirement. Let’s take another look.

Assuming a 10% (realistically achievable) annual growth in his portfolio, Mr. Cramer is comfortably on target. The present worth of his portfolio is $145,000 and with the assumed rate of growth, will grow to $ 192,995 in three years. If Mr. Cramer continues to add 15% of his $38,000 yearly salary to his 401(k) plan, he will increase that value by $20,753 (again assuming 10%-a-year growth). This will bring the total value of his nest egg to $233,047 by the time of his targeted retirement date.

Ms. Collins estimates that Mr. Cramer will need $26,000 a year to meet living expenses upon retirement and Social Security will provide approximately half of that. Then Mr. Cramer will need to draw $13,000 a year from his portfolio or approximately 5.6%. This leaves room for inflation without invasion of capital.

But Mr. Cramer says he wants to use up his entire estate in his lifetime. He could live even better if he goes to an annuity table to figure a draw that would exhaust his capital in 30 or 35 years. Since he has no heirs, that equity in his home could cover a nice funeral. Go for it, Mr. Cramer!

WALTER M. McHUGH

Rancho Palos Verdes

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I am tired of seeing casual references to the possibility of people my approximate age not receiving any Social Security upon retirement.

As far I can tell, the prospects for that unfair and socially devastating fiasco are at least as distant as they have ever been. At no time during the history of Social Security have future payments been guaranteed more than the 25 or so years they are now. That is to say that we could have had the same doomsday predictions in the ‘50s or ‘40s or ‘60s.

It seems to me that articles which let statements about the future unavailability of these funds go unchallenged tend to promote fear, mistrust and even hatred. They also tend to condition people to the inevitability of their being ripped off. This is the opposite of the supposed intent of authors to empower people, and while it may aid the securities business to promote such disempowerment, it is otherwise counterproductive.

ALAN M. RHODES

Los Angeles