Zuckerberg Pledges to Give Away Half of Fortune
Facebook founder and CEO Mark Zuckerberg, one of the world's youngest billionaires, has pledged most of his fortune to charity.
/ CBSOne of the world's youngest billionaires, 26-year-old Facebook founder and CEO Mark Zuckerberg, has pledged to donate at least half of his estimated $6 billion fortune to charity.
PICTURES: Billionaires Giving Back
Zuckerberg, along with junk bond pioneer Michael Milken and AOL co-founder Steve Case, are among 17of America's richest people who have added their names to a growing list of the planet's wealthiest people joining the Giving Pledge, a promissory group founded by Warren Buffett and Bill Gates which seeks to get billionaires to publicly pledge large chunks of their fortunes to charity and not their heirs.
In a release on the Pledge's website, Zuckerberg explained why, among other things, he pledged $100 million to the Newark, N.J., public school system earlier this year.
"People wait until late in their career to give back. But why wait when there is so much to be done?" Zuckerberg said. "With a generation of younger folks who have thrived on the success of their companies, there is a big opportunity for many of us to give back earlier in our lifetime and see the impact of our philanthropic efforts."
The Giving Pledge comes in part from Buffett's belief that heirs waste money, an idea he gained from steel tycoon Andrew Carnegie's book "The Gospel of Wealth," reports The Wall Street Journal.
Starting last year, Gates, his wife Melinda, Buffett and other wealthy individuals hosted a series of dinners for billionaires to discuss setting up the pledge, the journal reports. That led to an announcement in June of the pledge and its earliest signers.
Other members of the pledge include Oracle Corp. founder Larry Ellison, film director George Lucas, New York Mayor Michael Bloomberg, and Ted Turner.
After the initial Giving Pledge list came out, some critics decried it as a public-relations stunt, or the product of tax-breaks that are hurting the government's ability to offer critical services, reports the Journal.
However, the group's real reason for the public pronouncements of the Pledge is the idea that giving is contagious, said Peter Singer, professor of bioethics at Princeton University, in the press release.
"Research shows that when people know that others are giving, they are themselves more likely to give," Singer said. "So publicly pledging to give will encourage others to give. This holds true for billionaires and for those of us who aren't anywhere near that level of wealth. We can all make a difference, and play our part in making the world a better place."
NYT: Owning A Home No Longer Path to Wealth
The number of buyers who signed contracts to purchase homes dropped in May to the lowest level on record, a sign the housing recovery can't survive without government incentives.
/ AP Photo/Charles KrupaBefore the Great Recession, Americans looked forward to the day when they would purchase their first home. The ultimate symbol of success — home ownership kept the U.S. economy going. It meant having shelter over your family's heads, a nest egg, a way to fund your children's education, vacations — but sadly, that's no longer the case.
The New York Times reports that more than likely, that era is gone for good. When the economy collapsed, homeowners saw values depreciate at a pace like never before. Homes went into foreclosure, and with that their owners dreams collapsed as well.
"There is no iron law that real estate must appreciate," Stan Humphries, chief economist for the real estate site Zillow told the New York Times. "All those theories advanced during the boom about why housing is special — that more people are choosing to spend more on housing, that more people are moving to the coasts, that we were running out of usable land — didn't hold up."
Instead of appreciating as they did in decades past, real estate values will only rise to keep up with inflation. So if you're looking for a sure fire way to make money, don't bet on buying a house. It won't do anything for your future but provide a roof over your head.
Social Security Payouts to Exceed Revenues
If the Congressional Budget Office's prediction bears out, it will represent a major tipping point for the Social Security system which analysts didn't expect to see until 2016, according to the Times report.
Stephen C. Goss, chief actuary of the Social Security Administration, told the Times that the CBO's estimate was likely accurate, but that the tip in finances would not effect recipients in 2010, and America's retired workers can expect to continue receiving their payments.
Goss said the recession was to blame for the shift in revenues, and payouts. He told the Times that increasing numbers of Americans applied for Social Security benefits during the last year, as they lost their jobs amid nationwide layoffs.
As demand increased, funding decreased thanks to fewer people in gainful employment paying income taxes into the system.
According to the report, Social Security coffers will dry up by 2037 if the system's financial balance remains the same.
Alan Greenspan, who crafted a plan to bail out the cash-starved retirement infrastructure during an earlier crisis in the 1980s, tells the Times, "very much the same issue exists today."
"Because of the size of the contraction in economic activity, unless we get an immediate and sharp recovery, the revenues of the trust fund will be tracking lower for a number of years," Greenspan told the paper.
Americans Not Ready for Retirement
CBS/iStockphoto
The Employment Benefit Research Institute's study found the percentage of working households that have saved for retirement dropped to 69 percent in 2010, down from 75 percent a year ago. The number of workers and/or their spouses currently setting aside money for retirement dropped to 60 percent from 65 percent in 2009.
But the truly eye-opening numbers in the 2010 Retirement Confidence Survey are the percentage of Americans with little or no savings set aside for retirement - 27 percent report having less than $1,000 in savings, 43 percent say they have less than $10,000 set aside, and more than half (54 percent) have less than $25,000 saved.
It's no surprise, then, that U.S. workers are pushing back the retirement goal line. Nearly a quarter (24 percent) report delaying their retirement in the last year, with most of those reporting an economic or finance-related reason. And 33 percent of workers expect to retire after age 65, triple the number back in 1991.
"Americans' attitudes toward retirement have clearly tracked the economy the last couple of years, and that seems to be the case in 2010," Jack VanDerhei, EBRI's research director, said in a statement.
In all, just 16 percent of workers feel very confident they'll have financial security in retirement, which is near the survey's 20-year low. Among current retirees, 19 percent report feeling very confident in their financial situation.
Ignorance about how much money it will take for a comfortable retirement underlies these numbers. Less than half of American workers (46 percent) have calculated what their financial goals for retirement should be.
States Take on "Double Dipping" Retirees
(CBS/AP)
In some areas, government employees are allowed to "retire" in order to begin collecting retirement benefits only to quickly return to work, and their normal paychecks. But for many states battered by the economy, that loophole must be closed.
While there are no exact figures on the number of "double dippers," some states have identified thousands, according to the report.
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NYT About Your 401 (k): Missing The Point On Retirement Reform
The New York Times weighed in the debate over 401 (k) plans this morning. There are a number of ideas that sound just peachy in the la-la land that the Editors must believe exists. But there's little in the piece that helps advance feasible retirement solutions here in the real world.
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Investment Optimism And Pessism: Results Of A New Fidelity Study
A native Bulgarian always complains that "Americans are too optimistic!" I try to explain that some of that is part of the DNA here, while he likes to attribute the rosy outlook to a lack of struggle. To prove the point, he cites an old joke from his former country, which I like to call "The Bulgarian Optimist".
The Bulgarian Pessimist meets the Bulgarian Optimist on the street. The Pessimist says, "Things CAN'T get worse!", to which the Optimist says, "No, things CAN get worse!"
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Retirement Delays a Mixed Bag for Employers
(CBS)
A recent survey of more than 2,200 U.S. workers by the consultant group Watson Wyatt Worldwide found that 44 percent of workers 50 and older plan to delay their retirement, with half of those saying they'll work an extra three years than expected.
The downside for businesses is clear – with more workers staying on, especially experienced employees with higher salaries, payroll pressure will continue at a time when companies struggle for profitability. The slowing of retirements also makes it more difficult to hire new recruits, bringing fresh blood - and fresh thinking - into the company at lower expense.
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