Money Management & Retirement Planning Advice by Barry Unterbrink, Chartered Retirement Planning Counselor

Wednesday, February 04, 2009

Billionaire Math

The mega-money being thrown around in Washington and the financial markets needs to be better understood. Million, Billion, Trillion – after awhile of listening to the news and reading the media wires, my eyes glaze over (MEGA for short).

Just how much money is a billion, or trillion dollars? I’ll try to put this into perspective so both commoners and math whizzes can appreciate it.

First off, we’re all quite familiar I am sure of one-million. “One million dollars”, The Millionaire Next Door book recently published, the myriad of lottery games with “million” in their name has made us comfortable with the term from our youth. One million is the next number after 999,999; it's 1,000 thousand, a 1 plus 6 zeros. After that, it’s quite easy if you remember the 1,000 rule. 1,000 million = 1 billion, (9 zeros), and 1,000 billion = 1 trillion, (12 zeros), then 1,000 trillion = 1 quadrillion (1 + 15 zeros). Okay enough of this already.

Let’s break the government’s $815 billion (and growing) Economic Stimulus package down to sensible numbers per person so we can get a better grip on all this moo-lah (money) soon to come showering down from above (we wish).

With a civilian work force of about 155 million Americans, that’s $5,258 per person.
At 35 million Senior citizens, age 65 +, that’s $23,285 per person.
At 50 million Americans now drawing social security, that’s $16,300 per person.
At 4.78 million American’s on unemployment now, that’s $170,645 per person (sorry, you’ll hog the whole pie if we let you).

Lastly, all of America, about 300 million people, that’s $2,717 for every man, woman and child!The $815 billion plan would be about double the existing dollars of currency and coin in circulation, about $885 billion now.

I hope and pray that the money is well managed and spent on worthwhile projects that benefit all American’s in this difficult financial time.

Even though January was a rough month again for the financial markets, gold and silver perked up nicely. Gold bullion rose about 5% while silver rose 13%. My next blog will discuss collecting coins and precious metals and their place in your overall financial mix. I think you’ll be surpised at the results.

Until next time, ~Barry

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