Couple in 60's still working with $1.5 million saved (relative, years, housing)

[TuborgP]

So the couple is going to work a few more years and than spend 40K a year on vacations with the blessing of the person who wrote the article. Sounds like a plan to me.

[HappyTexan]

Originally Posted by TuborgP

So the couple is going to work a few more years and than spend 40K a year on vacations with the blessing of the person who wrote the article. Sounds like a plan to me.

The risk though is that health can deteriorate in those few years.
They may end up with a pile of money and not be physically able to take those $40K vacations.

[mlb]

I'm wondering down the road - if skilled nursing facilities will change their policy of keeping elderly who have run out of money.....and take care of them on Medicaid/Medicare funds.

My 91 year old mother will run out of money in about 7 years - she's been in assisted living for about 6 years now - having to liquidate all her assets - and retirement portfolio. She very well may outlive her money.

She has been told that when that happens - she will not be thrown out on the street.

I bet this changes over the years...with everyone else and the huge amounts of people who will need assisted/skill nursing living.

[Robyn55]

Originally Posted by mlb

I'm wondering down the road - if skilled nursing facilities will change their policy of keeping elderly who have run out of money.....and take care of them on Medicaid/Medicare funds.

My 91 year old mother will run out of money in about 7 years - she's been in assisted living for about 6 years now - having to liquidate all her assets - and retirement portfolio. She very well may outlive her money.

She has been told that when that happens - she will not be thrown out on the street.

I bet this changes over the years...with everyone else and the huge amounts of people who will need assisted/skill nursing living.

I wouldn't hold my breath in terms of anything remaining the same (or changing for that matter) when it comes to health care or elder care even 2 years down the road - much less 7.

On my part - I think it likely that more skilled nursing facilities will start to refuse to accept Medicaid patients - or go out of business. And/or perhaps there will be facilities with lower standards that cater to Medicaid patients.

As far as your mother's situation is concerned - you should look into the concept of "pending Medicaid" when it comes to skilled nursing facilities. Most facilities that will accept Medicaid patients will not admit them "pending Medicaid approval" if they can't afford to pay for at least 6-12 months out of pocket (just in case Medicaid doesn't approve their applications). SNFs usually cost a lot more than assisted living. So you don't want your mother to wind up in a position where she needs a SNF - isn't on Medicaid - but doesn't have enough to pay for these 6-12 months "pending Medicaid approval". You may not need to learn everything tomorrow - but it's good to understand the basic concept/problem. Robyn

[mathjak107]

the problem here in nyc is medicaid homes now are just awful. there is nothing like a private facility. many times the medicaid facilities are quite far from nyc as well..

[Robyn55]

Originally Posted by mathjak107

do you know anyone who actually sits there and tries to figure out their return on their pension?

nope..

it would be a stupid thing to do because a pension isnt measured in a return on investment even if part of it is contributory.

i dont even count the early years of an annuity as anything but a return of my own money. the irs throws a little interest in each years payment but thats for accounting only.

once i spend all my own money that they give me back at a burn rate i would never think of doing on my own without the annuity i go on on their dime.

no matter how long i live that money keeps coming on their dime at that same rate .

i dont know why you keep trying to equate a return to this. .if your father took it at 62 and lived to 103 you would love all the extra dough he got to spend each year long after his ,money would have been gone at that rate.

but even if not ,its not about a return on investment ,its all about a burn rate you cant sustain by doing it on your own without lots of risk and uncertainty ..

its also about bolstering a conservative portfolio with extra income during periods like now where there is little income coming in for extended periods of time ,its about avoiding selling equities at a loss, selling more than you should or could or at all to sustain longer than expected down turns.

if anyone is fixated on looking at everything as a return than dont buy an annuity, its not something you measure with a total return yardstick.

it may very well bolter your own portfolio returns as you will see in the thread below and in that sense it can be measured . but an annuity is a pension and has to be looked at as such. it provides stability, it provides a higher amount of money forever than you can get safely at that time and it adds a reasonable amount of certainty you can plan around without being dependent on the markets and interest rates whims.

My father didn't buy his annuities when he was 62 - he did when he was 80. The annuity payouts at age 62 today would be a lot lower than what he got - both as a result of increased life expectancy charts and lower interest rates.

I guess I come at this from a different POV than some people here because I don't have a pension per se. I was a small employer - and we had generous defined pension/profit sharing contribution plans in our firm. We discontinued the plans after government rules became ridiculous - and then I think everyone rolled the money over into self-directed IRAs. So I have been pretty much been responsible for planning my own "pension" for quite a while.

Best I can see right now - people who have pensions/annuities from outside sources may face things they didn't/don't expect 5-10-20+ years down the road (because a lot of entities that are paying pensions/annuities can't afford their present and future obligations). Just like I will face things I didn't expect to face with my "DIY pension". Robyn

[mathjak107]

the good thing is you have been retired for quite some time and have a handle on things . at least you know your expenses, what you need to maintain the life you want to lead, etc.

i wish i was already in at least that position. most of us who arent retired and dont want to live where we are are pretty clueless how things will be in real time. most only know on paper what they hope and think . . . we have guesses but if they are anything like the guesses i thought our second home would cost us oh brother are we in trouble.

[TuborgP]

Originally Posted by mathjak107

the good thing is you have been retired for quite some time and have a handle on things . at least you know your expenses, what you need to maintain the life you want to lead, etc.

i wish i was already in at least that position. most of us who arent retired and dont want to live where we are are pretty clueless how things will be in real time. most only know on paper what they hope and think . . . we have guesses but if they are anything like the guesses i thought our second home would cost us oh brother are we in trouble.

My formula is to always be ready for a 20% reduction in what you think it will be.

[BigJon3475]

Originally Posted by Caladium

...or the state where they live. A million bucks doesn't go as far as you might think in some cities.

Or you could move to somewhere in Latin America and live like a King and Queen.

Not everywhere in S. America is impoverished and you can still collect SS while you're there and enjoy their beaches and cheap COL.

[BigJon3475]

Originally Posted by mlb

I'm wondering down the road - if skilled nursing facilities will change their policy of keeping elderly who have run out of money.....and take care of them on Medicaid/Medicare funds.

My 91 year old mother will run out of money in about 7 years - she's been in assisted living for about 6 years now - having to liquidate all her assets - and retirement portfolio. She very well may outlive her money.

She has been told that when that happens - she will not be thrown out on the street.

I bet this changes over the years...with everyone else and the huge amounts of people who will need assisted/skill nursing living.

2018'ish is D-Day.