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Old 04-26-2014, 08:05 PM
 
48,516 posts, read 83,966,925 times
Reputation: 18050

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Quote:
Originally Posted by foglover View Post
Oh my, I'll probably get a lot of heat for this, but I want to emphasize that if I am guilty of anything it is merely stupidity. I am not trying to be offensive or confrontational.

Another caveat: It is overwhelmingly obvious that I know zip about economics. Money as subject matter is almost as boring as, oh let's see, as football. Bores me into catatonia.

In a current thread, a poster reveals her financial worth and asks if she has enough for retirement. It is a HUGE amount of money. And the talking money heads herein weighed in quite cautiously. IMO.

My question is this: what is all the money for? Let's assume that mortgage is paid and health insurance is in place. One is then left with the usual post-industrial necessities to pay for. Then what?

Travel seems to be a fetish that just keeps on collecting devotees. Okay, so most of the high rollers here can afford to travel. Then what?

All of us would like to have a healthy hedge against inflation. Okay. Then what?

Most folks, I hope, have some hobbies or recreational activities they indulge. Some can get expensive. Okay, but it is unlikely that anyone will be able to indulge those until they drop dead at 99.

I don't get it.
Another thing to prepare for is the higher medical cost over years. It also will allow a person to stay in place with hired help. Then one can certainly buy a real difference in assisted living or even nursing home with the right amount of money. money can buy many things not available without it as always.
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Old 04-26-2014, 08:43 PM
 
361 posts, read 621,593 times
Reputation: 496
Quote:
Originally Posted by rh71 View Post
I started my 401k when I was 22 so I'll have plenty by the time I retire. My point is there's no sense hoarding more for the sake of saving for later - you can still spend and not be broke later (especially if you admit to hoarding). I have to ask why you wouldn't RATHER spend money when you were younger compared to now....
Very little money to spend when I was younger...
Kids to raise -- that was expensive.
Then there was the layoff ... Cobra took all my UI.
A divorce -- will spare you the gruesome financial details.
Hoarding money...no way!
Oh... and there was no 401k when I was 22...just sayin'!
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Old 04-27-2014, 10:01 AM
 
Location: Glenbogle
730 posts, read 1,028,032 times
Reputation: 1046
Looking back on the things I spent money on when I was younger (rather than saving it in a nest egg for retirement) all I can say is: What a monumental waste. Other than books, there's not ONE thing that I threw my money away on during my 20s, 30s and early 40s that I either "needed" or have any interest in having or doing anymore.

ETA: By the way, I do think that many people underestimate the huge impact that a divorce can have on their retirement finances scenario. For instance, anyone who assumes that the house they own jointly during their 40s is going to "help finance their retirement" when they sell it 25 years later may be in for a rude awakening one day.
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Old 04-27-2014, 10:33 AM
mlb
 
Location: North Monterey County
3,184 posts, read 2,858,918 times
Reputation: 4879
Fidelity: Couples Need $240,000 for Retirement Health Costs - US News

I've always heard this - $240-250K JUST for healthcare/assisted living/pickup of expenses in a nursing home.

Both my mother and my MIL outlived their spouses. Dad died at age 80 - mom was his primary caregiver. MIL has been a widow for less than a year - she is 92.

Mom's assets thrown together were about $500K - she's just about to run out - (she's been in a care facility (first ALF then skilled nursing) now for almost 7 years. She was just diagnosed with clear cell cancer - we hear the staging and timetable next week - and will not survive that. She has chosen to go peacefully.

My MIL could live for many more years - but she pays 4500 a month for her assisted living.

THIS is why I am shoveling money into retirement vehicles. I am just guessing but figure we could be in the very same boat - me outliving my spouse....or the other way around. YES, Medicaid picks up the tab if the money runs out - but if the tab is being picked up for EVERYONE in the coming years as boomers age? The rules will inevitably CHANGE. I can guarantee it.

I am so onboard with the psychological reasoning and need for security for having ALL that money. Why SHOULDN'T I make the effort to save as much as I can while I can? We don't make much money but we save 25-30% of what we do make.

So living in retirement will NOT be about keeping up with the Jones' Travel Schedule.

It will be about quality of life.
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Old 04-27-2014, 10:49 AM
 
29,782 posts, read 34,880,403 times
Reputation: 11705
Quote:
Originally Posted by mlb View Post
Fidelity: Couples Need $240,000 for Retirement Health Costs - US News

I've always heard this - $240-250K JUST for healthcare/assisted living/pickup of expenses in a nursing home.

Both my mother and my MIL outlived their spouses. Dad died at age 80 - mom was his primary caregiver. MIL has been a widow for less than a year - she is 92.

Mom's assets thrown together were about $500K - she's just about to run out - (she's been in a care facility (first ALF then skilled nursing) now for almost 7 years. She was just diagnosed with clear cell cancer - we hear the staging and timetable next week - and will not survive that. She has chosen to go peacefully.

My MIL could live for many more years - but she pays 4500 a month for her assisted living.

THIS is why I am shoveling money into retirement vehicles. I am just guessing but figure we could be in the very same boat - me outliving my spouse....or the other way around. YES, Medicaid picks up the tab if the money runs out - but if the tab is being picked up for EVERYONE in the coming years as boomers age? The rules will inevitably CHANGE. I can guarantee it.

I am so onboard with the psychological reasoning and need for security for having ALL that money. Why SHOULDN'T I make the effort to save as much as I can while I can? We don't make much money but we save 25-30% of what we do make.

So living in retirement will NOT be about keeping up with the Jones' Travel Schedule.

It will be about quality of life.
Bada Bing!
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Old 04-27-2014, 03:36 PM
 
Location: Southwest Washington State
21,896 posts, read 14,397,959 times
Reputation: 30781
Quote:
Originally Posted by HarryLou View Post
Very little money to spend when I was younger...
Kids to raise -- that was expensive.
Then there was the layoff ... Cobra took all my UI.
A divorce -- will spare you the gruesome financial details.
Hoarding money...no way!
Oh... and there was no 401k when I was 22...just sayin'!
It sounds like you had some real bad luck. I do want to mention that even though you did not have a 401K when you were 22, you could have saved money in a bank account and gotten actual interest paid to you. And you could have invested in mutual funds. There were ways to save.

We didn't do a good job of saving in our twenties, either.
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Old 04-27-2014, 03:43 PM
 
Location: Southwest Washington State
21,896 posts, read 14,397,959 times
Reputation: 30781
Quote:
Originally Posted by StressedOutNYer View Post
Looking back on the things I spent money on when I was younger (rather than saving it in a nest egg for retirement) all I can say is: What a monumental waste. Other than books, there's not ONE thing that I threw my money away on during my 20s, 30s and early 40s that I either "needed" or have any interest in having or doing anymore.

ETA: By the way, I do think that many people underestimate the huge impact that a divorce can have on their retirement finances scenario. For instance, anyone who assumes that the house they own jointly during their 40s is going to "help finance their retirement" when they sell it 25 years later may be in for a rude awakening one day.
Yes on the home. It might, or it might not. We do know of people who are reaping the benefits of a hot market in their area, but our home for 23 years in a fine part of a metro area cost us money, when you factor in our improvements and maintenance costs. I think it is probably better financially to rent or own small. I did want to make a nice home though. It would have been hard for me to live in a cramped apartment or condo with kids.

I agree that we probably could have spent our money more wisely,especially at first, before we had all of our kids. We should have socked money away and left it alone. There were years when we couldn't have saved very much, even if we had tried, but early on we had a little extra. We have counseled our kids to save right from the beginning.
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Old 04-27-2014, 05:12 PM
 
10,818 posts, read 8,069,111 times
Reputation: 17029
Quote:
Originally Posted by rh71 View Post
I have to ask why you wouldn't RATHER spend money when you were younger compared to now. Big house for just the 2 (or 1) of you or nice car to go hardly anywhere when you're a senior...? Doesn't make logical sense to me. What are you doing with money having the time of your life now that you did not want to do when young? I think most would say travel. Then again, most don't travel many months of the year but make it seem like that's a huge deal. When you're older, you just have a lot of time on your hands and probably have to purposely find things to spend money on. Then there are potentially other factors like health and disability. That's just the way I see it so I'd love to hear where I'm mistaken.
I don't think we're that far apart, I too started saving money when I was in my early 20s (no such thing as 401k then). Not sure what you mean by nice car (we have two Subaru's, mine is 2009) or going hardly anywhere, and we don't have a big house (less than 2200 sf, which is about 1000 sf than I'd choose, given my druthers). I traveled widely during my young years, continue to do so in my senior years. By time of my life, I mean I indulge all the wants I didn't do when I was younger. That includes travel, but also eating out, buying books, attending cultural events, supporting charitable events, and indulging hobbies like genealogy, theater, and gardening.

Back in the day I had a grand old time scrimping. It was fun then camping out with sleeping bags, living with 3 roommates, bartering for rock concert tickets. Now that I'm old and gray, I'm having a even grander time living high on the hog. Contrary to what you assume, not all or even most seniors in their 60s and 70s are disabled.

Last edited by biscuitmom; 04-27-2014 at 05:21 PM..
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Old 04-27-2014, 05:19 PM
 
Location: USA
271 posts, read 315,036 times
Reputation: 153
Quote:
Originally Posted by mlb View Post
Fidelity: Couples Need $240,000 for Retirement Health Costs - US News




YES, Medicaid picks up the tab if the money runs out - but if the tab is being picked up for EVERYONE in the coming years as boomers age? The rules will inevitably CHANGE. I can guarantee it.
Agree, I think we will see a very different world in the years to come.
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Old 04-27-2014, 05:31 PM
 
Location: Baltimore, MD
3,745 posts, read 4,220,203 times
Reputation: 6866
Quote:
Originally Posted by StressedOutNYer View Post
I looked into MD when I first began researching retirement locations, and discovered that in addition to the income limits, there is also an asset limit of $200K (not including the residence for which the credit/reduction is being claimed).

So if someone sells their house in, say, NY or MA, and comes to MD with $300K from the sale, planning to save or invest it for retirement income, they will not be able to get the property tax credit.

Some towns or counties also have their own low-income senior assistance programs but it's not statewide.
It is true that if you have $300,000 in cash, not including the value of your home and retirement account funds, you would not be considered low income.
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