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We don't have specific back-up plans but we try to keep the risks down in the usual ways - good medical insurance, good house insurance, don't put all our eggs in one basket, diversified investments, etc. But this thread reminds me that I need to change the batteries in our smoke detectors.
You and a few others are having a great thread discussion on the difference between average and compound returns. You are well versed and understand the dynamics of change to ROI that occur during draw down. Many others don't and aren't as well prepared as they think. I would encourage others to read that thread in the investing forum.
I have to agree that flexibility is the key! I can be a bean counter when necessary, so I have copious Excel spreadsheets dedicated to the various retirement plans. Health (ours and my parents) are the real wildcards in this. A downturn there could throw a monkeywrench in things emotionally and financially.
Some of the safeguards that we have in place include: property insurance, health insurance, car insurance, a personal umbrella policy, living wills, regular wills, plans to save after retirement in retirement vehicles, no debt, adding a new income stream/rental unit every 2 years, cooking from scratch and being frugal within reason, no addictions, downsizing our personal residence (though we don't have to) and divesting ourselves of people who stir up drama. (Drama can be incredibly expensive!) We also try to keep each other in the loop of financial things so that the other spouse could pick up the pieces, if need be. We are also updating our properties with the goal of making things as easy to care for in the future, as we age.
I had A and B. But it was C and D that really screwed me over.
I knew reality said I might outlive my H and I planned for that possibility. What I didn't plan for was his dropping dead at 61. Without a will too by the way. That means in most states the widow loses half.
After H died, his father who had been dead since 1987 turned the knife in my back one last time. All I ever knew was his will had left everything but his oil royalties to his wife. The oil royalties went to H. After H died I learned the oil money went to H's half brother because of the way his father's will had been written. I think H probably didn't understand it either. If he had, he would have sold the royalties to me and that would have abrogated that clause in his father's will.
Anyway the money I had counted on for a big part of my retirement ended up belonging to a convicted felon. Who had already stolen plenty of money from other people. Believe me, it's a story!
I don't thing anyone should count on direct inheritance money from in-laws. It is their money and if their child pre-decreases them what is their reason to give to the spouse instead of another child? Grand child maybe but spouse? Even if the parent passes first their intent maybe to set it up so it transfers to another child.
I don't thing anyone should count on direct inheritance money from in-laws. It is their money and if their child pre-decreases them what is their reason to give to the spouse instead of another child? Grand child maybe but spouse? Even if the parent passes first their intent maybe to set it up so it transfers to another child.
H's father died in 1987 and H inherited the royalties. The half brother who got everything after H died in 2012 was no more related to the family by blood than I was. The oil money came from my FIL's family.
No doubt H's father was free to do as he pleased. I just wish we would have done more research and understood what he had done. I always thought once you inherited, it was yours. We didn't know there was a set of circumstances that could take it away later, years(decades) later.
Since H owned the oil rights he could have sold them to me or we could have put them in a trust for our use. H's mom never let us see the will. All she did was tell us the oil rights had gone to H. And since he started getting the money, we believed her. If we had insisted on a copy of the will, we would have learned the rest of the story. And could have planned appropriately! There's lots we would have done differently.
I never knew much about the oil till after H died. It was just a small deposit every month. The Bonanza Gold H had been waiting all his life to see happened 4 months after his death. I wish he had lived long enough to see it.
It's difficult to know what is the most likely, or most serious, wild card possibility, but I'll vote for health emergencies. If a person ends up partially paralyzed from a stroke, just for example, it is doubtful that person could continue working, depending on the nature of the paralysis and the nature of the job. (Yes, I know many people in wheelchairs have jobs, even good jobs, so I'm not discounting that possibility, just saying nothing is guaranteed along those lines.)
I thank my lucky stars that I was able to continue working until the moment of my own choosing, which was age 61.5 in my case. Stopping just two or three years sooner would have meant a substantially smaller pension, the way the California State Teachers' Retirement System calculates the pensions. Under our system, retiring at age 55 is just not a realistic possibility because the pension at that age would be vanishingly small. I'm not saying some people don't do it - there are plenty of women teachers whose husbands are earning the big bucks in some other profession and who don't need to worry about maximizing their pensions (again, just as one example).
I cannot take credit for my reasonably good health - I mean beyond not smoking and stuff like that. Good health to ANY given age is never guaranteed despite the best health and lifestyle habits; the latter just improve our chances.
I agree with the poster who wrote that we can only live as debt-free and within our means as possible, then if the you-know-what hits the fan it will at least be a little easier to cope.
My biggest fear in retirement is dementia. If I get it or my wife. My wife side of the family has gotten it. Age 68-70 seams like the prime ages. On my side of the family every female in the family has gotten it, however, no male has ever had it. All my life, not a single decade would go by without one of my female relatives having it.
I can deal with heart problems, cancer, kidney problems, broken bones, car crashes and death for what ever reason, but dementia can go on for 5-15 years.
Any one that has had to take care of a dementia family member would know what I'm talking about.
The biggest issue is health ;IMO. I am not even talking about financially either but life change. I see that happen more often than any other including financial.
The biggest issue is health ;IMO. I am not even talking about financially either but life change. I see that happen more often than any other including financial.
All of my parents' well-to-do retired friends were felled by serious illness leading to death. Their wealth didn't seem to save them. One of my mother 's female friends went to pieces when her husband predeceased her, because he had waited on her hand and foot and she didn't know how to do anything. She seemed to have no backup plan and went downhill very fast and died not long after his death, which not uncommonly happens after a spouse's demise when the two were really dependent on one another. My aunt went crazy when her husband died, did all kinds of irrational things and died within two years. She had had all kinds of hired help.
My biggest fear in retirement is dementia. If I get it or my wife. My wife side of the family has gotten it. Age 68-70 seams like the prime ages. On my side of the family every female in the family has gotten it, however, no male has ever had it. All my life, not a single decade would go by without one of my female relatives having it.
I can deal with heart problems, cancer, kidney problems, broken bones, car crashes and death for what ever reason, but dementia can go on for 5-15 years.
Any one that has had to take care of a dementia family member would know what I'm talking about.
I agree, dementia is imo a fate worse than death. With this running in the family, plans are needed.
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