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Old 04-10-2016, 02:27 PM
 
12,302 posts, read 15,205,734 times
Reputation: 8108

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Of course most had those good government jobs that offer security and great retirement benefits (though if I were teaching in the Chicago Public Schools I might consider suicide!). But I know a few in the private sector who were able to do it. Some are excellent financial managers who never had children. Others retired on disability and are experts on stretching a dollar.

Of course, moving to Cleveland helps.

Last edited by pvande55; 04-10-2016 at 03:04 PM.. Reason: Add line.
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Old 04-10-2016, 02:38 PM
 
Location: Tennessee
29 posts, read 62,904 times
Reputation: 81
It's no free ride under the FERS retirement plan either. The TSP 401k is 1/3 of your retirement portfolio. It is up to the employee to contribute or not. I averaged putting ~10 percent of my income into retirement for over 30 years. Also, government employees for what they gain in benefits, are offset when it comes to compensation compared to comparable jobs in the private sector. It's not all gravy working for the FEDS, but it does have its benefits

-WC
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Old 04-10-2016, 03:09 PM
 
10,604 posts, read 14,211,574 times
Reputation: 17203
I'll be the contrarian here. I assume this "we" is a spouse? Do they have anything to contribute? I'm no financial planner or govt retirement expert but I do know what it costs to age.

No one ever budgets a thing for Assisted Living or Memory Care. Or ANY LTC for that matter. I guess you're all betting on an early death. NOT an illness just a death, right?

You won't have enough, JSYK.

If I'm understanding you, at age 56 your entire net worth will be $886K (before debt payoff and including your 401):
  • the 401K $550K? (not including your two annuities payable by the govt for life)
  • the $336 remainder of your house sale before debt payoff
Total $886K BEFORE you pay off debt.

(420 + 142 = 562 - 226 = $336 BEFORE paying down this substantial debt)

We're counting on you not losing anything in your 401. In fact, my broker hates the mutual fund choices in 401s

How are you going to buy a new house or will you be renters for the rest of your lives?

I guess you could full time in the RV off the annuities. Hopefully you picked one that has actual windows and can work as a full RV not just a toy hauler. Now I see why your house isn't paid off.

Do you realize a pair of progressive glasses cost around $700? That's another $20K if you live to 85. But if you go to Walmart you can get them for half that.

A year in Assisted Living costs around $75K to $100K for one person?

A CRAPPY caregiver will run you around $25.00 per hour through an agency.

A quick study of the Caregiving forum should give you pause not to mention your parents who are still alive.

But if you have no assets except your annuities, the taxpayer will pick up the difference on Medicaid. Of course that's NOT for Assisted Living or Memory Care only Skilled Nursing Facility and bad because they're not always the best and sometimes you go wherever they have a bed. Don't think you can "stay home" because it doesn't work out that way.

I don't know who all these federal workers are who are dropping like flies at age 62, but I know literally HUNDREDS of people who haven't - up to and including age 104 living in a condo still driving. (!)

IRONIC you're citing these dead people without realizing that the likely hood is that you two won't be DEAD but incapacitated and go blowing through your assets quickly.

I STRONGLY suggest you get jobs, and stay with mom and bank as much of that annuity money as possible and even consider going towards a Life Care Retirement Community at age 62+ where you age in place and go from Independent Living to Assisted Living to Memory Care/ Skilled Care ONLY IF you've bought in there with an equity. Usually starting around $100K.

These places are hard to come by. And usually very very nice. Even in Independent Living your monthly payment will be (right now) a few thousand per month but locked in for life as you need additional care. And remember ONE of you may need service different than the other.

The one I know about is not in TN but here's one in FL. One of the few that offers Independent, Assisted, Memory Care AND Skilled.

https://actsretirement.org/community...es-vero-beach/

Note: they are not all the same even if they are a corporate chain. Some only have Independent & Assisted and others have more.

Don't laugh, a client of mine couldn't get appropriate care and housing and was VERY VERY wealthy but she couldn't get admitted to this place because of the heavy demand.

P.S. THAT place is FULL of people age 62 to 100 loving life and active. OR getting care they need as they age in place. IRREPLACEABLE.

Last edited by runswithscissors; 04-10-2016 at 03:38 PM..
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Old 04-10-2016, 03:45 PM
 
Location: CA
923 posts, read 722,896 times
Reputation: 687
Thank you for the response:

To answer the home question: I sold my former home for 1.3 (I bought it for 680K and we were there for 10 years and added to the house enough that there were no taxes on the gains). We bought this one for 785K so a 900 or + sale after two years will be well below the exemption.

Like you, my kids up to that point, walked to elementary and junior high and then drove to high school.

If I did stay to 62 years old teaching, it would be more like $6200 per month (the formula really changes at age 60+) so that you can retire with quite a bit. My S-dad makes more now retired than he did when teaching. My mom is an accountant and knows the formulas and says that CA Teacher's have a good retirement if they put in long enough.

True! I could teach in Ohio. I did a year near Dayton while completing my Master's (2006) and the principal offered me a job (I was subbing part time).

Ventura/Oxnard? We are close! We just aren't "beach" people. I was when young, but not now and my two oldest never want to go. Film editing and the other into automotive.

I'll meet with my advisor and then look over numbers. Remember in 2006? I was getting 5.25% from my bank!!! I also had a note at 9%! Those were the days.

I never made a great deal of salary at my job, but was lucky to buy and sell a few times in my area at the right times.
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Old 04-10-2016, 03:53 PM
 
Location: Tennessee
29 posts, read 62,904 times
Reputation: 81
Quote:
Originally Posted by runswithscissors View Post
I'll be the contrarian here. I assume this "we" is a spouse? Do they have anything to contribute? I'm no financial planner or govt retirement expert but I do know what it costs to age.

No one ever budgets a thing for Assisted Living or Memory Care. Or ANY LTC for that matter. I guess you're all betting on an early death. NOT an illness just a death, right?

You won't have enough, JSYK.

If I'm understanding you, at age 56 your entire net worth will be $886K (before debt payoff and including your 401):
  • the 401K $550K? (not including your two annuities payable by the govt for life)
  • the $336 remainder of your house sale before debt payoff
Total $886K BEFORE you pay off debt.

(420 + 142 = 562 - 226 = $336 BEFORE paying down this substantial debt)

We're counting on you not losing anything in your 401.

How are you going to buy a new house or will you be renters for the rest of your lives?

I guess you could live in the RV off the annuities. Hopefully you picked one that has actual windows and can work as a full RV not just a toy hauler. Now I see why your house isn't paid off.

Do you realize a pair of progressive glasses cost around $700? That's another $20K if you live to 85. But if you go to Walmart you can get them for half that.

A year in Assisted Living costs around $75K to $100K for one person?

A CRAPPY caregiver will run you around $25.00 per hour through an agency.

A quick study of the Caregiving forum should give you pause not to mention your parents who are still alive.

But if you have no assets except your annuities, the taxpayer will pick up the difference on Medicaid. Of course that's NOT for Assisted Living or Memory Care only Skilled Nursing Facility and bad because they're not always the best and sometimes you go wherever they have a bed. Don't think you can "stay home" because it doesn't work out that way.

I don't know who all these federal workers are who are dropping like flies at age 62, but I know literally HUNDREDS of people who haven't - up to and including age 104 living in a condo still driving. (!)

IRONIC you're citing these dead people without realizing that the likely hood is that you two won't be DEAD but incapacitated and go blowing through your assets quickly.

I STRONGLY suggest you get jobs, and stay with mom and bank as much of that annuity money as possible and even consider going towards a Life Care Retirement Community at age 62+ where you age in place and go from Independent Living to Assisted Living to Memory Care/ Skilled Care ONLY IF you've bought in there with an equity. Usually starting around $100K.

These places are hard to come by. And usually very very nice. Even in Independent Living your monthly payment will be (right now) a few thousand per month but locked in for life as you need additional care. And remember ONE of you may need service different than the other.

The one I know about is not in TN but here's one in FL. One of the few that offers Independent, Assisted, Memory Care AND Skilled.

https://actsretirement.org/community...es-vero-beach/

Note: they are not all the same even if they are a corporate chain. Some only have Independent & Assisted and others have more.

Don't laugh, a client of mine couldn't get appropriate care and housing and was VERY VERY wealthy but she couldn't get admitted to this place because of the heavy demand.

P.S. THAT place is FULL of people age 62 to 100 loving life and active. OR getting care they need as they age in place. IRREPLACEABLE.
Thanks runswithscissors... but no thanks

I'll try to address your hypothesis, or what I understand may be an average example in your view

- Yes, ball park figure for net worth is close

- As for 401K, I budget for annual yield of 4% over a 10 year period. The Dow average rate of return since 1980 is 5.669% adjusted for inflation. Yes, the stock market is volatile and there is risk

- Buying a home? We're not sure. May build on the farm or inherit existing home. Estimating $800.00 mortgage

- You're assumptions are I would get a new script yearly. Just by going every other year reduces the cost by 50%

- My peers, nor I are the average government workers where norms could be applied. I can only speak to the environment we work in. We may be indeed statistical outliers

- As for assisted care. I'm not going to live the rest of my life in fear of becoming bed ridden. The cost are the same whether I'm working or not. Your assumptions are I would need the assisted care later, rather than sooner. I would hate to learn I decided to work another 5 years and save more for assisted care, only to learn I have a need for assisted care. The 5 years or additional work were moot in the big scheme of things


Some info on life projection


Table 3 below compares the life expectancy at attained ages 55, 65, and 85 based on the mortality rates shown in Tables 1 and 2. It shows, for example, that the expected age at death for a male retiree age 55 was 76.39 in 1980, and was 79.33 years in 2000. Thus the life expectancy for a male age 55 increased by 2.94 years over this period.

Expected Age at Death
For All Retired Employees - Male
Attained
Age 1980 1990 2000
55 65 85
76.39 77.90 79.33 79.85 80.83 81.80 90.10 90.39 90.68


I have a safe full of tools to address issues with health should they become cost prohibitive

Thanks for the feedback

WC

Last edited by West Coasting; 04-10-2016 at 04:02 PM..
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Old 04-10-2016, 03:55 PM
 
Location: In The Pacific
986 posts, read 1,179,317 times
Reputation: 1233
Quote:
Originally Posted by odanny View Post
Where in the world did you relocate to? Are your living expenses substantially lower there than here? Just curious.
My wife and I were born in the Philippines, which still has a low cost of living, but other retirees with insufficient income would say other wise. Living here isn't for everyone.

Last edited by Art2ro; 04-10-2016 at 04:10 PM..
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Old 04-10-2016, 03:58 PM
 
Location: CA
923 posts, read 722,896 times
Reputation: 687
I have a safe full of tools to address issues with health should they become cost prohibitive

Eskimo deal for me! Put me on a floating piece of ice and adios! Never sitting in a bed 24/7. I've been "hyper" my entire life according to my report cards and now students.

Health coverage is my only concern. I have to look into that. I pay about $400 per month and my employee puts in $1100. That said, Where I live there is ONE health network so no competition. CLE has the Clinic and many hospitals (best cardio in the World).
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Old 04-10-2016, 04:19 PM
 
10,604 posts, read 14,211,574 times
Reputation: 17203
Quote:
Originally Posted by teacherdad View Post
I have a safe full of tools to address issues with health should they become cost prohibitive

Eskimo deal for me! Put me on a floating piece of ice and adios! Never sitting in a bed 24/7. I've been "hyper" my entire life according to my report cards and now students.

Health coverage is my only concern. I have to look into that. I pay about $400 per month and my employee puts in $1100. That said, Where I live there is ONE health network so no competition. CLE has the Clinic and many hospitals (best cardio in the World).
Right?

Here's the challenge.

You need a very functional Ouija Board to predict when that time comes because once you have a stroke, you're SOL.

Of course with dementia or another neurological disorder you won't even realize you're sitting in bed. You'll think you're in all different cities having all different adventures.

No, seriously people need Assisted or Skilled also as rehab so if you have a knee replacement or something you're back to tennis in no time. PROBLEM again, is which one has an opening and good care.

I only harp on this because I have a dog walking business and work for all these different people and know more than I ever hoped to (and my own mother who was wealthy and it didn't help her ONE BIT - as she wasted away in a Skilled Facility because they threatened to go to court for guardianship if I tried to let her die at home and her LAWYER - her POA - AGREED even knowing it was against her wishes)
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Old 04-10-2016, 04:26 PM
 
14,261 posts, read 24,004,620 times
Reputation: 20081
Quote:
Originally Posted by Art2ro View Post
My wife and I were born in the Philippines, which still has a low cost of living, but other retirees with insufficient income would say other wise. Living here isn't for everyone.
When I was working, I had a lot of my employees who were based in Manila. When I retired, I made an off the cuff remark about moving to Cebu and I basically received the comment "are you loco?"

I know a lot of American ex-pats who have relocated to the Philippines. In many cases, these are folks like yourself who have a wife or relatives from the Philippines. They generally are pretty happy and do pretty well.

On the other hand,the ex-pats who have no connections might last a year or two before they move on.

I may be wrong - and you can correct this - but most of the people that I talk to budget about US$1500 a month in expenses living outside the Metro Manila area for a couple living a lifestyle similar to the average Philippine lifestyle or US$3000 in a Western lifestyle.
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Old 04-10-2016, 04:37 PM
 
14,261 posts, read 24,004,620 times
Reputation: 20081
Quote:
Originally Posted by teacherdad View Post
I have a safe full of tools to address issues with health should they become cost prohibitive

Eskimo deal for me! Put me on a floating piece of ice and adios! Never sitting in a bed 24/7. I've been "hyper" my entire life according to my report cards and now students.

Health coverage is my only concern. I have to look into that. I pay about $400 per month and my employee puts in $1100. That said, Where I live there is ONE health network so no competition. CLE has the Clinic and many hospitals (best cardio in the World).


Before I make a comment, I will state that I have lived in the Cleveland area and really enjoyed it. Housing is very affordable especially if you live within the city (and you don't need to worry about school quality). The people are also great if you are friendly and make a minimal effort to fit in.

Cleveland has TWO major healthcare networks - University Hospital and the Cleveland Clinic. Each owns several hospitals. Don't assume that if you need care a a Cleveland Clinic hospital that you will be getting the same care as the concierge patients from around the world get. Also, like any healthcare system, it all relies on the quality of the doctors. My Cleveland Clinic doctor did not discover a lot of my health issues that my doctor in Chicago picked up on immediately.

Also, you better make sure that you understand which hospitals are in your network. Just because you want to head to a Cleveland Clinic facility does not mean that the insurance will cover it. If you rely on some of these exchange plans, your healthcare choices may be very limited. Also, in some states, you may need to change plans as many insurers are getting out of the health care exchanges as they are losing money.
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