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I think Americans are not ready for retirement at all when it comes to the prospect of long-term care. I have recently dealt with the decline and eventual deaths of my mother and mother-in-law. With advances in medical care people are living much longer but often with chronic conditions that leave them needing care. My mil ended up in a wheelchair needing full care (lifting out of bed, changing, etc) and the costs of that care ate up all of her retirement she had saved being very frugal. My own mom declined slowly with dementia and also required expensive care. With the rise in obesity I see many being taken by surprise with needing help in their later years to where their entire life savings will be gone in a short time.
My mother recently passed away and spent the last 4 years bed ridden in a facility with the last 3 in hospice care. She had a good federal pension (retired at GS12 with over 20 years service), good insurance and it still cost her nearly everything else saved.
My aunt is one. She is my mother's younger sister and my Mom is 83 so she has to be nearly 80 herself. She never had a solid career, but worked a variety of jobs throughout her life, never lasting for long- ...
Are you saying that she worked all her life yet never paid into SS ?
Are you saying that she worked all her life yet never paid into SS ?
No, he's saying his aunt never had a career job with higher income and never saved. If you start collecting Social Security at age 62 with that kind of income history, you're likely at poverty level being topped up by SSI.
I would imagine the bottom 30% to 40% of retirees have a similar story.
My mother recently passed away and spent the last 4 years bed ridden in a facility with the last 3 in hospice care. She had a good federal pension (retired at GS12 with over 20 years service), good insurance and it still cost her nearly everything else saved.
But wasn't that the point of saving it? So she could have it for those potential expenses that became very real at the end of her life? She sounds as if she planned well.
So long as a person pays into SS and works 40-quarters and they should qualify for a pension.
If the cost of maintaining your lifestyle is above your SS, then you have other issues. But you are on a pension at that point.
Many people live on SS.
While it is true that many people live on SS for people who always had minimum wage or just above minimum wage for their entire careers the amount can be quite small. I believe that my aunt received about $725 a month. Perhaps an income of $8,700 a year may seen like a lot to you but it certainly was difficult for a single woman living on her own to survive on that pension.
While it is true that many people live on SS for people who always had minimum wage or just above minimum wage for their entire careers the amount can be quite small. I believe that my aunt received about $725 a month. Perhaps an income of $8,700 a year may seen like a lot to you but it certainly was difficult for a single woman living on her own to survive on that pension.
My pension is nearly double that. Compared to me a $725/month pension is small. However in our town such is common.
It makes a huge difference whether you select to live in a high COL area or a low COL area.
I do. A friend of mine ignored doing financial planning and she spent money as soon as she got it. She used her home as a piggy bank by using equity line of credit, she let the house fall apart all around her (example: she never once cleaned her refrigerator in the 10 years she had it, when it broke, she found stuff in there that had been expired for 9 years.)
So, now it is 2016 and she is selling her house to one of those "we buy any house" groups. She will get less than 40% of the assessed value, she leaves hundreds of thousands of value behind because she let the house get so bad.
Now, she is 65, unemployed, and it dawned on her that not only does she have no savings...none...but she is only getting $150K for a home that should have sold for $500K in good condition. She thinks life is SO unfair to her. And of course, she asked me for a $20K loan. She never paid me back for the last loan I made to her....so, no.
You just described my mother...minus the $150k house equity.
IIRC, didn't a lot of the UAW folks take a haircut back in the collapse?
GM bondholders not the union nor pensioneers took the big haircut, contrary to centuries of established legal and financial precedent. This was done with the direct intervention of the US president and remains one of the primary reasons many on Wall Street are wary of the current administration (Obama).
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