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Old 11-03-2016, 01:36 PM
 
Location: Colorado Springs
4,830 posts, read 4,940,887 times
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People who have a paid off house, are 65 so they get Medicare, have paid off cars and modest savings to combine with their SS taken at FRA do well in retirement.

It's all about having a secure income that meets reduced expenses in retirement.

No, most people do not have $1M saved and they do fine.
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Old 11-03-2016, 01:37 PM
 
Location: SoCal
13,188 posts, read 6,301,958 times
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You do not need millions. I think SS is fine. Of course it doesn't hurt to have millions.
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Old 11-03-2016, 01:44 PM
 
3,339 posts, read 2,073,907 times
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Quote:
Originally Posted by stellastar2345 View Post
People always tell me (here at least) that you shouldn't count on your inheritance because health expenses may take it all. I think the average American something like 200k - 300k saved for retirement. My parents have multiple millions, and I am told that all of this can go towards healthcare. How does the average American afford to retire if multiple millions could potentially be needed for retirement?
average American..if they are two working spouses..that makes it 400-600k + ss = 60k income/year..not bad, especially if they paid their house alredy
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Old 11-03-2016, 01:53 PM
 
Location: Paranoid State
13,047 posts, read 10,426,347 times
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One of the big issues is long term nursing care. Here is a US gov website: Costs of Care - Long-Term Care Information

Quote:
Some average costs for long-term care in the United States (in 2010) were:

* $205 per day or $6,235 per month for a semi-private room in a nursing home
* $229 per day or $6,965 per month for a private room in a nursing home
* $3,293 per month for care in an assisted living facility (for a one-bedroom unit)
* $21 per hour for a home health aide
* $19 per hour for homemaker services
* $67 per day for services in an adult day health care center
It appears pretty easy to drop $7K per month in a nursing home. Five years at $7K/month is $420K. People certainly do it cheaper, of course, and they also do it more extravagantly.
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Old 11-03-2016, 02:00 PM
 
5,424 posts, read 3,440,673 times
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You don't even need a paid off house to retire. I've never owned a house and live in an apartment. And have been retired nearly 7 years.

I also retired at age 62, not at full retirement age under Social Security.

I get no special assistance from the government nor a pension, if you're wondering. (other than regular Social Security which most everyone receives)

There are a lot of 'shoulds' which are written about in articles and talked about which are not really true for many people.

It's important to save while you're working - in a 401(k) or equivalent, or IRA or other savings.

Last edited by matisse12; 11-03-2016 at 02:18 PM..
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Old 11-03-2016, 02:06 PM
 
Location: Nebraska
1,886 posts, read 2,296,469 times
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I think the OP is wrong about the average retiree having $200,000-$300,000 when they retire. There have ben several articles that say that the average savings at retirement is $25,000.
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Old 11-03-2016, 02:09 PM
 
Location: SF Bay Area
1,423 posts, read 2,429,026 times
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Quote:
Originally Posted by stellastar2345 View Post
Sure, but isn't that what medical insurance is for?
Medical insurance doesn't cover everything.
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Old 11-03-2016, 02:23 PM
 
2,633 posts, read 3,371,380 times
Reputation: 6970
Quote:
Originally Posted by twins4lynn View Post
Medical insurance doesn't cover everything.
Most people who "need" those millions are those with catastrophic health problems requiring lots of daily assistance (eg. home help/CNA/nursing assistance) that cannot or will not be provided by family/friends, and have medical expenses beyond what classic Medicare will pay. Many healthy folks are not familiar with what those expenses might be, but they can be vast with those with cancer or severe disabling conditions that require a lot of medical equipment/home modifications/regular use of certain medical supplies.

My Dad has out of pocket medical expenses that range from 13-20K per year and this does not include any hired assistance since family provides all of his care. Without family, he would require at least 15 hours of care per day at $24 per hour in my area. The "average" US retiree has an income of 32K per year. So... you can image how that would be a problem for the average person.

These folks spend down everything they have, and then typically wind up in nursing homes on Medicaid if their monthly SS/pension is not enough to keep them in their home with sufficient hired (or government subsidized) care. Or they die before they run out of their millions.... if they are lucky.

I am not a big fan of nursing homes, based on my personal experiences.

Many people live in retirement a very, very frugal lifestyle, and if you are relatively healthy with manageable out of pocket medical/dental/hearing aids expenses, it is possible.

If you want to maintain a more luxurious lifestyle as a retiree, then yes... you do need millions in the bank or a guaranteed pension that gives you the guaranteed income that can cover that lifestyle. And those pensions are hard to get, a few and far between these days.
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Old 11-03-2016, 03:30 PM
 
Location: Somewhere in deep in Maine
3,658 posts, read 2,807,585 times
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Defined benefit pension + Social SECURITY
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Old 11-03-2016, 03:33 PM
 
5,424 posts, read 3,440,673 times
Reputation: 13676
Pensions are somewhat rare and difficult to find and be a beneficiary of these days, many having been replaced by 401(k)'s.

One does not need a pension to retire.
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