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I'm surprised no one has mentioned universal basic income yet in this thread as far as a I can tell. I am already freaking out
about retirement and I am still 25 years away from it. I think we are going to need a stipend for the entire population at some point with the increasing stratification of wealth in the US. And before this happens we need a public healthcare option. I am one of the unfortunate families paying for our own healthcare, how many families can drop $1200 a month and increasing in costs at 20% a year from their own pockets. It's laughable and totally unsustainable.
I think we are going to find out, the hard way, that the Baby Boom DOESN'T have nearly enough saved to retire--and most people's health doesn't allow them to work until 65 (or 67) no matter how much they need to. We are going to see TONS of bankruptcies as more Boomers hit those incredibly inflated health care costs, considering that even with insurance, you've still got plenty to pay.
And BTW, do you know that "Balance Billing" is perfectly legal? It means that if you go to the hospital, thinking you are covered by insurance, you may find some of your health care providers aren't satisfied with the insurance company's "accepted and reasonable cost" for your area--and YOU are legally responsible for the difference between the reasonable cost and whatever incredibly inflated amount the provider decided to bill you?
I'm currently trying to fight a $1,500+ bill that went to a bill collector, threatening to ruin our credit rating, after the ER Doctor at Exeter Hospital (NH) decided his minimal input was worth 5X what the insurance company paid him. Funny, considering the pain resolved itself in hours and he never figured out what was wrong, and didn't run much for tests either. If we had known we would be burning $1500, we certainly would have requested another doctor, or just gone to Portsmouth Hospital--but they have no legal obligation to tell you that you're racking up huge bills that insurance won't cover.
There are many boondoggles in the way we pay for Healthcare.
Another is you have everything set up in Network... the day of surgery the in Network Anesthesia is not available... after you find out and on the hook for thousands of unplanned expense.
Problem is the Hospital cannot know for certain what you provider will and will not approve.
Better odds with outpatient scheduled surgery as there is time to do your homework...
So yeah, taking inflation in to account, if comfortable is $60k/yr today for retirement and that requires a $25k SSI, and that requires $850k saved to generate the balance
If you defer collecting Social Security until age 70, it's more like $40K for your Social Security check and that's inflation-protected. Assuming you have a paid for house that isn't wildly expensive to operate, that covers your cash flow for all your living expenses. Any retirement savings is gravy. It's retiring early that requires large piles of wealth.
But now we would be talking the SS retirement riddle again. The man (or woman) that TYPICALLY defers filing to 70 and collects $40k is NOT working until 70, but retires well before, typically 62, and is living on savings so that he CAN retire early. In which case his retirement income is typically well above $60k because the person smart enough to save enough to retire at 62, and delay filing until 70, has been making well over $60k by that time, and his target is higher.
The person that TYPICALLY works until 70 then files, does so because they have to, as they didn't have enough savings to live on and file earlier, and would therefore not be collecting $40k from SSA at that time. More like $30k tops, with negligible savings income. Maybe a $100k emergency fund. While $30k is MANAGEABLE for a 70 yo to retire with today, it is certainly not comfortable in much of the US.
The difference between $30k and $60k in comfort is far greater, IMHO, than the difference between $60k and $120k. At 59, I would be retiring (including my wifes SS & pension) with a steady income of something over $75k. But I would NOT want to depend on my wifes income, in case she passed away before me, and then be forced to live on $55k while paying tax at a singles rate. Nor would I want her do the same if I passed away first, and she lost her SS for mine, and my partial pension. Working 3 more years until 62, increases our income by $50k (for many various reasons) mainly due to large yearly pension increases for up to 5 more years, and savings growth, that is allowing me to retire at 62 and file at 70, or whenever I see fit.
Its back to the "manage" to retire, or comfortably retire with more choices and far less worries. The house would be paid off from earned income instead of savings, pension increases $5k/yr, and savings increases $60-80k /yr. Sure, I could work until 66, and have a $175k/yr retirement income, but that makes little sense to me as the comfort level just doesn't go up much from $125k to $175k, because I am ALREADY quite comfortable living on far less than that now, and would much rather have the added 4 years of total freedom. Heck, I'm struggling to justify not retiring at 61 with a lower income. One can easily play the OMY game for too long.
Last edited by Perryinva; 11-07-2016 at 11:24 PM..
This is unfortunately the problem -- working and saving in your 20s is critical. I started my retirement savings at 23 years old, and I know people that were ahead of me in savings even then. That first retirement fund into which I saved maybe 10,000 over three years (way back when) was eventually rolled into a Roth and now is worth 100,000.
If you save and invest consistently from age 20 until age 65, one million is not hard to achieve. If you miss those first ten years, it is much harder.
Well, I was doing other stuff. Was in the Army, fighting the wars that my elders were so enthusiastic for. Then university and grad school, then there was a little something called the Great Recession.... there was no getting good jobs then. There was surviving.
So I'm screwed, I guess.
Last edited by redguard57; 11-08-2016 at 01:28 AM..
But now we would be talking the SS retirement riddle again. The man (or woman) that TYPICALLY defers filing to 70 and collects $40k is NOT working until 70, but retires well before, typically 62, and is living on savings so that he CAN retire early. In which case his retirement income is typically well above $60k because the person smart enough to save enough to retire at 62, and delay filing until 70, has been making well over $60k by that time, and his target is higher.
The person that TYPICALLY works until 70 then files, does so because they have to, as they didn't have enough savings to live on and file earlier, and would therefore not be collecting $40k from SSA at that time. More like $30k tops, with negligible savings income. Maybe a $100k emergency fund. While $30k is MANAGEABLE for a 70 yo to retire with today, it is certainly not comfortable in much of the US.
The difference between $30k and $60k in comfort is far greater, IMHO, than the difference between $60k and $120k. At 59, I would be retiring (including my wifes SS & pension) with a steady income of something over $75k. But I would NOT want to depend on my wifes income, in case she passed away before me, and then be forced to live on $55k while paying tax at a singles rate. Nor would I want her do the same if I passed away first, and she lost her SS for mine, and my partial pension. Working 3 more years until 62, increases our income by $50k (for many various reasons) mainly due to large yearly pension increases for up to 5 more years, and savings growth, that is allowing me to retire at 62 and file at 70, or whenever I see fit.
Its back to the "manage" to retire, or comfortably retire with more choices and far less worries. The house would be paid off from earned income instead of savings, pension increases $5k/yr, and savings increases $60-80k /yr. Sure, I could work until 66, and have a $175k/yr retirement income, but that makes little sense to me as the comfort level just doesn't go up much from $125k to $175k, because I am ALREADY quite comfortable living on far less than that now, and would much rather have the added 4 years of total freedom. Heck, I'm struggling to justify not retiring at 61 with a lower income. One can easily play the OMY game for too long.
this is pretty true .
for those living off their investments and delaying ss while retiring you generally do not wait until 70 to spend more . you take whatever draw you planned on taking through retirement inflation adjusted day 1 .
so you need enough assets to safely live off of without running to low or you need enough income sources to sustain you .
not everyone has that choice and it is really reserved for those who do have enough to delay .
so in our case we have a draw rate of about 3.50% now and that will drop at 70 to 2.50% and the difference refills what we laid out and then some .
also in our case owning something out right will be more expensive then renting .
while the costs of buying an equivalent co-op to our apartment are less , the fact is the money we buy it with will cut our income by 12k a year making buying initially at least 6k a year higher .
But now we would be talking the SS retirement riddle again. The man (or woman) that TYPICALLY defers filing to 70 and collects $40k is NOT working until 70, but retires well before, typically 62, and is living on savings so that he CAN retire early. In which case his retirement income is typically well above $60k because the person smart enough to save enough to retire at 62, and delay filing until 70, has been making well over $60k by that time, and his target is higher.
The person that TYPICALLY works until 70 then files, does so because they have to, as they didn't have enough savings to live on and file earlier, and would therefore not be collecting $40k from SSA at that time. More like $30k tops, with negligible savings income. Maybe a $100k emergency fund. While $30k is MANAGEABLE for a 70 yo to retire with today, it is certainly not comfortable in much of the US.
The difference between $30k and $60k in comfort is far greater, IMHO, than the difference between $60k and $120k. At 59, I would be retiring (including my wifes SS & pension) with a steady income of something over $75k. But I would NOT want to depend on my wifes income, in case she passed away before me, and then be forced to live on $55k while paying tax at a singles rate. Nor would I want her do the same if I passed away first, and she lost her SS for mine, and my partial pension. Working 3 more years until 62, increases our income by $50k (for many various reasons) mainly due to large yearly pension increases for up to 5 more years, and savings growth, that is allowing me to retire at 62 and file at 70, or whenever I see fit.
Its back to the "manage" to retire, or comfortably retire with more choices and far less worries. The house would be paid off from earned income instead of savings, pension increases $5k/yr, and savings increases $60-80k /yr. Sure, I could work until 66, and have a $175k/yr retirement income, but that makes little sense to me as the comfort level just doesn't go up much from $125k to $175k, because I am ALREADY quite comfortable living on far less than that now, and would much rather have the added 4 years of total freedom. Heck, I'm struggling to justify not retiring at 61 with a lower income. One can easily play the OMY game for too long.
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?
If that have so much why don't they just buy health insurance and not pay cash? This is confusing
If that have so much why don't they just buy health insurance and not pay cash? This is confusing
There's a difference between "health insurance" and "long term care insurance". The former - under Medicare - can be very affordable (except perhaps for some very high priced drugs). The latter often isn't - and tends to be more problematic. Note that Medicare doesn't cover long term care. OTOH - if you run out of money - Medicaid can cover long term care. So that's pretty much the answer in a nutshell. Robyn
I think we are going to find out, the hard way, that the Baby Boom DOESN'T have nearly enough saved to retire--and most people's health doesn't allow them to work until 65 (or 67) no matter how much they need to. We are going to see TONS of bankruptcies as more Boomers hit those incredibly inflated health care costs, considering that even with insurance, you've still got plenty to pay.
And BTW, do you know that "Balance Billing" is perfectly legal? It means that if you go to the hospital, thinking you are covered by insurance, you may find some of your health care providers aren't satisfied with the insurance company's "accepted and reasonable cost" for your area--and YOU are legally responsible for the difference between the reasonable cost and whatever incredibly inflated amount the provider decided to bill you?
I'm currently trying to fight a $1,500+ bill that went to a bill collector, threatening to ruin our credit rating, after the ER Doctor at Exeter Hospital (NH) decided his minimal input was worth 5X what the insurance company paid him. Funny, considering the pain resolved itself in hours and he never figured out what was wrong, and didn't run much for tests either. If we had known we would be burning $1500, we certainly would have requested another doctor, or just gone to Portsmouth Hospital--but they have no legal obligation to tell you that you're racking up huge bills that insurance won't cover.
Were you out of network with the hospital? If the hospital is in-network, the ER physician should be covered as you have no say as to who your provider is in that case. You should have a legitimate case for in-network coverage.
We had a similar circumstance with an ER visit and the following surgery. The hospital was in-network, but the ER doc was not. He told my husband he needed surgery. The surgeon working that day was already performing a surgery and wanted to do it the next morning. When I checked insurance, the surgeon was out of network.
If the surgery was done when he was admitted the ER, he would have been covered regardless of whether the surgeon was in network. But because it was scheduled for the next day, the emergency status changed (nobody told us) and the surgeon would have been covered out of network ($$$).
I called around and found an in-network surgeon to perform the procedure. When my husband had the surgery, the anesthesiologist and lab company were not in-network. We were still fully covered because the hospital and the main surgeon were in network. I did have to notify the insurance company to adjust the claim because we were in network for the hospital and the surgeon.
General Info:
In many cases, balance billing is illegal. The best way to avoid balance billing is to stay in-network and to check to make sure a procedure is covered under your insurance plan prior to having it done.
There are many cases where you are in network for the doctor or hospital, but some other aspect IE the lab or radiologist is out of network, and you receive a bill. Call your insurance company and complain. They will usually cover it as in-network providing the facility and the main care provider are in-network.
I can't state this enough... MAKE SURE your claims are properly coded. If you have a routine lab, procedure, or exam and it is mis-coded as diagnostic, you will pay a much higher rate than for routine care. Examples of this are lab tests, colonoscopies, mammograms, etc.
Never ask "Do you take my insurance?" Ask "Are you in-network for my insurance plan." Ask for a "bill" prior to a procedure. Check the procedure code with your insurance company. Make sure you get "pre-authorization" prior to procedures, if required by your insurance plan.
Another avenue is to pre-pay the hospital for a planned surgery. I had a very expensive surgical procedure that I knew was going to max my out of pocket. I worked it out with the hospital and the insurance company to pay the hospital the remainder of my co-insurance in advance of the surgery. I did not receive any bills. It was very nice to not have to fight them, after the fact.
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