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I hope so. We pay far more for health care here than they do just about anywhere else and yet outcomes and life expectancy isn't as good. The how would be to get some fingers out of the pie and to share the costs with a wider pool.
I think that's a bit of a fantasy.
The real action in saving money on healthcare is lifestyle modification. 70% of our healthcare costs are driven by unhealthy lifestyles. There are practical ways to nudge people into healthier habits without being dictatorial or draconian.
100% truth!! The plan is NOT to retire in CT due to the high taxes. Somewhere with no snow and low cost of living would be ideal but planning for that is a ways away. Thanks!
Personally, I think there's nothing worse than hating your job. Maybe that's just my value judgement, but if you can save a higher % of your income and pay your house off faster, I would do it. Plugging away at a job you don't like for 9 more years doesn't sound good to me.
Even if so, people should keep in mind that the "Medicaid" Nursing home is often one step from the poor house...in fact, in some cases is IS the poor house.
What I am saying is that it's not the style that many would want to live in - there are nursing homes/assisted living places that are $300 a day and there are others that are $100 a day.
We have three people that we know who are currently in this type of situation - they have run through anywhere from 250K to 500K and now are in a double room with someone they don't know and not exactly in what many people would want.
But if the minimum is OK, then it can be done. Realistically, the OP is unlikely to EVER have enough money to really cover 4-6 years in a top-notch place in addition to the 2 decades or so of retirement beforehand, so maybe it's just as well to sigh and figure you will likely go out as "wards of the state".
While this is the basic truth behind all the posts about the actual ABILITY to save such a large amount, it bypasses the more basic truth that it is INCOME not savings that makes the difference.
The problem with income generated from investments is that if the investment principal is needed to pay for something, then the income goes away as well. So the more basic issue is that people are unable or unwilling to work long enough or earn enough to make enough to purchase income that is not affected by ones savings amount. The more wealthy have both; high income and substantial savings. As many have posted here, even if they haven’t a cent saved, but delay SS to 70 and have $40k SS, (or $60 to 80k for a couple) inflation adjusted, and a paid off home, then the nursing home they will afford will beat the pants off the guy with only $25k SS and retired earlier. It is all a gamble; you have to trade some comfort and lifestyle for end of life care, if you fear that. The average person may never have enough income even when working to afford a nice nursing home. How can they possibly expect to afford one in retirement when they choose a lower income to retire on because “thats plenty to live on”. ??? The answer is they can’t and they have made the decision to gamble with their possible nursing home situation. Which the lvast majority will say is a bet they are willing to take, NOW, before it happens. It is very common human nature to downplay the hardship that MAY occcur in the future.
If you have enough income generated by SS, pension, and purchased annuity, say, $120k, where even if you have nothing left in investments, your income goes with you as long as you live. In reality, if you had the fortune to be able to assure yourself $120k+ in income for life in retirement, without touching any savings, then the odds are pretty high that you also have a substantial nest egg saved, as well as an expensive paid off property. That is the definition of self insured. If your heirs want any of your fortune, then they have to be willing to provide the care that preserves your fortune. Otherwise, too bad, “I made it to provide for me, not leave to them”, ensues.
I think that this is the primary driver for those that purchase annuities later in life. They fear the loss of the investment and the associated income as they age and can not mentally manage those finance affairs. Annuities for the elderly get pretty reasonable in cost because actuarially your death is a more defined metric. It is easy when you are younger to flippantly declare that you would rather have your savings AND the income, but the reality is a guaranteed check for life is a known quantity, which can protect you more than the principle can.
Last edited by Perryinva; 04-16-2018 at 06:41 AM..
First off I am not a troll as I am a regular poster in the Connecticut section....where I live.
I am now 50......I have been in the same line of work for 31 years......32 this July. There is no pensions......just a 401K that I started 10 years ago.....I know late......lol. I am in the auto industry working for new car dealerships in a decent management position. I worked my way up through the ranks from age 18. Took years to get where I am at. When I graduated my dad said to take the phone company test and OI would get right in since that was his career......It's Verizon now but back in the 80;s it was Nynex and before that NY Telephone. He mentioned things like stocks, pensions,unions ......things this 18 year old did not understand nor care about then.......I said no......My friend Pete took the test and retired 3 years ago at 47........My dumb luck.......He's happy as can be right now.
So anyway.......my wife and I save......we do not live above our means....we are debt free and credit card free and not house poor. We refinanced to a 15 year mortgage a year ago and we make 6 extra payments a year and the house will be paid off in 9 years as long as we keep our jobs and everything goes to plan.
I will be 62 in 12 years. My plan....and it's a plan......is to semi retire once the house is paid off and maybe start collecting at 62......or maybe work part time somewhere until 67. Not sure. I have hated my job for the last 15 years but love the paycheck and in 12 years I will be at it for 40+ years. According to estimates from our financial planner, we should have about $450,000 or more in my 401 K by that time and my wife should have about $100,000 - $200,000 hopefully. Plus our Social Security.......My Mom who is 80 has stocks my dad left here from his career and those along with her savings and home would be left for me and my 2 sisters when that time comes.
We are not living large or on easy street right now.......Just smart with the money so we can retire. My friends all laugh at me saying nobody can retire anymore and you would need 1M + to retire.......While we would not mind 1M+ in savings, we dont need that much money.
So what is the deal? Is it really possible? Any retirees on here who can shed some light?
We are similar to you, I'm 54, will be 55 in the fall, and my OH ( other half) will turn 59 this week.
We own half a modest house, in an excellent school district and neighborhood. Compared to the house we thought we wanted, we have actually done better in thus house. We own about 1/2 the house since fall 2015.
We won't have the $600 k you may appear to have just in savings , but what we will have, plus social security will do us fine. We do struggle to save what we do, but if you are CONSISTENT about your saving, you'll get to where you need to be.
We are in upstate N.Y., we have chosen a southern warmer climate and small city to retire to. We can buy 3 houses for the current value of ours, and the taxes are a joke compared to here. It's1- 2.5 hours away from a major southern city, so if we needed extensive medical we could get it. It's also close (1-1.5 hous away from a beach if we want a beach day.
Our problem is my OH doesn't get any guaranteed hours working with special needs people, and no guaranteed hours at the other job, although the other job has just said the schedule out now will become permenant, and hope fully they will add another 5 hours to thst permanently. It will hopefully include winter hours.
I have SSDI, and I am allowed to Work part time, but I also got cut back to 8 hours for the winter months. Between us both this past winter we got cut back by 32 hours a week, thst really hurt. That's how most jobs in this area go, part time, around minimum, and no guarantees on hours.
Anyway, we hope in 3-5/6 years for a few things. One my OH will be 62and can take early SS, but may have to work until 65 to get medicare.
My FIL will hopefully pass away ( he turned 90 last week, is in frail health). My father will be 86, but is in fairly good health., we will retire to our favored retirement area, and snowbirds for the remaining time my father is alive.we will tgen stay south permanently.
We won't have a million for retirement either, but with SS and a draw down of $5-10k a year, we will actually have more money than live on now whike working, and will reduce COL, at least for housing.
We will have nice inheritance s, but not counting on those, because our father's may need it. With those, though, we will be fairly sitting pretty.
We will inherit 4 properties, FIL house, my father's house, my mother's dproperty in Florida, that my father technically owns with me now, and vacant land in my mother's hone state, split amongst us grandkids from grandmoter,that I don't expect much out of, if any thing. We will also have our house here. They arent landoffice properties, but all modest properties, we should get another $375k for all of them at minimum. Even if that's all we have, plus savings, plus SS, we should be ok.
All combined, we will be ok.
Instead of all eggs in One basket, well have several baskets, and may actually reach much more than that elusive million.thats the key.
And if we have to work in our retire ment locale, that's ok too.
My health is obviously not thst great, and there is some travelling we want to do earlier than later . I'm going to have to have my knee replaced this summer. So no travel this year. Thats,also a trade off, spend a little now and save a little more later.
I wish you luck, but do consider taking on your part time job now rather than later, and just adding it to your savings. It's just a suggestion. I'm working the part time to add to savings, and boost my eventual permanent SS. I am grateful pres. Bush Jr. Made thst possible.
It's not how much you have, but what your COL is, and how much frugal you are. If you are half as lucky as,we are, you'll be ok.
Even if so, people should keep in mind that the "Medicaid" Nursing home is often one step from the poor house...in fact, in some cases is IS the poor house.
What I am saying is that it's not the style that many would want to live in - there are nursing homes/assisted living places that are $300 a day and there are others that are $100 a day.
We have three people that we know who are currently in this type of situation - they have run through anywhere from 250K to 500K and now are in a double room with someone they don't know and not exactly in what many people would want.
But if the minimum is OK, then it can be done. Realistically, the OP is unlikely to EVER have enough money to really cover 4-6 years in a top-notch place in addition to the 2 decades or so of retirement beforehand, so maybe it's just as well to sigh and figure you will likely go out as "wards of the state".
I thought the key was to find a place that would take private pay for a minimum period of time and then accept Medicaid after that - that "decent" places would make arrangements like this? Otherwise, what is the answer if you don't have unlimited LTCi (and they don't write policies like that anymore).
We are similar to you, I'm 54, will be 55 in the fall, and my OH ( other half) will turn 59 this week.
We own half a modest house, in an excellent school district and neighborhood. Compared to the house we thought we wanted, we have actually done better in thus house. We own about 1/2 the house since fall 2015.
We won't have the $600 k you may appear to have just in savings , but what we will have, plus social security will do us fine. We do struggle to save what we do, but if you are CONSISTENT about your saving, you'll get to where you need to be.
We are in upstate N.Y., we have chosen a southern warmer climate and small city to retire to. We can buy 3 houses for the current value of ours, and the taxes are a joke compared to here. It's1- 2.5 hours away from a major southern city, so if we needed extensive medical we could get it. It's also close (1-1.5 hous away from a beach if we want a beach day.
Our problem is my OH doesn't get any guaranteed hours working with special needs people, and no guaranteed hours at the other job, although the other job has just said the schedule out now will become permenant, and hope fully they will add another 5 hours to thst permanently. It will hopefully include winter hours.
I have SSDI, and I am allowed to Work part time, but I also got cut back to 8 hours for the winter months. Between us both this past winter we got cut back by 32 hours a week, thst really hurt. That's how most jobs in this area go, part time, around minimum, and no guarantees on hours.
Anyway, we hope in 3-5/6 years for a few things. One my OH will be 62and can take early SS, but may have to work until 65 to get medicare.
My FIL will hopefully pass away ( he turned 90 last week, is in frail health). My father will be 86, but is in fairly good health., we will retire to our favored retirement area, and snowbirds for the remaining time my father is alive.we will tgen stay south permanently.
We won't have a million for retirement either, but with SS and a draw down of $5-10k a year, we will actually have more money than live on now whike working, and will reduce COL, at least for housing.
We will have nice inheritance s, but not counting on those, because our father's may need it. With those, though, we will be fairly sitting pretty.
We will inherit 4 properties, FIL house, my father's house, my mother's dproperty in Florida, that my father technically owns with me now, and vacant land in my mother's hone state, split amongst us grandkids from grandmoter,that I don't expect much out of, if any thing. We will also have our house here. They arent landoffice properties, but all modest properties, we should get another $375k for all of them at minimum. Even if that's all we have, plus savings, plus SS, we should be ok.
All combined, we will be ok.
Instead of all eggs in One basket, well have several baskets, and may actually reach much more than that elusive million.thats the key.
And if we have to work in our retire ment locale, that's ok too.
My health is obviously not thst great, and there is some travelling we want to do earlier than later . I'm going to have to have my knee replaced this summer. So no travel this year. Thats,also a trade off, spend a little now and save a little more later.
I wish you luck, but do consider taking on your part time job now rather than later, and just adding it to your savings. It's just a suggestion. I'm working the part time to add to savings, and boost my eventual permanent SS. I am grateful pres. Bush Jr. Made thst possible.
It's not how much you have, but what your COL is, and how much frugal you are. If you are half as lucky as,we are, you'll be ok.
Thanks for the reply. We are smart with our spending and saving......We are far from cheap......If we want something we buy it. If we don't really need it ,then we don't. We definitely don't buy things just to have stuff like many others do. We just try to live below our means. More people should do that but most won't. Anything can happen from now until retirement. As I mentioned, the plan is to be as debt free as possible by the time I am 62. My wife is 2 years younger than me ans she plans on retiring by 67. While I am not 100% certain about quitting work totally by 62, I without a doubt want to quit this career I am in by 62 and slow things down some. That's why I mentioned working part time somewhere if possible until finalizing retirement plans.
Thanks for the reply. We are smart with our spending and saving......We are far from cheap......If we want something we buy it. If we don't really need it ,then we don't. We definitely don't buy things just to have stuff like many others do. We just try to live below our means. More people should do that but most won't. Anything can happen from now until retirement. As I mentioned, the plan is to be as debt free as possible by the time I am 62. My wife is 2 years younger than me ans she plans on retiring by 67. While I am not 100% certain about quitting work totally by 62, I without a doubt want to quit this career I am in by 62 and slow things down some. That's why I mentioned working part time somewhere if possible until finalizing retirement plans.
If you don't have an IRA of some sort, start it now for both of you. You can invest $6,500 at 50 and above each year so with the two of you in 12 years you would have $150,000+ growth. You could utilize this as income along with a part time job that was fun and not touch your SS until you are 100% qualified. A regular IRA and you can cut your tax bill but you will need to make sure you will be in a lower tax bracket in order to benefit. A Roth you can take it out without paying taxes. It would be great if your part time work provided low cost medical insurance as well. I don't know where medical insurance will be in the future but you will need to look at that as you go along since you will have to pay out of pocket between 62 and 65 when you become Medicare qualified.
Very true. Medicare is cheap, but supplementary insurance to cover the other 20% of hospital and surgical bills and testing, and a good prescription plan will run about $6K per year for a couple. Without it, you are just one illness away from bankruptcy, or at least a major change in your lifestyle.
That's a few years old and our rate of increase is also worse, so the gap is bigger now.
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Somewhere with no snow and low cost of living would be ideal but planning for that is a ways away. Thanks!
