Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Thanks for your insights, Fran. I understand what you're saying about not moving. We do have friends nearby and my husband's successful "side gig" is right in this town. But I'm confused. You're saying you could not live near Boston. How do I square staying put with the high cost of living here?
BlueStocking: You have to live where you can afford to live. To figure this out, you have to do a budget. You have to KNOW how much money is coming in, AND how much you are spending on each thing. And you need to understand the difference between WANTS and NEEDS. Eating is a Need, but eating at restaurants (even the cheap ones) is a Want. You will not be able to spend so much on the Wants anymore.
If your husband is still working for another few years at the 6-figure income, start socking away as much money as you can in savings or investments. Everyone needs at least an Emergency Fund (rainy day fund). Start living on the projected retirement income now and save the rest... you will need it one day.
It seems like you didn't do much financial planning or budgeting in your past... for whatever reason. On a limited income, you must learn how to do it NOW. Start thinking outside the box in terms of where you will live as well as what you will buy or not buy.
---
Just a caution and no disrespect intended: Fran has faced some unusual and difficult circumstances in her life and her perspective on things can be rather unique at times.
I'm brand new here and trying to come to terms with what it's going to be like to be poor in retirement, especially since we are accustomed to a 6-figure income now. I'm 62 and dh is 63. We are among the millions who, with the exception of a couple of houses we bought and sold a long time ago, did not save or invest for retirement. I need to say that I'm very aware of the mistakes we made, our irresponsibility, as well as extenuating circumstances that made saving difficult (special needs child). No scolding necessary. We've been through the miserable beating ourselves up stage. I'm trying to problem-solve.
We rent in a very affluent New England town. By our SS calculations, allowing for me taking retirement now (500.) and dh taking his at 70 ($4000.), we will be receiving between 4500 - 5000/month. (That upper number assuming that my amount will go up to a percentage of his benefit.)
It will be possible to move further into the country, say, Vermont, and rent a cottage for about $1200. That would also be about the cost to stay here and live in elderly, public housing. A thought which (unnecessarily) shames me. It also kind of intrigues me: such a wealthy town doesn't really have a public housing waiting list.
We will have 1 car, no debts, and very simple needs. Moving isn't an option, we're in metro-Boston, have no funds for a downpayment and cannot find a rental for less than what we are paying now.
Could you do live on about $3300/month, after housing costs? What would you do to get ready?
This thread is ridiculous. Having over 3K left, after paying housing costs, is emphatically not poverty.
As I and several others have pointed out, "poverty" is geographically dependent.
In real-life, real-world day to day terms, it is inextricably tied to local COL (cost of living) which is also geographically determined.
To say X amount of dollars (for a two-person houseshold) is "emphatically not poverty" may be absolutely true in one part of the country but also absolutely false in another.
I suppose it also depends on how one defines "poverty." Those official government figures are arrived at by certain methods which are probably not the same as yours or mine (and those methods have changed over the years, from 1964 to the present day, by the way) and in fact is the subject of ongoing debate currently. From an extremely nerdy paper detailing the history of poverty measures (bold emphasis mine):
The Panel on Poverty and Family Assistance published its report of its study in May 1995. In the report, the Panel proposed a new approach for developing an official poverty measure for the U.S.--although it did not propose a specific set of dollar figures....the Panel argued that "the current poverty measure has weaknesses both in the implementation of the threshold concept and in the definition of family resources. Changing social and economic conditions over the last three decades have made these weaknesses more obvious and more consequential. As a result, the current measure does not accurately reflect differences in poverty across population groups and across time. We conclude that it would be inadvisable to retain the current measure for the future."
The Panel's proposal would adjust the poverty thresholds for differences in the cost of housing across geographic areas; the Panel believed that housing cost differences can be measured using Decennial Census data. The adjustment would be made not by state but by the nine Census divisions and (within each division) the size of metropolitan area.
Thanks for your insights, Fran. I understand what you're saying about not moving. We do have friends nearby and my husband's successful "side gig" is right in this town. But I'm confused. You're saying you could not live near Boston. How do I square staying put with the high cost of living here?
I just wish I could have stayed with my friends in my home city/state (I wish this even though most of my friends have retired and move to other states or they've passed away). 15 years later I still get homesick at times (against my will). I think moving away from 'home' and friends is the worst thing about retirement. I love where I am now, for many reasons, but it will never ever be my 'home'.
Of course, you have to do what you need to do financially; and, yes, you'll more than likely have to find a less expensive city/state. I just wish you didn't have to do so. It can be very painful for longer than you might expect, after the move.
Unfortunately OP derailed this thread from the get-go by using the loaded phrase "I know we'll be poor" in her title. As a result, many of the posts in this thread have argued what is poverty and what is not. That doesn't help OP with her current concerns.
I agree with those posts that encourage OP to carefully track current expenses and determine what will be her needs and wants in the projected retirement. Once she takes a cold hard look at that projection, she'll be in a better position to figure out how to meet her needs, and what can be cut.
In addition, OP needs to get a clearer understanding of what SS benefits she and her husband will receive under different retirement-age scenarios. Right now it looks like her assumptions are all over the place.
Is a commute from Saran Ave, Bedford, MA 01730 doable? There's a rental on zillow now for $950. You said your dh is working in North Boston; it's NW...perhaps the route would be better? I'm thinking you should go as low as you can now, to save up for moving to a lower COL place later.
That rental has a roommate. 950. is *unheard of* as a rent in this area.
I know it's easy to forget this, but some of us don't have desk jobs. The old bod cannot keep up with the physical demands.
Funny how often people have to be reminded of this.
Of course, OP is not one of these...
Not sure what is meant by "OP is not one of these, but I can tell you why dh and will retire in our 60s. Because time is a non-renewable resource and is more important than the slog.
It's not Northeastern privilege, it's the reality of living here. My husband needs to be in metro-Boston for work, so moving now is not an option. While we live only about 15 miles from his office the commute is *two hours.* It's the I-95/128 corridor for those who are familiar. Ditto everyplace else, even in outlying towns, rents are 3000/month for a 2 BR and housing prices carry about the same house payment. So that would leave 2000/month. For gas (don't get me started), food, insurance, utilities, medical copays, dental, etc.
What does "now" have to do with anything. Your husband is 63 and your OP discussed being "poor" when your husband retires 7 years from now when he's 70. What would prohibit you from moving to a lower cost-of-living locale at that point in time?
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
