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Old 09-11-2013, 09:11 AM
 
Location: Lexington, SC
4,281 posts, read 11,815,442 times
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Assume a retired couple. Early 70's. Living well, solid investments, good income stream, medical coverage etc. No debts. Income positive every month. One is the stronger earner with say 70% of the income. The stronger earner can well live within their income. The lesser earner cannot live their present life style within their income. The stronger earner dies and the lesser earner is alone.

Is there any financial advice to give the survivor that might not have been sound advice for the couple?

Forget life insurance for health and age reasons. Forget about leaving an estate/inheritance. Forget long term care.

The survivor is interested in only continuing their good life style.

Is an annuity sound? Is a reverse mortgage sound? At 70 years of age is a faster then normal draw down of IRA's, investments, a sound idea?

Suggestions please.
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Old 09-11-2013, 10:38 AM
 
Location: Northern panhandle WV
3,007 posts, read 2,672,934 times
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If you are married then the survivor [assuming the lower earner] would get the other's full Social security benefit, assuming you were married at least 9 months, and that they are FRA or past that. Both Annuity at a time when you are thinking of collecting on it, is not a great idea, and be very careful of reverse mortgage, [be sure you know and understand ALL the facts with it] you could perhaps set up a trust as well for the survivor.
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Old 09-11-2013, 11:16 AM
 
31,205 posts, read 38,123,194 times
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With all of this going for them there should have been a plan years ago. The options now are limited

As best you can you need to blend assets and move forward.
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Old 09-11-2013, 11:27 AM
 
1,308 posts, read 1,494,569 times
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I've been involved volunteering in the widowed community for over a decade. Please be aware that married people have more legal rights than do single people who are a couple. One of the stories that I hear repeatedly is of single people who share their house together for years. After one dies the family/children come in and lock the survivor out of the house. I've heard stories of family/children taking the body of the deceased and not telling the survivor where or when it is going to be buried. I've heard stories of family/children coming into the home while the survivor was at the funeral and taking everything of value out of the house.

People don't tend to talk about it but these are very common scenarios. The survivor is always in shock when their other half dies, even if they are expecting it. It is a way for our mind to initially handle the intense emotions. Survivors are grieving heavily. That is not the time to expect that they are going to be able to protect themselves from people who express their own grief through anger and rapacity.

Also, probate is expensive.

This is something you should add to your thoughts and plan for.
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Old 09-11-2013, 11:40 AM
 
Location: earth?
7,288 posts, read 12,052,554 times
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The thread title and the OP seem to be two different subjects.

This is not a thread about "Single vs. Married" - it seems to be more a thread about how to survive financially after your spouse dies.


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Old 09-11-2013, 11:46 AM
 
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My guess would be that the OP is asking for ways to financially protect his partner other than providing an inheritance. The responses are that marriage would be the best option in order to provide maximum protection.
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Old 09-11-2013, 12:26 PM
 
46,700 posts, read 20,381,531 times
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Quote:
Originally Posted by accufitgolf View Post
Assume a retired couple. Early 70's. Living well, solid investments, good income stream, medical coverage etc. No debts. Income positive every month. One is the stronger earner with say 70% of the income. The stronger earner can well live within their income. The lesser earner cannot live their present life style within their income. The stronger earner dies and the lesser earner is alone.

Is there any financial advice to give the survivor that might not have been sound advice for the couple?

Forget life insurance for health and age reasons. Forget about leaving an estate/inheritance. Forget long term care.

The survivor is interested in only continuing their good life style.

Is an annuity sound? Is a reverse mortgage sound? At 70 years of age is a faster then normal draw down of IRA's, investments, a sound idea?

Suggestions please.
I am assuming that the couple is married and death leaves the lower earner with a smaller income but a desire to maintain the same lifestyle. Correct?

You're not concerned about leaving an inheritance and wondering if a reverse mortgage, an annuity, or dipping deeper into assets such as IRA's, investments, etc. is a good idea. Correct?

The problem, of course, with using up your assets to maintain your current lifestyle is what happens when you run of money. Particularly, if this happens at a time when your cost of living is going up due to needing help with activities of daily living.

I would encourage you to consider the long-term care situation. Typically the spouse who departs first is cared for by the one who is left behind. But who cares for that person when the time comes?

A dear friend lived to be in her 90's outlasted her assets and struggled to get by on her income that was continually eaten away by increases in the cost of living.

When her husband was alive and they had assets and a stronger income, they could have moved into a continuing care community. These are usually run by churches, and require a buy-in, ($200,000 plus or minus) and a monthly fee.

The couple starts out living in a cottage, then moves to an apartment as they need more assistance, and then finally to the assisted living wing or nursing care unit. The guarantee is that you will never be evicted even if you require a high level of care.

Some folks, of course, pass away before needing such care. So their contribution to the pot helps cover the costs of those who hang until 100.

Once you pay the initial buy-in fee and cover your monthly bill, you are free to spend your remaining money on whatever you want. Trips to Europe. Fine bottles of wine. Whatever. As long as your income stream covers the monthly fee, you're fine.

Some change their lifestyle so that the surviving partner can live on the reduced income.

Others count on Medicaid picking up the tab when they run out of money. This is a meager existence at best and certainly not a backup plan I'd be comfortable with or even count on.
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Old 09-11-2013, 01:28 PM
 
6,791 posts, read 7,689,350 times
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Quote:
Originally Posted by LookingatFL View Post
I've been involved volunteering in the widowed community for over a decade. Please be aware that married people have more legal rights than do single people who are a couple. One of the stories that I hear repeatedly is of single people who share their house together for years. After one dies the family/children come in and lock the survivor out of the house. I've heard stories of family/children taking the body of the deceased and not telling the survivor where or when it is going to be buried. I've heard stories of family/children coming into the home while the survivor was at the funeral and taking everything of value out of the house.

People don't tend to talk about it but these are very common scenarios. The survivor is always in shock when their other half dies, even if they are expecting it. It is a way for our mind to initially handle the intense emotions. Survivors are grieving heavily. That is not the time to expect that they are going to be able to protect themselves from people who express their own grief through anger and rapacity.

Also, probate is expensive.

This is something you should add to your thoughts and plan for.
Yes, this happened to my fiancee' grandmother. Her BF of decades always wanted her to have their house, but he died suddenly, and they hadn't planned properly. His family shut her out, just threw her out into the cold. Fortunately her son was able to take her in.
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Old 09-11-2013, 02:37 PM
 
7,568 posts, read 14,871,147 times
Reputation: 12676
Quote:
Originally Posted by LookingatFL View Post
I've been involved volunteering in the widowed community for over a decade. Please be aware that married people have more legal rights than do single people who are a couple. One of the stories that I hear repeatedly is of single people who share their house together for years. After one dies the family/children come in and lock the survivor out of the house. I've heard stories of family/children taking the body of the deceased and not telling the survivor where or when it is going to be buried. I've heard stories of family/children coming into the home while the survivor was at the funeral and taking everything of value out of the house.

People don't tend to talk about it but these are very common scenarios. The survivor is always in shock when their other half dies, even if they are expecting it. It is a way for our mind to initially handle the intense emotions. Survivors are grieving heavily. That is not the time to expect that they are going to be able to protect themselves from people who express their own grief through anger and rapacity.

Also, probate is expensive.

This is something you should add to your thoughts and plan for.
Very good advice. I have heard this same scenario also several times. It is important that people who do not decide to marry make proper arrangements for the survivor.
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Old 09-11-2013, 04:19 PM
 
Location: Near a river
16,042 posts, read 20,636,464 times
Reputation: 15753
Quote:
Originally Posted by accufitgolf View Post
Assume a retired couple. Early 70's. Living well, solid investments, good income stream, medical coverage etc. No debts. Income positive every month. One is the stronger earner with say 70% of the income. The stronger earner can well live within their income. The lesser earner cannot live their present life style within their income. The stronger earner dies and the lesser earner is alone.

Is there any financial advice to give the survivor that might not have been sound advice for the couple?

Forget life insurance for health and age reasons. Forget about leaving an estate/inheritance. Forget long term care.

The survivor is interested in only continuing their good life style.

Is an annuity sound? Is a reverse mortgage sound? At 70 years of age is a faster then normal draw down of IRA's, investments, a sound idea?

Suggestions please.
Are you asking for answers to two different scenarios on the above, one if the couple is married, and one if the couple is not married (each legally single but living together)?
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