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Oh for God's sake. I became disabled and live on SSI of $889.40/month. My medical is free. I have Section 8 housing and my rent is $197/month.
Point being, if you lose everything, you'll still be fine. There are alot of businesses out there who profit on the fears of people afraid of retiring without enough money.
If you need to live in a million dollar home and go on cruises four times a year, you'll need to be rich.
I live in a pretty, but affordable part of CA on my meager income and my medical is free.
So worry if you want to. But, you don't have to.
Politics can change this and probably will in the future as the global economy and a host of other factors really start to kick in. Future people in your position will likely not be fine. Not sure when, but it will happen.
Politics can change this and probably will in the future as the global economy and a host of other factors really start to kick in. Future people in your position will likely not be fine. Not sure when, but it will happen.
It really depends on where you are in the country. Public housing, particularly low income elderly housing, is typically funded and controlled at the state, county, or local level. There are lots of places today where a retiree who runs out of money is faced with a 5 or 10 year waiting list for low income elderly housing. Given the demographics and lack of construction of these kinds of housing units, that is going to increasingly be the norm.
The whole point of the "why $1 million?" is that if you don't have a defined-benefit pension, you need a pretty big net worth to avoid running out of cash and landing on that 10 year waiting list. $1 million is a totally arbitrary number. What you're trying to avoid is $0 and $1000/month in Social Security trickling in because there is such enormous demand for public housing.
It really depends on where you are in the country. Public housing, particularly low income elderly housing, is typically funded and controlled at the state, county, or local level. There are lots of places today where a retiree who runs out of money is faced with a 5 or 10 year waiting list for low income elderly housing. Given the demographics and lack of construction of these kinds of housing units, that is going to increasingly be the norm.
The whole point of the "why $1 million?" is that if you don't have a defined-benefit pension, you need a pretty big net worth to avoid running out of cash and landing on that 10 year waiting list. $1 million is a totally arbitrary number. What you're trying to avoid is $0 and $1000/month in Social Security trickling in because there is such enormous demand for public housing.
You are absolutely correct. My husband's ex wife is currently on a waiting list for low income senior housing and was told she has a very long wait ahead of her. My husband and his ex divorced nearly 35 years ago because she wanted to be married and also have a boyfriend at the same time Ex got everything in the divorce settlement including a very nice paid for house as my husband wanted his kids to live in a nice place. The ink on the divorce papers was not even dry when ex sold the house, and with a 1/3 the money purchased a dump and moved in her low life boyfriend. For the next 30 years ex dabbled in low wage work, and was mostly supported by her boyfriend, and the rest came from what she made from the sale of the house my husband gave her in the divorce settlement. Three years ago ex's 30 year boyfriend had a stroke and now is in a nursing home permanently. Ex can no longer afford to keep the home without boyfriend's help as her SS is very low from a very low wage unsteady work history and she is now on this list for senior housing. She and I get along fine, and at the last B day party for one of the grand kids she told me she likely has a 2+ year wait for housing because the state is now allowing low income families with children to rent in low income elderly housing as the demand is so high for HUD housing. So now low income families with children go to the top of the list and seniors are moved to the bottom. I think most are sympathetic to the plight of refugees from south of the border and the Middle East, but as this country allows increased numbers of this individuals to cross the border most with children and no means to support themselves, they will tremendously add to this already top heavy list of US families with children in need of low income housing and seniors in need will drop even further down on these lists.
Whether a senior has become poor due to poor choices or bad uncontrolled circumstances, the safety net to catch them is becoming smaller and smaller and sadly that net may be entirely gone during many of our lifetimes
a lot of what you hear about that 1 million or 2 million minimum for retirement has the interests of the companies that might benefit from charging you fees.
Yes of course you don't want to live the life of a homeless pauper when you're in your 70s but let's look at who might benefit:
1) your financial manager who charges commission or his company that might charge you a fee on the million dollars
2) the government may not have to pay your SS retirement if you "decide" to work longer but have a heart attack and never start drawing on your benefits
3) your heirs will fight tooth and nail over your estate
If you have a pension that pays you a few thousand for the rest of your life, the only time you would need a savings is for vacations, gifts, health issues
if you do have a million dollars and you earn as little as 2% return and only withdraw 2% or less that million could last *FOREVER*. $20k a year forever is not too shabby.
as time passes, more and more people will NOT have the good fortune of having worked at a job that pays a pension so those retirement savings will increasingly become a more important role in people's retirement futures.
I've worked with a handful of people who didn't know they were sitting on large pensions simply becuase they haven't checked the value but also have no idea how much they'll need as they age.
expenses fall greatly in retirement and as people age, they tend to travel less further reducing expenses. the big question is health coverage and retirement homes.
a lot of what you hear about that 1 million or 2 million minimum for retirement has the interests of the companies that might benefit from charging you fees.
Yes of course you don't want to live the life of a homeless pauper when you're in your 70s but let's look at who might benefit:
1) your financial manager who charges commission or his company that might charge you a fee on the million dollars
2) the government may not have to pay your SS retirement if you "decide" to work longer but have a heart attack and never start drawing on your benefits
3) your heirs will fight tooth and nail over your estate
If you have a pension that pays you a few thousand for the rest of your life, the only time you would need a savings is for vacations, gifts, health issues
if you do have a million dollars and you earn as little as 2% return and only withdraw 2% or less that million could last *FOREVER*. $20k a year forever is not too shabby.
as time passes, more and more people will NOT have the good fortune of having worked at a job that pays a pension so those retirement savings will increasingly become a more important role in people's retirement futures.
I've worked with a handful of people who didn't know they were sitting on large pensions simply becuase they haven't checked the value but also have no idea how much they'll need as they age.
expenses fall greatly in retirement and as people age, they tend to travel less further reducing expenses. the big question is health coverage and retirement homes.
If you're 65 or older you have health coverage (Medicare). So health coverage is only an issue for those retiring before 65.
it all depends where you live . we live in a rent stabilized apartment in queens and our rent is 19k . so location determines what you need .shouting out numbers is meaningless
The "save $1M for retirement" advice is targeted at the fairly large segment of "mass affluent" folks who made say between $80k and $150k during their prime earning years and want to maintain a similar lifestyle in retirement. These people aren't rich but make enough to take a pretty big hit on taxes, college tuition, etc.
If you made more than that and want to continue your lifestyle you probably need to save more than $1M for retirement, plus a paid off home, social security and any pensions, but have also had the opportunity to do so.
If you were a middle income person / couple for most of your working life you don't need to save as much to maintain your lifestyle, especially if you have even a small pension and a paid off home. Even a modest $1000/mo pension is often worth the same or more than having a half a million dollars ($500k) saved!
The people who DO need to worry about saving huge sums for retirement are those under 40, especially higher earning folks who want to keep a similar lifestyle in retirement. Unlike older generations, this group almost never has pensions (unless they work for the government), and likely will not receive social security benefits at current level. So they are pretty much on their own when it comes to retirement savings.
it all depends where you live . we live in a rent stabilized apartment in queens and our rent is 19k . so location determines what you need .shouting out numbers is meaningless
My point exactly. My post was to illustrate that one size does not fit all and that the OP should not worry that she might not fit the criteria of some of the articles she has been reading. Each person's circumstances are different.
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Ex got everything in the divorce settlement including a very nice paid for house as my husband wanted his kids to live in a nice place. The ink on the divorce papers was not even dry when ex sold the house, and with a 1/3 the money purchased a dump and moved in her low life boyfriend. For the next 30 years ex dabbled in low wage work, and was mostly supported by her boyfriend, and the rest came from what she made from the sale of the house my husband gave her in the divorce settlement. Three years ago ex's 30 year boyfriend had a stroke and now is in a nursing home permanently. Ex can no longer afford to keep the home without boyfriend's help as her SS is very low from a very low wage unsteady work history and she is now on this list for senior housing. She and I get along fine, and at the last B day party for one of the grand kids she told me she likely has a 2+ year wait for housing because the state is now allowing low income families with children to rent in low income elderly housing as the demand is so high for HUD housing. So now low income families with children go to the top of the list and seniors are moved to the bottom. I think most are sympathetic to the plight of refugees from south of the border and the Middle East, but as this country allows increased numbers of this individuals to cross the border most with children and no means to support themselves, they will tremendously add to this already top heavy list of US families with children in need of low income housing and seniors in need will drop even further down on these lists.
