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According to the latest Bureau of Labor Statistics data, which is based on 2016 figures, “older households” — defined as those run by someone 65 and older — spend an average of $45,756 a year, or roughly $3,800 a month.
That's an average across the entire country meaning 50% spend a lot more!
According to the latest Bureau of Labor Statistics data, which is based on 2016 figures, “older households” — defined as those run by someone 65 and older — spend an average of $45,756 a year, or roughly $3,800 a month.
That's an average across the entire country meaning 50% spend a lot more!
That's in an era with defined benefit pensions. The late-Boomers and Gen X won't have that kind of median household income. $1 million household net worth including home equity is 80th percentile for age 60. Very few of those people have pensions. They project more like $35K to $40K median household income when they can't work. The top 20% to 25% will be fine because they either have the wealth or the public sector/union pensions. It's going to be ugly for the bottom half.
Which circles back to housing choices. I picked a small house in a $10 per thousand mill rate town. I don't have that $6K property tax bill and I don't have to worry about being taxed out of my house. To make that happen, I had to drop the "no fixer-upper" criteria. Most older small houses need a lot of work. If a house flipper is selling it, that "a lot of work" probably had a lot of cut corners.
That's in an era with defined benefit pensions. The late-Boomers and Gen X won't have that kind of median household income. $1 million household net worth including home equity is 80th percentile for age 60. Very few of those people have pensions. They project more like $35K to $40K median household income when they can't work. The top 20% to 25% will be fine because they either have the wealth or the public sector/union pensions. It's going to be ugly for the bottom half.
It sounds like you are not factoring in SSI income with those numbers.
I'm not saying it's cheap to retire but in most parts of the country (especially New England) this list would be considered quite reasonable. And there's definitely things that look very discretionary to me, like home alarm and property maintenance. Why can't you buy a mower and cut your grass? Landscaping companies are a huge ripoff.
I find it odd considering that I think you work in real estate that you would find having a home alarm system a discretionary expense ? My alarm was put in following the death of my 1st husband in 2001, and not only did it give me peace of mind when I began living alone, it pretty much pays for itself from the discount I get having it from my home owner's insurance company.
With regards to landscaping I own quite a nice riding lawn mower but my current age 67 husband has spine issues and even cutting grass with our rider is difficult on his spine. Additionally, myself being age 62 and still work full time as an R.N. the last thing I want to do on my precious weekends off is lawn work. And fortunately for me when I do retire in +/- 3 years my retirement income will be sufficient to be able to continue to afford having a landscaper which is not a discretionary expense for us but necessary expense.
It sounds like you are not factoring in SSI income with those numbers.
SSI, Supplemental Security Income, is means tested welfare to bring the low income elderly above the poverty level. Did you mean regular Social Security?
Yep. I factored Social Security into that number and it’s going to be the dominant part of most late-boomer and Gen X retirement income. When pretty much nobody has pensions and wealth for the bottom 2/3 so low, it makes for pretty lean times when that event occurs where you can’t work and have no choice but to start collecting Social Security. To buy that $400k house in Bristol in your early 60s, you’re either one of the fortunate few with a pension or you’re at least 80th percentile wealth. The median household income for retirees 20 years from now is going to be far lower as the people receiving pensions die off.
SSI, Supplemental Security Income, is means tested welfare to bring the low income elderly above the poverty level. Did you mean regular Social Security?
Sorry yes, I have a habit of calling it that due to the same abbreviated "Social Security Income".
Quote:
Originally Posted by GeoffD
Yep. I factored Social Security into that number and it’s going to be the dominant part of most late-boomer and Gen X retirement income. When pretty much nobody has pensions and wealth for the bottom 2/3 so low, it makes for pretty lean times when that event occurs where you can’t work and have no choice but to start collecting Social Security. To buy that $400k house in Bristol in your early 60s, you’re either one of the fortunate few with a pension or you’re at least 80th percentile wealth. The median household income for retirees 20 years from now is going to be far lower as the people receiving pensions die off.
I don't have time to find that data, but that still seems a bit of a stretch to me. I believe more Gen X folks have at least SOMETHING of a 401K, or well over 50% at least. Combined Social Security, 401K, IRA/ROTH, home equity, for an average married household I can't imagine being that bleak even if it's less in 20 years.
I would guess for maybe the bottom 3rd, being pretty dire.
Most services are a ripoff, but they are a convenience and sometimes a necessity. At the end of the day, it is usually money well spent.
And I don't think people should be suggesting someone is lazy when they don't know the circumstances.
Who suggested someone was lazy???? You sure jump to a lot of conclusions. I wrote that their budget included a number of discretionary expenses. Do you understand what that means?
I find it odd considering that I think you work in real estate that you would find having a home alarm system a discretionary expense ? My alarm was put in following the death of my 1st husband in 2001, and not only did it give me peace of mind when I began living alone, it pretty much pays for itself from the discount I get having it from my home owner's insurance company.
With regards to landscaping I own quite a nice riding lawn mower but my current age 67 husband has spine issues and even cutting grass with our rider is difficult on his spine. Additionally, myself being age 62 and still work full time as an R.N. the last thing I want to do on my precious weekends off is lawn work. And fortunately for me when I do retire in +/- 3 years my retirement income will be sufficient to be able to continue to afford having a landscaper which is not a discretionary expense for us but necessary expense.
Fine- I'm just saying that some of these expenses are discretionary for many. No need to defend your personal expenditures. Thanks for putting them out there so others can compare.
Based on your property tax, you must have a big house with a big lawn?
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