HoneyBBQ
Junior Associate
Joined: Dec 27, 2010 10:36:09 GMT -5
Posts: 5,395
Mini-Profile Background: {"image":"","color":"3b444e"}
|
Post by HoneyBBQ on Feb 6, 2019 10:55:24 GMT -5
Don't retire on a million unless you have other income. It won't go as far as you think it will. And I'm sure it won't in the future. I'm totally retiring with 1 million if that's all that's in there when I turn 65. 3% draw and SS will equal about what I make now. Only no mortgage, retirement savings or kid expenses to worry about. I think you totally could. Me? No. I'm too soft.
|
|
|
Post by The Walk of the Penguin Mich on Feb 6, 2019 11:24:20 GMT -5
In your case I imagine it will work. But you are frugal, I honestly don't see how you do it now and save too. Believe me my hat is off to you. I just don't think for 2 people it will be enough. Oh we could scrimp and save and make do on whatever, but we just want to continue a good standard of living. I can easily see how it would work. Had I still been working, I’d have retired with about this amount and with my SS, I’d have been fine. I was already living on about 2/3 my work income, which would have almost been my SS income at 67. So drawing 3% of a million yearly adds another $30k in income for gravy.
|
|
Deleted
Joined: Apr 25, 2024 19:01:28 GMT -5
Posts: 0
|
Post by Deleted on Feb 6, 2019 11:28:39 GMT -5
I'm totally retiring with 1 million if that's all that's in there when I turn 65. 3% draw and SS will equal about what I make now. Only no mortgage, retirement savings or kid expenses to worry about. I think you totally could. Me? No. I'm too soft. You guys are starting to freak me out a little! I thought I'd be living pretty good. Just back of the napkin. Current average monthly take home including my paychecks (minus family insurance and 401K), both child supports and tax credits = $3800/month...maybe 4K if there are big bonus checks, but out of that $4000. $1300 - house payment (just principal and interest) $500 - Roth $300 - Childcare $250 - Tuition $200 - kids activities $200 - college savings Then just the added cost of extra people to feed and clothe, extra vehicles, extra utilities, that I'm not even going to bother to calculate a dollar amount for.
Which leaves me with $1250/month, but all of that other stuff will be gone in retirement.
One million should easily provide $2500/month, then figure $800-$1000 for SS. Even if I have to pay a lot for health insurance it still seems like I'll be rolling in it compared to now!
|
|
countrygirl2
Senior Associate
Joined: Dec 7, 2016 15:45:05 GMT -5
Posts: 16,889
|
Post by countrygirl2 on Feb 6, 2019 11:45:17 GMT -5
We spend a lot. I figured before hubs retired it would be $5k to $6k a month and that's about what it is. Right now I am trying to squeeze us down to pay all the ins and taxes from our monthly income and not take it from the property income. I want to have enough to finish out that house without dipping into anything else. Next year it will cover all that for us and the business and give us extra income. We will be in great shape. I foresee one major expense for the post office in the future, for a new furnace at some point. We have a man that had us keep his name and number on file, he said when we are ready to sell the post office he wants to buy it. Hubs said I don't see it for some time, he said doesn't matter when just give me a call. So things like that are good to have in your pocket too. Hubs spends a lot, his gas bill alone is high. 2 vehicles, bunches of mowers and other equipment. I would think your animals would be expensive too MPL. We really don't do without something if we want it. Still you could blow your money if you started taking huge chunks out. I'm actually pretty happy with the RMD requirement now I think about it. It keeps us in line on withdrawals. 1 person I can see it easily taking care of you with other income, 2 its harder if you want to live.
And don't forget doesn't take much income to have 85% of SS as taxable. I did not figure that in way back when.
|
|
Deleted
Joined: Apr 25, 2024 19:01:28 GMT -5
Posts: 0
|
Post by Deleted on Feb 6, 2019 12:41:21 GMT -5
And don't forget doesn't take much income to have 85% of SS as taxable. I did not figure that in way back when. I was always figuring all income would be taxable. Using Taxcaster with 30K IRA withdrawal, 10K SS, $1000 in dividends and $1000 in interest, the tax obligation is $1945. That's not horrible. I figure any big withdrawals like a car or big vacation I would take from the Roth.
I mean, I hope I have more than a million, but I'm not going to freak if I don't and keep working forever if I don't.
|
|
resolution
Junior Associate
Joined: Dec 20, 2010 13:09:56 GMT -5
Posts: 6,980
Mini-Profile Name Color: 305b2b
|
Post by resolution on Feb 6, 2019 17:06:44 GMT -5
And don't forget doesn't take much income to have 85% of SS as taxable. I did not figure that in way back when. I was always figuring all income would be taxable. Using Taxcaster with 30K IRA withdrawal, 10K SS, $1000 in dividends and $1000 in interest, the tax obligation is $1945. That's not horrible. I figure any big withdrawals like a car or big vacation I would take from the Roth.
I mean, I hope I have more than a million, but I'm not going to freak if I don't and keep working forever if I don't.
The median retiree has around 250K so it is clearly doable with less.
|
|
oped
Senior Member
Joined: Aug 20, 2018 20:49:12 GMT -5
Posts: 4,676
|
Post by oped on Feb 6, 2019 17:16:23 GMT -5
My dad and step mother are between 60 and Medicare. Health insurance runs them 3 grand a month.
|
|
countrygirl2
Senior Associate
Joined: Dec 7, 2016 15:45:05 GMT -5
Posts: 16,889
|
Post by countrygirl2 on Feb 6, 2019 18:23:19 GMT -5
We pay about a $1000 a month for insurance, it will keep going up and my scrips are at $175 a month with the new insurance. That's the part that is going to hurt. So we are talking over $14,000 a year currently for insurance and scrips. And that's before any other expenses are even considered. But it is what it is.
Without capital gains and after next year, it should pretty well even out year over year, so we will know then what we will owe, that is all I want to know. This year if I'm even close I will have overpaid about $4k, but I'm not sure.
|
|
weltschmerz
Community Leader
Joined: Jul 25, 2011 13:37:39 GMT -5
Posts: 38,962
|
Post by weltschmerz on Feb 6, 2019 19:16:52 GMT -5
My dad and step mother are between 60 and Medicare. Health insurance runs them 3 grand a month.Holy crap!!
|
|
haapai
Junior Associate
Character
Joined: Dec 20, 2010 20:40:06 GMT -5
Posts: 5,883
|
Post by haapai on Feb 6, 2019 19:27:18 GMT -5
It's possible that increases in the longevity of the wealthiest folks in our society have really changed the nature of inheritances. Both of my grandmothers are over 100. Each of them has four children. All of those children are over 70. All of these children are past the age of traveling. Anything inheritance that these seven (I could not resist, I know the rhyme of the man from St. Ives) children receive will probably be passed down to their own children or even to their grandchildren.
What I'm trying to say here is that kids get nothing in a timely enough manner to make any difference in their lives, but the grandkids (or great-grandkids) might get some serious, high-dollar, very timely boosts.
|
|
CCL
Junior Associate
Joined: Jan 4, 2011 19:34:47 GMT -5
Posts: 7,594
|
Post by CCL on Feb 7, 2019 0:10:06 GMT -5
My dad and step mother are between 60 and Medicare. Health insurance runs them 3 grand a month. Whoa! That's a lot of money. Then I suppose they also have copays and deductibles to pay, too. No way we could afford that much.
|
|
oped
Senior Member
Joined: Aug 20, 2018 20:49:12 GMT -5
Posts: 4,676
|
Post by oped on Feb 7, 2019 0:12:35 GMT -5
I don’t know why it’s so high? It’s not like I saw bills but that’s what he said? Maybe it was total medical?
|
|
countrygirl2
Senior Associate
Joined: Dec 7, 2016 15:45:05 GMT -5
Posts: 16,889
|
Post by countrygirl2 on Feb 7, 2019 7:47:35 GMT -5
Because they aren't old enough for medicare till 65 so paying it all out of pocket. Then for 2, I can see that. MIL pays her part B and supplement plus deductibles. So $3600 for it and the part B, can't remember what it is now $180 a month? And she is 92. She is lucky she has union insurance so it covers the meds in the $3600.
|
|
Deleted
Joined: Apr 25, 2024 19:01:28 GMT -5
Posts: 0
|
Post by Deleted on Feb 7, 2019 8:39:44 GMT -5
I don’t know why it’s so high? It’s not like I saw bills but that’s what he said? Maybe it was total medical? It's possible, especially if they live in a HCOL area. My ACA premiums were $900/month till I became Medicare-eligible a year ago. DB and DSIL were paying $2K/year last year for both of them in SC. What scared the crap out of me was an early proposal by the Trump administration to cut the "flattening" of ACA rates some. In other words, the premiums for older people were artificially low and those for younger people were artificially high, and they wanted to reduce the premiums for younger, healthier people to get more of them in the pool of insureds, and enact some hefty increases for older insureds. As a retired actuary it made perfect sense to me. As a 60-something it was scary as heck. So, yeah, $3K a month for 2 people is possible. My $900/month also came with a $6K deductible and a crappy network. I'm profoundly grateful I never had anything more serious than poison ivy in those years.
|
|
oped
Senior Member
Joined: Aug 20, 2018 20:49:12 GMT -5
Posts: 4,676
|
Post by oped on Feb 7, 2019 8:56:13 GMT -5
I am guessing they have a better plan. She did have cancer about 18 months ago and her care was first rate.
|
|
HoneyBBQ
Junior Associate
Joined: Dec 27, 2010 10:36:09 GMT -5
Posts: 5,395
Mini-Profile Background: {"image":"","color":"3b444e"}
|
Post by HoneyBBQ on Feb 7, 2019 11:01:24 GMT -5
I think you totally could. Me? No. I'm too soft. You guys are starting to freak me out a little! I thought I'd be living pretty good. Just back of the napkin. Current average monthly take home including my paychecks (minus family insurance and 401K), both child supports and tax credits = $3800/month...maybe 4K if there are big bonus checks, but out of that $4000. $1300 - house payment (just principal and interest) $500 - Roth $300 - Childcare $250 - Tuition $200 - kids activities $200 - college savings Then just the added cost of extra people to feed and clothe, extra vehicles, extra utilities, that I'm not even going to bother to calculate a dollar amount for.
Which leaves me with $1250/month, but all of that other stuff will be gone in retirement.
One million should easily provide $2500/month, then figure $800-$1000 for SS. Even if I have to pay a lot for health insurance it still seems like I'll be rolling in it compared to now!
Don't freak out. My house costs almost that much in a HCOLA. My kid's summer camps still run $400-600/week. After school care is a couple hundred a week. I guess if I was retired she wouldn't do those camps? But I still would have to move away to a LCOLA and all that. I put away $1000/month for college for her. Etc. I would just have to change 99.90% of the things I do. I could do it, but I wouldn't like it. You're already a rock star in that area.
|
|
Deleted
Joined: Apr 25, 2024 19:01:28 GMT -5
Posts: 0
|
Post by Deleted on Feb 7, 2019 11:22:54 GMT -5
You guys are starting to freak me out a little! I thought I'd be living pretty good. Just back of the napkin. Current average monthly take home including my paychecks (minus family insurance and 401K), both child supports and tax credits = $3800/month...maybe 4K if there are big bonus checks, but out of that $4000. $1300 - house payment (just principal and interest) $500 - Roth $300 - Childcare $250 - Tuition $200 - kids activities $200 - college savings Then just the added cost of extra people to feed and clothe, extra vehicles, extra utilities, that I'm not even going to bother to calculate a dollar amount for.
Which leaves me with $1250/month, but all of that other stuff will be gone in retirement.
One million should easily provide $2500/month, then figure $800-$1000 for SS. Even if I have to pay a lot for health insurance it still seems like I'll be rolling in it compared to now!
Don't freak out. My house costs almost that much in a HCOLA. My kid's summer camps still run $400-600/week. After school care is a couple hundred a week. I guess if I was retired she wouldn't do those camps? But I still would have to move away to a LCOLA and all that. I put away $1000/month for college for her. Etc. I would just have to change 99.90% of the things I do. I could do it, but I wouldn't like it. You're already a rock star in that area. I wasn't talking retiring NOW. I was responding to those saying 1 million wouldn't be enough to retire off of. I was calculating based on no mortgage or kid expenses anymore. If I was taking home the same as I am now without all that I'd feel flush with cash.
|
|
oped
Senior Member
Joined: Aug 20, 2018 20:49:12 GMT -5
Posts: 4,676
|
Post by oped on Feb 7, 2019 21:07:46 GMT -5
Dad just got back to me, its actually over 3K a month, ... but it is low deductible and also National... because they are frequently between PA and Florida... so he said he thinks it would be a grand less if it wasn't national... BUT, their ability to do that is what he credits to them being able to choose the best doctors for her when she got sick... ? Anyway he says its another year and he'll pay it.
|
|
buystoys
Junior Associate
Joined: Mar 30, 2012 4:58:12 GMT -5
Posts: 5,650
|
Post by buystoys on Feb 8, 2019 8:08:59 GMT -5
I'll inherit nothing. That's a given. DH has already received part of his inheritance, kinda, sorta. When his father passed, the four kids received 1/2 the family house. They can't sell it while their mother lives there. Once she passes, the rest of the house will go to them. We've already decided that if she needs to do a reverse mortgage, we'll sign whatever needs to be signed for her. I don't know if the others kids feel that way, though.
|
|
TheHaitian
Senior Associate
Joined: Jul 27, 2014 19:39:10 GMT -5
Posts: 10,144
|
Post by TheHaitian on Feb 8, 2019 8:56:51 GMT -5
Don't freak out. My house costs almost that much in a HCOLA. My kid's summer camps still run $400-600/week. After school care is a couple hundred a week. I guess if I was retired she wouldn't do those camps? But I still would have to move away to a LCOLA and all that. I put away $1000/month for college for her. Etc. I would just have to change 99.90% of the things I do. I could do it, but I wouldn't like it. You're already a rock star in that area. I wasn't talking retiring NOW. I was responding to those saying 1 million wouldn't be enough to retire off of. I was calculating based on no mortgage or kid expenses anymore. If I was taking home the same as I am now without all that I'd feel flush with cash. Now we run about ~$7,000/month and about half of that is our mortgage (+extra): So take out mortgage, student loans and other fluff I can see us living on ~$3,000/month. Will it be fun? Hookers and blow? No... but we would not be eating cat food either. So I see your point! But we are also 30+ years from retirement that I am in the put your head in the sand and just throw money at it phase. If all else fella my back up plan is to convince DW to split our time between Haiti and USA... have a small 1 bedroom or 2 in a city near DD and then our place in Haiti during winter months.
|
|
countrygirl2
Senior Associate
Joined: Dec 7, 2016 15:45:05 GMT -5
Posts: 16,889
|
Post by countrygirl2 on Feb 8, 2019 13:17:08 GMT -5
Our base income is $74k, that will not change as that's SS, RMD's, and a small pension. It will stay that way, until one of us is deceased. As I've stated, not this year but next year we will add income plus reduce expenses. So it will gross right around $100k. We aren't living large, I still have to pay attention to what I spend. And I'm putting off new flooring for a year so we don't draw down on monies, then the next 2 years will be saving for hubs a new vehicle. Paying insurance, having a new car on occasion, and any maintenance items will come up just like it does now. Just because you retire doesn't mean expenses necessarily drop a ton. We are fortunate he is still able to fix and redo but that won't continue for ever.
In 10 years when we start selling a house a year, then my bonds will start coming due. I will have to cash them in a year at a time adding more income and more taxes! I expect our insurance premiums to go up and up. But I hope we are positioned to remain ok. Nursing home or assisted living will eat us up as we will qualify for nothing. So that when it happens and depending on how long could change our income and asset amounts a lot. But this is only different from others as many may qualify for Medicaid so it won't cost them anything. Those costs are the great equalizers.
I think we are positioned about as good as I could get it. And yes I still worry about money, its just my nature, its also why we have some, LOL!
Could we live on less if we had to, of course, anyone can. Do I want to, no. I would recommend anyone that can work where they can get a pension, its worth way more then you can ever imagine.
|
|
countrygirl2
Senior Associate
Joined: Dec 7, 2016 15:45:05 GMT -5
Posts: 16,889
|
Post by countrygirl2 on Feb 8, 2019 13:18:23 GMT -5
And I have no idea how seniors live on the small amounts of SS they get, but they do somehow. But I think they only exist.
|
|
tallguy
Senior Associate
Joined: Apr 2, 2011 19:21:59 GMT -5
Posts: 14,147
|
Post by tallguy on Feb 8, 2019 14:38:41 GMT -5
Our base income is $74k, that will not change as that's SS, RMD's, and a small pension. It will stay that way, until one of us is deceased. As I've stated, not this year but next year we will add income plus reduce expenses. So it will gross right around $100k. We aren't living large, I still have to pay attention to what I spend. And I'm putting off new flooring for a year so we don't draw down on monies, then the next 2 years will be saving for hubs a new vehicle. Paying insurance, having a new car on occasion, and any maintenance items will come up just like it does now. Just because you retire doesn't mean expenses necessarily drop a ton. We are fortunate he is still able to fix and redo but that won't continue for ever. In 10 years when we start selling a house a year, then my bonds will start coming due. I will have to cash them in a year at a time adding more income and more taxes! I expect our insurance premiums to go up and up. But I hope we are positioned to remain ok. Nursing home or assisted living will eat us up as we will qualify for nothing. So that when it happens and depending on how long could change our income and asset amounts a lot. But this is only different from others as many may qualify for Medicaid so it won't cost them anything. Those costs are the great equalizers. I think we are positioned about as good as I could get it. And yes I still worry about money, its just my nature, its also why we have some, LOL! Could we live on less if we had to, of course, anyone can. Do I want to, no. I would recommend anyone that can work where they can get a pension, its worth way more then you can ever imagine. Well, no. Your RMD's will change year-to-year. The amount is based on a percentage of the year-end balance from the previous year. That percentage is not fixed, and increases slightly every year as you get older. There is a schedule available which tells what percentage of that amount must be taken at every age. Also, because it is a percentage of account value it could be tremendously affected by market performance up or down compared to today.
|
|
countrygirl2
Senior Associate
Joined: Dec 7, 2016 15:45:05 GMT -5
Posts: 16,889
|
Post by countrygirl2 on Feb 8, 2019 15:13:04 GMT -5
You are correct, but I don't think enough to make much difference. I realize the life expectancy table goes down year by year, I have those. I should have stated that amount will change from year to year by a small amount. But even if it goes up and we get COL wages raises, I need to reread this stuff, the rise in ins is going to offset about anything we get or more. So if anything it will go down. Ours don't fluctuate much, we are in low volatility funds. They are fairly stable.
|
|
sesfw
Junior Associate
Today is the first day of the rest of my life
Joined: Dec 21, 2010 15:45:17 GMT -5
Posts: 6,268
|
Post by sesfw on Feb 10, 2019 14:44:33 GMT -5
And I have no idea how seniors live on the small amounts of SS they get, but they do somehow. But I think they only exist.
cg2 …. this is very true. This was the case of my SIL before she passed in 2009. Hard to believe it was 10 years ago. She was very careful of her funds and fortunately her mobile home and lot was paid for. Even then after her death it was sold for $40K. Very bad condition. This price was the value of the MH park land she was in.
|
|
TheOtherMe
Distinguished Associate
Joined: Dec 24, 2010 14:40:52 GMT -5
Posts: 27,163
Mini-Profile Name Color: e619e6
|
Post by TheOtherMe on Feb 10, 2019 14:55:06 GMT -5
My parents lived almost 40 years on their SS, dad's pension that is less than $500 per month and a very small pension for mom (less than $150). They were still able to save.
They accumulated their retirement money through IRAs and savings after my sister and I left home.
They traveled in the early years, paid cash for two houses and their cars.
Without the savings, mom would have been in a world of hurt had dad gone first.
|
|
dancinmama
Senior Associate
LIVIN' THE DREAM!!
Joined: Dec 18, 2010 20:49:45 GMT -5
Posts: 10,659
|
Post by dancinmama on Feb 11, 2019 17:06:28 GMT -5
We are in the process of educating ourselves about trusts and are planning to set one up. We will sit down and talk to DS, but let him know that we do not have LTC insurance which means there could be a boatload or not much at all left by the time we go.
I will likely inherit $1M+, but I have NEVER considered it in our financial/retirement planning. My dad passed in 2008; my parents had set up an AB trust 12 years before that. My mom still lives alone and is in fairly good health at age 92. She is mobile, still drives, and can still manage her own affairs. Her mom lived into her late 90s.
|
|
abovewater
New Member
Joined: Feb 5, 2019 19:20:07 GMT -5
Posts: 11
|
Post by abovewater on Feb 11, 2019 19:35:55 GMT -5
"Would you be comfortable with...Your kids knowing they will receiving a large sum of inheritance and doing their planning based on that?"
No, not comfortable with that.
Since being a teenager, I was told that we had old family money, and that someday I'd inherit "more money than I knew what to do with" according to my mom. It was a fun thought, but as it turns out, the family money wasn't an enormous sum to begin with. Over the years it's been spent 'here and there,' and there probably won't be any left by the time my siblings and I would receive it.
Thankfully we're all financially stable, but I truly wish I had never heard about it in the first place.
|
|
Deleted
Joined: Apr 25, 2024 19:01:28 GMT -5
Posts: 0
|
Post by Deleted on Feb 11, 2019 20:00:22 GMT -5
"Would you be comfortable with...Your kids knowing they will receiving a large sum of inheritance and doing their planning based on that?" No, not comfortable with that. Since being a teenager, I was told that we had old family money, and that someday I'd inherit "more money than I knew what to do with" according to my mom. It was a fun thought, but as it turns out, the family money wasn't an enormous sum to begin with. Over the years it's been spent 'here and there,' and there probably won't be any left by the time my siblings and I would receive it. Thankfully we're all financially stable, but I truly wish I had never heard about it in the first place. Oh man. I don't think anyone should expect a dime of inheritance, but it would suck to be told your whole life you were getting a sizeable one and then find out otherwise. I want any surprises in that department to be positive ones, so I'm happy I'm assuming nothing.
|
|
countrygirl2
Senior Associate
Joined: Dec 7, 2016 15:45:05 GMT -5
Posts: 16,889
|
Post by countrygirl2 on Feb 11, 2019 21:56:36 GMT -5
In a way I'm glad we came from nothing. We had no expectations of receiving anything. We worked made our own way, saved and saved. I got mom's farm before she died we had to sell the house for her to use the money, but I kept the 25 acres of farm land. Never made anything off of it really, but the pay off was big. Hubs expected in later years to maybe get a bit. Our son pretty well knows unless we are in a nursing home he will get some money. Nothing fantastic but it should top of his retirement nicely. He will take care of it, his wife I doubt it. But you never know. Our thoughts now are about DD, as it is its half and half and hers to go into a special needs trust with leftover to him. But I don't know about that, I'm afraid it would go to the state, I understand in Texas they do everything to get it all and before they are gone and the client gets little or no good from it as intended. We will relook that again. We have son on our LLC as a nonparticipating partner, so it could go directly to him them be liquidated. But things change and we aren't gone yet, we could live it all up before we go, you never know.
|
|