More retirement advice. Before you have to go into the nursing home, move to Minnesota.
Retirement question
- Thread starter Jaxdog
- Start date
I got defensive one year ago because I hated all of this market chop from AI and the admin juicing the market with the tariff BS. I positioned equally in UHC (bingo), PM and UPS for the dividends. I figured that since they are all decent recession plays, I'd be okay. Combined with VIG, it's performed steadily for me at about 18% YTD even though I could have made more with more tech exposure.
The UHC play was shrewd but I didn't expect it to do as well as it has in one year. Always a reminder to buy well-performing companies when there's a discount opportunity.
The UHC play was shrewd but I didn't expect it to do as well as it has in one year. Always a reminder to buy well-performing companies when there's a discount opportunity.
There may be some nursing home facilities that take medicaid that are decent, but I would not worry about protecting assets from nursing homes unless you have so little that they're going to be exhausted and you're going to end up in a medicaid home regardless.
Most nursing home patients are out in 5 months. The average is under 14 months. So you are very likely to be done with a nursing home stay for under $150k, even if you stay longer than average. Granted the ones that stay alive in nursing homes for a long time most people can't save enough assets for. Going to need at least $2.5M to fund it indefinitely even in low cost areas, although there are products that are basically reverse life insurance products where you pay a large amount up front and then if you end up being one of the lucky (or unlucky?) ones that live a long time after entering a nursing home, they continue to pay. Not sure what those cost.
All that to say, I'd just roll the dice before just conceding thath you will be in a medicaid home when the time comes. If you blow through a $300k would be inheritance, then that sucks, but I think I'd rather a parent spend two or three years in a decent nursing home than have them in a ******** for 3 years (although they'll probably die sooner in a medicaid home just from despair) to get that $300k, especially if it's going to be split among siblings. I guess if you're at that $1M or 1.5M range, I can definitely see a parent wanting to be in a **** hole at the end of life so that their kids can get the benefit of their life savings.
To quibble, thats not the best use of averages. That average number keeps going up. So the average senior entering a home today will be there longer than the current average. Maybe far longer. Add in memory care, and the cost goes up way more.
But anyway, the point is to have the option if you need it. You dont want to be a couple years into having an elder needing that care, realizing theres likely many more years needed, and not have the funding nor the Medicaid option. But yeah, this probably applies to a niche group. At higher levels it doesnt make sense to move money out of tax advantaged accounts. The biggest key is to not comingle accounts. You dont want a low asset elder denied Medicaid because they have technical connection to assets that are the child's.
Plus, it applies to at home assistance too.
I’m a state retiree working for a private employer, so I’ve not taken any money out yet but plan to next year when I can do so without penalty— small amounts from an another annuity where I put my deferred comp — mostly to pay for home improvement projects during the next few years.
I’ve thought about retiring at my designated retirement age, but am considering doing so when I’m 65 because too many friends have passed away before or shortly after they retired… I’ll pay off my house then so I won’t have a house note
By that time, I’ll have hopefully built up my retirement fund via my current employer to an okay level now that they’ve started to match what I put in it. Maybe my PERS benefits will be compounded to a decent amount and the real life Social Insecurity will be at an alright figure too…
Considering that I’m single, in my late 50s, have no children, and the future for me consists of genetic time bombs, my self-prescribed retirement activities will be fun-filled
No beaches though. I 17ing dislike lower Alabama sand. Too 17ing hot.
Other places could be possibilities though…
I’ve thought about retiring at my designated retirement age, but am considering doing so when I’m 65 because too many friends have passed away before or shortly after they retired… I’ll pay off my house then so I won’t have a house note
By that time, I’ll have hopefully built up my retirement fund via my current employer to an okay level now that they’ve started to match what I put in it. Maybe my PERS benefits will be compounded to a decent amount and the real life Social Insecurity will be at an alright figure too…
Considering that I’m single, in my late 50s, have no children, and the future for me consists of genetic time bombs, my self-prescribed retirement activities will be fun-filled
No beaches though. I 17ing dislike lower Alabama sand. Too 17ing hot.
Other places could be possibilities though…
You’ll be using that 500K to renovate it…
If you trust those Euro fixer upper shows and videos… **
Ramsey's logic is terribly flawed. He is assuming a uniform 12% rate of return. So if inflation is a uniform 4%, you can take out 8% without ever touching the principal. 12% is an awfully high return assumption to make for planning purposes. And assuming anything is uniform is just dumb. He's completely ignoring sequence of returns risk. And to advise people in this way is irresponsible.
Shocking that Ramsey would oversimplify and completely misrepresent something he presents as facts. I hope no one listens to his advice on this. 12% return in retirement is laughable. You should be shooting for an 8% return, and that's high.
You can live like a King on $1000 a month at the north beach in the Dominican Republic. I almost moved there!
I’ve read Ramsey’s book and Inused to listen to his show sometimes. I don’t follow all his specific things but my father thought like Dave Ramsey before Dave Ramsey was ever born and that was ingrained into my brain from an early age. My father’s financial rules were, don’t borrow money for anything other than a house/land and no more than one car at a given time. If you want something save up the money to pay cash for it, otherwise you can’t afford it. Pay for your home as quickly as possible and once it’s paid for continue making those payments into savings. He always had a side job or a secondary way to make money and that money went straight to savings. Live below your means and save the rest.
That advice is generally very good advice. He takes it to the extreme sometimes, but I've pretty much always pretty much lived my financial life like that even without listening to him. Except for the 2nd job part.
Ramsey was decent 15-20 years ago when he was focused on browbeating financially illiterate people to get out of debt and learn to save in talk radio format to the delight of listeners. Like most businesses, the product suffered when he needed to "scale" to grow his hick financial empire.
He and his kids now give pretty poor overall financial planning advice, but they've got a big company to run and need to make profits. Financial Peace University, anyone? GTFO. That's the most church-based MLM stuff if I've ever seen it, and I have a hunting lease in Mormon country. See patdog's reference to the fixed 12% return. He's a hack with the same advice that anyone with depression-era grandparents would give.
You can get a nice smaller home for $100k or so. I've looked into and talked to friends who do business there and they say the fixer uppers are like $75k for a smaller home.
Ramsey is a greedy sack who's advice is flawed and his brother is a libtard working in Oxford
Cousin. And I like Marshall just fine. Even though I often disagree with him politically. I think Dave is a fraud.
Its really two things that are both right. Using debt as leverage to make wealth is very legitimate. It works great in a rising market. The downside is it leaves you vulnerable in a recession.
NO!!!!!!!! NO STRATEGIC DEBT!!!!!!!!! RICE AND BEANS AND DRIVE A 1994 HONDA ACCORD AND TITHE
The stats on nursing home stays? I've seen it in multiple places in financial planning and personal finance space. It's always been consistent so never really dug down into the sourcing.
Or my opinion on nursing homes that take medicaid? That's definitely much more limited. I have been to a few in Mississippi and you would not want to leave your parents there if you had a choice. Somebody on the board of one of them told me that they were actually a pretty good one because even though the facilities look bad, the lack of job opportunities in the area meant they got pretty good workers that generally cared and were good to patients, whereas facilities in more economically successful areas can't compete for workers and so they end up being terrible, even if they may or may not have some nicer facilities due to local donations. So definitely don't take my opnion on them as gospel. Hopefully I am wrong and most nursing homes that take medicaid are decent places.
I agree with this assessment, from my own tours of facilities in Madison and the Gulf Coast. They're functional. They're not nice.
The quality of caregiver staffers is quite variable across facilities. Mostly black. Mostly female. Mostly uneducated. Some are truly caring and hard working. Many are fat, lazy, clock-punchers with bad attitudes. Publicly funded or privately funded, it’s pretty much the same.
Not bad advice for a few years if you need to reduce debt or build a nest egg. It does take some self discipline and sacrifice get on a path to success. I have never did find a way to spend my way to financial stability. As far as tithing, to each his own.
Will you receive a pension check? Is your retirement totally in savings, 401K and IRA? If the latter, how is that money invested? Dividend investments kick off dollars, growth stocks don't. Think about how your investments produce cash to reinvest. When I retired, I had to totally redo my investments to produce income. If you have an IRA, you have to do the same. When you reach the age of mandatory withdrawal, you don't want to have to sell stock to withdraw. It's all strategy that is taught very poorly.
When I hear people being critical of Dave Ramsey, my first thought is “are they up to their eyeballs in debt or completely underwater?”
Well 4% for one person may be more money per month for another person that withdraws 8%. It is all about how much your account balance is.
But According to Google the S&P has an average year gain of 11% over the last 20 years. Dow is around 8%. My portfolio has gained in that average over the last 20 years. And that includes the downturn of 2008.
So, If you have your money invested properly, you can withdraw 8% per year and your 401k(or whatever you have) will increase by at least 8% You'll never run out of money.
with all that said check with your financial advisor. Also I am really close to retiring... maybe this December or next ... so I expect a 1929 collapse
But According to Google the S&P has an average year gain of 11% over the last 20 years. Dow is around 8%. My portfolio has gained in that average over the last 20 years. And that includes the downturn of 2008.
So, If you have your money invested properly, you can withdraw 8% per year and your 401k(or whatever you have) will increase by at least 8% You'll never run out of money.
with all that said check with your financial advisor. Also I am really close to retiring... maybe this December or next ... so I expect a 1929 collapse
The problem scenario is a big downturn early in retirement. If you had retired in early 2008, that downturn would have hit you a lot harder than it did. Because you’d have to draw out more shares in a down market to live on & you’d never be able to recoup those losses.Well 4% for one person may be more money per month for another person that withdraws 8%. It is all about how much your account balance is.
But According to Google the S&P has an average year gain of 11% over the last 20 years. Dow is around 8%. My portfolio has gained in that average over the last 20 years. And that includes the downturn of 2008.
So, If you have your money invested properly, you can withdraw 8% per year and your 401k(or whatever you have) will increase by at least 8% You'll never run out of money.
with all that said check with your financial advisor. Also I am really close to retiring... maybe this December or next ... so I expect a 1929 collapse
I mean, it depends on the person you're hearing from. His lessons are for people who have no idea how to manage money on an elementary basis. And he has now turned his "advice" into a huge money-maker that is borderline predatory and uses religious channels as his marketing arm.
There are many, many better people out there who give financial advice that are less condescending and less profit-centered.
Exactly. At its core, don’t borrow money, live a little below your means, and save money is good advice. Bit there are times when some temporary (which may be up to 15-30 years in the case of a house) manageable debt is fine. And his investing advice is just simplistic, often wildly risky, garbage.