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Re: How much do you need for a comfortable retirement?

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Message 71 of 166

i would say: this might work for people able to work a full time job,but try living on 1300.00/monthly and think a little more on the subject of living comfortable. just saying.

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RE: How much do you need for a comfortable retirement?

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Message 72 of 166

In Response to RE: How much do you need for a comfortable retirement? by jmleahyjr

I'd like to encourage you to start a new Topic on that "continuum of care" subject!

I think we've kind of gotten (lazy) into the habit of including everything in this one Topic about having enough for a comfortable retirement.


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RE: How much do you need for a comfortable retirement?

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Message 73 of 166

In Response to RE: How much do you need for a comfortable retirement? by ASTRAEA

This discussion has gone on for a considerable number of postings with a substantial amount of it related to the sub-topic discussion on long-term-care insurance.  Without wishing to start another tangential discussion here, there is a related subject or series of subjects that may be of interest and which would probably provide enough discussion for a separate topic.  I have recently had occasion to investigate institutions, organizations, and companies that provide assisted living, continuing care, and retirement living, including the range of services available and the different manners in which costs are imposed.  

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RE: How much do you need for a comfortable retirement?

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Message 74 of 166

In Response to RE: How much do you need for a comfortable retirement? by ASTRAEA

Yes, but "quality of life" is a very recent concern. Most people didn't live long enough for 'quality of life' in their old age to be an issue. When I was growing up in the 50's, on average most people lived barely 6-7 yrs after retirement age 65.

Now, people are being told to be sure they have sufficient funds for 20-30 yrs - even 40 if they have really favorable personal health and genetic factors. That's a huge change in the span of my lifetime, and I won't reach 60 until this May.

Just as Medicare is having to slowly shift focus from reimbursing quantity care to rewarding quality of care/cost savings, changing anything to do with government or large corporate processes is like turning an oil-laden supertanker 180-degrees....you can do it, but it takes a lot of empty ocean space and time to accomplish. You are working against momentum.

None of us should want a government making policies that could change unexpectedly from one day to the next, every day, anyway. That would be even more chaotic than what we have now.

When plans are made upon future suppositions, those decisions may hold true or they may be found to be false, as time moves on and suppositions are superseded by real data.

But 'real data' has to be validated by time. Short term trends do not always make long-term facts.

Companies need to see that 'quality of life' is a profitable field, but government can help by establishing basic guidelines. The most successful healthcare systems are ones where everyone is enrolled, there is a government-decreed basic level of services, but there is also a competitive insurance market for differing levels of care needs.

At this point, the few companies who have gone into 'quality of life' services are segmenting their efforts and pricing is all over the place, because no one can truly forecast how much consumers are willing to pay, for which services.

There are already caps on many LTC policies. MetLife dropped out of the market (keeping their in force book of LTC policyholders) last year, and unlimited benefit periods were also eliminated by at least two LTC carriers that I know of.

As I have said, people have to decide what their financial situation can absorb. If they can come up with $80K/yr for each spouse, great. Some can; most can't.

LTC insurance gives us 'more arrows in the quiver.' It gives DH and I options we would not have otherwise, should one or both of us need expensive care.

Yes, we may pay premiums for a long time and never need it. We've been paying homeowners' insurance and auto insurance for a long time too, and have seldom needed that either. We've (mostly) stayed out of the hospital except for three emergencies, and never stayed longer than four days.

One doesn't buy insurance because one knows when one is going to use it. It's purchased in case it is needed, because it's a form of financial leverage. In that sense it is not much different than buying a home with a down payment instead of using 100% cash. A good LTC policy gives us shelter from financial storms (risk mitigation) and appreciation (compounded inflation benefit, unlimited term) in exchange for a modest expenditure.

A 'comfortable retirement' is whatever one thinks it might be. But as these chaotic times have shown, people need to think about all the bad things that could go wrong, and plan for those. What is the use of plans that, like some of our friends, only accounted for assumptions that the markets wouldn't fluctuate and their health would never fail them?

When I worked in the CFP office, there were at least three couples who came in, paid for an expensive financial plan (they were all done by hand in our office, not by those limited computer software programs), and professed themselves indignant when told they needed to stop spending so much money, save more, and plan more comprehensively (like most people, they were underinsured; especially with children in the household this is very common).

These people were all certain they were making enough money to soon take early retirement. Which they were, but they were also spending it on their lifestyles and hadn't thought about what could go wrong. Two were self-employed but had no disability or LTC insurance.

Sometimes a good professional 'check up' is needed to ensure that the goals are achievable, the budget is on track, and that all scenarios have been stress-tested properly.

Doing this would help a lot of people actually achieve that 'comfortable retirement' they are dreaming of.

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RE: How much do you need for a comfortable retirement?

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Message 75 of 166

In Response to RE: How much do you need for a comfortable retirement? by kom2010

Just as a social comment, I think that medical research needs to focus on "quality of life" keeping pace with longevity; it's crazy to extend life for people, if there's poor quality going with it!

I haven't bothered with LTC insurance, because my income should cover it. The longer people live, I think the more restrictions will be instituted on LTC coverage, because statistically the companies will be unable to cover their clients' needs otherwise.


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RE: How much do you need for a comfortable retirement?

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Message 76 of 166

The fastest growing group in ALL industrialized nations, from Europe to the US to the traditional Three Tigers of Asia, is the age group 80+ yrs. This is why all of these nations are facing serious healthcare issues specific to their own culture/healthcare systems.

Longevity is now increasing every month, statistically speaking. Each baby born in a calendar month will live on average, several days longer than a baby born in previous months. Medical technology is geared towards saving lives of common critical illnesses.

Statistics now show that if a couple reaches retirement age 65 in good health, the death of the SURVIVING spouse is age....92. And that age, like the babies being born, continues to creep up every year as we extend mortality.

What is not addressed is quality of life. Other nations care for their elderly (which is a massive cost they are wrestling with) while the US does not, putting most of the burden on the individual/family assets.

80% of Medicare's cost is spent on 20% of its enrollees, in the last 2-5 years of their lives. Whether we, as taxpayers, continue to fund this or, as the ultra-conservatives want, disassemble and gut all government entitlement programs, there are hard choices we all must make.

Do we stop spending on the very sick/very old? There are more of them, in growing numbers, than the young/permanently disabled. I know very few 30- or 40-yr olds who are permanently disabled or medically impaired in some way, but a fair number of Boomers are, and when you get to the 80+-yr olds the percentage shift to an overwhelming majority of some type of impairment.

Given the thrust of the medical research/technology that has increased longevity to amazing lengths at astonishing speed, but has not concentrated on ensuring quality end-of-life on a consistent basis, there are only two choices:

- Make sure you have enough funds to self-insure, not only for yourself but your spouse. Be certain any family member you care for also can self-insure without your assistance. It doesn't matter where you get the liquidity from, just that you have access to funds on demand and for an extended period.

- Reduce your financial risk by strategic planning, which will probably include LTC insurance, purchased when the cost/value ratio is most favorable to YOU, not the insurer.

Making the determination of cost/value ratio in one's financial planning is a process no different than buying life, disability, homeowners, auto, or health insurance. These are all specialty products, and must be considered on an individual basis because everyone has a unique financial profile.

If one has sufficient liquidity to self-insure, insurance needs are reduced, if not eliminated.

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RE: How much do you need for a comfortable retirement?

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Message 77 of 166

In Response to RE: How much do you need for a comfortable retirement? by kom2010

What I meant was that I don't think the actuary tables would justify the very high premiums for older people because while there may be more likely care need it won't last as long as that for a relatively young person stricken with a major dehabiliting disease. Just a logical assumption on my part.

Some insurers go to at least 77 or so, but you have to be in pretty good health and able to pass cognitive ability tests etc. Still not affordable though in our case.

Some retirement housing plans do offer LTC for a lot less than the premiums for a couple of years  as part of the initiation fee. Again you have to be in pretty good shape to qualify.

Karl

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RE: How much do you need for a comfortable retirement?

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Message 78 of 166

As anyone who has read my posts can tell you, sleepercell, I'm a retired executive assistant who worked in insurance, banking, consulting, and financial services. I don't work for anyone and don't need to. I spend my time gardening, cooking, reading, and writing (just posted some stories on one of the fiction sites).

Anyone can self-insure. Whether they SHOULD self-insure is another matter altogether.

That is not my determination to make for anyone else. Unlike you, I think people should be aware of options, research them, and evaluate what suits their own personal financial situation. What works for me does not work for you, and vice versa.

There is no one solution for everybody. Self-insurance is the "right" thing only for certain people. Astraea self-insures, as do many people I know who have sufficient assets to be able to do so.

Some people like to work on their own cars. I don't. I know how to, I just don't want to. Therefore I pay somebody to do it for me. Some people pay gardeners a monthly fee to keep their landscape neat and tidy; I prefer to do it myself because I enjoy it.

IOW, I assess how I spend my time. It's no different than assessing how we spend our money, except that it is more complicated. Saying "oh, it's simple to do investing/financial planning and anybody can do it themselves" is not only self-deluding, it is contemptuous and denigrating.

Because most people are not trained to analyze properly nor how to research what factors they do not know, which is far more important in financial planning than in gardening. Build your house on sand, and it can fall - as simple as that. It may not....or it may. But you have increased your risk factors, whereas better planning, more knowledge, and/or using a professional could have increased your chances of success and lowered your risks.

You are fortunate that you can just ignore an $81K/yr figure and say, "I can self-insure." I cannot, and I doubt your vaunted hypothetical $48K/yr middle class person cannot either. How long would it take most people to save up $81K? Are they to sell their houses? Where do the spouse and children live?

For you to attack Astraea and then me with snide remarks, merely weakens your own arguments.

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RE: How much do you need for a comfortable retirement?

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Message 79 of 166

In Response to RE: How much do you need for a comfortable retirement? by kom2010

Are you selling LTC Insurance or do you work for AARP or both?

Corporations self insure and individuals and families can do the same thing.

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RE: How much do you need for a comfortable retirement?

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Message 80 of 166

In Response to RE: How much do you need for a comfortable retirement? by SLEEPERCELL

Thank you...happy to share. ~ Mimi

“The third-rate mind is only happy when it is thinking with the majority. The second-rate mind is only happy when it is thinking with the minority. The first-rate mind is only happy when it is thinking."
War With Honour, 1940 ~ A.A. Milne
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