How much do you need for an UMC retirement?

[Anonymous]

Anonymous wrote:Another total joke are these people who think they need to fund three generations before they retire: themselves, their kids, and their grandchildren. I’m not working extra so that the two generations after me don’t have to. It’s fine if you have good fortune and want to share the wealth, but this is not “saving for retirement.”

+1, some people are trying to build true generational wealth. That's fine but a different goal than OP's question about how much you need to maintain an UMC lifestyle in retirement.

The funny thing is that because a lot of people will automatically spend more if they have more, a lot of people who amass small fortunes by the time they retire will squander most of it (on vacation homes and subzero refrigerators and first class plane tickets). Meanwhile you could save a more modest amount, live a perfectly nice retirement on 100-150k a year, and wind up leaving a paid off home and a good chunk if change to kids if you don't wind up with major LTC costs (which lots of people don't-- neither of my ILs wound up in LTC unless you count the 6 months my FIL spent in hospice before he died (paid for by Medicare and the VA). My dad spent 2 years on LTC but so far my mom hasn't needed it (she's 85 and lives in a condo in a retirement community but it's very economical ).

[Anonymous]

Anonymous wrote:

Anonymous wrote:Fridge 1 - $1200 lasted 10 years
Fridge 2 - $1400 current but on 10th year and will be swapped out at upcoming kitchen remodel.

I’m pretty sure both kept food same cold temperatures as your subzero. Plus I got $17400 to play with. 😁

DP but there is a coolness factor to Sub-Zero fridges. Mine has a glass door and a blue LED light - I've had it for 10 years and sometimes, when entering my kitchen, I still stop and think how cool it is. It's my favorite thing in my entire house. Of course it's not a necessity, but neither is anything besides basic food, clothes, and a roof over one's head. Also, $20K is at the very top of the price range, even for Sub-Zero fridges.

Still as dumb as buying a luxury car. Maybe even dumber.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Fridge 1 - $1200 lasted 10 years
Fridge 2 - $1400 current but on 10th year and will be swapped out at upcoming kitchen remodel.

I’m pretty sure both kept food same cold temperatures as your subzero. Plus I got $17400 to play with. 😁

DP but there is a coolness factor to Sub-Zero fridges. Mine has a glass door and a blue LED light - I've had it for 10 years and sometimes, when entering my kitchen, I still stop and think how cool it is. It's my favorite thing in my entire house. Of course it's not a necessity, but neither is anything besides basic food, clothes, and a roof over one's head. Also, $20K is at the very top of the price range, even for Sub-Zero fridges.

Nothing tastes as good as skinny feels. Stop worshipping your refrigerator

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Fridge 1 - $1200 lasted 10 years
Fridge 2 - $1400 current but on 10th year and will be swapped out at upcoming kitchen remodel.

I’m pretty sure both kept food same cold temperatures as your subzero. Plus I got $17400 to play with. 😁

DP but there is a coolness factor to Sub-Zero fridges. Mine has a glass door and a blue LED light - I've had it for 10 years and sometimes, when entering my kitchen, I still stop and think how cool it is. It's my favorite thing in my entire house. Of course it's not a necessity, but neither is anything besides basic food, clothes, and a roof over one's head. Also, $20K is at the very top of the price range, even for Sub-Zero fridges.

Nothing tastes as good as skinny feels. Stop worshipping your refrigerator

+1

If you’re skinny, you’re most of the way to UMC.

[Anonymous]

Anonymous wrote:

Anonymous wrote:UMC income is likely $250,000, so you will need over $6 million in income generating assets.

Do you really need that as a senior citizen? House is paid for. If it’s a large house it’s a good time to downsize. You’d be debt free. Your bills would be taxes, cars, utilities, travel if you want. Not all that much in expenses.

Taxes, cars, utilities without the travel runs us over $250K a year.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:UMC income is likely $250,000, so you will need over $6 million in income generating assets.

Do you really need that as a senior citizen? House is paid for. If it’s a large house it’s a good time to downsize. You’d be debt free. Your bills would be taxes, cars, utilities, travel if you want. Not all that much in expenses.

Taxes, cars, utilities without the travel runs us over $250K a year.

You’re doing something wrong

[Anonymous]

Anonymous wrote:People over-budget for and over-idealize travel. I’ve done my fair share of exotic travel and found that people everywhere are pretty much doing the same thing (imagine that!). My own bed, couch, food and car are great for me - I don’t need to rent someone else’s to be happy. Sure, I like a trip every now and then, but I’m not going to work longer to spend $25-50k year on travel.

Exactly! Except maybe for Japan, and maybe some parts of Asia, most other places I've visited (Europe especially) are s*itholes and you have to watch your pocket, deal with attitude, etc. Much rather spend that money at local restaurants and US beaches.

[Anonymous]

If you have a paid off house, your expenses during retirement are gonna be absurdly lower than your expenses during your work years. All these people in this thread are over-saving for their needs. Which is not bad, but they’re not optimizing for their own retirement goals, per se.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Another total joke are these people who think they need to fund three generations before they retire: themselves, their kids, and their grandchildren. I’m not working extra so that the two generations after me don’t have to. It’s fine if you have good fortune and want to share the wealth, but this is not “saving for retirement.”

+1, some people are trying to build true generational wealth. That's fine but a different goal than OP's question about how much you need to maintain an UMC lifestyle in retirement.

The funny thing is that because a lot of people will automatically spend more if they have more, a lot of people who amass small fortunes by the time they retire will squander most of it (on vacation homes and subzero refrigerators and first class plane tickets). Meanwhile you could save a more modest amount, live a perfectly nice retirement on 100-150k a year, and wind up leaving a paid off home and a good chunk if change to kids if you don't wind up with major LTC costs (which lots of people don't-- neither of my ILs wound up in LTC unless you count the 6 months my FIL spent in hospice before he died (paid for by Medicare and the VA). My dad spent 2 years on LTC but so far my mom hasn't needed it (she's 85 and lives in a condo in a retirement community but it's very economical ).

It's not "squandering" on vacation homes, subzero and first class tickets if you plan to spend on that. For some of us, those items are just a "drop in the bucket". If you have $10M+, why wouldn't you splurge on things that give you pleasure? Sure I don't need a subzero, but it's an awesome fridge, keeps food fresher (with 2 compressors) and we can easily afford it. Same for business class travel. Don't have to have it, but I can't take my $$$ with me when we die. Kids don't need $10M+ each, so why shouldn't we enjoy it

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Fridge 1 - $1200 lasted 10 years
Fridge 2 - $1400 current but on 10th year and will be swapped out at upcoming kitchen remodel.

I’m pretty sure both kept food same cold temperatures as your subzero. Plus I got $17400 to play with. 😁

DP but there is a coolness factor to Sub-Zero fridges. Mine has a glass door and a blue LED light - I've had it for 10 years and sometimes, when entering my kitchen, I still stop and think how cool it is. It's my favorite thing in my entire house. Of course it's not a necessity, but neither is anything besides basic food, clothes, and a roof over one's head. Also, $20K is at the very top of the price range, even for Sub-Zero fridges.

Still as dumb as buying a luxury car. Maybe even dumber.

Both are only dumb if you cannot afford it. If you are worth $20M+, it's not a concern. You get to pick the splurges that you spend you money on

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Another total joke are these people who think they need to fund three generations before they retire: themselves, their kids, and their grandchildren. I’m not working extra so that the two generations after me don’t have to. It’s fine if you have good fortune and want to share the wealth, but this is not “saving for retirement.”

+1, some people are trying to build true generational wealth. That's fine but a different goal than OP's question about how much you need to maintain an UMC lifestyle in retirement.

The funny thing is that because a lot of people will automatically spend more if they have more, a lot of people who amass small fortunes by the time they retire will squander most of it (on vacation homes and subzero refrigerators and first class plane tickets). Meanwhile you could save a more modest amount, live a perfectly nice retirement on 100-150k a year, and wind up leaving a paid off home and a good chunk if change to kids if you don't wind up with major LTC costs (which lots of people don't-- neither of my ILs wound up in LTC unless you count the 6 months my FIL spent in hospice before he died (paid for by Medicare and the VA). My dad spent 2 years on LTC but so far my mom hasn't needed it (she's 85 and lives in a condo in a retirement community but it's very economical ).

It's not "squandering" on vacation homes, subzero and first class tickets if you plan to spend on that. For some of us, those items are just a "drop in the bucket". If you have $10M+, why wouldn't you splurge on things that give you pleasure? Sure I don't need a subzero, but it's an awesome fridge, keeps food fresher (with 2 compressors) and we can easily afford it. Same for business class travel. Don't have to have it, but I can't take my $$$ with me when we die. Kids don't need $10M+ each, so why shouldn't we enjoy it

I have known several couples who took this approach to retirement and then discovered they needed to scale back if they didn't want to spend it all. The problem with this kind of spending is that it begets more spending. The 20k fridge leads to a 100k kitchen reno. Which leads to Getting dissatisfied and buying a new house or putting in a pool or whatever. Getting used to first class and luxury travel means getting bored with it and pursuing even pricier and more expensive travel. Then the market has a bad 6 months and suddenly these folks claim poverty.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Fridge 1 - $1200 lasted 10 years
Fridge 2 - $1400 current but on 10th year and will be swapped out at upcoming kitchen remodel.

I’m pretty sure both kept food same cold temperatures as your subzero. Plus I got $17400 to play with. 😁

DP but there is a coolness factor to Sub-Zero fridges. Mine has a glass door and a blue LED light - I've had it for 10 years and sometimes, when entering my kitchen, I still stop and think how cool it is. It's my favorite thing in my entire house. Of course it's not a necessity, but neither is anything besides basic food, clothes, and a roof over one's head. Also, $20K is at the very top of the price range, even for Sub-Zero fridges.

Still as dumb as buying a luxury car. Maybe even dumber.

Both are only dumb if you cannot afford it. If you are worth $20M+, it's not a concern. You get to pick the splurges that you spend you money on

But this post is about umc retirement!

[Anonymous]

Anonymous wrote:

Anonymous wrote:Upper Middle Class people don't do much. Mu MIL and mother in retirement only traveled once every few years and only if a wedding or something, went out to dinner or lunch 2-3 times a year only if a reason like former co-workers or neighbor get together.

They do not buy new cars and budget is for house and gifts for grandkids at parties.

My MIL lives in her paid off house at 83. Has no maid or landscaper. Does her own grocery shopping and drivers her perfectly good 2003 car with low miles.

I don't think my MIL has been on a plane in the last 20 years. She can afford to but at 83 and a widow she dont want to.

From what I saw with my grandparents and now see with my parents, it seems like there are three periods of retirement:

1. The active years (roughly 60-75) are when you spend a lot of hobbies and travel.
2. The sedentary but still independent years (roughly 75-85) are when you don't spend much.
3. End-of-life care years (roughly 85+) are when you again spend a lot.

We probably need $300k annually in Phase 1, $80k annually in Phase 2, and up to $300k annually in Phase 3. By Phase 3, we can spend down assets like our home, which has a lot of equity that we don't include for retirement planning purposes, but it would become available and could fully fund extra expenses in Phase 3 over Phase 2. Since we have substantial home equity (say $1.5m+), I favor drawing down more than 4% in Phase 1 to enjoy life as much as possible while we're healthy and active.

Somewhat going off topic here but I agree that there are phases, and one thing that's tough for couples (especially those with an age gap) is that they will often be physically in different phases at the same time, but their lifestyle is determined by the person who ages faster/worse.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:As others have said, the cost of care is exorbitant. My mother in law is paying $15k a month for my father in law’s nursing home (technically a rehab, but he cannot do physical therapy anymore and is just in bed for the past year.) they are Umc but not very rich.

OP here. Thanks for mentioning the cost of nursing home care. $15k a month for 2 people would mean $360k a year. It seems like it would take $10m in investments to pay for that. DH also wants both of us, and our parents, to avoid nursing homes but instead have in-home care. Who knows how much that would run.

Find a top notch CCRC and enter while still healthy enough (ideally by 75). Sure you pay $300-500K+ in entry fees, but that covers your nursing/memory/assisted living care when you need it. Good ones mean if you "run out of money/investments" you don't owe anything else---they cannot touch your SS, only your other investments.
My parents are in one, and there are currently 4 people (all widowed women) who are late 90s/over 100 who "have run out of $". They no longer pay anything. Two are still in independent living, the others are in higher level care.
My parents pay their $7K/month for their apartment and that covers 1-2 meals per day and all utilities/cable/etc. All they pay is renters insurance.
Should they need advanced care, all we pay more is for the full 3 meals a day (so extra $300/month/person).

At 75? You want me to move to a facility at 75? I plan to still be getting the Epic pass at 75. Maybe I won't be able to do that, but I am certainly not going to plan to move to a CCRC at that age. WTF? [/quote

My thoughts exactly. Just went to my condo's HOA meeting and chatted with my 89 year old neighbor who still teaches ski lessons for fun. I plan to be like her! I also plan to be the person who had renewed their Epic pass for the most number of years, i.e., I'll be healthy until I die and hopefully I'll die quickly. Definitely don't want to be my MIL who needs care for 25+ years, wears diapers and cannot feed herself.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:As others have said, the cost of care is exorbitant. My mother in law is paying $15k a month for my father in law’s nursing home (technically a rehab, but he cannot do physical therapy anymore and is just in bed for the past year.) they are Umc but not very rich.

OP here. Thanks for mentioning the cost of nursing home care. $15k a month for 2 people would mean $360k a year. It seems like it would take $10m in investments to pay for that. DH also wants both of us, and our parents, to avoid nursing homes but instead have in-home care. Who knows how much that would run.

Find a top notch CCRC and enter while still healthy enough (ideally by 75). Sure you pay $300-500K+ in entry fees, but that covers your nursing/memory/assisted living care when you need it. Good ones mean if you "run out of money/investments" you don't owe anything else---they cannot touch your SS, only your other investments.
My parents are in one, and there are currently 4 people (all widowed women) who are late 90s/over 100 who "have run out of $". They no longer pay anything. Two are still in independent living, the others are in higher level care.
My parents pay their $7K/month for their apartment and that covers 1-2 meals per day and all utilities/cable/etc. All they pay is renters insurance.
Should they need advanced care, all we pay more is for the full 3 meals a day (so extra $300/month/person).

At 75? You want me to move to a facility at 75? I plan to still be getting the Epic pass at 75. Maybe I won't be able to do that, but I am certainly not going to plan to move to a CCRC at that age. WTF? [/quote

My thoughts exactly. Just went to my condo's HOA meeting and chatted with my 89 year old neighbor who still teaches ski lessons for fun. I plan to be like her! I also plan to be the person who had renewed their Epic pass for the most number of years, i.e., I'll be healthy until I die and hopefully I'll die quickly. Definitely don't want to be my MIL who needs care for 25+ years, wears diapers and cannot feed herself.

I mean, we would all love to be like your neighbor, but you do understand that she is an outlier. Biden was also planning to be mentally sharp in his 80s, but no doctor and no magic could make it happen. Statistically speaking, if you are a man, you’ll be dead by 89 and not skiing.