Anonymous wrote:

Anonymous wrote:There is not much you can do OP. There are a significant number of people between the ages of 50-65 that have been hit by the recession when we graduated and the great recession too.

They need to really start pinching pennies. I'm 55 and drive a 20 year old Toyota to save money for retirement, cook almost all food at home, and limit purchases. They need to plan to reduce lifestyle expenses (like the leased cars) and to work part time doing something less taxing as they get to be 68+.

I would not plan to give them money.

On the plus side they have 400k+, a paid off house and no mortgage. I would assume that is a big part of their retirement plan. If they could get rid of the leased cars and buy smaller fuel efficient cars when prices come down, that might help too. The 400k and paid off mortgage in a LCOL area is more than a vast number of Americans their age.

They aren't financially comfortable, perhaps, but thanks to that paid off house and $400,000 in savings, plus Social Security, they certainly are not destitute. Median net worth for people ages 65 to 74 is $266,400 -- so your parents are doing better than well over half the people in that age group in the U.S.

If they spend 4 percent of their $400k savings every year (and invest it well), that's $16,000 per year, plus inflation in future years. In addition, if they retire at 67, they would get about $40,000 a year in Social Security (per the AARP quick SS benefit calculator). If they don't start collecting SS until age 70, their annual take would be nearly $50,000.

So, that's annual income of $56,000 to $66,000 a year, in a low cost of living area, which should be doable. And we haven't even talked about the fact that their $400k in savings should grow over the next few years if they continue to work and if it invested well, or about ways to tap their home equity.

In short, they should have enough money to finance a modest retirement, especially if they keep working for a few more years. What they lack is enough savings to adequately finance long-term care should they need it, but you'll and they will just have to cross that bridge if you come to it.

This, exactly. They are not in a bad place if they have a paid off house, $400k of retirement, future social security entitlements, adequate health to allow them to continue to work and they live in a LCOL area. I would kindly and subtly let them know you don't have the resources to supplement their retirement as you are young and hope to start a family, but in the back of my mind, I would also want to get a good understanding of eldercare and how to get them into subsidized assisted living when the day comes. And most importantly, do better yourself and prioritize your own retirement savings so your kids or future kids aren't similarly burdened with worry.

There are millions of seniors who have never owned property and manage to live off of social security alone (my mom is one). Your parents may not be able to afford the retirement they want or have envisioned but they’re not going to be out on the streets.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Encourage your mom to maintain a PT job. Normally, women outlive men by many years. Maybe she will buy a tiny home near you or near friends years from now.

They will have Social Security, Medicare, and savings your mom should definitely have an easy receptionist job somewhere just to help her enjoy the day and to give some every day money for them both. I would also encourage your Dad to get a cashier job at Home Depot when he wants to retire. It brings in spending money, and is a fun way for anyone who has enjoyed an outdoor or physical job over their life. I’ve been on a computer my whole life and actually can’t wait to do this myself.

LOL. Retail cashier jobs are the furthest thing from “fun.”

And increasingly they involve using technology that may not be easy to master at an advanced age. Receptionists these days use lots of data bases, etc. The days of sitting around greeting people when they come in and chit chatting are long gone.

Anonymous wrote:There is not much you can do OP. There are a significant number of people between the ages of 50-65 that have been hit by the recession when we graduated and the great recession too.

They need to really start pinching pennies. I'm 55 and drive a 20 year old Toyota to save money for retirement, cook almost all food at home, and limit purchases. They need to plan to reduce lifestyle expenses (like the leased cars) and to work part time doing something less taxing as they get to be 68+.

I would not plan to give them money.

On the plus side they have 400k+, a paid off house and no mortgage. I would assume that is a big part of their retirement plan. If they could get rid of the leased cars and buy smaller fuel efficient cars when prices come down, that might help too. The 400k and paid off mortgage in a LCOL area is more than a vast number of Americans their age.

They aren't financially comfortable, perhaps, but thanks to that paid off house and $400,000 in savings, plus Social Security, they certainly are not destitute. Median net worth for people ages 65 to 74 is $266,400 -- so your parents are doing better than well over half the people in that age group in the U.S.

If they spend 4 percent of their $400k savings every year (and invest it well), that's $16,000 per year, plus inflation in future years. In addition, if they retire at 67, they would get about $40,000 a year in Social Security (per the AARP quick SS benefit calculator). If they don't start collecting SS until age 70, their annual take would be nearly $50,000.

So, that's annual income of $56,000 to $66,000 a year, in a low cost of living area, which should be doable. And we haven't even talked about the fact that their $400k in savings should grow over the next few years if they continue to work and if it invested well, or about ways to tap their home equity.

In short, they should have enough money to finance a modest retirement, especially if they keep working for a few more years. What they lack is enough savings to adequately finance long-term care should they need it, but you'll and they will just have to cross that bridge if you come to it.

Move them to New York or CA, have them set up a Medicaid trust or sign the assets over to your name and get them subsidized housing and other benefits

Anonymous wrote:

Anonymous wrote:Encourage your mom to maintain a PT job. Normally, women outlive men by many years. Maybe she will buy a tiny home near you or near friends years from now.

They will have Social Security, Medicare, and savings your mom should definitely have an easy receptionist job somewhere just to help her enjoy the day and to give some every day money for them both. I would also encourage your Dad to get a cashier job at Home Depot when he wants to retire. It brings in spending money, and is a fun way for anyone who has enjoyed an outdoor or physical job over their life. I’ve been on a computer my whole life and actually can’t wait to do this myself.

LOL. Retail cashier jobs are the furthest thing from “fun.”

OP - You are old enough to have an honest conversation with your folks that they might benefit from going to a certified financial planner for a one time fee who could evaluate their overall earnings and expenses along with what hey have for retirement. There is no reason why they should not expect to work till retirement ace at 67. It is very good to know they have their home paid off. There also might be FREE programs at area senior centers or with various groups that can give them information on retirement planning. It is important that you do not let them limit your future plans and goals.

A paid off house and $400K in retirement got my mom into asbury Methodist.

They have 10 more years they can work and retirement will grow.

They have $150K/ year until they are 70.

There is not much you can do OP. There are a significant number of people between the ages of 50-65 that have been hit by the recession when we graduated and the great recession too.

They need to really start pinching pennies. I'm 55 and drive a 20 year old Toyota to save money for retirement, cook almost all food at home, and limit purchases. They need to plan to reduce lifestyle expenses (like the leased cars) and to work part time doing something less taxing as they get to be 68+.

I would not plan to give them money.

On the plus side they have 400k+, a paid off house and no mortgage. I would assume that is a big part of their retirement plan. If they could get rid of the leased cars and buy smaller fuel efficient cars when prices come down, that might help too. The 400k and paid off mortgage in a LCOL area is more than a vast number of Americans their age.

Anonymous wrote:Encourage your mom to maintain a PT job. Normally, women outlive men by many years. Maybe she will buy a tiny home near you or near friends years from now.

They will have Social Security, Medicare, and savings your mom should definitely have a easy receptionist job somewhere just to help her enjoy the day and to give some every day money for them both. I would also encourage your Dad to get a cashier job at Home Depot when he wants to retire. It brings in spending money, and is a fun way for anyone who has enjoyed an outdoor or physical job over their life. I’ve been on a computer my whole life and actually can’t wait to do this myself.

My dad thought the same thing. It turns out that once a 68 year old starts slipping mentally, they don’t have a choice

Down the road Dad can downsize to a non physical job and still have income coming in though it won't be as much.
This and social security should get them by.

Encourage your mom to maintain a PT job. Normally, women outlive men by many years. Maybe she will buy a tiny home near you or near friends years from now.

At some point they will be able to collect social security. In a low cost of living area with no mortgage payment, they should be able to retire.

I feel horrible about this and it makes me worried about the future. My parents have made about $150k (combined) in LCOL for about the past 10 years at least and never seemed to live extravagantly. I would be shocked if they have more than $400k in retirement savings. They recently paid off their house, but lease cars (not fancy ones). The vast bulk of their HHI is my father’s income, and he works a physical job that he won’t be able to do much longer.

I don’t know what to do.