Retirement questions

Found this article interesting. Across all asset and income levels, retirees adjust expenses rather than use assets to fund their lifestyles. Why oversaving and reluctance to liquidate is more psychological than it is financial.

https://ofdollarsanddata.com/how-do-retirees-actually-spend-their-money/

I'm 64 and am getting a bit tired of the farm thing. Starting to look at alternatives in the next few years.
 
I retired when I was 51, 10 years ago. Having flexibility in your budget, being able to put off big expenses when investments are down is key.
Having no mortgage or other debts, no children to take care of means your budget is smaller and more optional line items.
 
MooneyDriver78 said:
I retired when I was 51, 10 years ago. Having flexibility in your budget, being able to put off big expenses when investments are down is key.
Having no mortgage or other debts, no children to take care of means your budget is smaller and more optional line items.
Click to expand...

I'm with you on the debt thing. Paid off my mortgage 20 years ago, I owe nobody nuthin', except of course property and income taxes. So nice to be free of those burdens, even if it means I drive 30 year old vehicles and fly a 60 year old airplane.

Now if only the stock and bond markets would chill out....$7 avgas sucks out loud too.
 
Never. Your investments will collapse in the next six months. I plan on working until I croak.
 
MooneyDriver78 said:
We’ll see if it gets challenged in SCOTUS, presidents aren’t supposed to be able to spend $.
Click to expand...
We are in a Post Rule of Law nation. How does a court undo something like that? Simply re-instate the debt? People go nuts over a cold order of fries. What do you think will happen after a court says that someone owes something another government official just said he didn't?
 
FWIW: on debt sometimes you need to look at the pros/cons of paying off certain debts especially mortgages depending on one's financial plan. For example, if your investments are returning at a percentage rate much higher than a mortgage rate you'll be money ahead. I kept my mortgage at retirement because my money was earning 3x more than the loan rate. That said when I hit 65 and no longer have income limitations for my medical insurance plus apply for SSI, I will pay off my mortgage over one or two years depending on the payoff amount as that is how my plan is structured. As to flexibility with retire income I followed the route to always have 18-24 months of cash and liquidable assets on-hand to weather any market issues affecting any investment or qualified accounts.
 
cessna182b said:
So what are these benefits of which you speak? They will cost you $170 per month (for each insured) at present; probably more in the future.

Dave
Click to expand...

I don't recall specifics. I was talking to someone about this, did a quick search and came up with site pointing out the pros and cons.
 
Bell206 said:
FWIW: on debt sometimes you need to look at the pros/cons of paying off certain debts especially mortgages depending on one's financial plan. For example, if your investments are returning at a percentage rate much higher than a mortgage rate you'll be money ahead. I kept my mortgage at retirement because my money was earning 3x more than the loan rate. That said when I hit 65 and no longer have income limitations for my medical insurance plus apply for SSI, I will pay off my mortgage over one or two years depending on the payoff amount as that is how my plan is structured. As to flexibility with retire income I followed the route to always have 18-24 months of cash and liquidable assets on-hand to weather any market issues affecting any investment or qualified accounts.
Click to expand...

The problem with that is you maybe forced to paying the mortgage payments when your investments have dropped substantially. Selling low, now if the 3X ROI you have is guaranteed then that’s a good idea. If not, then choosing to pay off the mortgage, say end of last year would been better. There’s no 1 correct answer.
Having no mortgage means your required spending is less and gives you more freedom to lower your spending when investments are down. For example, my aviation budget this year will be a lot less than last year.
It depends on how much guaranteed income vs investment income you’ll have.
BTW, if OP is the type to panic when investments drop 25% or more, either he needs a FA (whose job will be to talk him off the ledge) or should just buy annuities.
 
MooneyDriver78 said:
The problem with that is you maybe forced to paying the mortgage payments when your investments have dropped substantially.
Click to expand...
Thats only provided you are solely living off your qualified investments which adds risk across the board. As I mentioned, if you keep 18-24 months of "cash" on hand your monthly budget (mortgage) is covered for the length of your average down market. Its simply something to look at and depends on your specific situation. However, to generically state you must pay off all debt as a requirement to retire is not financially sound either. I found a number of people maintained a mortgage after retirement which led me to my plan when I retired.
 
You must log in or register to reply here.
Back
Top