<p>I have recently given a lot of thoughts on this topic as I have set October 1 as my retirement date. Regarding to discussions on this thread concerning replacement income, Morningstar has a pretty decent discussion on basing replacement income on earning brackets. The article link is <a href=“http://news.morningstar.com/articlenet/article.aspx?id=647796”>http://news.morningstar.com/articlenet/article.aspx?id=647796</a>
The article also provides links to research discussed in the article. </p>
<p>The house issue concerns me. We do NOT have a house to age in. It is high maintenance, too large, too expensive, tons of stairs, precarious driveway…getting garbage to the top is quite a chore. We really need someone to help us with some problems we have already right now, but my husband is a do it yourselfer, we’re cheap, and we’re uncomfortable having people come into the house to do work. So it isn’t all getting done. I’m thinking about us both taking some time off and just concentrating on getting things fixed. But this is not a house to age in, we can barely handle it now. Yet we don’t want to move, and are getting by now. It’s really hard to make yourself do what needs to be done, until the time you MUST do it, I think. I don’t want to think about leaving.</p>
<p>Yet like sally, I see where my money is going.</p>
<p>busdriver11, I have a large house with some things that need to be done before I can sell. I am determined to get out from under the headache of it sooner rather than later. I set a target date for selling (next spring/summer), and have started lining up contractors to do the work. Setting a date and making a list of what needs to be done helps. I try to do something every weekend (research contractors, make a trip to goodwill, bag up junk in the basement, sell something I need to get rid of on Craigslist, etc.)</p>
<p>You know, intparent, I think we need to do something similar. Not to sell it yet, we are still really enjoying living nere, but to get things fixed up. We have an extremely hard time with the contractor thing. My husband always feels that we are getting ripped off, that someone is going to case our house, and that he could do it much cheaper himself. I think that’s a problem with being a do it yourselfer! But sometimes it’s best to get it done by a professional, especially if you don’t have the time to fix it. I think I might start a thread on here asking for good local contractors that won’t rip us off or make us uncomfortable, there are enough local people on this forum.</p>
<p>It is such a huge chore. We have lived here almost seven years and we still haven’t fixed up most of the things we’d intended to. It’s annoying how you only start fixing things up when it’s time to sell!</p>
<p>“We also plan to age in place” - It seems that most LTC plans cover in-home care, to prevent need for nursing home. We think that is appealing. </p>
<p>@busdriver11, my husband and I are also DIYers, this is why I moved last year and bought a brand new house so there is not a lot of fixing in the future. But in retrospect, it was hard to clean up the old place, thank goodness, my kids helped us but it took us 6 months. We literally threw away a lot of things. We are now in a no buying memorandum for a while, as we bought stuff over Xmas and never opened, we should only buy stuff that we use.
I like an empty house, it’s much nicer and easier to clean. I too don’t trust people to come clean our house either so we do it ourselves but we only work part-time as in 3 days out of 5 for DH and 4 days out of 5 for me.</p>
<p>I urge everyone to start looking for someone to come by to help around the house before you really need the help. That way you have inroads to help, and someone who knows how you like things done while you can still guide and show things. This is where my MIL fell down. By the time it was clear she needed help, she needed to get someone in there cold. Had she had someone to clean once a week, work with her, know how she liked things, it would have been far better. </p>
<p>I have always had someone to help me clean our large house, so when my MIL and mother moved in here, (really before that), I had extended the help schedules and things to be done. With MIL needing assistance, it was a natural transition to further extend hours. </p>
<p>I dread moving from here as I do have a great infrastructure and ready help that is affordable. But I , too, live in a high tax, high cost place and it makes no sense to stay here after DH retires. We only came here because of ready work for him. The solace is that we have a lot of choices in terms of places with lower COL. Can’t get much higher, so if the market doesn’t tank again, we could do well. But it means moving when we are older. </p>
<p>I have to admit all of this fills me with some dread, especially as I see both my mother and MIL and see how things can be.</p>
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<p>I agree with the earlier posts that this may be a cultural thing. I think some ethnic groups are more used to the idea and actually expect this. And if both spouses share that outlook, then taking on parents might be a smooth transition. </p>
<p>However, when both spouses are highly americanized, and both spouses are working, the idea of having “the in-laws” come live with you could be frightful…especially if personalities, politics, religion, lifestyles don’t mesh.</p>
<p>and, hey, couples have at least two sets of parents…and not all of us can be like cptofthehouse and have both grandmas come live with you …most of us wouldn’t have the space or patience. </p>
<p>and can you imagine if your divorced parents needed to come live with you at some point? yikes</p>
<p>“We also plan to age in place” - It seems that most LTC plans cover in-home care, to prevent need for nursing home. We think that is appealing."</p>
<p>My parents (85&87) have had LTC policy for about 25 years. It’s wonderful. My dad has some memory issues and also had a stroke several months ago - he recovered but has blood pressure issues. Since then my mom doesn’t want to leave him alone in the house. LTC is covering completely the 12 hours a day/7 days a week of home health aides. It would cover 24 hrs/day but my dad doesn’t need that yet. </p>
<p>My dad still has a very large term life insurance policy but it’s paid for by the company he was a part owner of. My mom had one too - until last year when the monthly premium went up to $36K! She called to tell me not to worry when I got a letter from insurance company for non payment (both my sister and I are listed to get all those kind of things just in case.) </p>
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<p>Please compare the LTCi policy of 25 years ago with what you could purchase today, in terms of eligible expenses, limits, premiums, renewal provisions, etc. If I could buy a policy like the ones written 25 years ago, I’d sign up in a heartbeat. </p>
<p><a href=“Why long-term care insurance may become extinct - CBS News”>http://www.cbsnews.com/news/why-long-term-care-insurance-may-become-extinct/</a></p>
<p>One point that I would like to mention is don’t forget about income taxes on IRA and 401-K withdrawals.</p>
<p>I know someone (a doctor, actually) who had his and his wife’s whole retirement planned out - expenses estimated, income was set, he was good to go.</p>
<p>He then retired and realized that he had totally forgotten that all the IRA and 401-K withdrawals would be subject to income tax.</p>
<p>That really messed things up.</p>
<p>So, when you are planing on removing 4% (or whatever you decide on) of your IRA and 401-K balances each year, don’t forget that you will have to pay income tax on those withdrawals (unless you have Roth accounts, of course).</p>
<p>Whoops. 10 char</p>
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I’m struggling with this now. I have a term policy that had a flat premium for 10 years, after which it goes up substantially every year. I’m in the increasing stage now. My health is pretty good, but I doubt if I could get a new policy that would be much cheaper. I don’t really need it–but each year, when the bill comes, I think, “Yeah, that’s a lot, but if I die this year, it will have been a bargain.” How do you decide when to stop paying it?</p>
<p>I also have to decide when to drop life insurance. If I pass my wife will get my pension and we have enough savings/investments to payoff the mortgage. We have no other debts.</p>
<p>Not only is there tax on your IRA, 401K withdrawals, the tax impact can be higher than expected if they push your Social security income up to the taxable level. That happened to my MIL when she took some realized gains on some investments that DH decided were ripe for the selling. Those gains wiped out the protection for her social security. She still made out, but it was sobering how much less, especially since it wiped out any deductions for medical expenses. Plus it raised her Medicare premium for the next year. Add it all up and the gains were greatly reduced.</p>
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<p>When no one is depending on your income. Therefore, if you die, no one is financially out of luck. Life insurance is designed to protect your income. So if your survivors will be OK without your income, then you don’t need life insurance anymore.</p>
<p>^^This.
Life insurance is not meant to be a means to provide a windfall.</p>
<p>I agree that large premiums with large payouts life insurance isnt needed if the death is an emotional loss, not a financial one.</p>
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<p>Entirely agree with this. And I agree with IxnayBob about the issues with new LTC insurance policies. A close relative in the insurance business says there’s no regulation, no guarantees. No assurance that the company you’re purchasing the policy from will still be in business when you need the policy, no assurance rates won’t rise dramatically, no assurance that their definition of qualifying for benefits (e.g. not being able to carry out everyday tasks) will match up to when you find yourself infirm. I wish I could purchase the policy that my parents have. </p>
<p>I always am amazed at life insurance. It is insurance against untimely death that leaves the survivors in financial difficulty. It is not an investment (whole life, universal life, etc.) but term insurance should be for a term where others are relying on the financial capability (and or work) of the insured – e.g., having to hire a nanny to replace a stay-at-home-parent, no longer having income from a worker, etc.</p>
<p>Insuring children doesn’t make sense unless you were planning to live off their earnings.
AD&D insurance makes no sense (what’s the greater need because someone died in an accident rather than from a disease?). Losing a limb might affect the ability to work, but that’s what disability insurance is for, which is another point: many households have enough life insurance, what they’re really lacking is disability insurance.</p>