I’m in the camp of trying to spend(within reason of course) my nest egg, not interest in keeping it in tact. It has gone up significantly without taking a lot of risk.
Next year, my husband has to take his first RMD, that would be the first time we touch our retirement nest egg, I wonder what happens to the Second Act or new legislation to delay RMD to age 75. It’s been quiet on that front, I had thought it would have passed by now.
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I also had thought once ‘nest egg’ (401k, other accounts) gets big enough to retire - the goal is not to keep it intact but to reduce it reasonably (so you still have enough to support yourself w/health care supplementation into your 90s and have gifting opportunities for family/charity).
My goal wouldn’t be to die with a few million untouched. Is that the goal of others?
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This thread already has a pretty broad title (including “general retirement”) and I haven’t had issues with the mods being too restrictive on this thread. Again, just one opinion.
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If there’s a topic on this thread that I’m not interested in, for instance Medicare I’m not there yet.
I can definitely skim through those posts that don’t apply or interest me. I’m happy to leave this thread as is.
We have lots of health, healthy eating and general exercise topics already. And since in every thread there are plenty who are retired I find lots of like minded people.
Besides it keeps me young to fraternize with those still working, younger and young at heart. 
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It’s apparently the goal of my financial advisor. He keeps bringing it up 
Not ours though
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My goal is to die without costing my kids a ton of money towards the end of my life. I have a bucket of money set aside for that purpose. I HOPE that money will go to the kids instead of towards medical care, etc.
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We’ve always said that we plan to die with a dollar. Obviously, that’s hyperbole as no one can plan that perfectly, but we have enough to cover our needs for our lifetime and are not planning to leave wealth to anyone.
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Why would he keep bringing it up? Whether you plan to spend, preserve, or build is a fundamental first question in retirement planning as it is critical to determining how much you need to retire. We answered that one with our planner decades ago. I would be very annoyed if ours kept questioning the basis on which our plan was formed. (I’m assuming you clearly stated your goals with him long ago?)
Our goal is to live off the principal. Since longevity is an issue in my family, we set the goals to be pretty old. But if things happen and we need to dip into the principal we will.
Honestly, given the timeline, I’m not sure anyone can predict it. Sure you can spend down the principal esp if you have other sources of income ( pension). But for us, social security doesn’t seem to be a guarantee. My spouse thinks they will eventually do a means test and we’ll be out of luck ( or tax it so it becomes invalid).
If I was over 85, I would look at the amount left and start to figure out gifting and philanthropy. Prior to that, I’d do normal annual giving.
If we used every penny of our retirement, that would be fine too. Our home is pretty valuable and I’d expect that our kids would be settled and wouldn’t need it. But like, everything, you just never know.
We could have a grandkid with special needs, or someone’s health could go South, so many potential potholes everyone hopes they don’t hit.
So I guess my long winded answer is, best case, we leave most of the principal. Worst case, we leave only the house.
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Everything is out of my control regarding future health of future generations. I’m not planning that far. I don’t have crystal ball to see many generations down the line, that’s if my kids decide to get married and have kids eventually. I don’t want to carry that burden really.
My retirement planning is just for my husband and I, if there is any money leftover, they can have it. But I’m done worrying, when is it going to stop.
But since interest rate has increased, when I’m back from my vacation, I’m going to do a deep analysis regarding 1031. Anybody has any experience on this?
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We have a dynasty trust to benefit us and our progeny. My plan, when I stop working (or more likely work less and have a lower income) would be to draw down my 401k. I would like to leave several million in the trust if I can.
That would help the kids with health, welfare, housing, education, etc. It could invest in their entrepreneurial ventures if that made sense. It purchased a condo that we rented for my daughter and her friends (who paid rent) instead of paying for a dorm for her. We rented it out for a few years after she graduated. The increase in value we realized would have covered her college costs. We sold it and the profit is still in the trust. It is not there to pay for annual living expenses but to help with big one-time expenses that would make their lives easier.
I would be delighted if some were there for the (not yet on the scene) grandkids.
I would be delighted if there were money there to help the kids and the grandkids but not to pay l
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We are focused on meeting our own needs, rather than on wealth transfer to our children. I expect that there probably will be some left for them, since we don’t want to actually run out before we kick the bucket. My MIL is 95 and has LTC @ $3,000/month that will last until she is 102. She has a small annuity, a small survivor pension and social security that together with the LTC covers all of her expenses and more. She is finally understanding that all of her savings is untouched, and she won’t be able to take it with her. She has decided to give more for birthdays/holidays than she used to, and she is taking her D/SIL out for meals often. I doubt that she is spending down significantly, but she is getting some happiness from sharing a bit while she’s still living. It’s good to see. If the point comes when H & I are sure everything will be covered, we plan to make gifts while we’re still alive.
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I think that’s really important. Some people spend a lot on themselves and never share with presents or experiences. Others, like my MIL would give every last penny to her kids ( and she did). The trick, IMO, is knowing what you can afford and then planning how to spend the rest. It ties a lot into your values. Some think it’s important to give $ to a philanthropy they care about, others want to give directly to their kids. About 1,000 ways to cut it. And definitely no right answer.
It also depends a a lot on how much money is saved. For most, there is no option other than drawing the money down. I think most people don’t have enough saved to cover their retirement costs. Some do. But many are struggling.
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We keep in mind our kids and grandkids with our financial planning. We only do small things for them now - as my parents did.
My dad diversified from his construction business into building two apartment buildings and remodeling a building into a 5 unit apartment building - along with co-ownership for a while with a successful corner bar/restaurant (sandwiches and pizza) which his construction company remodeled - managing partner eventually bought out which was the plan. When timing was right, he sold his construction business assets/buildings. Dad sort of realized during my college years that he had ‘made it’ - for many years it was paying off the original business loan (for 2/3rd of the construction business), and a fair amount of ‘worry’. Parents started traveling more. They lived in a small community and were active in several things that kept them entertained and busy. Dad died at 64 of cancer - he was so looking forward to Medicare and lowering his health insurance premiums (once he sold his business he was on the ‘high risk’ health insurance option, while mom had lower health insurance premiums) - mom died at 77. Mom lived off the income from apartments and died at home.
DH’s parents remembered family pretty much with cash at birthdays and Christmas, and that was appreciated for the heart felt gifting. DH’ s mother had a small estate as she only spent a few weeks in skilled care before she died at 92 - she had been a retired school teacher, had a paid off house and some cash in the bank. DH’s father died at 92 just a few months prior - he was in skilled care which was paid for by his social security and Medicaid. The dad at the end of working, had been with the post office, but not enough years for pension. Thankfully a son lived close to assist with various financial and health management - with another son and DH helping with traveling in to help.
We haven’t structured thing at this point beyond the wills we have, and the beneficiaries for various things. We do need to do more, but don’t ‘worry’ - will do things along the way. One does never know when one’s time comes. Right now just focusing on health, day to day things, and oversight of financial estate. Right now we have a trip in Oct, and a trip for Thanksgiving. I have a flexible schedule to help DD/Gkids while her H is out of state for training (6 -8 month, Army) - he just left (Gkids are 4, 3 and 1) – DD has M - F job and great daycare.
I’m of a generation that our parents lived during the Great Depression and world war 2.
I think there is a mind set of not spending a lot, being mindful of never running out of money.
i know that’s a generalization of a generation but it describes mine.
On another topic, our financial advisor timed his half yearly talk well, in the one month that the stock market was up. He was all optimistic that his firm thought that trend was going to continue and that our investments were going to end the year well.
Bunch of horse pucky!
I’m not particularly worried, but I have to laugh at these meetings. Full of optimism!
This firm has a tool, you enter all of your investments and income streams and it will calculate how your money will last. Except that the amount you spend is the same into perpetuity and the investment outlook default is significantly below historical average. So it makes you feel that you need to spend less now so your money will last. When the facts are that we’d like to spend more now and will have less needs later. I know health care needs will be more at some point but that should be offset by less travel and less spent on hobbies and home.
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Sounds like it’s time to find an experienced, reputable advisor/wealth manager who will help you define your goals and nail down a solid, workable, measurable plan that will get you where you want to go rather than someone with a “tool” who feeds you unrealistic optimism. If you are laughing at your meetings, it’s time to end them and get serious with someone who can help you make the retirement you envision happen. A good financial planner is someone you can build a long-term trust relationship with, who understands market volatility and risk and will help you build a portfolio to navigate and withstand those vagaries. If you do not have this confidence with your current FA, it’s time to part ways. Your retirement is serious business, not something to leave in the hands of someone who hopes things end well.
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In my opinion…retiree health and activities could be in the same thread…but nest egg?
Wouldn’t nest egg be included in this thread about how much you need to retire?
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That’s our goal too! The kids will have our house to deal with…but I hope to gift them pretty much the rest before I go to the great beyond. Or…use it for things we want to do.
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I already gave my son enough $ to put a down payment on a house in the Bay Area. He didn’t give me enough time to plan carefully what to sell. No fault to Fidelity, they met with me for 2 hours but it was too rushed.
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I also find that most “tools” aren’t flexible enough to build the model I want. Upfront first 10 years of retirement is going to be a lot more expensive then the next ten and so on. But one has to be able to change the variables ( like inflation). Some of the “tools” are completely useless. But some are actually good, with tweaks.
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