Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Re: Ask the "Expert"
Old 07-07-2005, 11:35 AM   #61
Recycles dryer sheets
 
Join Date: Jul 2002
Posts: 420
Re: Ask the "Expert"

Very good points Sillysal!
__________________

__________________
preben is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Re: Ask the "Expert"
Old 07-07-2005, 11:41 AM   #62
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
cute fuzzy bunny's Avatar
 
Join Date: Dec 2003
Location: Losing my whump
Posts: 22,697
Re: Ask the "Expert"

Quote:
Originally Posted by Sillysal
So...back to the original subject...
Oh come on, it was a mighty fine hijacking...

Quote:
I wonder how the extra time the parents can devote to being involved with their childrens' lives will affect the quality of their life?
Worth a million bucks to me to spend all my time with my kid from birth until he calls me names and runs screaming from the house, presumably after I've paid for his college education. Speaking of which, the prince of wails is awakening from his morning nap and is due for a stroller trip around the neighborhood...
__________________

__________________
Be fearful when others are greedy, and greedy when others are fearful. Just another form of "buy low, sell high" for those who have trouble with things. This rule is not universal. Do not buy a 1973 Pinto because everyone else is afraid of it.
cute fuzzy bunny is offline   Reply With Quote
Re: Ask the "Expert"
Old 07-07-2005, 03:27 PM   #63
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,380
Re: Ask the "Expert"

Various people have given estimates of the US median household income. For King Co, WA, a large urban agglomeration with quite a spread in income and level of living, the median household income is $65, 400. Household size varies, but the City of Seattle has a majority of single or 2 person households.

Demographically, this area is about 75-80% white and northern Asian. The rest is largely Afro-Am, Hisp-Am, and a smaller # of Am-Indians and Asians other than Chinese, Japanese and So. Indian.

I didn't take the time to look, but as you can see the average median white household would have a higher income than the overall median, and furthermore, the median family with children (not welfare) would have a higher median yet.

Martha mentioned the fact that living on a $40,000 draw from a portfolio is very different from living on $40,000 earned income. For one thing, there are many subsidies available to the family with that earned income, but few to none for the portfolio holders.

Another thing often not noticed is that median income figures are distorted by payments of services, which are not usually tabulated. Such things as Medicaid, Medicare, AFDC, commodities, etc., etc. are income, but do not show up.

Additionally, a family with assets needs more insurance, and probably needs to avoid any exposure to loss that it can. Not a problem for bottom feeders.

The last thing I want to mention is that there is lot of difference in what different people want for their children. For example, there are many whole states in America where a public school education is pretty close to no education at all. It all depends on what one's standards are.

Mine were that if I had an intelligent child, I didn't want him being taught by an ignoramus. If he liked music and was willing to work at it, I wanted to buy him (them) quality lessons. If they wanted to do experiments I wanted to buy them what they needed to do them.

It worked out wonderfully; but it wasn’t cheap and I don't think it can be cheap.

I also think people overestimate how easy or pleasant it might be to move to a new, cheaper community. Why are they cheap? Because nothing much is going on to draw new people. Business is relatively stagnant, amenities may be so- so, the people may be uneducated and backward. Otherwise, it is all expensive. Maybe you don't care for yourself, but how about your spouse? Your kids?

The most important thing that shapes a child’s attitudes while growing up is who are his/her peers.

Would you rather your daughter go to the prom with the guy she met at Scarsdale HS, or Harlan County Consolidated? They may both be fine gentlemen, but it is a choice that you are making when you set out to raise a family with severe financial constraints.

I would be wary of banking heavily on statistics that may be misleading, or at least not very applicable to you own situation.

ha





__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is offline   Reply With Quote
Re: Ask the "Expert"
Old 07-07-2005, 04:06 PM   #64
Thinks s/he gets paid by the post
maddythebeagle's Avatar
 
Join Date: Jun 2005
Posts: 2,450
Re: Ask the "Expert"

Interesting post HaHa. There are very nice area in the midwest with access to good health care, schools, and great recreation ops. I think you also have to think about is an area (like some of the frothy areas) driven up by demand of higher income folks. In that case, how does retiring in such an area make sense esp. with property taxes increasing.
__________________
- Hurry! to the cliffs of insanity!
maddythebeagle is offline   Reply With Quote
Re: Ask the "Expert"
Old 07-07-2005, 07:36 PM   #65
Recycles dryer sheets
 
Join Date: Oct 2004
Posts: 214
Re: Ask the "Expert"

Haha:

Out of curiosity I looked it up...based on 2003 Census data, Median incomes for 4-person families range from about
87K in New Jersy down to 45K in New Mexico.* (I'm too lazy to calculate the average)*

You are correct in pointing out the difference between the above numbers, and the median household income numbers (which are significantly lower).* *

If you go down to the city level, the dispersion is even greater with some cities running at 30-40K.* So, a family-of-4 income of 54K looks quite low for some areas and
perfectly OK for others.* Finally, 80K appears to be "median"
or better for all but the richest areas of the U.S.* I'm not sure what the official definition of "middle class" is though.

As usual, it just depends* *
__________________
RockMiner is offline   Reply With Quote
Re: Ask the "Expert"
Old 07-07-2005, 08:04 PM   #66
Moderator Emeritus
Nords's Avatar
 
Join Date: Dec 2002
Location: Oahu
Posts: 26,616
Re: Ask the "Expert"

Quote:
Originally Posted by Just not
Moi? Now if I said something like how ridiculous it is to have a president who cant pronounce 'nuclear' or 'abu ghraib'... who is embarrassingly clumsy, chokes on snack foods and talks with a texas accent even though he's from new england...

But I just said he's clumsy. You KNOW gerry ford is somewhere pumping his fist yelling "YEAHHH!"
I, for one, welcome a President who spends more time mountain biking, mispronouncing, choking, and being clumsy. Or would you prefer that he spend his lame-duck years in the Oval Office working on problems like Social Security, Medicare, the Supreme Court, Congressional gridlock, and deficit spending? Gosh, where's [sarcasm] Jimmy Carter now that we really need him? [/sarcasm]

Quote:
Originally Posted by Sillysal
I wonder how the extra time the parents can devote to being involved with their childrens' lives will affect the quality of their life?*
I see two possibilities:
1. Making their kids miserable by lavishing them with love, quality time, and extra attention to every little detail in their lives. It's what parents do for a living. I only have to do it for five more years and then college is her problem, right?
2. Maybe it'd be better to let the public schools and the county/state/federal government raise our children while we continue to screw around in our cubicles watching our 401(k) plans double every five years. What could possibly go wrong?
__________________
*
*

The book written on E-R.org, "The Military Guide to Financial Independence and Retirement", on sale now! For more info see "About Me" in my profile.
I don't spend much time here anymore, so please send me a PM. Thanks.
Nords is offline   Reply With Quote
Re: Ask the "Expert"
Old 07-07-2005, 09:15 PM   #67
Thinks s/he gets paid by the post
 
Join Date: Jan 2004
Posts: 2,049
Re: Ask the "Expert"

First, the original question came from a column in money.cnn.com. "Do you think we have enough to retire?", she asked. "Chris" also suggested that they were thinking of moving to another (less expensive) state. While that state may not be as "hip" or cool as California, the family is apparently ok with that. For $200k, they don't have to live in East St. Louis or Laredo, TX. I know this is hard to believe for those of you that live in a bubble state but it's true.

Second, about college costs. Retirement plans don't count against you when applying for financial aid. There is also the matter of the $50k in 529 plans. I don't know if that's 50*3 or 50 total but they do have 11+ years for it to grow. There are also good state schools and some of those aren't in California (Michigan, Texas, Wisconsin, Georgia).

Third, health care. This is admittedly the largest problem. If you go to ehealthinsurance you can see what kind of plans they can get for a family of 5. Where I live it'll cost them less then $400 with a $3000 deductible from BC/BS. Coinsurance out-of-pocket max is $9000 at 25%.

Finally, as others have pointed out, the median household money income in the US is about $43k. For families, it's $54k. Most of these families, presumably, have a mortgage or rent. *


Can it be done? Of course...and it helps if you're not living in California or New York. Could they be in a better position? Definitely. Maybe the severance will fix that problem. While their FIRE wouldn't be as glamorous or exciting as the FIRE people here profess to live up to, living on $54k, with a paid off house, is doable. Apparently, according to the below numbers, a lot of 5 person families do so.


* http://www.census.gov/hhes/www/incom...eandstate.html
__________________
eridanus is offline   Reply With Quote
Re: Ask the "Expert"
Old 07-08-2005, 07:51 AM   #68
Moderator Emeritus
Martha's Avatar
 
Join Date: Feb 2004
Location: minnesota
Posts: 13,212
Re: Ask the "Expert"

Quote:
Originally Posted by eridanus

Second, about college costs. Retirement plans don't count against you when applying for financial aid. There is also the matter of the $50k in 529 plans. I don't know if that's 50*3 or 50 total but they do have 11+ years for it to grow. There are also good state schools and some of those aren't in California (Michigan, Texas, Wisconsin, Georgia).

Third, health care. This is admittedly the largest problem. If you go to ehealthinsurance you can see what kind of plans they can get for a family of 5. Where I live it'll cost them less then $400 with a $3000 deductible from BC/BS. Coinsurance out-of-pocket max is $9000 at 25%.


But the non-retirement assets will count against them in financial aid.

And the healthcare price probably is for a plan where everyone is healthy. Five people; fair chance of someone developing a chronic condition and their insurance price skyrockets.
__________________
.


No more lawyer stuff, no more political stuff, so no more CYA

Martha is offline   Reply With Quote
Re: Ask the "Expert"
Old 07-08-2005, 09:56 AM   #69
Thinks s/he gets paid by the post
maddythebeagle's Avatar
 
Join Date: Jun 2005
Posts: 2,450
Re: Ask the "Expert"

It seems like everyone that pays for their health care out of pocket with high deduct. insurance is taking some kind of risk I think a key point is that it wouldnt nec. bankrupt them. That is the point of insurance. Most employer based insurance "over insures people", which I think is part of the problem with costs rising.
__________________
- Hurry! to the cliffs of insanity!
maddythebeagle is offline   Reply With Quote
Re: Ask the "Expert"
Old 07-08-2005, 12:12 PM   #70
Moderator Emeritus
Martha's Avatar
 
Join Date: Feb 2004
Location: minnesota
Posts: 13,212
Re: Ask the "Expert"

Quote:
Originally Posted by maddythebeagle
It seems like everyone that pays for their health care out of pocket with high deduct. insurance is taking some kind of risk I think a key point is that it wouldnt nec. bankrupt them. That is the point of insurance. Most employer based insurance "over insures people", which I think is part of the problem with costs rising.
You are assuming they can get insurance. Or get insurance at a price they can afford on their budget. Many young people assume the insurance, especially high deductible insurance, can be bought for a fair price. See what happens once something goes wrong with someone in the family.
__________________

__________________
.


No more lawyer stuff, no more political stuff, so no more CYA

Martha is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


 

 
All times are GMT -6. The time now is 09:27 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.