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Re: Going broke at 81
Old 11-07-2005, 04:37 PM   #41
 
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Re: Going broke at 81

Quote:
Originally Posted by Gearhead Jim
Just a thought about Cutthroat's comments on spending principal:

If you keep your principal constant in dollars, it's actually decreasing by about 3% per year from inflation.* After 30 years your principal has decreased by about 50% even if the numbers look identical.

So, most of us will be spending principal even if we don't realise it.

(edit)
Using the period 1974-2003, it looks like the decrease would be more like 70%
Yup, that is another way of saying it. Remember our money today is nothing more than a number in a computer, It's not really physical piles of cash. So in the end, it's all about purchasing power! And in the end if you have the same number as you did 30 years before, but it's worth 70% less, then you have consumed 70% of principal.

Most all retirement planners factor in inflation and increase your withdrawels to keep up with it.
If your pile is shrinking in purchasing power after withdrawels, inflation and portfolio return, then you are consuming principal.
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Re: Going broke at 81
Old 11-07-2005, 04:48 PM   #42
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Re: Going broke at 81

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What if on her widow cruise she meets a charming man that you would immediately recognize as a bounder. But you are gone, and she is in new situation all alone.

So she marries this guy, and one way or another he or his children wind up with your blood sweat and tears.

For me, this would not be an acceptable outcome.

Ha
That is why I plan on spending as much of it as I can while I am still around. *

My kids are provided for in my trust and once I am dead, it cannot be changed. *The "bounder" would be SOL as outlined in my trust. *

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Re: Going broke at 81
Old 11-07-2005, 10:53 PM   #43
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Re: Going broke at 81

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Providing you've got a paid for house and a paid for car (if you're even still driving), and you dont have an expensive taste for travel or gambling, i'm gonna bet your need for cash in your 80's and beyond will be pretty nominal. My dad has no debt and while he still buys himself a new car every 3-4 years and likes good food and wine, he's spending under $20k a year. He could easily get by on his social security and a few extra bucks. Ten years from now I doubt his needs are going to run much past a bowl of soup and something good on television.
The only gotcha here is nursing care, if you don't have other arrangements for that. Dad is now in a nursing home in Fla that is costing us an extra 60k a year, and I think that is considered pretty good value. He's a tough old nut and may be in there for 10 years (he's 90 now). Or he may be in for the average, 2-3 years, I believe.

Anyway, it's something you don't want to ignore -- the lower-end nursing homes (maybe for people who have outlasted their assets and are on some sort of public assistance?) that I have seen involve a pretty dismal array of poorly-tended (smelly diapers) old folks sitting parked in wheelchairs in windowless hallways staring off into space and making yawping noises at each other with food all over their bibs...

My own approach is to ignore the issue and hope the markets are kind in the interim. I don't trust long term care insurers to be there for me when I need them, maybe just a bias. Instead, I try to cover this in my planning by keeping assets equal or slightly up in real terms each year, in other words, not spending down assets for normal living expenses in the years ahead. Then you will have those assets to spend down in your 90s or whenever you go into a nuring home if need be.
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Re: Going broke at 81
Old 11-07-2005, 11:05 PM   #44
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Re: Going broke at 81

Bob,

One thing I learned is to stay as far away as possible from insurance companies.

Since I have been reading this board I have grown to dislike brokers and insurance agents. When I think back to all the poor choices I have made with investing and whole life insurance I get the shakes. Hope it's not too late to correct these mistakes and get on the right track.
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Re: Going broke at 81
Old 11-08-2005, 01:31 AM   #45
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Re: Going broke at 81

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Originally Posted by ESRBob
I don't trust long term care insurers to be there for me when I need them, maybe just a bias.
DW had long term care insurance for her mom who lasted one year in assisted living and just 3 months in a home. One of those plans where you needed to loose 4 out of 5 functions. Wasn't all that expensive. We were sort of surprised it actually paid out but then it wasn't a long stay either (payout 3X of what was paid in if you're curious). Even with the positive insurance outcome we're also skeptical about these policies remaining viable with the boomer bulge growing older and care costs escalating.
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Re: Going broke at 81
Old 11-08-2005, 07:01 AM   #46
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Re: Going broke at 81

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Originally Posted by TargaDave
DW had long term care insurance for her mom who lasted one year in assisted living and just 3 months in a home. One of those* plans where you needed to loose 4 out of 5 functions. Wasn't all that expensive.* We were sort of surprised it actually paid out but then it wasn't a long stay either (payout 3X of what was paid in if you're curious).* Even with the positive insurance outcome we're also skeptical about these policies remaining viable with the boomer bulge growing older and care costs escalating.* *
The better companes writing this business will be and will pay. The wrinkle is that a lot of companies have been burned by this product and have stopped writing it, so the remaining ones have been able to jack up prices. I think that you are better off self-funding.
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Re: Going broke at 81
Old 11-08-2005, 08:33 AM   #47
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Re: Going broke at 81

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Originally Posted by brewer12345
The better companes writing this business will be and will pay.* The wrinkle is that a lot of companies have been burned by this product and have stopped writing it, so the remaining ones have been able to jack up prices.* I think that you are better off self-funding.
I guess I'm not convinced that even the best companies will be certain to be there and to pay. We thought that pensions were for sure too, just a few short years ago.

My inclination is not to rely on a product being there for me 50 years from now, when the concept has not even been around for 20 yet.

This is the best reason I've heard yet for preservation of capital if you have no heirs.
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Re: Going broke at 81
Old 11-08-2005, 06:06 PM   #48
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Re: Going broke at 81

C-T,
My mother is in Assisted Living which is contained in a larger facility that has a full nursing home and "Memory Loss" unit. I am with you. Some nice "recreational drugs" will be my salvation from that "life". I have spent many hours there and while her area is light years ahead of the others, it still sucks to be there. She is in decent health other than being blind and some other stuff that is not life-threatening so she may live for many more years. While she enjoys not being alone she hates dealing with all the "weirdos" and misfits that are in various stages of social de-evolution. The food suck and the help is few and far between.

My dad was lucky a heart attack took him out so he would not have to endure that kind of place. I know he would have gone "over the hill" if put there and would have found a way to do himself in rather than endure "living" in a place lie that.

Disclaimer: This is a very nice place relative to others we visited before putting her in there. This is in fact the best in town and while it is clean and generally progressive, it still sucks to be in there. She is happy and that is what counts. I would not be that is just me. Different strokes for different folks.

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Re: Going broke at 81
Old 11-08-2005, 06:16 PM   #49
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Re: Going broke at 81

I agree Cut. Mrs. Zipper's mother was in a home for 2 years and it is NOT a pretty sight. In fact, she fell, through their negligence, broke a hip, and died within a week.

On a lighter note , you could garage yourself and let the car run all day.

With modern pollution control you would run out of gas before you killed yourself!

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Re: Going broke at 81
Old 11-08-2005, 06:41 PM   #50
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Re: Going broke at 81

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Originally Posted by Cut-Throat
Sheryl,

Have you been in a long term care facility or nursing home lately?* - I have, and my biggest fear is not paying for it! - It's going there in the first place!* - I have spent the last couple of months with my FIL there, and I'd rather change places with a death row inmate scheduled for the morning execution.*

This is really scary stuff, and I have made up my mind. I'm not going there. I gonna call Smith, Wesson or Kervorkian. If we, as a society have not figured out how to die gracefully by the time my time comes, at the very least I will buy a $200 bottle of Cabernet and listen to my stereo in the garage with the car running.

I'm not kidding! - There is no way the religious right is going to get a hold of my wife's and my carcasses.* I have always been pro-choice in everything in my life!
Cut Throat:* I have been inside about 7 or 8 different nursing homes, I think.

I totally and completely agree with you.* Right now, I would say the same thing.* *I NEVER want to be there.

But.* * *My grandmother is in a VERY nice nursing home.* I am very impressed with how good it looks and the care she gets.* It's still a nursing home, and I wouldn't want to be there.* *However, her mental capacity is gone, by the time she was moved from assisted living to this facility she did not have the ability to make the decision to take hereself out.* When we visit, she often asks how long she's going to be able to stay in this nice hotel.* It doesn't matter what we tell her, because she forgets the answer within ten minutes anyway.

I faced a much more heartwrenching decision with my mother.*
She was violently adamant that she never ever ever wanted to end up in one of "those places" no matter what.

She was only 73 when she had major lung and heart issues which eventually killed her.* I have to say it was probably good that they did.

She was on and off of a respirator, in and out of consciousness, totally unable to care for herself, or to take herself out, which I think she would have wanted.* We were in a position were we could have directed the respirator to be removed, based on her living will, but it wouldn't have killed her.* She probably would have been a vegetable, maybe for months or years.* She was in the worst kind of limbo, and we would either have had to put her in the home she dreaded or move her several thousand miles to one of our homes with round the clock care, which she also would have hated. She dreaded being a burden almost as much as she dreaded a nursing home.

I guess the point of my very long story is that sometimes you just don't have the option.* Something quick like heart attack or stroke incapacitates you with no warning.* You need to have a pact with a spouse to smuggle you drugs, I think, but you still need to be strong enough to take them.*


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Re: Going broke at 81
Old 11-08-2005, 06:49 PM   #51
 
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Re: Going broke at 81

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I guess the point of my very long story is that sometimes you just don't have the option. Something quick like heart attack or stroke incapacitates you with no warning. You need to have a pact with a spouse to smuggle you drugs, I think, but you still need to be strong enough to take them.
Yup, I know what you mean! - But if I am aware enough to worry about money, I can take myself out!
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Re: Going broke at 81
Old 11-08-2005, 07:01 PM   #52
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Re: Going broke at 81

So true.

I guess the nightmare, is being aware enough to care that you are in a dump but too broke or sick to do anything else about it.
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Re: Going broke at 81
Old 11-08-2005, 09:33 PM   #53
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Re: Going broke at 81

My fantasy if I get into a tough situation was always to go off one of the cliffs on HiWay 1 up around Stinson Beach. It is hard enough to stay on the road there even when you want to.

Still, I think it is hard to end life. My Dad was in "assisted living" for about 4 years until he was 88. He sure didn't like it, but he was a real coper. He found things that made it worthwhile. Then he caught a good hand and died in his sleep.

Ha
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Re: Going broke at 81
Old 11-09-2005, 07:00 AM   #54
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Re: Going broke at 81

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Originally Posted by Sheryl
I guess I'm not convinced that even the best companies will be certain to be there and to pay.* We thought that pensions were for sure too, just a few short years ago.*

My inclination is not to rely on a product being there for me 50 years from now, when the concept has not even been around for 20 yet.* *

This is the best reason I've heard yet for preservation of capital if you have no heirs.
There's no suchthing as absolute certainty. Having said that, I spent years looking at the credit quality of life insurers professionally, and there are some who wite the product that I have no doubts about (John Hancock and Genworth/GE).

I still think self-insuring is likely to be cheaper and more flexible, though.
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Re: Going broke at 81
Old 11-09-2005, 07:40 AM   #55
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Re: Going broke at 81

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Cut Throat:* I have been inside about 7 or 8 different nursing homes, I think.

I totally and completely agree with you.* Right now, I would say the same thing.* *I NEVER want to be there.

My mother is in one now. I shutter at each visit, looking around at the people during endgame. The highlight of the day is the meals. Like life imprisonment, going in knowing you're not coming out alive is depressing. And unlike life imprisonment, there's no parole.
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Re: Going broke at 81
Old 11-09-2005, 08:02 AM   #56
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Re: Going broke at 81

I worked for a time in the kitchen of a nursing home. This home was really quite nice. It was on the edge of the bay, with beautiful views out most windows. Most of my contact with the residents was at lunch time. I would on occassion serve meals in the lunch room. Some of the residents used to snap there fingers, calling out "waitress, waitress" like they were in a restaurant. Got to know some of the residents pretty well. Most were pretty positive people and would joke around with each other at the table.

I also spent a lot of time washing dishes. Trays would come down from the rooms where people couldn't get to the dining room for meals. Once in a while a plate would have sh*t on it. A commentary on the meal?

It wasn't such a bad place to be but it wasn't a great place to be either.
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Re: Going broke at 81
Old 11-09-2005, 10:04 AM   #57
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Re: Going broke at 81

My grandfather moved to assisted living in his late eighties. He said he liked it. His old neighborhood was turning into crack town and grandma had Alzheimers. He took care of her until even the home care people said it was too advanced for their help. He felt cut off from other people. And someone moved out to live nearer their kids, so no one died for him to move in. He has since passed away, but it worked for him.

In turn, I have my wifes 83 yr old father living next to me in a mobile home. He said he needed just a few more good years, but after running a life expectancy calculator (which said he should go to about 105) I think he lied to me.
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Re: Going broke at 81
Old 11-09-2005, 11:26 AM   #58
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Re: Going broke at 81

Well, here I am at age 60 and never thought I'd last that long- military, airplanes, aerobatics, police work, car racing, etc. I don't have any kind of death wish and was always very careful about those activities, maybe that's why I'm still here. Or just lucky.

When I was 20, I said "Shoot me when I turn 40."
When I was 40, I said "Shoot me when I turn 60."
Now I say, "Shoot me when I start to lose my marbles or my mobility." (DW would say the marbles rolled away 30 years ago)

My point is that regardless of what we say when younger, most old folks still desire life over death. If you have provided for your care when you can no longer do it yourself, then that gives you much more freedom to choose.

It's one thing to say "I want to end my life because my physical/mental condition is unbearable", quite another to say "I want to end my life because I can't afford the help I need."

Some of us have philosophical or religious prejudice against suicide, others develop those attitudes later in life. You need to make the financial preparations sooner so you have the option for philosophical/physical decisions later.
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Re: Going broke at 81
Old 11-09-2005, 11:43 AM   #59
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Re: Going broke at 81

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Well, here I am at age 60 and never thought I'd last that long-* military, airplanes, aerobatics, police work, car racing, etc.* I don't have any kind of death wish and was always very careful about those activities, maybe that's why I'm still here.* Or just lucky.

When I was 20, I said "Shoot me when I turn 40."
When I was 40, I said "Shoot me when I turn 60."
Now I say, "Shoot me when I start to lose my marbles or my mobility."* (DW would say the marbles rolled away 30 years ago)

My point is that regardless of what we say when younger, most old folks still desire life over death.* If you have provided for your care when you can no longer do it yourself, then that gives you much more freedom to choose.

It's one thing to say "I want to end my life because my physical/mental condition is unbearable", quite another to say "I want to end my life because I can't afford the help I need."

Some of us have philosophical or religious prejudice against suicide, others develop those attitudes later in life.* You need to make the financial preparations sooner so you have the option for* philosophical/physical decisions later.
Interesting perspective, Jim. I watched my grandmother cling to life despite having what you or I might think of as a pretty low quality of life for years. She emphatically did not want to go.

I'm a more-or-less faithful Catholic, so I don't go in for suicide. My healthcare directive indicates no pulling of the plug, and my wife knows that I will not pull plugs for anyone.
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Re: Going broke at 81
Old 11-09-2005, 12:35 PM   #60
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Re: Going broke at 81

I believe that the issue is not so much financial as it is a "quality of life" issue. Most of us here can afford it or we would not be here (with some exceptions). C_T can clearly afford it as can many others here. The issue is what does one do when their quality of life is no longer acceptable? Suicide is always one option but may not be available or possible at some point in time.

I am sure that many older people in these places still want to live. I just can't see me wanting to live like that and to me that is indeed not living; it is merely surviving. If given a choice and the means, I believe I would rather be dead than be forced to live in that kind of environment while waiting for death to take me.
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