A delusional couple wants to retire

[JustCurious]

This is an article from MarketWatch that published a question from a 56 year old couple that wants to retire as soon as possible.

https://www.marketwatch.com/story/w...-want-to-retire-what-should-we-do-11609257212

They have the following debts and savings...

We have about $400,000 in debt. The highest interest rate is 4.99% (on the boat). The rest is under 3%. Here’s a breakdown:
Home: $275,000
Boat (major retirement plus!): $60,000
Car: $22,000
Credit-card debt: $30,000

Our income is as follows:
$152,200 — Max 401(k) contribution of $26,000 with 3% employer + 25 cents per dollar
$10,000 — in real-estate transactions (side thing)
$20,000 — Husband’s income

Our savings combined:
$53,000 in individual retirement accounts
$75,000 in annuities – minimum payout is $1,200 at age 65
$20,000 in the 401(k) (plus employer contributions)
$35,000 in money market accounts
Total savings $178,000.


Are they delusional? Is this a serious question? (Notice they did not provide their expenses, only their income) The MarketWatch writer responded with a long discussion of retirement calculators and various issues and concludes with "I wish you the best" without saying whether the couple can retire or not.

 

[finnski1]

Yes I saw this on Marketwatch as well and just shook my head.
"Boat major retirement plus"

 

[Nemo2]

Sure they can retire. Retire, eat, and live indoors? A whole 'nother issue.

 

[statsman]

Brutal. Beyond the debt-to-savings ratio being rather poor, the following confuses me:

Our income is as follows:
$152,200 — Max 401(k) contribution of $26,000 with 3% employer + 25 cents per dollar

Our savings combined:
$20,000 in the 401(k) (plus employer contributions)

How can someone with so much income and 401(k) contribution have so little 401(k) savings? Are they cashing out the 401(k) to make purchases, along with the increased debt?

 

[JustCurious]

A couple who makes $182k per year and has $30k in credit card debt is very likely living above their means. And they want to retire with total savings that are less than their annual income?


It sounds to me like they need to keep working until at least social security FRA, probably longer.

 

[mystang52]

Edit: I deleted my original reply after seeing the other responses. Those responses have me convinced the question posed on Market Watch is fake.

 

[CSdot]

I saw that and couldn’t help but think it had to be a joke.

Not only the emphasis of how a $60,000 boat (expense) as a PLUS in retirement, but also the comment in their annual salary line about $26k + employer match where later they acknowledge they only have $20k + employer match TOTAL in the 401(k) account.

The only thing that could save this couple is if they left out the fact that House they owe $275k on, is really a $1M + house that they can sell. That way they can downsize to a cheaper residence and maybe have a chance.

 

[erkevin]

Similar to "Dear Abby", I wonder if these articles aren't fabricated to draw attention/clicks.

 

[JustCurious]

Similar to "Dear Abby", I wonder if these articles aren't fabricated to draw attention/clicks.

Why would Marketwatch fabricate an article that makes them look like buffoons?

 

[cyber888]

Yeah saw this .. in debt for $400K, yet the guy loves his $60K boat for retirement. It's essential for his retirement. What a joke. He has not paid for the boat yet .. it's part of his debt.

 

[Gumby]

To be fair, the question was not "Can we retire right now?" The question was whether to pay down debt first or max out savings first.

 

[ivinsfan]

I've got to call BS on their claimed interest rates? So I don't believe anything else either.

 

[Gumby]

I've got to call BS on their claimed interest rates? So I don't believe anything else either.

Yeah, credit card debt under 3% seems unlikely. Unless they are floating balance transfers.

 

[ivinsfan]

Yeah, credit card debt under 3% seems unlikely. Unless they are floating balance transfers.

That makes it a case of someone telling only part of the story. So what other details are missing or fudged.

 

[Gumby]

I'm not convinced that any of these questions in Marketwatch are from actual people. I think the author just makes them up to set up her column.

 

[ivinsfan]

I'm not convinced that any of these questions in Marketwatch are from actual people. I think the author just makes them up to set up her column.

I agree but they could do better research. Oddly enough we just bought a new car for cash. The salesman insisted on running a finance option. Our credit is top notch and the rate they used was around 7% didn't seem to matter how much down or term either.

 

[LRDave]

That boat is a real plus if they can live on it (and sell all other assets)!

 

[Bigdawg]

Husband makes 20K? I hope that is net. Min wage in Maryland pays 22K +. I side gig sports officiating and make 15-18K/yr doing that.

Thinking maybe this couple is fictitious

 

[Chuckanut]

I'm not convinced that any of these questions in Marketwatch are from actual people. I think the author just makes them up to set up her column.

Journalists making up stories? I am shocked. Shocked!

The article reminds of me a former neighbor who was going to retire as soon as he inherited his Uncle's collection of gold coins worth about $50,000 (back in 1990's). His uncle had promised the coins to him years ago so he had no reason to invest or save money. Lucky him.

 

[Exchme]

I hadn't seen this one, but I have noticed that the questions on Marketwatch are becoming more like a Jerry Springer show of finance, with more and more outrageous questions from increasingly selfish and clueless people. I guess that gets the most clicks, but makes the whole thing irrelevant to normal folks.

 

[CSdot]

Journalists making up stories? I am shocked. Shocked!

The article reminds of me a former neighbor who was going to retire as soon as he inherited his Uncle's collection of gold coins worth about $50,000 (back in 1990's). His uncle had promised the coins to him years ago so he had no reason to invest or save money. Lucky him.

I went to a private high school, and sadly this mentality is one that is shared by a subset of those I went to school with in the 70s and 80s. I'd say a third to a half went and made something of themselves, and hopefully have saved and prepared for their eventual retirement.

Another percentage, maybe 25%, went to college, then into their family business. I guess in a way they got their inheritance early, though many worked hard and earned what they got by building the company into something better than it was.

Then there was the final group who seemed to know in the back of their minds that they would eventually inherit wealth (similar to your guy who did no planning because he was told he would inherit a gold coins collection). This group maybe went to college, but never really did anything of consequence. They lived like they had good paying jobs, but that was more from the trust funds they were given. Many of these never made anything of themselves, nor did they have any reason to try, as they counted on their inheritance. Very sad.

 

[G8tr]

DW and I were just discussing what we might leave to our kids someday, in the context of spending more money on ourselves (new car for her, home improvements, etc...). We definitely want to put things into trusts tied to milestones and age targets.

The article clearly sounds like click bait, kinda like a sitcom where the main characters are so stupid that they make the viewer feel smart (i.e., I'm not as financially stupid as THAT couple).

 

[Dtail]

Good for another thread here, so no harm....

 

[bobandsherry]

Brutal. Beyond the debt-to-savings ratio being rather poor, the following confuses me:

Our income is as follows:
$152,200 — Max 401(k) contribution of $26,000 with 3% employer + 25 cents per dollar

Our savings combined:
$20,000 in the 401(k) (plus employer contributions)

How can someone with so much income and 401(k) contribution have so little 401(k) savings? Are they cashing out the 401(k) to make purchases, along with the increased debt?

Yeah, seems the question is more from a troll or the writer is just making up facts to write a story. The whole thing just doesn't add up to be sincere question.

 

[bada bing]

I quit checking Marketwatch when they went to a partial paywall recently. A lot of the actually useful articles are blocked behind beg-ware placards, but they still serve up tripe like this for free.