What would happen if one ran out of $ later in life?

[athena53]

If I ran out of money (age 79+ now), I could live on my SS and I would become a "live in" with a family member or I would look for a girlfriend that had a house and needed someone to talk to every day.

My Grandpa's second wife found out after her first husband died that he'd elected a pension with no survivor benefit. Her adult kids told her she needed to remarry. When Mom took over his finances after she died and Grandpa was failing, she found that step-Grandma had been sending $300/month to one daughter and every time one of Grandpa's CDs came up for renewal it was renewed in her name. I saw my cousin last week and she said one of step-Grandma's children said that they were grateful that Grandpa "took her off their hands". Wow.

As for SS- I know several widows who were stunned to find that as widows they got only their husband's benefit as a Survivor- not their husband's plus Spousal. They couldn't afford to live in their houses anymore.

Lots of sad stories out there. I'm glad that becoming widowed at age 63 didn't compel me to become a gold-digger.

 

[braumeister]

I find this hypothetical thread to be somewhat annoying...

Simple solution:

 

[aja8888]

My Grandpa's second wife found out after her first husband died that he'd elected a pension with no survivor benefit. Her adult kids told her she needed to remarry. When Mom took over his finances after she died and Grandpa was failing, she found that step-Grandma had been sending $300/month to one daughter and every time one of Grandpa's CDs came up for renewal it was renewed in her name. I saw my cousin last week and she said one of step-Grandma's children said that they were grateful that Grandpa "took her off their hands". Wow.

As for SS- I know several widows who were stunned to find that as widows they got only their husband's benefit as a Survivor- not their husband's plus Spousal. They couldn't afford to live in their houses anymore.

Lots of sad stories out there. I'm glad that becoming widowed at age 63 didn't compel me to become a gold-digger.

My post you quoted was in jest, but as you say, stuff like that happens. When my wife died last year, her SS just went away since it was way less than mine. I'm OK, and like you, have "plenty" in reserve to go the whole distance in comfort.

I don't have any grandkids, so I am helping my daughter and her husband as needed (complicated health issues there). Whatever is left will be their's someday anyway.

 

[Aerides]

I think we're all kind of focusing on low income seniors, vs. the premise: Someone who has a 100% chance of success in FIREcalc has considerable assets/pensions, etc., to get there. If that all somehow magically went away, it would not be a singular event, so there is time to plan.

And even if it did, you'd have to be a catastrophe (sued to the point of bankruptcy?) that would be somewhat insane, and assuming you don't have insurance (homeowners, umbrella, etc.)

Assuming all that, you still would unlikely to be someone with a meagre SS, and could probably figure out how to get by. If you see things going that way, move to a state that has good bankruptcy protections, lets you keep your home, etc.

So, with the premise that someone has all they need to fire - in a VERY healthy way - they most likely, if they are smart, have availed themselves of the kinds of protections to mitigate disaster before it happens.

 

[youbet]

I find this hypothetical thread to be somewhat annoying...

In the sense that the impact of "someone" running out of money is highly dependent on the person and the circumstances, I agree. A few of the anecdotal stories were interesting and/or informative. But, we're all just BS'ing online, so wat da heck.......... !

 

[NW-Bound]

In the sense that the impact of "someone" running out of money is highly dependent on the person and the circumstances, I agree. A few of the anecdotal stories were interesting and/or informative. But, we're all just BS'ing online, so wat da heck.......... !

Yeah, it's hot like Hades out there. Our plants are all dead or look so sick, my wife's about giving up on her garden.

What to do but to stay in the comfort of the AC, and shoot the breeze?

Might as well enjoy your AC, while it still runs.

 

[Dtail]

In the sense that the impact of "someone" running out of money is highly dependent on the person and the circumstances, I agree. A few of the anecdotal stories were interesting and/or informative. But, we're all just BS'ing online, so wat da heck.......... !

Agree

 

[CardsFan]

I think we're all kind of focusing on low income seniors, vs. the premise: Someone who has a 100% chance of success in FIREcalc has considerable assets/pensions, etc., to get there. If that all somehow magically went away, it would not be a singular event, so there is time to plan.

And even if it did, you'd have to be a catastrophe (sued to the point of bankruptcy?) that would be somewhat insane, and assuming you don't have insurance (homeowners, umbrella, etc.)

Assuming all that, you still would unlikely to be someone with a meagre SS, and could probably figure out how to get by. If you see things going that way, move to a state that has good bankruptcy protections, lets you keep your home, etc.

So, with the premise that someone has all they need to fire - in a VERY healthy way - they most likely, if they are smart, have availed themselves of the kinds of protections to mitigate disaster before it happens.

Well said. The OP was not talking about "anyone", he was asking us here "what would happen if it all went away". Not a likely scenario for most here (we would start planning well ahead of the ultimate end of money).

 

[bada bing]

I think we're all kind of focusing on low income seniors, vs. the premise: Someone who has a 100% chance of success in FIREcalc has considerable assets/pensions, etc., to get there. If that all somehow magically went away, it would not be a singular event, so there is time to plan.

As someone who fits the original premise, it was easy to make the feared financial catastrophe impossible: Delay SS to 70 and take an annuity. In my case it will be choosing a pension annuity over lump same, but same difference. I'm currently trading a chunk of my retirement savings for delayed SS credits and declined pension lump sum. Good trade for my situation.

An added psychological bonus is I likely will more freely spend. It is easier to spend monthly deposits as they come verses taking money out of sacrosanct savings. Another observation I have is the tendency for people to become a bit miserly as they age. I like the set up for more "blow that dough".

The old "three legged stool" of retirement income (SS + pension + savings) has a lot of merit in the redundancy and safety. JMO, but too many people focus too much on piling up the biggest nest egg while neglecting safe income. Delaying SS has always been a good deal as far as cost/income. SPIA rates are much better now verses the last decade because of interest rate increases. JMO, but being overly vulnerable to the whims of the market and/or the possibility of future diminished self screwing things up isn't worth it for s bigger pile in the estate.

 

[ivinsfan]

Well said. The OP was not talking about "anyone", he was asking us here "what would happen if it all went away". Not a likely scenario for most here (we would start planning well ahead of the ultimate end of money).

Bingo my point of view is from a friend of ours who literally spent all his money. He has a very nice paid off house and his SS. So you look for things you need everyday ie food, to things that just make your life better and see what the government/state has to offer...Answer a lot! If you avail yourselves of all these programs your monthly expenses drop dramatically and your actual money goes much farther. Many many of these one off programs simply look at your annual income.. My buddy gets about 1100 in SS which keeps his income even as a single in range for many programs.



This is the type of individual I was thinking about in my replies to the OP.

 

[Walt34]

The government has massive safety nets for elders that run out of money..ie Medicaid, low income apartments, food stamps, heating assistance, basic cell phones and free or subsidized internet. If you see somethings like this coming the key is to get it as soon as you qualify not wait until you spend your last cent.

This.

I had an elderly distant relative who had to retire due to health issues and all she had coming in was about $900/month in SS and she was doing very well. She moved from a LCOL area (middle VA) to a HCOL area to be nearer a daughter in MD, and was able to qualify for numerous safety net benefits. People like her were exactly what those programs were designed for. She did work all her life but at low paying jobs and she never could save anything.

We visited her a couple of times at her subsidized elder apartment and unless one knew it was subsidized there was no outward indication of that. I thought it looked like any other middle-class apartment building, with adequate heat and A/C. She paid a percentage of her income to rent (1/3, I think) and qualified for SNAP benefits and a couple of other programs. She even had a car for a while but she didn't dare drive it farther than she could walk back if it quit.

All in all, while she wasn't living in luxury, she was far from destitute either and in no danger of having to live on ramen noodles or under any bridges.

 

[FREE866]

Given that food is a big expense I would just cease eating out. I would just eat rice, beans and corn for dinner every night like I had last night. It’s extremely inexpensive. And Honestly it was really delicious so I’d be fine doing that.

 

[MC Rider]

Eating out has got very expensive. A normal breakfast with eggs, bacon, potatoes, toast, ice tea at you local spoon is probably over $20, especially with tip. Make the same at home for maybe $2. Cooking, eating, and cleanup will probably take less time than going out too.

 

[Fermion]

A few nickel and dime things like free internet aren't going to help much if you can't even afford health care and the basics. I get the point, it just isn't a very good one when adding up all the significant costs. And I wasn't mocking you, it was Fermion who mentioned "free internet" first in this thread. Like I said, it's not easy to qualify for some types of public assistance as a senior unless you're really bad off with no assets. Even as little as $15,000/yr income and $8000 in assets can exclude you. And everyone thinks Medicare part A is free, but it's not free unless you paid into Medicare for 40 quarters.

Well, to be fair, I was aiming my response at the OP's original question, "what would happen if one ran out of $ later in life". I made a few assumptions:

1) At some point they had money, probably paid taxes into SS and Medicare

2) They are now out of money. To me, being out of money means you have sold off everything that you could. If I still have a home worth $400,000 with no mortgage, I am not "out of money"

So an average person on here, who proabably would get an average SS check of $1700 at age 66, and who eventually runs out of money, maybe at age 70, 75, whatever. That was the target for my response.

I wasn't talking about the meth addict living in a van down by the river since age 23 who has paid in a total of $75 to SS.

 

[badatmath]

GenX I wonder how state dependent this is. We live in a high tax state with many programs for seniors. Perhaps that makes a difference. With 50 states as well as many different ideas about what qualities as low income, it's hard to come to a consensus

Only program I can think of in my city is section 8 and I recall a headline saying the wait list was closed. It opened briefly after another closure of a couple of years. I don't think it would be easy at all.

I know my disabled neighbor didn't qualify for things like utility assistance because she made something like $3 too much. . . Beyond that I can't say. Neighbor had cheap rent as sis owned the house.

 

[Fermion]

Cutting out the car (which obviously works a lot better if you are living in a medium size city where services are within walking distance or they have a good public transportation system) really cuts down on the monthly budget.

From my $1700 example, if you were paying $600/month for an apartment (we pay $550 right now for a 1bd but I will allow a higher rate) you would have $1100 left for utilities, food and medical. Our water and garbage are included in the rent, but our electric runs about $75 a month average (we run the AC constantly during the summer). We are building a house, have a large sailboat moored in the sound, own many vehicles, snowmobiles, heck I think I register 12 things each year. All of that would be gone, poof.

I would cancel all insurance, no car, no umbrella policy.

Budget would be $1025 for food and medical. That is it.

Our bloated budget is only because we have lots of stuff, and stuff requires stuff to protect and store and insure.

 

[Fermion]

Only program I can think of in my city is section 8 and I recall a headline saying the wait list was closed. It opened briefly after another closure of a couple of years. I don't think it would be easy at all.

I know my disabled neighbor didn't qualify for things like utility assistance because she made something like $3 too much. . . Beyond that I can't say.

Move to a area without a wait list (if such a thing exists, never looked into it).

I do not agree that people have the right to live anywhere they want to live if they do it on other people's dime.

 

[badatmath]

Moving is prohibitive when you can't even walk to the mail box. She had no car either so I am not sure how one moves. Her sis lived overseas, no other family.

A one bedroom in my city goes for $1300 and up so I hear. Nothing fancy either. But my state does not have high taxes and a lot of options.

Editing to add, I found the article -wait list was closed 2016 to 2022 and then opened briefly and closed again. I don't have the least idea if it is by city, county, etc.

 

[MC Rider]

The things you own, end up owning you, they say.

But cutting out all your favorite toys would hurt, for sure.
Pay to play.

 

[Katsmeow]

There is a difference between elderly who were low income and have no savings and get the SS minimum and people who do have savings, likely have SS will above the minimum and have assets.

Most people who have savings and it is depleted more quickly than expected for whatever reasons will adjust their spending long before they hit zero.

Many many with assets will either have a paid off house or a house with at least 50% equity. So a reverse mortgage can either provide income (if the house is paid off) or at the very least eliminate a mortgage payment.

My mother died about 5 years ago. During the 5 years before her death she saved $50,000. Her income during that entire period was about $22k to $23k a year. She did own her house with no mortgage. She did have assets, but she added to them during those years rather than depleting them.

She was not miserable. She bought whatever she wanted to buy. But she was in her 80s (and then 90s) and had a simple life. She watched TV. Talked to people (mostly on the phone) and didn't have a desire to spend much money.

My SS is well above the minimum. If I suddenly woke up one day with no assets of any kind, I could survive on my income although it might mean moving to another area.

 

[badatmath]

I find it depressing to think about all around - may have to abandon this thread.

 

[aja8888]

Move to a area without a wait list (if such a thing exists, never looked into it).

I do not agree that people have the right to live anywhere they want to live if they do it on other people's dime.

My son-in-law's mother moved to Texas from Georgia to be near her son. She was on a 2 year long wait list for a Section 8 apartment that cost $800/month, plus utilities. She was working at Walmart making about $2 K/month. During those 2 years, she lived with him and my daughter. She was 62 at the time with no savings.

After my wife died last December, I started looking for apartments to see if that was something I wanted to do. Most 55+ apartment complexes here are charging near $2,000/month for a 762 sq.ft. one bedroom.

 

[jazz4cash]

GenX...You aren't too well informed on the things available to low income seniors.If you took a good look you might be surprised. The original question was what if you have only SS but not really enough money to cover the basics? I didn't even mention the meals on wheels program, free or minimal bus fare programs among other things...


You missed my whole point with you mocking the free internet..if people need it to live on and you are old with limited income most likely there is some kind of program you can look too that will assist you.

My experience is much different from what you describe. I’ve been helping a relative and most of the programs are very hard to navigate, especially if you are not internet savvy. I was shocked how many hoops we had to jump through to get “free” internet. It was a $30 credit per month on her bill. Things we take for granted like 2FA are baffling and humiliating to her. She expects to make a phone call and resolve every issue. She has a comfy senior apartment but her SS was not enough for her to qualify. After many attempts they found a loophole to let her in. They are not accepting any Sec 8 applications due to a years long backlog.

 

[Fermion]

My experience is much different from what you describe. I’ve been helping a relative and most of the programs are very hard to navigate, especially if you are not internet savvy. I was shocked how many hoops we had to jump through to get “free” internet. It was a $30 credit per month on her bill. Things we take for granted like 2FA are baffling and humiliating to her. She expects to make a phone call and resolve every issue. She has a comfy senior apartment but her SS was not enough for her to qualify. After many attempts they found a loophole to let her in. They are not accepting any Sec 8 applications due to a years long backlog.

Are you serious? Free internet took all of 2 minutes for me to set up for my mom.

 

[NW-Bound]

With just SS, it would be hard for MANY people. It was not intended to be the sole source of retirement income.

My wife drew SS at 62, because for a couple it's the right strategy for the spouse whose benefit is lower. I am waiting for 70 for my SS.

If my wife were by herself, it would be hard for her to live on her SS alone. It would be tough, even if she had a paid-for home.

As for me, I could live frugally on my delayed-till-70 SS, because of my higher income history, me working longer compared to my wife's ER at 50, and the effect of delaying SS.

But if I had no other means to live on till 70, I would have to work till that age. ARGHHHH! I might die before I get there.

I just consulted Quicken, and have to make some corrections.

What my wife gets for SS now, it's after the cost of Medicare and Medicare Supplement. So, she's covered and only has to worry about other basic expenses such as food and utilities, because the house is paid for. She would have to sell the 2nd home. Even this primary home is too big for her. It will cost more without a handyman to maintain it. Nobody to look after the DIY solar system, although as a single woman, she would not have something like that.

In short, if my wife were single, she would be OK with her SS, as long as she already owned her home, and it had to be something smaller than our current home.

As for me, I would be more comfortable because my SS is higher.

Still, just on SS we would not be able to indulge in many activities and things we currently enjoy. It's not the end of the world. We both rely on the Internet for entertainment, and like to cook our own food, and don't care about fancy cars. Have not gone to the cinema for years. No concert either, so would not miss a thing.

Life would still be good, just not with photos taken from foreign lands to show people. No fancy booze. I drank moonshine when I was young, and could go back to it.