GoodbyeYellow
Recycles dryer sheets
- Joined
- Jun 23, 2021
- Messages
- 55
The recent post on the challenge of spending SS income raised an old worry.
I am 63, DW 60, both retired. We have cash reserves + small income to (if calcs are correct) take us up to her age 65 (4.5 years to go) so we can continue to use ACA. No SS income yet for either of us. We pull about $20K in dividends but that may change based on strategy. We add to this income with small conversions but as this is the first year we've been without any earned income, that plan is still in the oven.
We also have an investment portfolio in the low single $Ms. The plan is to take SS in 4.5 years (I'm guessing $70K total) and start cashing out the portfolio to cover the shortage. So from the above, it seems clear we won't need to draw the pf down much as our spend rate now is about $100K/yr. Mortgage payment is low, at $1K/mo with about $250K to go, at a very low rate (but will adjust around the time she hits 65). Health is still good enough for travel, and we can manage a couple of decent trips each year.
So what's the problem? We got here by frugal spending (saving) and would like to increase it (how, is another question and well-answered in the thread reference above, as well as countless others I'm sure). But how much to increase it by?
Enter the unknowns of life expectancy, long-term-care, other emergency expenses, and so on. Absolutely not a new dilemma; I'd be willing to bet a lot of you have been there already.
I mean, LTC can take the hide off of you, right? And 10, 20 years out, who knows what that will be if it's so horrendous today? With ongoing advances in medicine, can we rely on genealogical data to say ok, I'll be gone by x age? So we're finding it nigh-impossible to say, ok, beyond a base level of spending (and some small luxuries but really, not much), we can spend $x more and still be ok.
We do not need to allocate for kids; they are doing well.
Is there a magic calculator for this, given so much is guesswork? Are there viable hedges to LTC that are not rip-offs? What are y'all doing in this area?
I am 63, DW 60, both retired. We have cash reserves + small income to (if calcs are correct) take us up to her age 65 (4.5 years to go) so we can continue to use ACA. No SS income yet for either of us. We pull about $20K in dividends but that may change based on strategy. We add to this income with small conversions but as this is the first year we've been without any earned income, that plan is still in the oven.
We also have an investment portfolio in the low single $Ms. The plan is to take SS in 4.5 years (I'm guessing $70K total) and start cashing out the portfolio to cover the shortage. So from the above, it seems clear we won't need to draw the pf down much as our spend rate now is about $100K/yr. Mortgage payment is low, at $1K/mo with about $250K to go, at a very low rate (but will adjust around the time she hits 65). Health is still good enough for travel, and we can manage a couple of decent trips each year.
So what's the problem? We got here by frugal spending (saving) and would like to increase it (how, is another question and well-answered in the thread reference above, as well as countless others I'm sure). But how much to increase it by?
Enter the unknowns of life expectancy, long-term-care, other emergency expenses, and so on. Absolutely not a new dilemma; I'd be willing to bet a lot of you have been there already.
I mean, LTC can take the hide off of you, right? And 10, 20 years out, who knows what that will be if it's so horrendous today? With ongoing advances in medicine, can we rely on genealogical data to say ok, I'll be gone by x age? So we're finding it nigh-impossible to say, ok, beyond a base level of spending (and some small luxuries but really, not much), we can spend $x more and still be ok.
We do not need to allocate for kids; they are doing well.
Is there a magic calculator for this, given so much is guesswork? Are there viable hedges to LTC that are not rip-offs? What are y'all doing in this area?