PandaBear
Recycles dryer sheets
- Joined
- Mar 11, 2014
- Messages
- 313
My sister is going through a divorce. She is in her mid 50’s, has worked inconsistently (she was a stay at home mom to 4 kids, worked at the local Catholic school, basically in exchange for tuition when her kids were young) She now has a teaching job. They had very limited assets, including retirement funds. Like, she will probably walk away with about 50k. That’s everything….home equity, savings, retirement. (I knew they were not as financially well off as dh and I, but this has me truly shocked). Right now she has a decent salary. Her salary increases this spring because she just finished her masters degree in December.
She plans to teach until she is 65. That will give her 13 years towards a pension. She will have social security, but a small amount. It’s projected to be:
Age 62 $710
Age 65 $1009
Age 70 $1251
My brother decided to move to the city where she lives. He’s retired and he has lived around the country and has realized he wants to live where he has family (he’s single). He’s rehabbing a house and so come summer (when the house is habitable), she can live there and not have rent/mortgage. They live in an area that’s slightly below the average cost of living.
I understand 100% that one should never ever count on an inheritance. However, it is likely she will receive something from my mom, likely in low to mid six figures. But I realize that’s not something we should count on.
I am helping her figure out things and make a plan. I’d appreciate any ideas/suggestions/comments.
My thoughts/questions so far.
She will be impacted by the GPO. I’m just not sure exactly how to figure it out.
I am going to encourage her to open a retirement account, but I’m not clear on what she can do. Can she contribute to a ROTH, regular IRA and a 403b? Are totals cumulative or separate? I also believe she can contribute “catch up”?
Her salary can increase if she has 30 more college class units. She plans to take them this spring and summer so her salary will increase for the next school year (21-22). I have offered to pay for the classes, so she can put the tuition amount towards retirement instead.
Thank you.
She plans to teach until she is 65. That will give her 13 years towards a pension. She will have social security, but a small amount. It’s projected to be:
Age 62 $710
Age 65 $1009
Age 70 $1251
My brother decided to move to the city where she lives. He’s retired and he has lived around the country and has realized he wants to live where he has family (he’s single). He’s rehabbing a house and so come summer (when the house is habitable), she can live there and not have rent/mortgage. They live in an area that’s slightly below the average cost of living.
I understand 100% that one should never ever count on an inheritance. However, it is likely she will receive something from my mom, likely in low to mid six figures. But I realize that’s not something we should count on.
I am helping her figure out things and make a plan. I’d appreciate any ideas/suggestions/comments.
My thoughts/questions so far.
She will be impacted by the GPO. I’m just not sure exactly how to figure it out.
I am going to encourage her to open a retirement account, but I’m not clear on what she can do. Can she contribute to a ROTH, regular IRA and a 403b? Are totals cumulative or separate? I also believe she can contribute “catch up”?
Her salary can increase if she has 30 more college class units. She plans to take them this spring and summer so her salary will increase for the next school year (21-22). I have offered to pay for the classes, so she can put the tuition amount towards retirement instead.
Thank you.