Running out of money vs. Too much money but couldn't enjoy it

[cyber888]

Just curious if you care to share stories about other people you heard who run out of money in retirement and also people who retired then died and left a big amount of money/asset to other people .. they never enjoyed it because they passed away too soon.

On one hand, you have people who retire early with not that much money, then enjoyed living life in their 50s and 60s, and then run out of money in their 70s or 80s. Or they retired with much money, but spent it way too fast and run out of money.

On the other hand, you have people who worked hard and retired in their late 50s or mid-60s with millions of dollars and then lived only a few years and passed away and still had too much money in their retirement account. And then, the government or other people took their money. Or they retired and then got sick or had a stroke, and could not really enjoy retirement.

I don't know why I'm interested in these stories, but I guess I'm interested about not just the fairy tale retirement but the other retirement realities that life can take. For some, life could be long, and for some, life could be short. For most of us here, we just want to live till 90 or 100 and have $1 before we pass away peacefully in our sleep. But the reality is a little different for most ...

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RUNNING OUT OF MONEY

To share my story, I had an uncle and aunt who we considered rich and they had 4 kids. They sold their business and huge McMansion, and their first 20+ years of retirement was good. They bought a smaller house and traveled the world and kept on spending whatever they liked. But their 4 children (my cousins) kept on asking money from them. These children grew up with a golden spoon in their mouth, and they never achieved any discipline, no savings, and kept on depending on their parents. My aunt and uncle also took their 4 children with them on vacations abroad. After 20-25 years in retirement (never working), their savings dwindled and they lived on SS and moved to a small condo that another aunt own. They rented it for cheap. Three years ago, my uncle died and none of his children even visited him on his deathbed. I felt really bad about it. Last year, I visited my widowed aunt, she told me that her son (my 53 year old cousin) was undergoing kidney dialysis and she was helping him with the cost. I gave her some $$$ to help. She has no more savings at 76 years old and just depend on a small social security fix income. She's luck that her sister (my aunt who owns the condo) is helping her out with expenses.

TOO MUCH MONEY/ASSET and DIED TOO EARLY

Ok, I heard this story from my realtor. A well-to-do retired couple bought two tracks of land in a nice upscale resort loghome community to build a huge loghome on the lake. Suddenly, these two couples died. And apparently, they did not have family or did not have a will, because nobody followed up on the land they bought from the developer that this realtor worked for. So, the developer started to inquire about this couple and the developer found out that they did not leave that land to anyone. So, the developer initiated a claim to get the land back. Because the realtor said that if nobody will contest the claim, the developer will surely get the land back. Incidentally, I also saw a TV show about a loghome builder who were building a mansion log home for a couple and when it was 80% finished, the owner (husband) died and never moved in to their dream log home mansion.

I have also a colleague (Bob) who retired 2 years ago, and I'm sure he was financially ok. And I just heard from another colleague yesterday that Bob had two strokes. I hope he recovers. I just hear some stories that retirement also shortens the lives of people because they don't find meaning in their lives .. oh well .. I hope I'm wrong.

 

[RenoJay]

My parents will likely pass with millions, but it's a very conscious decision. They have everything they want and they like the "game" of building net worth.


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[Keim]

My inlaws. They worked for years to build a very healthy savings account. Early onset dementia hit one, and they can't get out and enjoy it much at all.

 

[razztazz]

I knew a guy in the Air Force. Did 23 years I believe. I was at his retirement party. Three, maybe four years later I see his name listed as deceased. Probably just past the age of 45. Didn't list cause of death

 

[Sunset]

I know this one lady, she is worth millions and lived a good life spending freely on trips and such in her later 30 years.
Now she sits in a retirement home with millions in the bank.
Didn't spend it fast enough.. a good problem to have.

 

[34rlsa]

I know this one lady, she is worth millions and lived a good life spending freely on trips and such in her later 30 years.
Now she sits in a retirement home with millions in the bank.
Didn't spend it fast enough.. a good problem to have.

Is she single?

 

[Running_Man]

My mother contracted lung cancer when she turned 66 and my father was 70, my father had taken a buyout of the pension and within the 5 years of being retired they went through all the money. After my mother passed my father lived on only social security and was $15,000 in debt from medical and burial bills.

He never complained about his lot in life and never would take any money. He kept his car in good shape and lived with my brother for a few years before renting an apartment near a very nice county park. Rent was low and he lived on the equivalent today of $1,600 a month. He spent his time walking 5 miles each day, talking with people in the park, always keeping a pack of dog treats with him to give to people walking their dogs and working to keep the walking paths clear for everyone else. He always walked with a foldable pruning saw and shears to trim any wayward vegetation.

He taught me having little money is nothing to fear, it is always possible to make do and enjoy life with what you have, but life is easier with more money that is for sure. Even a few hundred dollars a month would have made a huge difference to him. He died at age 87 with $4,000 in the bank and debt free. In my entire life I never once heard him complain about being poor nor about it being unfair that someone else had more money than he. Because I think he had little money he had much time for walking the 5 miles daily and enjoying the county park, this in turn kept him healthy and active throughout his retirement.

I hope I am able to experience the good parts of his retirement with at least a little more cushion to make it through the years.

 

[NW-Bound]

RUNNING OUT OF MONEY

I have some acquaintances who I do not think have much more than SS. We never talk about money, so I think they just cope with it, the same way Running_Man's father does.

Here in this forum, we had some posters lamenting of shortfall during the Great Recession of 2008-2009, then they disappeared altogether. I think they have gone back to work.

TOO MUCH MONEY/ASSET and DIED TOO EARLY

I do not know of any in real life, but I could easily be one of those stories. I am OK now, but it could easily go the other way and I could be pushing daisies instead of making this post.

Many posters here have had some scary moments with heart trouble, and some have fought off cancer. Quite a few talked of losing their loved one. And many posters have been absent after talking about their own medical problem. It could happen to any of us, really.

 

[jabbahop]

Running_man. I love your father story. Simple life and contentment.


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[Senator]

I sometimes worry about having too much money in the end, but it was not something that I worried about until recently.

In the end, is is easier to spend money, than try to earn it.

 

[jjquantz]

Perhaps what you want to is to just hear some collection of "real-life" retirement stories.

My father retired in 1996 at 58 (mom was 56) after working 38 years in the same factory. He had a small pension that paid for their [-]rundown shack[/-] very modest home in a not so nice part of town. They would take one trip each year to Laughlin to play poker. Other than that they would sit in their house, smoke cigarettes and talk about how the world was going to hell in a handbasket. At 63 he was diagnosed with stage 4 lung cancer. He refused treatment for fear that it would deplete their meager savings and leave mom without anything. He died a few months later leaving mom with no pension. Mom died 4 years later, also from lung cancer. When mom passed, the total value of the estate, IRAs, house equity, everything was $25,000. She couldn't have been living on more than $800/month.

I will give them credit for never complaining about their situation or asking for help. They were able to pay their bills, eat regular meals and watch cable television. Were they happy? I don't know, but I don't want to find myself in their situation.

Too little money AND died to soon?

 

[Looking4Ward]

My mother contracted lung cancer when she turned 66 and my father was 70, my father had taken a buyout of the pension and within the 5 years of being retired they went through all the money. After my mother passed my father lived on only social security and was $15,000 in debt from medical and burial bills.

He never complained about his lot in life and never would take any money. He kept his car in good shape and lived with my brother for a few years before renting an apartment near a very nice county park. Rent was low and he lived on the equivalent today of $1,600 a month. He spent his time walking 5 miles each day, talking with people in the park, always keeping a pack of dog treats with him to give to people walking their dogs and working to keep the walking paths clear for everyone else. He always walked with a foldable pruning saw and shears to trim any wayward vegetation.

He taught me having little money is nothing to fear, it is always possible to make do and enjoy life with what you have, but life is easier with more money that is for sure. Even a few hundred dollars a month would have made a huge difference to him. He died at age 87 with $4,000 in the bank and debt free. In my entire life I never once heard him complain about being poor nor about it being unfair that someone else had more money than he. Because I think he had little money he had much time for walking the 5 miles daily and enjoying the county park, this in turn kept him healthy and active throughout his retirement.

I hope I am able to experience the good parts of his retirement with at least a little more cushion to make it through the years.

+1

Thanks for a great read to start my day.

 

[rodi]

Too little money: My bff's parents. For political reasons they quit their overseas posted government jobs. To make it worse, they cashed in their federal pensions. She went back to work and he had various "businesses" he pursued and they blew threw the pension lump sum. My bff was about 19, living on her own, and having to lend her parents $1k at a time so they could pay their rent. (Which put her in a position of not being able to pay her own rent.) She ended up moving back in with them for a while to help them financially. We became roommates/bff's when she moved out of that situation. FFW several years and her dad is supplementing the tiny bit of income her mom was bringing in by doing telemarketing. FFW even more years and she's now forced to supplement their income by about $1500/month. They lived in our casita for a while for super cheap rent (compared to market rate), and then lived in BFF's second home for free for almost a year. She still supplements their income. They have a small SS coming in from her mom's jobs she's had post "retiring" from the government.

These are smart people who for years lived beyond their means and now live on a shoestring and depend on their daughter's money to make the bills.

My mom retired at age 62, dx'd with cancer at 67, died at 67 after 3 years of chemo. She did manage to get some living in before dying - 2 round the world trips done between chemo rounds, meeting her first grandchild (my older son.)

 

[Car-Guy]

How about the couple that have some money but won't spend it. I know a couple that are in their early 90's. I know them well enough to estimate their net worth is probably close to a million dollars (mostly tax paid cash) and no debt. Both are collecting SS and I know one of them has a pension and the other is collecting from an annuity. I'm not sure how much that adds up to monthly but I'm sure it covers all their living expenses since they live like paupers in house that's falling apart from lack of any maintenance. (BTW, no kids or remaining family) I've known them for a long time and they never did much of anything except watch TV and watch the grass grow. (not the smoking kind of grass) Even when they were 30+ years younger they didn't do much. (no hobbies, no travel, no computer, no Internet, no cell phone, etc.) They do have one used car (and one of them is still driving) and cable TV. Their health was good enough (until recently) that they could have done "something".

I've never really said much to them since it is their life choice but that's not living IMO. It's existing.

 

[InTheSticks]

I think my parent's actually did a pretty good balance in this area. My dad had 2 pensions (federal government and reserves) and SS. When in they were in their 60s and 70s, they traveled and spent. But, after mom passed and dad was in his 80s, he couldn't travel. The money piled up.

 

[Fishingmn]

It would be a lot easier to plan if I knew the dates of our deaths.

My DW retired last month (52). Part of the impetus was the health issues that many of our peers are having. Very good friend with stage 4 lung cancer (53), best friend with stage 2 colon cancer that just came back (53) and another acquaintance who just had a stroke (55). Add to that the onset of Ataxia that my mom (75) got as a complication of cancer in the last year which will restrict her to a nursing home the rest of her life.

You just never know how to plan things out and whether spending more or saving more is the right answer.

Had a friend from work 5 years ago that got laid off about the time I did. She took her $150k severance and blew it all in 2 years. Soon after she got cancer and died. For her, spending it ended up being the right decision.

 

[Danmar]

Interesting stories, but what can we learn from them? Here is a start.
1) Pensions/annuities are really good to have in retirement. They take out much of what can go wrong.
2) a healthy lifestyle both before and during retirement is most important. You can't defeat the grim reaper but you can certainly improve your quality of life and improve your odds of a longer life.
3) it's better to leave a little on the table when you go versus running short. So be conservative in your saving/spending. This does not mean being a cheapskate or a miser. Be flexible in your saving/spending to reflect actual events as they unfold.
4) Educate yourself on financial matters. There is no reason to claim ignorance or lack of understanding if things go wrong. Take ownership of your financial matters.
5) Because we can't know the future, live each day like it is your last. Never procrastinate. (This point added in edit and should be attributed to NW-Bound.)

Must be some more good ones?

As always easier said than done.

 

[NW-Bound]

Earlier, I said I did not know any who died early, but I was wrong.

My wife's long-time friend died of colon cancer at the age of 60. She was about to take early retirement, but the recession of 2009 dropped her 401k by 50%. So, she did part-time work for her employer megacorp to wait for it to come back, and that was when she was diagnosed with this terrible disease. Even if she did not do the part-time work, she could not have much time in retirement.

In cases like the above, there's not much one can learn other than to enjoy each day that we have. We just don't know what fate awaits us.

 

[Souschef]

Too little

My father died in 2003 at the age of 92. He told my mother she would be taken care by their investments. However, she just passed last March at the age of 102.
They did not have long term care insurance.
Her stocks were supposedly to go to my sister's children. Toward the end, she had to have 24 hr care. She went through her savings, but I would not help until all the stock was sold, because I felt I would be subsidizing my nieces, who did not need the money.
Her condo was free and clear, and the sale proceeds went to my sister, who deserved it, as she handled mom's affairs.

 

[calmloki]

What?! No obligatory YOLO?

 

[pb4uski]

I think I know of few retirees who had money, overspent and now have little money. Just the circles I run in I guess.

OTOH, I know numerous retirees who LBYM and have a large stash. Most of them don't sacrifice much of anything... have traveled and keep nice but modest houses in good order... but can no longer travel or do a lot for health reasons.

My mom is also in the above category but I admit that the older she has become the harder it is for us to get her to spend money on keeping up the houses or on improvements that would make her life easier and more enjoyable. Everything is "good enough"... even if it is not functioning properly rather than fix it (or have it fixed) she just does without it or creates some workaround and I address it the next time I'm there. It drives me a bit nuts.

 

[Souschef]

What?! No obligatory YOLO?

Sorry, I do not understand what that is in reference to.
After my dad died, she made a couple of trips to NY to see my sis and kids, but that was about it.
She did not socialize with people in her condo complex.

 

[calmloki]

I think I know of few retirees who had money, overspent and now have little money. Just the circles I run in I guess.

OTOH, I know numerous retirees who LBYM and have a large stash. Most of them don't sacrifice much of anything... have traveled and keep nice but modest houses in good order... but can no longer travel or do a lot for health reasons.

My mom is also in the above category but I admit that the older she has become the harder it is for us to get her to spend money on keeping up the houses or on improvements that would make her life easier and more enjoyable. Everything is "good enough"... even if it is not functioning properly rather than fix it (or have it fixed) she just does without it or creates some workaround and I address it the next time I'm there. It drives me a bit nuts.

We are probably in the "good enough" camp. Getting estimates and riding herd on the people who improve something is a hassle - we should swap out the carpet in this house; we do so often on the rentals, but here we would have to move everything and then move it back - easier to just dim the lights and put furniture over the stains. This summer my faithful E39 BMW with over 325,000 miles needed replacing - all kinds of problems I was putting up with unrelated to it driving down the road. We went car shopping and it was a huge PITA. Ended up with a newer BMW wagon which is ok, but I'd have been much happier with the same (fully functional) car.

Souschef - I'm kinda prone to the non sequitur - was imagining youth of today reading this thread and shouting their rallying cry: YOLO!

 

[RE2Boys]

YOLO ?? I had to google it.....must already be an outdated term as I've never heard my teenagers use it.

 

[38Chevy454]

YOLO = You Only Live Once