Statistics I have seen generally state that 70% of folks who live past 65 will spend time in a LTC (long term care) facility. I was President of a corporation that built and operated an assisted living facility for ten years and then sold to private industry. LTC encompasses a wide range of types. Worst case scenario is placement in a memory care facility when still healthy. Extremely high cost care that can be a lengthy stay due to overall decent health. Nursing home care is also pricey but on average, stay is not as long due to declining health. I’ve also read that very few people die at home due to the advent of EMT services available everywhere. Other words, folks are stabilized enough to make it to a hospital.
Retirement Targets
- Thread starter yowza
- Start date
There are many articles you can find that suggest you should so many times your salary saved at particular ages. After looking at multiple articles myself I found the following ranges.
35 1-2x your salary
40 2-3x your salary
45 3-4x your salary
50 4-6x your salary
55 6-7x your salary
60 6-9x your salary
65 8-11x your salary
I just use these as targets for a very basic comparison.
I find it interesting that on a site like Fidelity they run the model using returns much below average.
How about just average? They wouldn't give a worst case and try to upsell?
Nah. They wouldn't do anything like that.
Excellent! Just keep doing it. Even in the dark days like last year its important to keep investing.
Even MORE so!
Last year was an opportunity for younger investors.
Pile money in there. Buy shares. Investing is for the strong!
(Not an investment professional, but a big believer in the time value of money)
I would say for assisted living the number they show is way off. I would double that number. This is from recent experience with an elderly parent.
Yeah, that doesn't really refute what I said (nor did you include any sources for your percentages). Even if those are accurate, what percentage of people even make it past 65? The reality is, "most" people will either die before or just won't need to live in a facility (which is what I was arguing to begin with..).
Also didn't answer my question about what happens to people who can't afford that expensive long term care? Are there crappier facilities that the gov't subsidizes, or are they just left to die in the streets? I'm not so sure I would choose having my ass wiped for 5+ years over just calling it a life, myself.
I just grabbed a couple of the first sources I found, and I wasn't really arguing costs. I was refuting the claim that most people will need to live in a facility - simply not true
I hope when I'm 65 I have more than 11X my salary in savings. Doesn't seem like all that much, really.
You're not wrong, but also they would probably catch hell for "overselling" returns too.
It's a tightrope for the financial industry - you can't overpromise because that would be deceptive, but if you underpromise too much people won't even try. Thinking about it, they might be required to use 8% or something lie that (although I might be conflating with something else).
Well, if you take out 4% per year (which will last forever), that's 44% of your salary. Add on SSI. And only trying to get to 75% of salary... it adds up from that perspective. It's not luxurious but it works.
e.g. $80k salary => goal is $60k; $35k from savings plus $25k from SSI and you are there
That said, I want to replace ALL my income without SSI, so using that 4% rule I need 25x salary.
Someone lives in them as most are full. I do think when most people get to one of those, it seems like maybe 6 months and they pass away.
I think most long term care policies only pay out for 3 years. Most are dead by then.
And since you are a young pup you also have a lot of time to impact your health later in life. Take care of business now and likely to see the payoff on down the road.
They were going to make it a law in Washington state to have one, so I bought it. The state backed down and my premiums for this year went up 22%. I would definitely wait, as it doesn't provide all that much coverage for the buck.
Who knows how raises/increase will turn out, but if two people had a combined income of 140K right now with a 2.5% increase each year, they would be making about 260K in 25 years. 260,000 x 11 is 2,860,000.
You can never save too much. I thought we were fine, but then eggs went to $4, bread $3, my utilities shot up about 20% and property taxes up about 12% all in one year. Insurance also just went up about 18% at my March renewal. Most of these new expenses are never going to go back, so our bucket has a bunch of new holes in it. I'm certainly more concerned than compared to just a couple years ago. So save, save, save as much as possible.
A good strategy is to increase your contributions by 1 or 2% every year you get your raise, so you don't notice less going to your bank account.
And Social Security could be a distant memory for a lot of us. Disappear or have the age pushed out so far it won't come into play.
Invest until it hurts. Roth 401k ain't a bad option
