[quote]“I thought my 60s were going to be my golden years. I would watch commercials, and all I saw were people on trips to Cancún or golfing or sitting by the pool. I couldn’t wait,” said Haverfield
[quote]The couple had planned to retire with $1 million in savings between their IRA and their 401(k). But Haverfield said her husband did a poor job managing their finances, especially as he became ill, and she retired several years earlier than planned to tend to him full-time. Their money quickly dwindled to pay for his care, as well as that of her mother and several other ailing relatives.
It really takes some biting of the tongue not to be too very unkind toward the woman who thought her 60s were going to be sitting by the pool. golfing, Cancun vacations...all on the basis of having had "plans" with her husband to retire $1M in IRA and 401(k) savings when there's no indication at all that they were anywhere near that goal. She seems to have mistaken hopes and dreams for plans and savings. Good intentions don't pave the way for retirement.
The truth is she might have done every thing right and had $1M in retirement savings and still her 60s might have been short of Golden. I understand that and am sympathetic, particularly to the crunch of medical costs for her dying husband (before, I gather, he might have qualified for Medicaid and Medicare benefits. Medical costs in the U.S. are ruinous and that is indeed a crime and a national shame. not hers nor her husbands.
But damn, Golden Years in the U.S. are anything but a guarantee of watching amber-hued sunsets in twin Cialis bathtubs and jetting off to Cancun, again: not when you have a mortgage that isn't in its very last throes or when you don't have a massive pot of retirement of other savings. Unless you're more than rich enough not to need a mortgage, retiring with a more than a very short term of the mortgage in place is almost always a very bad idea. Not to mention footing the medical and care expenses of a whole generation of old relatives before getting your mortgage paid off.
[quote]Haverfield lives on $2,400 a month in Social Security benefits, totaling $28,800 a year.
Had she owned her house and not had a $1500/month mortgage, $2400 a month in Social Security would have been enough to get by reasonably if somewhat modestly. She could pay her property tax, have money enough for food and basic expenses of keeping a household. She would not have much money for jetting ff to exotic places, and she might need to economize by heating and cooling part and not all of her house. Selling her house and moving to a rental apartment might be an attractive option to have more cash flow, or at the very least a backup plan in cash her costs or maintaining her house became a burden.
There are one-bedroom apartments in her area from $1200/month for something respectable (and more basic, cheaper apartments as well), considering the savings of $4000/year in property taxes and the prospect of (maybe) getting some equity back from the sale of her house would boost her position a bit.
SO many people plan well and still have the rug pulled out from under them, I hate to "but why didn't she just..." the poor woman, but just hoping everything ends up well and just hoping that your golden years will be spent golfing on Cancun vacations is a bit of a liberty against all evidence to the contrary.