AUTHOR: C Z on 10/26/2024 FIRST: Jonathan Clements on 10/27/2024 | RECENT: C Z on 10/28/2024
Comments
Just a comment from a 71 year old HD reader who is retired and not in the same financial league as most of the HD posters. I came across a blurb in the NYT about Jonathan Clements about 2 or 3 years ago and that sparked my curiosity... what was this HD thing all about. Would there be any info to give me ideas about managing my own finances as well as my aunt's? ( I am POA for a 98 year old living in personal care bldg in PA) You are right that broad financial planning education should start in the home or even in school. Just saving for a small goal ( bicycle/ toy/ car) or tithing is a place to start. If that is not available, I think the workplace is the next best place, since that is where 401k's start. I did not start saving for retirement until I was 28 and had a steady job after college . My own curiosity is the driving force behind understanding more about managing what I have accumulated. Sometimes I don't understand topics in HD, sometimes they spur me to look further. We live frugally on just Social Security , no pensions, and my husband's RMD from a small IRA ( like 200,000). I did a very large Roth conversion, very stupid on my part, but I see that as a good thing down the road. We have everything we need, can get our taxes done with VITA ( they max out at 70,000 per year to qualify) The eye opener for me has been taking my aunt's taxes to a CPA and seeing how they suggest doing this or that to meet income ceilings for Federal taxes ( sale of house, higher income from her 401k, gains from a brokerage etc. ). I am learning by fire, but welcome the challenge, even with my limited experience . Please keep the information coming, even for this retiree!
I saw first hand the need to be visible when my aunt was in rehab after a hospital stay. Different doctor visits happen throughout normal business hours, staff on 2nd and 3rd shifts can update you on progress or changes in meds. It was an easy habit to continue in assisted living. Residents are simply her neighbors to me.
You're right, economics is only part of it. She might have been able to start with IL. I projected costs with both scenarios and I think at 5 years it made more sense to start with IL. Kinda morbid thinking at the time, but I was trying to be objective and be confident that her funds would work. We asked her to stay at this AL for a week while I got settled in after a hip revision. It was called respite care, but to me it was a test drive! A few months later she had another stay for a week . When we looked at places in NJ ( Somerset County) she at least had a point of reference and ultimately, thankfully agreed to move close to me. I want her to make decisions as long as she is willing and able to. I have asked her every few months if she feels safe,if she is happy with the move away from her church and friends. She says yes. That keeps me motivated to be a good steward with her funds.
My aunt will be 98 in November and moved into an assisted living building about 2 years ago . The AL building is part of a CCRC that offers Type A contracts, although my aunt came in as private pay. She uses a walker to get to activities and 3 meals a day in the dining room....she chooses from a menu. Less than 150 residents spread across 4 floors. Nurses station on each floor. Her monthly fee is just under 8000; if she had come in as independent living her monthly fee would be less than half of that ( the billing department has accidentally sent me annual price lists for both private pay and independent living residents) Part of the high entrance fee for Type A contract is long term care insurance and part of the monthly fee is also long term care insurance. I have received a letter ( as my aunt's POA) at the beginning of the year which explains the one time tax savings for first time residents ( part of their entrance fee) and a tax savings for a portion of their monthly fee. If my aunt has to move to personal care, her rate will double. Monthly fees will be about 15,000. Again,if she had started out in independent living, her monthly fees would be dramatically lower. I think you have to be honest with yourself about your health needs, family history before deciding on any type of CCRC. Pay alot up front ( Type A) or pay as you go ( other types of contracts). My aunt is a few miles from me in Lancaster County,PA where there are many choices for retirement living. I visit a minimum of once a week, staff knows me (very important to have staff know that someone is looking out for your loved one) residents know me. I feel and my aunt feels like she is well taken care of and can get help anytime.
Oh my, that's a pretty big deal! I'll check with the broker to see who officially monitors that. Thank you so much for responding!!
The snafu occurred with Interactive Brokers and since then the acct has moved to Schwab. Oh you have made my day!
So it would make sense to take a larger RMD to fund my aunt's living expenses, reducing the value of an inherited IRA. Just a balancing act with her taxes, but at 97 it may be moot. Ah, the joys of being POA.
The 600,000 is my own Roth.....I accidentally rolled over most of my 401k to a Roth in 2023. Was supposed to be only 20,000 but I clicked a few areas where I shouldn't have. That triggered a large tax bill; now I am subject to IRMA on my SS. Things are tight but doable. I am in that 5 year waiting period. ROTH is in mostly ETFs, alot of Vanguards, two bond funds, QQQ. Sale of our house will cover the entrance fee to CCRC; our SS and maybe a small amount from retirement will cover our monthly fee. Things are inexpensive here in central PA.
Just to clarify upfront, I am new to the Forum and new to investment products. Is it smart/dumb to use monies from an inherited IRA to fund an immediate fixed an annuity? Seems like you would pay taxes on the IRA money and then pay taxes again on annuity proceeds I am 70, husband is 73. Just SS income, no pensions. Husband will take his first RMD this year, but it is around 7500.00. All of my savings, about 600,000 is tied up in a Roth for at least another 3 years. As POA I manage my 97 year old aunt's funds, about 1.5 million....mostly CDs, a small brokerage acct, her 401 K, so I have been learning about money management as I go along. We anticipate moving into a continuing care retirement community in a few years, so a guaranteed supplemental income stream would be helpful. We have no kids. Thoughts?
Comments
Just a comment from a 71 year old HD reader who is retired and not in the same financial league as most of the HD posters. I came across a blurb in the NYT about Jonathan Clements about 2 or 3 years ago and that sparked my curiosity... what was this HD thing all about. Would there be any info to give me ideas about managing my own finances as well as my aunt's? ( I am POA for a 98 year old living in personal care bldg in PA) You are right that broad financial planning education should start in the home or even in school. Just saving for a small goal ( bicycle/ toy/ car) or tithing is a place to start. If that is not available, I think the workplace is the next best place, since that is where 401k's start. I did not start saving for retirement until I was 28 and had a steady job after college . My own curiosity is the driving force behind understanding more about managing what I have accumulated. Sometimes I don't understand topics in HD, sometimes they spur me to look further. We live frugally on just Social Security , no pensions, and my husband's RMD from a small IRA ( like 200,000). I did a very large Roth conversion, very stupid on my part, but I see that as a good thing down the road. We have everything we need, can get our taxes done with VITA ( they max out at 70,000 per year to qualify) The eye opener for me has been taking my aunt's taxes to a CPA and seeing how they suggest doing this or that to meet income ceilings for Federal taxes ( sale of house, higher income from her 401k, gains from a brokerage etc. ). I am learning by fire, but welcome the challenge, even with my limited experience . Please keep the information coming, even for this retiree!
Post: Reflections on a Quiet Failure
Link to comment from June 8, 2026
I saw first hand the need to be visible when my aunt was in rehab after a hospital stay. Different doctor visits happen throughout normal business hours, staff on 2nd and 3rd shifts can update you on progress or changes in meds. It was an easy habit to continue in assisted living. Residents are simply her neighbors to me.
Post: Assisted Living: How Will You Choose?
Link to comment from May 12, 2025
You're right, economics is only part of it. She might have been able to start with IL. I projected costs with both scenarios and I think at 5 years it made more sense to start with IL. Kinda morbid thinking at the time, but I was trying to be objective and be confident that her funds would work. We asked her to stay at this AL for a week while I got settled in after a hip revision. It was called respite care, but to me it was a test drive! A few months later she had another stay for a week . When we looked at places in NJ ( Somerset County) she at least had a point of reference and ultimately, thankfully agreed to move close to me. I want her to make decisions as long as she is willing and able to. I have asked her every few months if she feels safe,if she is happy with the move away from her church and friends. She says yes. That keeps me motivated to be a good steward with her funds.
Post: Assisted Living: How Will You Choose?
Link to comment from May 12, 2025
My aunt will be 98 in November and moved into an assisted living building about 2 years ago . The AL building is part of a CCRC that offers Type A contracts, although my aunt came in as private pay. She uses a walker to get to activities and 3 meals a day in the dining room....she chooses from a menu. Less than 150 residents spread across 4 floors. Nurses station on each floor. Her monthly fee is just under 8000; if she had come in as independent living her monthly fee would be less than half of that ( the billing department has accidentally sent me annual price lists for both private pay and independent living residents) Part of the high entrance fee for Type A contract is long term care insurance and part of the monthly fee is also long term care insurance. I have received a letter ( as my aunt's POA) at the beginning of the year which explains the one time tax savings for first time residents ( part of their entrance fee) and a tax savings for a portion of their monthly fee. If my aunt has to move to personal care, her rate will double. Monthly fees will be about 15,000. Again,if she had started out in independent living, her monthly fees would be dramatically lower. I think you have to be honest with yourself about your health needs, family history before deciding on any type of CCRC. Pay alot up front ( Type A) or pay as you go ( other types of contracts). My aunt is a few miles from me in Lancaster County,PA where there are many choices for retirement living. I visit a minimum of once a week, staff knows me (very important to have staff know that someone is looking out for your loved one) residents know me. I feel and my aunt feels like she is well taken care of and can get help anytime.
Post: Assisted Living: How Will You Choose?
Link to comment from May 12, 2025
Again, thank you for taking the time to help me. Have a good week
Post: RDQ Sorry folks, I still see annuities, including deferred annuities, as a viable option for creating steady retirement income.
Link to comment from May 5, 2025
Oh my, that's a pretty big deal! I'll check with the broker to see who officially monitors that. Thank you so much for responding!! The snafu occurred with Interactive Brokers and since then the acct has moved to Schwab. Oh you have made my day!
Post: RDQ Sorry folks, I still see annuities, including deferred annuities, as a viable option for creating steady retirement income.
Link to comment from May 4, 2025
Have had this for a few years and my funds have quadrupled. And it is only about 6- 7 % of my portfolio . Bulk is various Vanguard ETFs.
Post: RDQ Sorry folks, I still see annuities, including deferred annuities, as a viable option for creating steady retirement income.
Link to comment from May 4, 2025
So it would make sense to take a larger RMD to fund my aunt's living expenses, reducing the value of an inherited IRA. Just a balancing act with her taxes, but at 97 it may be moot. Ah, the joys of being POA.
Post: RDQ Sorry folks, I still see annuities, including deferred annuities, as a viable option for creating steady retirement income.
Link to comment from May 2, 2025
The 600,000 is my own Roth.....I accidentally rolled over most of my 401k to a Roth in 2023. Was supposed to be only 20,000 but I clicked a few areas where I shouldn't have. That triggered a large tax bill; now I am subject to IRMA on my SS. Things are tight but doable. I am in that 5 year waiting period. ROTH is in mostly ETFs, alot of Vanguards, two bond funds, QQQ. Sale of our house will cover the entrance fee to CCRC; our SS and maybe a small amount from retirement will cover our monthly fee. Things are inexpensive here in central PA.
Post: RDQ Sorry folks, I still see annuities, including deferred annuities, as a viable option for creating steady retirement income.
Link to comment from May 1, 2025
Just to clarify upfront, I am new to the Forum and new to investment products. Is it smart/dumb to use monies from an inherited IRA to fund an immediate fixed an annuity? Seems like you would pay taxes on the IRA money and then pay taxes again on annuity proceeds I am 70, husband is 73. Just SS income, no pensions. Husband will take his first RMD this year, but it is around 7500.00. All of my savings, about 600,000 is tied up in a Roth for at least another 3 years. As POA I manage my 97 year old aunt's funds, about 1.5 million....mostly CDs, a small brokerage acct, her 401 K, so I have been learning about money management as I go along. We anticipate moving into a continuing care retirement community in a few years, so a guaranteed supplemental income stream would be helpful. We have no kids. Thoughts?
Post: RDQ Sorry folks, I still see annuities, including deferred annuities, as a viable option for creating steady retirement income.
Link to comment from May 1, 2025