Rather than a percentage allocation, I think that setting aside an amount that I will require in the next 5 years or so in bonds and short-term funds makes more sense. I put the rest in equities. With that strategy, total bond funds and long-term bond funds make less sense. I'm 75 and have enough assets that I should be OK regardless of my allocation. I have been frugal most of my life and don't have any close relatives in need of an inheritance. I indulge myself more now and hope to increase my charitable contributions every year for the rest of my life.
I'm 75 and never married. My only close relatives are my 78-year-old brother and my 65-year-old sister. None of us have any children. My brother is in assisted living, I handle his relatively simple finances. My sister and I both have more savings than we will ever likely spend. I have tried to simplify my finances. My investments are all at Vanguard, mostly in a traditional and a Roth IRA. I do most of my banking with Capital One, which has excellent online features to manage my accounts. I plan to close a long-dormant credit union account in the next few days. In my will, I'm leaving my home and any vehicle to a non-profit. My IRAs will also mostly go to non-profits as beneficiaries. When I'm no longer capable of managing my own financial affairs, I plan to use Vanguard's financial advisory service for my IRAs. A local non-profit set up to protect the elderly will handle the rest of my finances and pay my bills for a fee. I accept that I will probably stop driving entirely in a few years. I expect to move to a senior facility of some sort around then. Most likely, I'll donate my home to the non-profit at that time. The big question in my mind is how to decide when to turn my finances over to others. That will certainly be much harder for me than the decision to stop driving.
I not only don't try to keep up with the Jones, I have no idea what the Jones are doing. I've paid interest on credit cards twice in my life, both back in the 1970s. The first time, I had just graduated from college, moved to another state, and hadn't received my first paycheck yet. The second time, I wrote the check for the wrong amount -- by 4 cents. It cost me the minimum charge of 75 cents, as I recall. I've owned 6 homes in 4 states. One of them never had a mortgage, I got 15-or 20-year mortgages on the rest with no less than 25% down. I've paid cash for most of the cars that I've owned.
I recall one co-worker who kept bugging me for stock tips. This was back in the late 1980s to early 1990s, before index funds were common. I knew that he would never have the patience to be a buy-and-hold investor. I did quite well with individual stocks, but I held many of them for 10-15 years. I also got extremely lucky with some of them. My three best stocks were all in boring industries. One was my very first stock purchase, PepsiCo. In another case, a new coworker and his wife lamented that their favorite store chain didn't have any local stores. I did a little investigating and ended up buying Walmart stock a couple of years before I ever saw one of their stores. The third stock was Paychex, the payroll processor. Those three winners easily made up for all the mediocre and outright clunkers that I bought. I usually only bought 50-100 shares of a stock and never bought more later. Even though my stocks made it possible for me to retire at 51, I realized that there was a high amount of luck involved and that it would be unlikely for me to repeat it. All my investments are now in index funds.
Here in the Rochester NY area, private health insurance is dominated by one non-profit, Excellus, with 73% of the market according to some estimates. The healthcare market is dominated by two non-profits (one is the University of Rochester Medical Center), which together run all of the hospitals in the region along with many other medical facilities. My MA policy, from Excellus, includes all of the hospitals in the area and 99% of the physicians. I don't need to get referrals for specialists. I don't see that changing anytime soon because the healthcare providers need to work with Excellus and Excellus needs to work with them.
I struggled over when to take SS, but I ultimately realized that it didn't really matter. I'm single and my only close relative is my sister, who is 10 years younger. Neither of us is likely to outlive our money regardless of when we take SS., I ended up taking it at my FRA of 66. My sister, who is generally in good health but had breast cancer 3 years ago, opted to take her SS this year at age 65. I got lucky, my investments since I started SS have done significantly better than inflation, which should delay the break-even point a few years. For both my sister and me, our decisions of when to take SS won't affect us, but will, to some extent, affect how much we leave to our favorite charities.
I live in the Rochester NY area, the healthcare market here is dominated by 3 non-profits. Excellus has the bulk of the health insurance, by some estimates 73%. Two healthcare networks (one run by the University of Rochester Medical Center) run all the hospitals in the region and many of the other medical facilities between them. Is that a good thing? I'll let others debate that. However, it means everybody is forced to work together. My Medicare Advantage plan from Excellus includes all the hospitals in the region and 99% of the physicians. I don't need to get referrals for specialists or even need to designate a primary care physician.
I started my career in the early 1970s. My first mortgage had a double-digit interest rate, I can't remember the exact figure. I was well aware of the effects of inflation and took it into account when I stopped working full time in 2000 at age 51. Because of some semi-lucky investments, I had over $1,000,000 at the time and a lifestyle where I didn't spend much. I worked a part time job for 20 years after that, much longer than any of my "real" jobs. I invested mostly in stock index funds. I started Social Security at my FRA of 66. I've always assumed that my investments would earn 0% when adjusted for inflation, the reality has been much better than that. I'm 75 now and, despite depending on my investments for about half of my income, their value now, adjusted for inflation, is close to the same as it was in 2000 when I stopped working full time.
I went to Rochester Institute of Technology a few years before you went to the University of Rochester. My main concern at the time was the cost, our family didn't have much money to begin with and my father had been unemployed for most of the year before I started in the 1967-68 school year. I wanted to go into engineering, and I could commute from the nearby town where I lived. RIT was scheduled to move to a new campus that year, but it didn't happen until the following year. My first-year tuition was $2050. RIT had about 4000 full-time students at the time. It had a good regional reputation but wasn't well-known nationally. Do I think that I made a good choice? Yes, I got a good education, and the culture was right for me. I didn't know that at the time, however. RIT is a much different institution now. With about 17,000 students, it's one of the 20 largest private colleges in the country. Would I fit in now? I'm not sure, but I'm pleased with the way that it has evolved. They've forged their own path and appears to still offer a great education.
I haven't looked at the formula for a while, but SSA takes your total income that was subject to SS tax for each year, adjusts them for inflation since that year, and adds the highest 35 years together. If you don't have 35 years of paying into SS, $0 is added for the remainder of the 35 years. Then they divide that by 420 (the number of months in 35 years). Then they take 90% of the first X dollars, 32% of the next Y dollars, and 15% of the next Z dollars and add them together to calculate your initial monthly SS payment. The values of X, Y, and Z are determined each year but only the ones for the year you begin taking SS matter for you. If your income was high enough so that you are in that 15% bracket, working more years probably won't increase your SS payments much, although if you start collecting before your FRA, the payments will be reduced. My case was complicated by the fact that for the first 8 years of my career I worked for the Federal Government, which wasn't covered by SSA at that time. I retired from fulltime work at 51, so I only had about 20 years of SS coverage. I worked another 20 years part-time at less than 25% of my previous salary. My total was still high enough to be in the 15% bracket when I began receiving SS at my FRA of 66.
Comments:
Rather than a percentage allocation, I think that setting aside an amount that I will require in the next 5 years or so in bonds and short-term funds makes more sense. I put the rest in equities. With that strategy, total bond funds and long-term bond funds make less sense. I'm 75 and have enough assets that I should be OK regardless of my allocation. I have been frugal most of my life and don't have any close relatives in need of an inheritance. I indulge myself more now and hope to increase my charitable contributions every year for the rest of my life.
Post: The Simple Life
Link to comment from December 21, 2024
I'm 75 and never married. My only close relatives are my 78-year-old brother and my 65-year-old sister. None of us have any children. My brother is in assisted living, I handle his relatively simple finances. My sister and I both have more savings than we will ever likely spend. I have tried to simplify my finances. My investments are all at Vanguard, mostly in a traditional and a Roth IRA. I do most of my banking with Capital One, which has excellent online features to manage my accounts. I plan to close a long-dormant credit union account in the next few days. In my will, I'm leaving my home and any vehicle to a non-profit. My IRAs will also mostly go to non-profits as beneficiaries. When I'm no longer capable of managing my own financial affairs, I plan to use Vanguard's financial advisory service for my IRAs. A local non-profit set up to protect the elderly will handle the rest of my finances and pay my bills for a fee. I accept that I will probably stop driving entirely in a few years. I expect to move to a senior facility of some sort around then. Most likely, I'll donate my home to the non-profit at that time. The big question in my mind is how to decide when to turn my finances over to others. That will certainly be much harder for me than the decision to stop driving.
Post: When should one give up control over finances?
Link to comment from December 14, 2024
I not only don't try to keep up with the Jones, I have no idea what the Jones are doing. I've paid interest on credit cards twice in my life, both back in the 1970s. The first time, I had just graduated from college, moved to another state, and hadn't received my first paycheck yet. The second time, I wrote the check for the wrong amount -- by 4 cents. It cost me the minimum charge of 75 cents, as I recall. I've owned 6 homes in 4 states. One of them never had a mortgage, I got 15-or 20-year mortgages on the rest with no less than 25% down. I've paid cash for most of the cars that I've owned.
Post: When Easy Money Bites
Link to comment from November 16, 2024
I recall one co-worker who kept bugging me for stock tips. This was back in the late 1980s to early 1990s, before index funds were common. I knew that he would never have the patience to be a buy-and-hold investor. I did quite well with individual stocks, but I held many of them for 10-15 years. I also got extremely lucky with some of them. My three best stocks were all in boring industries. One was my very first stock purchase, PepsiCo. In another case, a new coworker and his wife lamented that their favorite store chain didn't have any local stores. I did a little investigating and ended up buying Walmart stock a couple of years before I ever saw one of their stores. The third stock was Paychex, the payroll processor. Those three winners easily made up for all the mediocre and outright clunkers that I bought. I usually only bought 50-100 shares of a stock and never bought more later. Even though my stocks made it possible for me to retire at 51, I realized that there was a high amount of luck involved and that it would be unlikely for me to repeat it. All my investments are now in index funds.
Post: O.K., I Give Up, You Win!
Link to comment from November 2, 2024
Here in the Rochester NY area, private health insurance is dominated by one non-profit, Excellus, with 73% of the market according to some estimates. The healthcare market is dominated by two non-profits (one is the University of Rochester Medical Center), which together run all of the hospitals in the region along with many other medical facilities. My MA policy, from Excellus, includes all of the hospitals in the area and 99% of the physicians. I don't need to get referrals for specialists. I don't see that changing anytime soon because the healthcare providers need to work with Excellus and Excellus needs to work with them.
Post: Prefer the Original
Link to comment from October 26, 2024
I struggled over when to take SS, but I ultimately realized that it didn't really matter. I'm single and my only close relative is my sister, who is 10 years younger. Neither of us is likely to outlive our money regardless of when we take SS., I ended up taking it at my FRA of 66. My sister, who is generally in good health but had breast cancer 3 years ago, opted to take her SS this year at age 65. I got lucky, my investments since I started SS have done significantly better than inflation, which should delay the break-even point a few years. For both my sister and me, our decisions of when to take SS won't affect us, but will, to some extent, affect how much we leave to our favorite charities.
Post: Just the Facts by Jonathan Clements
Link to comment from October 22, 2024
I live in the Rochester NY area, the healthcare market here is dominated by 3 non-profits. Excellus has the bulk of the health insurance, by some estimates 73%. Two healthcare networks (one run by the University of Rochester Medical Center) run all the hospitals in the region and many of the other medical facilities between them. Is that a good thing? I'll let others debate that. However, it means everybody is forced to work together. My Medicare Advantage plan from Excellus includes all the hospitals in the region and 99% of the physicians. I don't need to get referrals for specialists or even need to designate a primary care physician.
Post: Wellcare for Part D by Andrew Forsythe
Link to comment from October 12, 2024
I started my career in the early 1970s. My first mortgage had a double-digit interest rate, I can't remember the exact figure. I was well aware of the effects of inflation and took it into account when I stopped working full time in 2000 at age 51. Because of some semi-lucky investments, I had over $1,000,000 at the time and a lifestyle where I didn't spend much. I worked a part time job for 20 years after that, much longer than any of my "real" jobs. I invested mostly in stock index funds. I started Social Security at my FRA of 66. I've always assumed that my investments would earn 0% when adjusted for inflation, the reality has been much better than that. I'm 75 now and, despite depending on my investments for about half of my income, their value now, adjusted for inflation, is close to the same as it was in 2000 when I stopped working full time.
Post: Hedging your bet in retirement-dealing with inflation. What’s your strategy? R Quinn
Link to comment from October 5, 2024
I went to Rochester Institute of Technology a few years before you went to the University of Rochester. My main concern at the time was the cost, our family didn't have much money to begin with and my father had been unemployed for most of the year before I started in the 1967-68 school year. I wanted to go into engineering, and I could commute from the nearby town where I lived. RIT was scheduled to move to a new campus that year, but it didn't happen until the following year. My first-year tuition was $2050. RIT had about 4000 full-time students at the time. It had a good regional reputation but wasn't well-known nationally. Do I think that I made a good choice? Yes, I got a good education, and the culture was right for me. I didn't know that at the time, however. RIT is a much different institution now. With about 17,000 students, it's one of the 20 largest private colleges in the country. Would I fit in now? I'm not sure, but I'm pleased with the way that it has evolved. They've forged their own path and appears to still offer a great education.
Post: Ranking Colleges
Link to comment from October 5, 2024
I haven't looked at the formula for a while, but SSA takes your total income that was subject to SS tax for each year, adjusts them for inflation since that year, and adds the highest 35 years together. If you don't have 35 years of paying into SS, $0 is added for the remainder of the 35 years. Then they divide that by 420 (the number of months in 35 years). Then they take 90% of the first X dollars, 32% of the next Y dollars, and 15% of the next Z dollars and add them together to calculate your initial monthly SS payment. The values of X, Y, and Z are determined each year but only the ones for the year you begin taking SS matter for you. If your income was high enough so that you are in that 15% bracket, working more years probably won't increase your SS payments much, although if you start collecting before your FRA, the payments will be reduced. My case was complicated by the fact that for the first 8 years of my career I worked for the Federal Government, which wasn't covered by SSA at that time. I retired from fulltime work at 51, so I only had about 20 years of SS coverage. I worked another 20 years part-time at less than 25% of my previous salary. My total was still high enough to be in the 15% bracket when I began receiving SS at my FRA of 66.
Post: How might early retirement at say age 55 affect your FRA SS benefits?
Link to comment from September 28, 2024