Do you know someone that retired without savings?

[EconDiva]

Do you know someone that retired without having saved money for retirement? 

Ok, for the purposes of this thread let's say 'no savings' would be someone who has less than approximately $50k in retirement vehicles (401k, IRA, etc.) at the time of retirement. 

What does their life look like now that they are retired?  What was their reasoning(s) for not saving? 

[forummm]

My parents haven't retired yet, but they are close to that age and have a negative net worth. They will probably just take Social Security and live on that. It would be more than they make now.

[mozar]

People I know who have no savings either keep working or scale way back. My great aunt is 76 and sill works part time. In retail. She was full time until a year ago. I know people who retired with savings and still have to scale back when they realize they don't have enough to travel the way they always imagined. My mother thinks she will work until 75. Statistically speaking, most people take social security as soon as they are able - 62 because their bodies can't work full time anymore. So they only get 75% of benefits.

[Elderwood17]

My parents retired with nothing but social security, a paid off house and a paid off lake cabin.  Sold the cabin last year at age 91 and they now have more money than ever before in their lives!

[arebelspy]

Someone pointed out to me years ago the vast majority retire with little to no savings.

They live same way they lived for 40+ years while working: paycheck to paycheck.

Only now the paycheck comes from Social Security instead of their job.

Look at most people who retire at 65+ and have no pension.  That fixed income lifestyle is what it looks like.

[Dee18]

My brother in law just retired and his monthly Social Security payment is $3500.  My sister (his wife) is not yet taking her social security.  She will in 3 years.  Hers will be about $2400 per month, for a total of over $5900 per month, with an annual COLA.  Yes, that's over $70,000 per year!  My bro-in-law was very much a swami, a professor, so he worked until 70. They also have substantial 403(b)s, but I mention their social security here because so often people on MMM act like Social Security isn't worth much. 

[ltt]

My MIL had pretty much next to nothing--I'm not even sure she had $1,000 in the bank.  She received SS and her deceased husband's small pension.  Neither added up to $1,000.  She did fine.  She had a small paid-off home, a little bit of credit card debt, and a very old car.  That's just how she lived. 

[mbl]

My FIL lived in one of our rentals after he sold his house and had to use the proceeds to pay off debt.
When he no longer could live on his own, he moved in with my BIL and his family.
He received about $600/month which more than covered what little he needed.

He passed at 73 with just about what he entered this world with.

[Write Thyme]

My FIL was forced to retire early due to disability. He has a pension. MIL works part time. They don't have any savings or other retirement accounts other than SS. FIL isn't old enough to collect his yet. They should be fine, but they'd be better off downsizing.

My mom says she wants to retire in 2-3 years, but she's in debt, has at least another 10 years on her mortgage, has no savings and very very little in her 401k. I don't know how this is going to work out. Ugh.

[2ndTimer]

My MIL was a widow who worked low wage jobs.  She sold some land that she had bought with her husband's insurance money when he died.  That gave her a nest egg of about $50,000.  That and social security were what she lived on.  She lived in nice doublewide trailer.  She could have made it on her own but her burden was somewhat lightened by having three smart, productive sons who looked after her in different ways. 

The one who rose high in corporate America made it clear that he was always there as a financial backup if she needed it.  I don't think she ever did.  The one who did well in local law enforcement stopped in for a chat with the owner of her trailer park now and then just to make sure "everything was all right."  Once I got to know her, the Hub and I kept her in all sorts of little luxuries like wine, music, chocolate, books, art supplies, new mattress, etc that she particularly enjoyed. 

She was an exceptional woman and it felt like a privilege to visit her.  Because I am not nearly so exceptional as she was, I am saving my money.

[HazelStone]

Friend of the family took Social Security widow benefits at 60. Her husband had died in his early 40's, neither made much money. She kept up part time independent contractor work and the Social Security was basically a backstop. At seventy she still works a little bit; doesn't strictly have to because she re-married and her husband still works. Were the husband not in the picture, she would be living in "retirement" very similar to how she lived as a single parent- very careful with her money and living in a very modest house and an old paid for car. She is big into healthy lifestyles so her medical expenses were never much (knock on wood).

[ltt]

My FIL was forced to retire early due to disability. He has a pension. MIL works part time. They don't have any savings or other retirement accounts other than SS. FIL isn't old enough to collect his yet. They should be fine, but they'd be better off downsizing.

My mom says she wants to retire in 2-3 years, but she's in debt, has at least another 10 years on her mortgage, has no savings and very very little in her 401k. I don't know how this is going to work out. Ugh.

Sometimes things do manage to work out with very little savings and no debt and getting SS (like in my MIL's case), but in your mother's case, unless she will get SS to cover the mortgage and has really small expenses, I'm not sure it will work.

[desk_jockey]

My brother in law just retired and his monthly Social Security payment is $3500.  [...] My bro-in-law was very much a swami, a professor, so he worked until 70. 

That BIL is an great exception to the rule.  The maximum amount possible is $3501 / month for a 70 y.o.   Not many people wait until 70.  Very very few people have more or less capped out SS payments for 35 years leading up to it.   I think looking at the average and median payouts are a more useful metric.

[mm1970]

Do you know someone that retired without having saved money for retirement? 

Ok, for the purposes of this thread let's say 'no savings' would be someone who has less than approximately $50k in retirement vehicles (401k, IRA, etc.) at the time of retirement. 

What does their life look like now that they are retired?  What was their reasoning(s) for not saving?

My dad.

His house was paid for and he took social security.  Which wasn't much (a few hundred a month).

He was probably the definition of minimalist though (he gave me his copy of Walden before he died).

His reason for not saving was that we were poor.  He never had a credit card, and was almost never in debt.  Paid cash for cars, only borrowed for the house (which was paid off before I was born).  The only debt I remember us having was for my surgery when I was 12, and that was $6000.  They paid it off $100 a month, took a few years (also put tax returns to it).

Despite all that, when he died he'd saved about $10k in the 15-18 years on social security.

[jeromedawg]

My in-laws are very close to this. They run a restaurant and have very little savings if any. Just in the past couple years my wife, brother-in-law, and I started contributing to a small savings account for them. It probably isn't going to do much for them but it's something. We've also tried to get on their case about cutting debt down, paying stuff off, and just being more wise with money in general. They seem to have gotten better and paid of their credit card debt. They still owe payments on their home and car though, but it's manageable. They're both 70 and are still running themselves into the ground with the restaurant, and I can tell more and more they want to part with it. It's been their burden-child for their entire lives after moving to the US. My poor wife bore the brunt of it when the business went downhill after she was born (and especially when the Northridge earthquake hit and did major damage to their home, at the time, and the restaurant they were at). Anyway, long-story short, they just were never very wise with their money and probably wasted a bunch of it on extraneous purchases and also on greedy & selfish family members/relatives who they were just trying to help. It has reduced their "savings" to a pretty minimal amount. I wouldn't say they won't have *any* savings, but I don't think it's sustainable. Especially when they say things like "We'll live in low-income housing and will live off social security and medicare"

[damize]

My aunt retired on roughly $1400 per month social security and a little bit of savings (~$5000).  She bought a house and a car when she retired, so a lot of that goes to debt/mortgage.  Her savings recently dried up on home repairs and appliances, so had to borrow some money from my cousin for food and gas. 

Aside from that, she lives very frugally, albeit very lonely.  I try to visit/help when I'm in town.

[Imustacheyouaquestion]

That BIL is an great exception to the rule.  The maximum amount possible is $3501 / month for a 70 y.o.   Not many people wait until 70.  Very very few people have more or less capped out SS payments for 35 years leading up to it.   

And someone in a position to make $118k for 35 years could set themselves up much, much better than having $3500 in SS payouts by simply saving and investing more.

On the other hand, SS pays really good returns for someone in this position. I just used a retirement calculator and found you'd need to contribute $22k per year (or 18% of a $118k salary) for 35 years with a real return of 4% to reach $1.05M (for a 4% SWR equal to $3500/month). That makes SS at 6.2% for an individual contribution look like a real bargain for high earners with long careers like this BIL.

[Write Thyme]

My FIL was forced to retire early due to disability. He has a pension. MIL works part time. They don't have any savings or other retirement accounts other than SS. FIL isn't old enough to collect his yet. They should be fine, but they'd be better off downsizing.

My mom says she wants to retire in 2-3 years, but she's in debt, has at least another 10 years on her mortgage, has no savings and very very little in her 401k. I don't know how this is going to work out. Ugh.

Sometimes things do manage to work out with very little savings and no debt and getting SS (like in my MIL's case), but in your mother's case, unless she will get SS to cover the mortgage and has really small expenses, I'm not sure it will work.

Yeah I think the inlaws will be fine, but my mom will need to make some tough changes. She recently "sort of" asked for financial advice, and I also offered ways to reduce expenses and to go over her budget, but she hasn't got back to me about that yet. I think she won't end up changing until she hits rock bottom unfortunately.

[boognish]

Someone pointed out to me years ago the vast majority retire with little to no savings.

They live same way they lived for 40+ years while working: paycheck to paycheck.

Only now the paycheck comes from Social Security instead of their job.

Look at most people who retire at 65+ and have no pension.  That fixed income lifestyle is what it looks like.

I interact with Medicare beneficiaries regularly and can vouch for this. It's insanely common for retirees to live entirely on social security (and are thus crippled by an unexpected $50 copay)

[takeahike]

My dad. After working blue collar at same company since he was 20 and retired at 65.. he had 90K in 401K. He's receiving a small pension that doesn't nearly cover his living habits. He gets social security. He has always spent every dime and then some without much thinking. He could be a gazillionaire if he hadn't been divorced 3 times and refinanced his house probably 6 or 7 times to pay out ex-wives and to pay off credit card debt. At age 68 he just refinance his house AGAIN. He has paid for his house over and over again and uses it as his bail-out. I stopped offering advice. He has 3 vehicles and a 3 bedroom home.. is rebuilding his garage himself.. but that means he needs tools and supplies. Sigh. He's going to hit the wall one day and I'm not looking forward to it. (oh and he's already burned through that 90K because he kept making withdrawals on it and getting the tax penalties)

[hunniebun]

I am Canadian, if that makes a difference and my Grandmother (In-law) lives on nothing but Old Age Security and Canada Pension. She lives in a subsidized apartment that is basic but nice...has a livingroom/kitchen and a bedroom and bathroom. She has enough for food, clothing, medication (also covered by government aid because of her lack of income) and she even has money left over to give to he 17 grandkids for birthdays and Christmas and to play bingo at the local legion.  She won 100K on a scratch ticket and gave the money away to her 9 children and kept only 10K for herself...so clearly feels that she didn't not any more.  It is not quite the retirement I would want for myself, but I am glad that she (and other seniors without savings) are taken care of comfortably. 

[BlueHouse]

She was an exceptional woman and it felt like a privilege to visit her.  Because I am not nearly so exceptional as she was, I am saving my money.

This just made me cry a little.  Thanks 2ndTimer for reminding me that I need to visit my exceptional mother on a more frequent basis.  :)

[Cassie]

I have known a lot of people that have done this. The ones that live on SS only are usually the poorest. Also life expectancy can really screw with your savings.  My parents had a fair amount of $ saved in addition to SS & pension but when you live until 90 there often is no savings left.

[wenchsenior]

My mother. My mom essentially shut down for 5 or 6 years following my parents' divorce when she was 40. She had been a stay at home mom, has a very passive type of response to upsetting events, and just never recovered a life plan or much sense of self worth after the divorce. She also had no experience in investing and money management (my father was a small business owner who handled all of that). She lived off her half of the settlement, shrinking child support payments, occasional financial help from me, and after the first 5 years, low-paying work with no benefits or health insurance, sinking ever deeper.

Eventually she was approaching 65 with no savings, a minimal paycheck, and no place to live. The choice was bare bones welfare, or support from family (her own sisters wouldn't help, and her other two daughters (my sisters) are too broke to do anything). So it was up to me and my husband.  Fortunately, we are in a cheap-housing town. I paid off her last remaining credit card bills, and we moved her. We bought a small second house for her, and pay for all her bills. We gave her our old car, and bought another. I job hunted for her, but it was the great recession, so after a year of effort and several interviews for her, she applied for SS (1200/month minus medicaid B = less than 1000/month to live on). Six years on, and it's working ok, but yeah....We pay all her bills except gasoline, groceries, and incidentals. Recently, she received a small inheritance, which she agreed to let me manage three-quarters of, and that is going to be our bulkwark against any emergency expenses, medical bills, etc.

I'm glad my mom is taken care of and safe, but it has caused a lot of stress in my marriage, limited our options, and challenged the formerly close relationships within our family. I'm tired of always being the responsible one and sometimes I resent the hell out of everyone.  Also, my husband and I started our retirement saving late, and that 8-10k/year of support to my mom? I really wish we could invest it.

BUT AMAZINGLY? My mother was STILL in better shape than my husband's mother, who at 70 is ill, living on SSDI, and was for a period of time last year living homeless in a tent. We expect she will soon be homeless again. His family is mostly taking care of her, but we get semi-annual emergency requests for several thousand dollars from them, too. So we try to budget for that.

Watching  this financial train-wreck on both sides of the family has made me terrified and completely paranoid of being dirt poor in retirement. What amazes me is that other family members seem to regard me as being overly obsessed, even though they see the consequences of failure first hand. Cognitive dissonance can be amazing.

[Exflyboy]

WOW!!!!!....

[LiveLean]

My in-laws, though my FIL does a brisk business at 68 as a handyman working in my sister-in-law's new Atlanta neighborhood of clown homes remodeling 2-year-old bathrooms (can't live with builder's grade, apparently) and adding decks and screen porches everywhere.

[Exflyboy]

My MIL.. Mind you she had a nice little payout form the Government ($150k) cus her hubby was exposed to plutonium in the Rocky Flats fire (not widely reported). I did some numbers and told her that she had just enough to bolster her retirement along with SS if she was careful.

What did she do?.. spent all of it moving her trailer house to a piece of land she bought and going on several trips to Australia and the like.. I did plead with her not to do this.. but what can you do?

So now she just has SS and has left the house in her will to her Son a recovering meth addict while her Daughter gets nothing!

MIL is not in the best of health (mostly self inflicted) and I had to have the conversation with my Wife abut how much we would be prepared to help out when the time came. Of course I had to put this in context with the time she bought a car and tried to register it at our house to commit Sales tax fraud in Colorado.. kinda forgot to tell me she was going to do that!

I turned her into the DMV of course.

Anyway the net amount we are prepared to help with her care is precisely $zero!.. He care will have to come out of the remaining value of her house.

not my job to enable her poor behaviour.. my job is to ensure the comfort of my Wife.

[Zamboni]

Statistically speaking, most people take social security as soon as they are able - 62 because their bodies can't work full time anymore.

I am not sure that physical inability to work is the reason most people pull the trigger at 62.  Is there data to support this? 

Surely some people are too infirm to work, but I think many people just start withdrawing at 62 because a) they can and b) they don't really like their jobs very much.  It's like little kids who can't resist eating the single marshmellow even though they are told they can have two marshmellows instead if they just wait for five minutes.

Both of my parents and several aunts and uncles decided to start drawing SS at 62 even though they were all in sedentary jobs and clearly capable of continuing to work full time. My Dad continued to work to supplement his income (mostly because he likes his job) but several others quit as soon as possible. As far as I can tell, only one of them had any sort of pension or savings. They had a big discussion about this at a family reunion a few years ago which is the only reason I know about it.

All are now in their 70's, apparently tired of living on so little, and I suspect wishing that they had worked a few more years and deferred taking the benefit so that the monthly payout would be higher now. It's sad.  :-(

[Roland of Gilead]

On the other hand, SS pays really good returns for someone in this position. I just used a retirement calculator and found you'd need to contribute $22k per year (or 18% of a $118k salary) for 35 years with a real return of 4% to reach $1.05M (for a 4% SWR equal to $3500/month). That makes SS at 6.2% for an individual contribution look like a real bargain for high earners with long careers like this BIL.

Except remember that SS is actually double what you pay because your employer takes money they would have paid you and also pays 6.2% on your behalf.   Self employed understand that SS is actually over 12% per year.

If I saved 12% per year for 35 years (and then some, assuming I started saving at 25 and didn't draw until 70, 45 years later!)  I would expect a lot more than $3500 a month.

[mozar]

wenchsenior: can your mother apply for the divorce spouse benefit? Was she married at least ten years?

zomboni: you are right that physical body wear and tear is not the only reason, but it is the major reason. I'm debating whether or not I should tell my dad he can take SS at 62. It's risky but he has a job where occasionally has to work overnight and it messes with his health. I'm not sure if working till 65 is worth a few hundred dollars a month. And he'll get a pension at 65.

[frugaldrummer]

My mom was widowed young, lost a lot of housing equity in a subsequent divorce, and retired at 65 from a demanding job with I think just a little over $100k. My ex and I helped buy a house for her to live in near us (split the down payment and renovation costs, she paid the mortgage and we paid major repairs). She gets social security, now worth I think about $1700 a month.
After a few years of volunteer work at the local library and spending down a portion of her savings, they encouraged her to apply for a paying job.
Today at 83 she works 3 days a week, earns $21 an hour, and lives with me after we sold her house (I had to split my share of the profit with my ex). She loves her job, drives a two year old Honda, has over $100k in retirement savings again, and has been able to travel to Europe 5 times in the past 15 years (which she could never do before). She pays for our cleaning lady and most groceries, and her other expenses like meds and car expenses. I pay for the house and utilities, rest of groceries and occasional dinners out.

If she had owned a paid off home before retirement, she would not have needed any assistance at all.

[EricL]

Someone pointed out to me years ago the vast majority retire with little to no savings.

They live same way they lived for 40+ years while working: paycheck to paycheck.

Only now the paycheck comes from Social Security instead of their job.

Look at most people who retire at 65+ and have no pension.  That fixed income lifestyle is what it looks like.

It sounds a bit judgemental. After all, early retirement IS kind of new. And retirement at any age is pretty much only a 20th century thing. Back in the day you worked till you dropped or, if you lived to infirmity, occupied a rocking chair by the fire dispensing wisdom. But even then many people hoped to drop dead at work so they didn't become a burden on their children. (Like the protagonist in Tolstoy's Master and Man).  People really did hope for heavenly salvation as their fall back. Protestants often hoped for it on Judgement Day after a long relaxing dirt nap.

SS was only supposed to be around to guarantee 3 hots and a cot in the last few years of life so guys who did shit like build the Empire State Building wouldn't be begging change in their last years.  Even so it's telling SS was supposed to kick in at the edge of a person's life expectancy.  Investing was something the fat Wall Street dude with a ticker tape machine under a bubble did on the Monopoly game.  It was not something ordinary people could do or (after October 1929) wanted to do. Banks were OK and could even pay OK interest.  As long as they stayed afloat. If not they ran debtors off their homes and farms so they could pay panicking account holders. Often they failed all three. So was quite possible to put 10% of a pittance paycheck away for 40 years and get: a pittance.  Yeah we can talk some smack about idiots today but maybe we can cut earlier generations some slack.

[wenchsenior]

mozar: that $1200 is her spousal SS benefit. Her own benefit would have been smaller.

frugaldrummer: Your mother's situation is exactly what I had hoped best case for my own mother and would have put her in a much better position. But at the time of the divorce, she made a big series of very bad decisions (essentially by shutting down and making none) and no one around her really pushed the issue. Even buying a small condo and working a minimum wage job starting immediately would have helped a great deal. Future consequences didn't seem real to her, I guess, as they don't for many people. And her depression and insecurity made job hunting overwhelming. If she'd had a different type of personality, or maybe one support person who'd acted on her behalf (as I did later...I actually found her only long term decent paying job FOR her...because it had been my temp job after college and the boss didn't want a big hassle when I left, so he hired her in my place).

Alicia Munnell (?) at Boston College studies retirement demographics for a living and has really interesting documents about SS and the looming crisis as the Boomers retire. Ironically, as a generation, Boomers are the richest in human history, but of course, that varies wildly from person to person.  When surveyed, most people plant to retire at 65. But in reality, nearly all retire at 62. Munnell thinks it's a combo of 'getting what's mine' as soon as SS is available, impulse quitting 'because SS is available', unanticipated health issues (the worker's own, or that of a worker's family member that they have to care for), and just not understanding how long they might live and how desperately they might need the higher amount that delaying taking SS would provide.

Interestingly, when discussing how to make SS solvent again, Munnell notes that if policy makers raise the retirement age again, as they probably need to, the will ALSO have to raise the minimum retirement age, or the change will have almost no monetary effect on the health of the system. Most will STILL retire at 62. And she notes that raising the age also places more burden on those with poor health, hard physical jobs, and those with shorter expected life spans, which isn't exactly the original goal of SS.

[arebelspy]

Someone pointed out to me years ago the vast majority retire with little to no savings.

They live same way they lived for 40+ years while working: paycheck to paycheck.

Only now the paycheck comes from Social Security instead of their job.

Look at most people who retire at 65+ and have no pension.  That fixed income lifestyle is what it looks like.

It sounds a bit judgemental. After all, early retirement IS kind of new. And retirement at any age is pretty much only a 20th century thing. Back in the day you worked till you dropped or, if you lived to infirmity, occupied a rocking chair by the fire dispensing wisdom. But even then many people hoped to drop dead at work so they didn't become a burden on their children. (Like the protagonist in Tolstoy's Master and Man).  People really did hope for heavenly salvation as their fall back. Protestants often hoped for it on Judgement Day after a long relaxing dirt nap.

SS was only supposed to be around to guarantee 3 hots and a cot in the last few years of life so guys who did shit like build the Empire State Building wouldn't be begging change in their last years.  Even so it's telling SS was supposed to kick in at the edge of a person's life expectancy.  Investing was something the fat Wall Street dude with a ticker tape machine under a bubble did on the Monopoly game.  It was not something ordinary people could do or (after October 1929) wanted to do. Banks were OK and could even pay OK interest.  As long as they stayed afloat. If not they ran debtors off their homes and farms so they could pay panicking account holders. Often they failed all three. So was quite possible to put 10% of a pittance paycheck away for 40 years and get: a pittance.  Yeah we can talk some smack about idiots today but maybe we can cut earlier generations some slack.

There was no judgement.  Any you read was you reading into it your own preconceptions.  Reread what I wrote (simple facts)  with that in mind.  :)

[EricL]

Preconceptions? Never.  I never get judgemental either.

[Michread]

My in-laws have no savings.  They have pensions and SS which gives them about $36k/yr.  They live paycheck to paycheck.

[LAL]

My grandmother and grandparents before my grandfather passed.  They retired  at 50 because of health conditions and got disability.  The as and Medicare.  They lived on $1200/month and rented my mom's second house which was paid for by section 8. They got food stamps and drove cheap second hand cars.  Until I grew up I didn't know how unusual it was to live like that.

They had no savings and until now my grandmother rarely has more than $1k saved.  Nothing to pay for and now she lives with one of her daughters.  All medical covered by Medicare and Medicaid. My great grandmother was the exact same way and lived to be 100. She owned nothing and rented in elderly housing which rent was on a sliding scale and she lived off social security  at a rate of $600/month. No car and no  expenses. 

Guess I was born into mustachian.

[pdxbator]

My MIL. She retired at age 71 a few years ago. She has a very small amount in a pension fund and the rest is SS. I don't know exactly how much income she has per month but I know it isn't much. She lives in a condo that I bought and rent to her WAY below the standard around here so that she has a safe place to live. She also gets a regular stipend of money from my husband so that she can afford her diabetic medications. Makes me pretty sad to see that. She worked hard all her life raising two kids on her own working multiple jobs but not having much income because all were low paying. She has also made poor decisions about money, but is generally pretty frugal. I don't know what the hell is going to happen in the future if her health declines. Scares the sh*t out of me that we'll have a permanent new house guest.

[jeromedawg]

I don't know what the hell is going to happen in the future if her health declines. Scares the sh*t out of me that we'll have a permanent new house guest.

I worry about this exact same thing with my in-laws. They're in generally OK health now at 70 but my father-in-law has had a couple episodes with his heart and the doctors can't pinpoint it. My mother in law seems to have chronic pains in her back and arms (probably a combination of sitting at a desk all day at the restaurant and also not seeing a real doctor to get cleared after a whiplash-inducing accident). They are so stubborn about continuing to work, probably because they know they dug themselves into a hole they can't get out of with buying a home at peak prices (before the bubble burst) at the age they did. They have an affinity for buying "nice" and "new" only to make it go "old" really fast. They're like magnets for financial fires (that we have to help put out sometimes). When it comes down to health, they believe in Eastern/Chinese medicine, most of which  does nothing substantial IMHO (and then they try to tell us to drink or eat certain things based on what they've heard, especially now with my wife pregnant). And they go on to make comments about how nice it would be to live in the condo that we're currently in once we 'upgrade to a bigger single family home'....LOL that's the last thing on my mind, if at all - the good thing is that they're not really insistent about any of this and don't want to impose. But both my wife and I know that we are going to have to take care of them at some point in time. And what that will look like if one of them becomes [terminally] sick or handicapped, I fret over in the back of my mind. On top of that, my brother in law lives further away (7 hours driving, 1 hour flying) and is very high-maintenance [about himself] when it comes to him visiting. We have to chauffeur him around every time he flies in because he 'hates' driving. And everything is about him, really, when it comes time for him to visit. It's like taking care of kid or royalty whenever he visits... so aside from him contributing some money to my in-laws, I really don't envision him helping out much more in the case that something happens to either of them.

[wenchsenior]

For those of you with parents/in laws who have financial trouble looming: take my advice and get clear in advance on what you are willing or not willing to do. Rough out a plan and how it might affect your financial plans long term. Don't wait for a crisis to develop before thinking about different options.

We don't really help my husband's mother much, except in these several times per year emergencies, because that entire family is completely unreliable and impractical about money. There's legal issues, drug issues, plain old stubborn bad decision making issues. So we just don't get directly involved except to occasionally send cash, because it would be pointless.

With my mom, the deal was we would offer her a place to live and support her, as long as she was cooperative and transparent about her finances. And she agreed, so it's at least stable and workable.

However, we initially tried living with her, and that was not good. Hence the expense of the second home. We have had to bypass a couple of opportunities to move out of this town (which we dislike) because the housing expenses of maintaining two households is daunting in most places. If we get another  chance to move, we now we are considering the possibilities of a semi-detached 'wing' or small guest house on a larger property, so that my mother is close as she ages, but we all have our own living space. In that case, she'll have to contribute to the mortgage too.

Anyway, plan now. And if you are the only family member with financial resources, also expect that everyone else will just throw their hands up and expect you to take care of it.

[HairyUpperLip]

wow. interesting thread.

[jeromedawg]

For those of you with parents/in laws who have financial trouble looming: take my advice and get clear in advance on what you are willing or not willing to do. Rough out a plan and how it might affect your financial plans long term. Don't wait for a crisis to develop before thinking about different options.

We don't really help my husband's mother much, except in these several times per year emergencies, because that entire family is completely unreliable and impractical about money. There's legal issues, drug issues, plain old stubborn bad decision making issues. So we just don't get directly involved except to occasionally send cash, because it would be pointless.

With my mom, the deal was we would offer her a place to live and support her, as long as she was cooperative and transparent about her finances. And she agreed, so it's at least stable and workable.

However, we initially tried living with her, and that was not good. Hence the expense of the second home. We have had to bypass a couple of opportunities to move out of this town (which we dislike) because the housing expenses of maintaining two households is daunting in most places. If we get another  chance to move, we now we are considering the possibilities of a semi-detached 'wing' or small guest house on a larger property, so that my mother is close as she ages, but we all have our own living space. In that case, she'll have to contribute to the mortgage too.

Anyway, plan now. And if you are the only family member with financial resources, also expect that everyone else will just throw their hands up and expect you to take care of it.

This is very true - it's a good idea to push them to get their will and trust done, so that many of these types of scenarios are covered (especially what to do upon [certain types of] hospitalization and or death). Guest homes are great, except that in my area the only way to a house with a guest home is at least $1,000,000+ (I don't even think a million would be enough, actually. Probably bump that up to $2-3mil and you're good hahaha).

[soccerluvof4]

My Mother till she passed recently. They were poor but my dad had enough insurance that covered the house when he passed. She lived on a very small amount of SS but made cash buying and selling furniture for years. Never seemed to do without but she was very good at her buying and selling up until the day she died.

[tobitonic]

This is what most people do; with a paid off house, social security, and medicare,

Do you know someone that retired without having saved money for retirement? 

Ok, for the purposes of this thread let's say 'no savings' would be someone who has less than approximately $50k in retirement vehicles (401k, IRA, etc.) at the time of retirement. 

What does their life look like now that they are retired?  What was their reasoning(s) for not saving? 

This is the state of nearly everyone in the country. With social security and a paid off house (or even without it, in many cases), it's enough.

[Cassie]

I know a few people that live in low income senior housing that is quite nice and this is how they make it on SS alone.

[music lover]

I know several people who retired with no money...but they have a govt COLA pension that kicked in right away and most of them are doing just fine.

[little_brown_dog]

My grandparents retired at 50, and even though they had decent savings at the time, it was nowhere near enough to cover 35 years (6 of which my grandmother spent in expensive assisted living and nursing homes). By the end of it, my grandmother literally had no money and was relying completely on Medicaid and SS. Her adult kids ended up paying bills that weren’t covered by the govt. Grandfather died before the money ran out. Sigh.

[Cassie]

People with government pensions are probably going to do the best without savings because of that guaranteed income stream. Add SS into that for most of them and probably is enough.