Author Topic: Seeking Advice for Un-prepared Parents about to retire, Dividends?  (Read 1542 times)

joe189man

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Seeking Advice for Un-prepared Parents about to retire, Dividends?
« on: September 08, 2021, 01:29:01 PM »
My folks play to retire in about 12-18 months. They plan on living on SS for all needs once retired. they have some money in retirement and CDs but not much, less than $150k i think. Their house is paid for and have lots of "collectibles" they plan on selling in retirement.

I am trying to figure out how best to help guide them... they are not very financially savy, dad has is retirement funds in a 75% bonds fund and had no idea it was performing so poorly....

The best course of action, it would seem to me, would be to take the Cash from the CDs and focus it towards dividend stocks to help supplement SS.

The rest in tax advantages accounts, i would recommend putting in the usual index funds (SP500 or VTSAX).

What would you guys recommend for un prepared parents about to retire on SS?

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #1 on: September 08, 2021, 01:54:16 PM »
Did they ask for your advice?  If not, the Boundaries book by Townsend and Cloud might be helpful to you.

boarder42

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #2 on: September 08, 2021, 02:00:03 PM »
dividends are inefficient you should just have them sell shares and not target dividend producing stocks.

PDXTabs

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #3 on: September 08, 2021, 02:05:29 PM »
Do they need more than SS? With a paid off house they might not. A full case study might be helpful.

Malcat

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #4 on: September 08, 2021, 02:08:24 PM »
Can you direct them here to ask their own questions? Or hire an excellent financial advisor for them?

At this point it sounds like they need highly qualified advice directly.

Unless you are an expert and already have a dynamic with them where you advise them on major life decisions, then I would leave the actionable advice to someone else.

joe189man

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #5 on: September 08, 2021, 02:35:32 PM »
We have talked about having me help them, i am the executor of their estate.

i dont think they need more than what SS can provide, their expenses are low now with a paid off home. Their plan is to live like they are on SS for the next year while dad works to make sure it can be done.

it may be best to help/recommend they set up a meeting with a CFP to get some of these things figured out.

boarder42

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #6 on: September 08, 2021, 02:49:20 PM »
We have talked about having me help them, i am the executor of their estate.

i dont think they need more than what SS can provide, their expenses are low now with a paid off home. Their plan is to live like they are on SS for the next year while dad works to make sure it can be done.

it may be best to help/recommend they set up a meeting with a CFP to get some of these things figured out.

probably better than asking this forum what to do.  In your place i'd go ahead and manage it but I also wouldn't be posing a question the way you have here.  Either you have to dive in and do wha'ts best for them and learn it all or a qualified hourly rate professional fiduciary is probably the best step forward.

joe189man

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #7 on: September 08, 2021, 03:15:48 PM »
We have talked about having me help them, i am the executor of their estate.

i dont think they need more than what SS can provide, their expenses are low now with a paid off home. Their plan is to live like they are on SS for the next year while dad works to make sure it can be done.

it may be best to help/recommend they set up a meeting with a CFP to get some of these things figured out.

probably better than asking this forum what to do.  In your place i'd go ahead and manage it but I also wouldn't be posing a question the way you have here.  Either you have to dive in and do wha'ts best for them and learn it all or a qualified hourly rate professional fiduciary is probably the best step forward.

Ouch,
what question would you have asked?

think they need income  supplementation (dividends) and some rainy day money (long term growth via S&P500), but am not sure.

I asked the question because i dont know.

PDXTabs

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Malcat

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #9 on: September 08, 2021, 04:57:15 PM »
We have talked about having me help them, i am the executor of their estate.

i dont think they need more than what SS can provide, their expenses are low now with a paid off home. Their plan is to live like they are on SS for the next year while dad works to make sure it can be done.

it may be best to help/recommend they set up a meeting with a CFP to get some of these things figured out.

probably better than asking this forum what to do.  In your place i'd go ahead and manage it but I also wouldn't be posing a question the way you have here.  Either you have to dive in and do wha'ts best for them and learn it all or a qualified hourly rate professional fiduciary is probably the best step forward.

Ouch,
what question would you have asked?

think they need income  supplementation (dividends) and some rainy day money (long term growth via S&P500), but am not sure.

I asked the question because i dont know.

Don't take it as a criticism, it's likely he just means that the way you e posed the question makes it unclear what kind of help we should be offering you.

That's why I asked a bunch of clarifying questions.

rmorris50

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #10 on: September 08, 2021, 06:47:34 PM »
$150k isn’t much. If my parents were asking for my advice, I’d suggest living off social security and take a capital preservation strategy on the $150k, and only use it for “unexpected” expenses like health care, fixing a broken car, etc. I wouldn’t advise investing it at this point. So not sure what value a financial advisor would provide at this point.

My mom lives on social security only, and has maybe 25k at most in the bank. She gets by okay but it’s an extremely simple life and I just make sure she has the essentials. I cover her cable and phone bill and that helps her immensely, and will also buy groceries here and there for her. Otherwise I stay out of getting any deeper into her personal affairs. She also knows she can move in with me and I leave it at that. Up to her to ask me to take me up on it, but I expect she never will.


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marion10

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #11 on: September 08, 2021, 10:13:07 PM »
They are probably going to be very disappointed in what they get for their “ collectibles”.

Finances_With_Purpose

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #12 on: September 09, 2021, 01:33:36 AM »
While I agree with the others, it also sounds like you're already involved in those conversations.  FWIW, I have helped folks walk through this. 

1.  Realize that SS doesn't keep up with actual inflation, so their income is going to shrink every year and they are going to feel poorer--because they are.  That percent or more difference per year really adds up over time. 

2.  Manage their medical costs.  The best thing they can do is to stay healthy and avoid major medical issues.  That could eat up the $150k quickly.  Make sure to manage which meds/plans they need to avoid huge expenses when possible.

3.  Realize that their medical expenses will likely increase over time, compounding the problem listed in 1. above (inflation). 

4.  I would preserve the $150k but I might also invest it some in things that are a great hedge against inflation, so that the worse inflation is (i.e. the lower their future income), the better off their investments will be, at least.  They don't have enough saved to even come close to making up the difference, but it could help a little at least.   

5.  Debt can be fatal: they can't get more income at this point. 

All told, we can't be sure without knowing more, but it does NOT sound like they are ready to retire.  They don't even know their expenses, and it's likely that they're undercounting those, because that's most common.  (E.g.: how do they budget for another car?)  Retirement is not an age, it's a financial status, and doing it on SS alone is hard even if your expenses today were below the SS income, for the reasons noted above. 
« Last Edit: September 09, 2021, 01:35:17 AM by Finances_With_Purpose »

Car Jack

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #13 on: September 09, 2021, 06:10:18 AM »
First off....how old are they and are they both still working?  If either is under 70 at time of retirement, stop.  And wait.  The increase in payout by waiting until 70 will serve them well.

Next, they should actually start selling these collectibles NOW.  This can help in a number of ways.  First, if their collection is actually worth money, it helps them declutter and gives them cash to put away for retirement.  Be careful HOW they sell.  Ebay and paypal will send a 1099k if they reach enough (not a lot) in sales.  They'd need to match what they paid because they'll end up paying income taxes.  Craigslist, failbook marketplace, in person works better at avoiding the taxman.  On the other side, if they find that their precious collectibles are worthless, better to know before they quit their day job(s).

With close to nothing saved, they may want to change their plans and work a bit longer.  Dividend stock is a very 1920's way to create an income stream.  I don't like it myself because what it does is creates a tax liability stream.  Dividends come whether you want them or not and if they're going to have to pay income tax on it, this can do bad things for medicare costs and so fourth.  Maybe not with the small amount of money they could put into stock anyways.  I'm working on reducing dividend producing investments myself, buying only relatively diversified stocks that don't pay a dividend, such as everyone's favorite, BRK. 

Getting a single, hourly paid meeting with a financial advisor, or even better a CPA, to get a clear understanding of what retirement will look like in a year is probably not a bad idea.  You don't want to tell your parents that they can only take $6k a year from their life savings at 4%.  This person can give them an idea on health insurance costs (are they old enough to be on medicare?).  Although their income tax is likely to be low, there's still property tax.  Are they best served selling their house and renting a smaller place?  I get that parents want to stay in their ginormous, oversized house that was perfect when 4 kids were at home, but those kids are all gone and it costs money to stay with all that un-necessary space.


Malcat

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #14 on: September 09, 2021, 06:57:18 AM »
First off....how old are they and are they both still working?  If either is under 70 at time of retirement, stop.  And wait.  The increase in payout by waiting until 70 will serve them well.

Next, they should actually start selling these collectibles NOW.  This can help in a number of ways.  First, if their collection is actually worth money, it helps them declutter and gives them cash to put away for retirement.  Be careful HOW they sell.  Ebay and paypal will send a 1099k if they reach enough (not a lot) in sales.  They'd need to match what they paid because they'll end up paying income taxes.  Craigslist, failbook marketplace, in person works better at avoiding the taxman.  On the other side, if they find that their precious collectibles are worthless, better to know before they quit their day job(s).

With close to nothing saved, they may want to change their plans and work a bit longer.  Dividend stock is a very 1920's way to create an income stream.  I don't like it myself because what it does is creates a tax liability stream.  Dividends come whether you want them or not and if they're going to have to pay income tax on it, this can do bad things for medicare costs and so fourth.  Maybe not with the small amount of money they could put into stock anyways.  I'm working on reducing dividend producing investments myself, buying only relatively diversified stocks that don't pay a dividend, such as everyone's favorite, BRK. 

Getting a single, hourly paid meeting with a financial advisor, or even better a CPA, to get a clear understanding of what retirement will look like in a year is probably not a bad idea.  You don't want to tell your parents that they can only take $6k a year from their life savings at 4%.  This person can give them an idea on health insurance costs (are they old enough to be on medicare?).  Although their income tax is likely to be low, there's still property tax.  Are they best served selling their house and renting a smaller place?  I get that parents want to stay in their ginormous, oversized house that was perfect when 4 kids were at home, but those kids are all gone and it costs money to stay with all that un-necessary space.

Exactly this, if these people need any kind of "reality check", you don't want to have to be the one to give it, also, as their kid, they're likely to dismiss you if they don't want to believe you.

They need a realistic view of what their situation is, if they can afford to quit working, if they can afford to keep their house, etc. They also need to get realistic about their "collectibles" so that they don't end up experiencing a rude awakening like someone who tried to sell their 10K diamond ring in an emergency only to find out that they can't get more than $1000 for it.

I don't know your parents, so I don't know how amenable they are to reality, but they may possibly be up against some uncomfortable truths moving forward.

joe189man

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #15 on: September 09, 2021, 09:30:00 AM »
They are probably going to be very disappointed in what they get for their “ collectibles”.

I couldn't agree more and have told them as much

First off....how old are they and are they both still working?  If either is under 70 at time of retirement, stop.  And wait.  The increase in payout by waiting until 70 will serve them well.

Next, they should actually start selling these collectibles NOW.  This can help in a number of ways.  First, if their collection is actually worth money, it helps them declutter and gives them cash to put away for retirement.  Be careful HOW they sell.  Ebay and paypal will send a 1099k if they reach enough (not a lot) in sales.  They'd need to match what they paid because they'll end up paying income taxes.  Craigslist, failbook marketplace, in person works better at avoiding the taxman.  On the other side, if they find that their precious collectibles are worthless, better to know before they quit their day job(s).

With close to nothing saved, they may want to change their plans and work a bit longer.  Dividend stock is a very 1920's way to create an income stream.  I don't like it myself because what it does is creates a tax liability stream.  Dividends come whether you want them or not and if they're going to have to pay income tax on it, this can do bad things for medicare costs and so fourth.  Maybe not with the small amount of money they could put into stock anyways.  I'm working on reducing dividend producing investments myself, buying only relatively diversified stocks that don't pay a dividend, such as everyone's favorite, BRK. 

Getting a single, hourly paid meeting with a financial advisor, or even better a CPA, to get a clear understanding of what retirement will look like in a year is probably not a bad idea.  You don't want to tell your parents that they can only take $6k a year from their life savings at 4%.  This person can give them an idea on health insurance costs (are they old enough to be on medicare?).  Although their income tax is likely to be low, there's still property tax.  Are they best served selling their house and renting a smaller place?  I get that parents want to stay in their ginormous, oversized house that was perfect when 4 kids were at home, but those kids are all gone and it costs money to stay with all that un-necessary space.

They are mid sixties, Dad has some medical issues and likely cant work for more than a few more years at most, mom's retired but could work.

i have prodded them to start selling stuff, they do but often buy more, its been their hobby for decades. i hate it.

i told dad about a local CFP i found online and recommended a consultation to get their plan reviewed

they are considering moving to a lower tax state, their house is not set up to age in place and needs lots of basic maintenance. I have told them that i think a consultation with a realtor is a good idea to make sure any "projects" they do will maintain or ade value and are not wasted (they like to landscape) money.

Exactly this, if these people need any kind of "reality check", you don't want to have to be the one to give it, also, as their kid, they're likely to dismiss you if they don't want to believe you.

They need a realistic view of what their situation is, if they can afford to quit working, if they can afford to keep their house, etc. They also need to get realistic about their "collectibles" so that they don't end up experiencing a rude awakening like someone who tried to sell their 10K diamond ring in an emergency only to find out that they can't get more than $1000 for it.

I don't know your parents, so I don't know how amenable they are to reality, but they may possibly be up against some uncomfortable truths moving forward.

They seem to be living in an alternate reality half the time, i am trying to get them ready for the uncomfortable truths

Thanks for the advice, i will let you all know how the meeting with the CFP goes, if i can convince them to do it

Malcat

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #16 on: September 09, 2021, 10:18:09 AM »


Exactly this, if these people need any kind of "reality check", you don't want to have to be the one to give it, also, as their kid, they're likely to dismiss you if they don't want to believe you.

They need a realistic view of what their situation is, if they can afford to quit working, if they can afford to keep their house, etc. They also need to get realistic about their "collectibles" so that they don't end up experiencing a rude awakening like someone who tried to sell their 10K diamond ring in an emergency only to find out that they can't get more than $1000 for it.

I don't know your parents, so I don't know how amenable they are to reality, but they may possibly be up against some uncomfortable truths moving forward.

They seem to be living in an alternate reality half the time, i am trying to get them ready for the uncomfortable truths

Thanks for the advice, i will let you all know how the meeting with the CFP goes, if i can convince them to do it

Oof, okay, well I've been there.

In that case, I strongly STRONGLY recommend that you not take the role of the person who tries to explain reality to them. They will just end up holding it against you.

Do not help them except in very specific ways that they very specifically ask you for.

So for if example they say "hey kid, you know numbers, can you help us plan our retirement, we're kind of lost, but we have tons of expensive fine China/guns/beanie babies that I'm sure we can sell to cover whatever is missing"

Then I would follow up with:
"What kind of advice do you want exactly?
If you would like, I can refer you to an excellent fiduciary.
I can also help you find an antiqued expert to value your China/guns/beanie babies, but really, I know nothing about it."

And if they say
"No no, none of that, just take a look at our accounts and let us know what investments will meet our needs, you know this stuff, you do it for yourself, I'm sure you can do it for us"

What they really mean is "we don't want to know the reality and we're projecting our magical thinking onto you so if you fail to produce the magical cash stream we're hoping for, it's on you"

When dealing with reality denying, magical thinkers NEVER put yourself in a position to be the one who has to convince them of reality.

Keep a large distance between you and that role. Make it the responsibility of someone whose job that is.

Another Reader

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #17 on: September 09, 2021, 12:14:02 PM »
The single, most important thing to do today is to get on top of this is to figure out what their medical insurance will cost and how it will be paid.  If you and they do not understand Medicare, you need to get on top of that now. You need to understand what they qualify for and when. Do not allow them so be sold an Advantage or supplement plan until you do this.  If they are going to move out of state, you need to understand the plans in the new state.

Basic hospitalization is "free" (Part A) but Part B, which pays most of the doctor bills is not. It comes out of the Social Security check. The supplement that pays the remainder is optional and is purchased from an insurance company.  There is also Part D, which is the drug plan.  The Advantage plans are all in one, but have significant disadvantages.

Bottom line, if they think they are getting $2,500 a month in Social Security, they are probably getting significantly less because of Medicare. 

The cash needs to be held as cash until a detailed plan is in place.

One group I have found helpful is earlyretirement.org. Lots of stories about people helping out elderly family members and good informationabout Social Security and Medicare. Good to get started now!

vand

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #18 on: September 09, 2021, 12:25:50 PM »
You haven't said what sort of lifestyle and spending they have become accustomed to, however it seems the best advice you can give them is just to prepare them for a considerable drop in their expenditure.  You can't do anything about it now, they are on the cusp of retirement and are in the position they are in due to the last 30 years. 1-2 years of hard saving isn't going to do anything for them, and I would strongly caution against switching everything into riskier assets to try to make up for the shortfall. They simply cannot afford a market crash so close to retirement.


That said though, if they can claw their way to say $200k, use a 6% WR and plan on a 20-25yr drawdown period.. that nestegg could give them $12k annual income, which isn't inconsiderable. Sure, they risk running out of money if they live much longer than average life expectancy, but TBH that's a risk that might well be worth taking.
« Last Edit: September 09, 2021, 12:34:34 PM by vand »

Evgenia

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #19 on: September 09, 2021, 12:43:35 PM »
The single, most important thing to do today is to get on top of this is to figure out what their medical insurance will cost and how it will be paid.  If you and they do not understand Medicare, you need to get on top of that now. You need to understand what they qualify for and when. Do not allow them so be sold an Advantage or supplement plan until you do this.  If they are going to move out of state, you need to understand the plans in the new state.

Came here to say this, as someone FIRE who did three years of elder care. Unfortunately, all sorts of private/corporate interests are allowed to "administer" Medicare, which creates ample confusion, fraud, etc.

Otherwise, if Medicare is covered, a case study would be helpful. My father is in a similar situation: about $150k saved (could be worse for an oft-unemployed factory worker who also went through divorce); does not have a paid-off house but the mortgage is only $400/month and it's a nice house bought long ago; and he has minimal utilities and other expenses. He lives quite comfortably on SS alone but then, he's always been frugal and that's how I learned so many skills that got me to FIRE. I offer to cover certain things but he's well and truly fine, still eats out occasionally, has a new-ish car, and so on.

Car Jack

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #20 on: September 10, 2021, 07:38:13 AM »
I can't help but relate your parents to myself.  I'm mid 60's.  DW and I are both still working despite having well over 50 times spending in liquid accounts, paid house, kids done with college and 4 paid off cars.  If they know what they'll spend in retirement (health insurance and property tax will be high on the list), then take that, subtract social security (which drops to 80% in 2034) and multiply by 25.  This is a quick and dirty go-no-go test.  If they actually can pay insurance and property tax with just SS, then great.  I sorta doubt it.  If your mom can work, then why isn't she?  No kids to raise as an excuse.  And sell those collectibles. 

ChpBstrd

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #21 on: September 10, 2021, 09:59:45 AM »
A good step one is to figure out how much your parents spent LAST year. You may be surprised to find they are more frugal than expected, and the cash squeeze will be less brutal than expected. More likely, you'll be able to quantify the problem and say to them "it looks like you have an $xx,xxx shortfall in your annual budget if you continue spending like last year while retired." This is also a good way to get them thinking about an annual budget, which will be critical when they are on such a tight income. Mint or Personal Capital might work to pull in transactions for last year, and once set up can provide a quick overview. Don't shy away from talking about how failure to adhere to the budget results in running out of money in year 20xx. If they get it, the "collectible" problem will solve itself.

Then, it's time to see if you can knock off four figures of spending through frugality:

-optimize their health insurance configuration, as noted above
-go down to one car, if that
-shop for cheaper homeowners & car insurance
-review all subscriptions, payments, entertainment services, cable, premium internet, rented modems, cell phone plans, etc. and cancel or downgrade all you can
-look for ways to get their prescriptions more cheaply, such as through mail order or Walmart
-check their restaurant, fancy grocery, or alcohol / tobacco habits and offer to help if necessary
-identify and create replenishment budgets for things like roof, car, water heater, HVAC, etc. replacement, based on the age of each item.
-go through their house and car(s) looking for preventative maintenance items where failure causes double the damage. Is the timing belt due for a change? Is the water heater due to spring a leak any day now? Is the HVAC condensation line clogged? Are there leaks beneath the sinks, or wood rot visible from the crawl space under the house? Are there termites or rats, or are squirrels in the attic?
-they will need your help selling their collectibles on eBay ASAP. All that shit needs to go yesterday; it's an emergency!
-if they are donating to charity or church, it's time to stop before they become the charity case

Talk to them about what a fallback plan might look like:

-Could they live with a roommate?
-Reverse mortgage?
-Can they downsize and live a couple of years off the extracted home equity?
-Can they move in with you?
-Could they move in with you while earning rent from the house?
-Do they have life insurance (if not, it's too late now) or annuities


Keep their investments in conservative instruments. Now is not the time to do a WallStreetBets YOLO move to add risk. Also, most companies paying decent dividends on common stock are the ones that are shrinking and self-liquidating, like oil companies. Those dividends will be cut. If there is some small amount of breathing room in the budget, I might consider preferred stocks, although these can be volatile during corrections. I have a handful of 6% yielding preferreds on some shaky REITs, and that probably represents the limit on risk/return at this age.

lhamo

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #22 on: September 10, 2021, 10:27:08 AM »
Another thing to add to the list for discussion:

What is the financial plan for the surviving spouse?

They might do ok on SS when it is coming in for both parties, but the cut after one of them passes is likely to really throw a wrench in things for the surviving party.

If they are planning to move they should do some research into subsidized senior housing options in their target communities and get on waiting lists sooner rather than later, if they qualify.

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #23 on: September 10, 2021, 06:20:48 PM »


Exactly this, if these people need any kind of "reality check", you don't want to have to be the one to give it, also, as their kid, they're likely to dismiss you if they don't want to believe you.

...

In that case, I strongly STRONGLY recommend that you not take the role of the person who tries to explain reality to them. They will just end up holding it against you.

Do not help them except in very specific ways that they very specifically ask you for.

...

What they really mean is "we don't want to know the reality and we're projecting our magical thinking onto you so if you fail to produce the magical cash stream we're hoping for, it's on you"

When dealing with reality denying, magical thinkers NEVER put yourself in a position to be the one who has to convince them of reality.

Keep a large distance between you and that role. Make it the responsibility of someone whose job that is.

I'm just bolding this wisdom from @Malcat because you do NOT want to overlook this fact.  You may be prone to taking on others' problems, and they're your parents, but that can put you in a worse space than if you back off some.  Sometimes, there's just not much you can do to help the people you love avoid doing really dumb/foolish things: that's just life. 

talltexan

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #24 on: September 13, 2021, 11:20:34 AM »
Plot twist: the "collectibles" are NFTs, they appreciate between 5x-15x, and the couple realizes an extraordinary (and unexpected) increase in their standard of living.

joe189man

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #25 on: September 13, 2021, 12:14:49 PM »
Plot twist: the "collectibles" are NFTs, they appreciate between 5x-15x, and the couple realizes an extraordinary (and unexpected) increase in their standard of living.

hahahahaha

i wish, i bet they have never heard the phrase "non-fungible token"

we are talking antiques mostly

Malcat

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #26 on: September 14, 2021, 05:17:10 AM »
Plot twist: the "collectibles" are NFTs, they appreciate between 5x-15x, and the couple realizes an extraordinary (and unexpected) increase in their standard of living.

hahahahaha

i wish, i bet they have never heard the phrase "non-fungible token"

we are talking antiques mostly

Ugh, I was hoping they were at least baseball cards or vintage Legos or something that might actually have a market.

They're likely to be very rudely awakened by how little market there is for antiques.

NorCal

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Re: Seeking Advice for Un-prepared Parents about to retire, Dividends?
« Reply #27 on: September 14, 2021, 05:28:07 AM »
While it’s hard to give specific investment advice without a full case study, you did mention that they should be able to get by on SS alone. That is an excellent start.

One thing you should consider (which is contrary to a lot of opinions here) is to put some of that $150k into an annuity. It won’t help with inflation risk, but it will help with longevity risk. We did this for my FIL who was in a somewhat similar situation.  Annuities can be great for those who use their income as a benchmark for spending. It helps prevent bad spending from that big lump sum.

Just make sure enough is set aside for an emergency fund.