Investing Thread

[Coleman]

There will be a wealth transfer of a different kind when we boomers start kicking off at a bigly clip. Though this nugget was in the article:

A survey from Alliant Credit Union finds that half of millennials think they’re inheriting at least $350,000 from their parents, while half of boomers report say they’ll give away less than $250,000.

Like everything else they've done in their lives, on this issue Boomers will certainly leave younger generations disappointed.

[Skatastrophy]

Like everything else they've done in their lives, on this issue Boomers will certainly leave younger generations disappointed.

Funny and true.

Also, I think people severely underestimate late life expenses. It's a race to see how fast you can end up on Medicaid.

[reinko]

Funny and true.

Also, I think people severely underestimate late life expenses. It's a race to see how fast you can end up on Medicaid.

My brother in law’s mother is in a memory care facility, thank God she has awesome insurance to offset a big chunk of the expenses, but rate card is something like $18K a MONTH.

[Skatastrophy]

My brother in law’s mother is in a memory care facility, thank God she has awesome insurance to offset a big chunk of the expenses, but rate card is something like $18K a MONTH.

That's tough to stomach. So many families could not afford that. Additionally, I don't think enough families discuss their financials, the drawdown period of their life, and then costs associated with senior apartment living through end of life care. People really just *hope* they're going to have enough to retire.

Without going into the ~$5-$10k/mo for my grandma's continuing care facility, she had to pay a buy-in fee of something like $200k just to get the opportunity to pay them that $5-$10k/mo. It makes sense that senior living centers don't want to start housing someone that's going to run out of money quickly, but realistically 70%+ of the US can't afford that. It my grandma's place nice? Yeah kinda, but it's not super nice. The nice part is that they have senior apartment living all the way through memory care.

Maybe I don't need that gas station burrito for dinner.

[Goose]

The cost of taking care of the elderly is crazy and makes me sad. I saw how my Dad lost his will to live when he saw the cost associated with having quality of life care. His last several months were difficult and he was not himself, but he was 100% up to speed on what the care was costing on daily, weekly and monthly basis. He let that consume his thoughts and he lost the drive needed to get stronger.

I have to admit, I just turned 60 earlier this year and I think about getting older and the thought causes me some anxiety. No one wants to be a burden to family and crazy expenses adds additional stress. The older I get the two groups of people I want to help the most are the homeless and the elderly. Both groups are very high in my daily prayers.

[MU Fan in Connecticut]

My brother in law’s mother is in a memory care facility, thank God she has awesome insurance to offset a big chunk of the expenses, but rate card is something like $18K a MONTH.

My 93 year old Great Aunt is in assisted living facility and this is the monthly cost.

[forgetful]

That's tough to stomach. So many families could not afford that. Additionally, I don't think enough families discuss their financials, the drawdown period of their life, and then costs associated with senior apartment living through end of life care. People really just *hope* they're going to have enough to retire.

Without going into the ~$5-$10k/mo for my grandma's continuing care facility, she had to pay a buy-in fee of something like $200k just to get the opportunity to pay them that $5-$10k/mo. It makes sense that senior living centers don't want to start housing someone that's going to run out of money quickly, but realistically 70%+ of the US can't afford that. It my grandma's place nice? Yeah kinda, but it's not super nice. The nice part is that they have senior apartment living all the way through memory care.

Maybe I don't need that gas station burrito for dinner.

I'd go higher. I don't think 95% of the US can afford that.

[Skatastrophy]

I'd go higher. I don't think 95% of the US can afford that.

I started looking up stats on median retirement savings per age group and got stressed out for people.

[jesmu84]

Lots of money to be made in elder care. Lots of subpar care for the prices charged. Lots of corners being cut. Lots of shareholders being enriched.

[MU82]

Lots of money to be made in elder care. Lots of subpar care for the prices charged. Lots of corners being cut. Lots of shareholders being enriched.

Management shareholders who have been given shares, yes. It's not been a great many years for stocks for these companies, however, and lots of regular shareholders are underwater on them.

[Goose]

I agree the % of people who cannot afford proper elderly care is extremely high. $15k+ a month eats up a nest egg pretty quickly, especially with the unknown of how long that care is needed.

[jesmu84]

I agree the % of people who cannot afford proper elderly care is extremely high. $15k+ a month eats up a nest egg pretty quickly, especially with the unknown of how long that care is needed.

Well said goose.

They next 20 years are going to be potentially very ugly with the boomers aging out of the population for several reasons

[MU82]

One problem is that the long-term-care insurance industry sucks. Coverage is outrageously expensive and benefits aren't that great in lots of plans. You can pay in for decades and then only get coverage for 18 months, and even that coverage falls short.

Best is to self-insure, but as lots of folks here are correctly saying, many (probably the majority) can't really afford that, either.

[reinko]

If folks can afford it, please look into long term care insurance policies. My brother in laws mom has one (as mentioned above she is in memory care for $18K a month), her policy I think covers 70% for the first ten years, then gradually goes down after that.

Her husband who passed a few years back, noticed some cognitive decline a long time ago and added it, and literally made the difference in having a great place for her to have everything she needs.

[Goose]

jesmu84

I agree that things very possibly can be difficult for those of 60 and older. The last thing anyone wants to be is a burden to their children. When I was a kid that meant having an elderly parent live with their kids, the problem today is much potentially much bigger. I remember my parents always saying that they would never live with one of their kids, I never remember them worrying about the cost of getting older.

[Skatastrophy]

I have attempted, a couple of times, a frank discussion with my parents around their plans for later in life healthcare needs. They are uncomfortable discussing finances and it really is a discussion about finances at the root of it. It opened up a multi-year discussion around my father's comfort with his retirement number and how many more years he wants to work. Their home and when is the right time to downsize. What medicare and the supplements look like for them, and how medicare supplementals lock you in so it's basically a permanent decision. Getting my parent's invested assets moved away from a sheister that was charging him over 1% of his assets per year.

What I thought was going to be a conversation to protect my personal family's financial well being during my parents twilight years turned into a much larger conversation with significant learning (and bonding opportunities) on both sides. I recommend starting to have these convos with your parents (or children) if you haven't already. Just the insight into how my parents think about these things has helped me understand them and their priorities more.

[Goose]

Skatastrophy

I think it is a difficult discussion, but an important one to have within a family. For me, I am still at an age that I do not want to admit that I am getting close to having that discussion. Right now, the biggest discussion we are having is in regard to downsizing our home. My wife and I are torn on the topic and the grown kids are 100% against the idea. I have definitely let them sway my thinking quite a bit on the topic.

[jesmu84]

If you care about your friends/family, do NOT let them get a Medicare advantage plan

[The Hippie Satan of Hyperbole]

Skatastrophy

I think it is a difficult discussion, but an important one to have within a family. For me, I am still at an age that I do not want to admit that I am getting close to having that discussion. Right now, the biggest discussion we are having is in regard to downsizing our home. My wife and I are torn on the topic and the grown kids are 100% against the idea. I have definitely let them sway my thinking quite a bit on the topic.

Is your kids thinking based in sentimentality or do they have a better reason for wanting you to keep your home?

My wife and I are actually talking about this now, but that will be 100% a decision that the two of us will make because the kids aren't participating in the upkeep.

[Skatastrophy]

I have a worry about my parent's decision to downsize after seeing my grandma's decisioning of... delaying decisions. She kept the home until she couldn't physically upkeep it, and then kept it for three more years. It's emotionally hard to front-run our physical decline in our later years, but seeing my grandma having to suddenly move out of her family home that had fallen into disrepair was heartbreaking and traumatic for her. She couldn't help with moving/downsizing, either, and even her mental faculties made it take 10x longer when she had to decide what she kept and what she got rid of.

I don't know the right time to take action on downsizing. I've moved around so much my whole life it's pretty easy to just move and get rid of stuff, so I don't have much helpful input for my parents. Also, I live in a major urban area with great access to smaller properties and excellent healthcare, whereas my parents like living on their larger property up by Colgate where there's no real healthcare access and grocery stores are miles away. It's hard for them to imaging living somewhere densely populated. I don't know how they're going to deal with moving to senior apartment living, since that's basically dorms for the elderly.

IMO they should get a condo in an elevator building in a walkable neighborhood with plenty of rideshare access to live out the next couple of decades. I feel like they might live on their semi-rural property until something terrible happens, though.

[The Hippie Satan of Hyperbole]

I have a worry about my parent's decision to downsize after seeing my grandma's decisioning of... delaying decisions. She kept the home until she couldn't physically upkeep it, and then kept it for three more years. It's emotionally hard to front-run our physical decline in our later years, but seeing my grandma having to suddenly move out of her family home that had fallen into disrepair was heartbreaking and traumatic for her. She couldn't help with moving/downsizing, either, and even her mental faculties made it take 10x longer when she had to decide what she kept and what she got rid of.

I don't know the right time to take action on downsizing. I've moved around so much my whole life it's pretty easy to just move and get rid of stuff, so I don't have much helpful input for my parents. Also, I live in a major urban area with great access to smaller properties and excellent healthcare, whereas my parents like living on their larger property up by Colgate where there's no real healthcare access and grocery stores are miles away. It's hard for them to imaging living somewhere densely populated. I don't know how they're going to deal with moving to senior apartment living, since that's basically dorms for the elderly.

IMO they should get a condo in an elevator building in a walkable neighborhood with plenty of rideshare access to live out the next couple of decades. I feel like they might live on their semi-rural property until something terrible happens, though.

My parents were in the exact same situation as yours. They eventually moved into a senior living condo complex. My dad loved it from day one because he was a very social person. My mom took longer but now really does enjoy it, especially since my dad passed a couple of years ago. She's not the most social, but she needs something. Also she has the ability to move into nursing and memory care at the same facility down the road. It is expensive however.

[Goose]

Sultan and Skatastrophy

I am not sure on your age Sultan, but guessing close to mine and making the downsizing decision has become a more serious one for us. We are both healthy and want to own a home and that is my biggest struggle. We have a nice sized home, not crazy, but it is nearly 100 years old and upkeep is expensive and hard work. We definitely neglected some upkeep over the years due to raising four kids and paying private school education for K-4 through college. We are not playing catch up on the house and is causing some stress.

Our kids are a help around the house when needed and would do more if requested. Truthfully, my wife is 57 and I am 60 and hardly in need of any serious help. All four of the kids love the house and they are now seeing their kids enjoy our house and large yard. Economically, I do not see a major advantage for downsizing and that is my biggest issue.

It is funny that I have three older siblings, all in their 70's, and none of really downsized. One sister sold her lake house and replaced it with two condo's and other two are in the same house over 35 years. That said, I did agree to have a serious discussion on downsizing in the spring.

[The Hippie Satan of Hyperbole]

Goose, I'm only 55. I agree that the economics don't really favor the downsizing option right now.  But my wife is eyeing up a condo complex which looks like any other housing development so our house would be its own "unit." It's more expensive, but the idea of not having to worry about upgrading / fixing the interior, and having someone deal with the exterior, appeals to us.

I've talked myself into the monthly condo fee because it seems more economical than hiring someone to do all the yard work. But the price difference would mean working a couple of extra years.  Which I am not opposed to right now - but how will I feel about that in 7-8 years? No idea.

[Goose]

Sultan,

Sad but true, I think I will be working for another ten years or longer. Partly of it for cashflow and partly because I think I need to stay busy. It is strange but turning 60 really freaked me out. I dreaded it for a year and now trying to make this the best decade of my life. Honestly, time has flown by and I was not mentally prepared to feel comfortable getting older. Just another thing to stress me out, I guess.

Thankfully, I am extremely excited for the MU season and am hoping to enjoy every second of what might be a special season.

[Skatastrophy]

I'm in my early 40s. I've done well for myself, but if I have to suddenly float my parents retirement too it changes my math. My parents aren't great with money which is why I care so much about this. I want them to not be stressed about the whole thing. And I want me to not be angry with them about money in 2 decades because they fumbled their retirement without talking to anyone in the family about it.