Color of Money Live: Your Retirement Years (February 2)

Feb 02, 2017

Join Washington Post nationally syndicated personal finance columnist Michelle Singletary for an online discussion.

This week will be the first in a series on the first Thursday of every month discussing retirement planning and retirement-related issues such as senior fraud and long-term care. The questions and discussion from the chats will inspire a weekly newsletter about retirement that comes out every Monday, which you can subscribe to by going here.

Dr. Caroyln McClanahan, a physician turned financial planner, will be joining Michelle this week as a guest.

As always, send your money questions in early!

I'm talking about retirement today. I have a great guest so keep the questions coming.

Is there a formula to figure out how much money you will need for retirement? And provide for inflation? Not that this would be a firm figure, but just something that would provide a "ballpark figure" to work off of?

There are many "rules of thumb" but how much you need depends on multiple factors: when you plan to quit work, your health, and how much you spend on necessary versus discretionary spending. One rule of thumb is the 4% rule - you can pull out 4% a year plus inflation and not run out of money for 30 years. However, this may not hold in a low interest rate environment, so you must be careful. 

For example, if you need $40,000 a year after your social security, you should have $1 million set aside. Big numbers... but another reason people who are healthy should work as long as possible in a job they love.

I "retired" at 45 receive monthly payments from defined benefit pension from local government. I contributed to a 457 plan and have not touched those funds. I'm working again on a job with 401k and contributing the $18 max. Can you direct me to source to determine an estimate of future needs and if I'm on track.

There are a number of retirement calculators on the web - just google "retirement calculators". Another option is to find an hourly planner who can help you with more precise calculations.

I also like the retirement calculator at choosetosave.org

 

One of my credit cards had to be cancelled last year because of fraud (someone charged a security deposit on a Las Vegas apartment). The card issuer notified me of the suspicious charge with a text message. Now I have alerts set up on my credit cards; I get a text message every time a charge is made. I also set alerts on my checking and savings accounts; I get a text whenever there's a check cashed or a withdrawal.

I get so many alerts for my various accounts, my head hurts. But that is the time we live in. I will say the card companies have gotten pretty good at spotting fraud and stopping charges before they go through. I had to cancel a card recently because of fraudulent charges. The card company caught them both and alerted me.

how do I connect to this chat?

Hey there -- chat producer here. The chat is text-based; no audio or visual. If you're on this page, you're in the right place.

I'm a 40-year-old single mother of two. My debt to income ratio is 92%, and I haven't purchased a thing to eat yet. Without my parents monthly help, I don't know how we will make it. I am currently battling my ex-husband over child support. But until it is settled, the burden is solely on me. Most of my debt is credit card debt. Unfortunately, my car was used as collateral to secure one of the cards. I didn't read the fine print from my credit union. Is bankruptcy my best option over debt consolidation? Until the battle with my ex is over, my attorney fees continue to increase. Please help.

I'm so sorry about your situation. 

I would suggest you go to a non-profit consumer counseling agency. You can find one at debtadvice.org

Even if you decide to file for bankruptcy, you'll have to talk to a counselor to even file. 

But I'm not sure you need to take that route because it's a step that can cause even more issues. 

Right now. Make an appointment to sit down with a credit counselor, who can also help you with budgeting.

Of course I don't know where you live but can you move in with anyone to help reduce costs? Your parents maybe? 

Let me know what happens because I need you to contact the agency  -- today!

We are helping my mother-in-law, who has health problems that unfortunately include some cognition issues. They are manageable at this point in time. Since taking over her finances (and going after some nasty fraud that she fell for), we found out that she has short term care insurance, life insurance, but not long term care insurance. When we've spoken to her about this, it's ended badly. Basically, she says that if she has to stay in some sort of "old people home" for more than 100 days, she'd rather die. So it's a waste of money. Right now, she lives independently with some long-distance help from us. But I don't think this is likely to last given her issues. She can afford additional hired help to come to her home, if she's willing to accept it, but unless something big happens I think she is eventually looking at assisted living. I am afraid that will bankrupt her and make her a ward of the state, so we've been pushing for her to get long term care insurance. Do you think long term care insurance is worth it and why?

She would probably not qualify for LTC insurance at this point. Thankfully, she will also not become "a ward of the state". What will happen first is you will spend down her assets on her care, then she will qualify for Medicaid to cover her long term care needs. Make sure you speak to an elder care attorney to help you plan appropriately. Also, make sure she has updated advance directives that share her quality of life choices. Sometime we push people into things they don't want and it ends up making them miserable and can be very costly. 

My husband and I have a 14 year age difference, which has always provided some planning challenges as well as benefits (like the fact that my accounts will have that much longer to grow before we can use the money in my 60s). We currently live on less than $40k/year when you take out stuff like mortgage and daycare expenses - both of which we do not plan to have in retirement. SS, small federal pension, and 4% rule from 401k should provide $80-100k/yr from his accounts alone (the delta being for the 3 years between when he retires at 62 and takes SS at 65 unless we delay to 70). This seems like SO much money compared to what we are used to right now! But I am worried about health care expenses (and I'm in my 30s... can you tell I'm a worrier). We are both blessed with excellent health, which we maintain by eating organic and living an active lifestyle. But I don't have a crystal ball. Is there a new number we are supposed to shoot for to 'self-insure' rather than purchase LTC insurance? I thought if you had $3M at retirement you didn't need the LTCI. Also, I am planning to retire when he does, so in my late 40s, barring catastrophic change to this plan such as one of us or a child becoming sick, disabled, etc. Do I need LTCI or should I be saving to self-insure?

This answer depends on your health, your choice for where you want to grow old (in a home or retirement facility) and your support systems. 

Long term care insurance is in flux right now and given your young age, it might not be a good deal. Consider talking with an hourly fee only planner to see if you have enough to self insure given my comments in the first paragraph.

Would you consider the Federal Civil Service Retirement System (CSRS) safe, or do you see a situation where that may fail in the future?

Read Michelle's latest newsletter on the topic: Pension plans in peril

I wish I can tell you that it's 100% safe. Who knows given what's happening to pensions -- people living longer, returns not what plan administrators calculated, etc.

But at this point given that it's the federal gov't pension plan, I wouldn't worry. 

I have read most of the articles about pensions reducing benefits. I generally support the reduction, because it will increase the chance that these funds last for the people who are expecting a benefit from them, and for the people currently working to provide the benefit. Reducing benefits because of poor planning and other decisions that the baby boomers made is going to become normal in very short order (think Social Security, too). I think that the boomers, responsible for the decisions that led to this situation, should bear the cost, but that doesn't seem to be the sentiment of most. What do you think?

Retirement was "invented" in the 1930's with the advent of social security. They picked age 65 back then and the average age people lived to if they lived to be 65 was 72, so people only spent about seven years in retirement. Now, people easily live 30 years past 65. We need to change how we spend our last years - people who stay financially engaged in some form of work are healthier, happier, and more financially secure. This will protect them against policies such as reductions in benefits. 

I think President Trump is going to be ruinous to the US economy, but I'm not trying to make this political. My question is how do I invest my 401K in view of the gloomy future that I envision. I don't believe the current stock run up will be sustained. Obviously I have no more prognostication powers than the next person, so I can't just give up on the US stock market either. Are Govt Bonds a good idea if we end up in a constitutional crisis? Go into cash? Go international? Would retirement date funds be any more immune than other investments? I see bad things coming, but don't know enough to protect my investments. The answer is certainly a combination of the above; where should the balance be?

It is very important to be diversified because you cannot predict the future. If you are risk adverse you would want more assets in bonds, but still need to have some assets dedicated to stocks, including international funds. There are multiple bond classes, and you should diversify into all of these including corporate and international bonds. 

Consulting a fee only hourly planner can help you determine how much risk you should take given your situation.

Hey, I get your fear. I've been checking my 401 (k) A LOT these days. 

But that's not good. It makes me worry more. Even though it's up, a Trump tweet swings it down. Policy talks from Trump about cutting taxes swings it back up.

I'm getting whiplash.

But I have a plan. And that's all I can do. Stay out of debt. Pay off mortgage before retirement.  Live below your means. Save. Save. And save some more.

Beyond that folks, not much we can do to hedge anything because we just don't know. 

I'm not in a full-on panic. We've gone though tough times and survived. 

Hi. I am a divorced female and have worked all my life and saved good amount of money for retirement. Most of it is in stocks and most of it I manage myself. I would like to retire in 4 years (age 60). I am unsure of how to begin the process of transitioning from stock appreciation to income generation, whether it is better to sell appreciated stocks as $ is needed or change my portfolio to generate a steady income stream, and whom to go to to help me do this. i was able to manage my stock portfolio pretty well. The next step is beyond my skill set. Thank you. Amanda in Virginia

It sounds like you are a good do-it-yourselfer. One of the biggest mistakes people make at your age is to be too aggressive with their portfolio. At this point, it might be wise to hire an hourly planner to help you figure out how much risk you should take and help you transition your portfolio to what you need. You can then manage it from there. 

One thing to consider - you may want to hire a financial planner at some point to help you manage your portfolio tax efficiently too. People focus on returns but often do a horrible job with staying tax efficient which often scalps a load off that great return.

Many times, when reading estate planning advice, they will reference the person's/estate's lawyer. I don't have a lawyer. Should I? What would be the pros? What would they do for me? I'm in my early 50s, divorced no kids, net worth of around $250,000. How does one determine if and when to bring in a lawyer? My goal this year is to get all my affairs in order so my siblings/nephews won't have a difficult time of it if something happens.

It is important for you to have a will, which dictates what happens to your assets when you die; a power of attorney document, which dictates who takes care of your finances if you are alive but incapacitated; and a living will, which lets people know the type of care you want if you are terminally ill. An attorney draws up these documents for you. After that, you shouldn't need an attorney regularly other than to update your documents, which needs to happen whenever you have a major change or at least every 10 years.

You say Save Save Save. But what do you do with those savings? That's the questioner's point, I think. Bonds? Stocks? Banks?

Some goes into emergency fund & life happens fund.

Figure out what you need to save for retirement. Go to choosetosave.org

If you've got kids some goes into college fund. I like 529 plan. Choose age-based plan if they are younger. The money is invested typically more aggressively the younger they are (mostly equities) and then more conservative (bonds) as they get closer to going to college.

The asset mix for retirement depends on your risk tolerance, years away from retirement etc. If you have current investments every financial company as a tool that you can use to figure out the mix based on your age for example. 

So the answer is you have do some work to find out how to save and invest your money. You may need to hire a fee-only planner. Talk to the administrator of your workplace retirement plan. For free or a small cost you can get someone to help you figure out the right mix for you.

I looked into getting Long Term Care insurance, but my husband (age 65) is not eligible due to health problems. What should we do?

The answer to this is quite long, but in a nutshell, it is important to create a "long term care plan" - think about where you plan to age, who will be around to help you, and create your advance directives. This will allow you to put a cost to your needs and help you save for the care that is needed. It would be good to hire an hourly fee only financial planner to help you with this. 

I'm 32 years old. I have an employer that offers a pension (one that is currently well-funded; I pore over the annual disclosures when I get them to make sure it remains on solid ground as well as my annual statement saying what my vested lump-sum value is). But I have been saving in my Roth IRA for 10 years. I also started saving in the 401(k) late last year to diversify my current and future tax liability. No debt here - I rent and don't plan to buy a while, don't own a car, and pay off my credit cards every month. Enough liquid savings to cover the unexpected. Are there other money moves I should consider making if/when I find there are some months when I have extra income? Thanks!

You are doing great! Conservative options - Make sure you have an emergency fund of three months, consider saving for a down payment of your home for when you do buy one. Less conservative - open a taxable "non-qualified" account at a low cost brokerage firm and start investing there. 

I HAVE CONTRIBUTED FOR YEAR TO MY COMPANY 401k AND A NON QUALIFIED (RABBI TRUST). I AM ON THE FINAL STEP TO RETIREMENT, AND FACING MAJOR TAX HIT WITH MANDATED FULL PAYOUT OF THE NON QUALIFIED PLAN. IS THERE A WAY TO AVOID OR ROLLOVER TO DELAY OR SLOW DOWN THE TAXATION.

This is a situation where you really want to consider talking to your accountant or a fee only hourly planner. Depending on your situation, there may be things you can do to mitigate your taxes.

Hi Michelle, I enjoyed reading the frugal stories from last week's chat. I thought it would be really funny to hear more of people's frugal stories and maybe sharing these stories could help people relax. One of my craziest frugal stories is my husband always wants sausage and onion on his pizza. It drives me crazy how much the pizza shop charges for onion on half a pizza. We have had some stupid fights over the cost of onion...I have gone as far to have an onion in the house and chop it up for his pizza. I know it sounds crazy...but it's true.

Thanks for coming back and putting out the request.

Okay people let's hear it.

Tell us your frugal -- oh heck, cheap stories. 

Here's mine from one of my penny pinching columns:

I once ran out of gasoline trying to reach a station where the fuel was two cents a gallon less than at the 10 or so I had passed on the way home (with the needle way past "E"). My husband later asked, "Honey, why didn't you stop and get just enough gas at one of the more expensive stations to get you to the cheaper station?"

When he asked the question, I slapped myself on the forehead. Duh!

 

I didn't stop because I was too focused on saving that two cents a gallon. I was, without a doubt, being penny-wise, pound-foolish.

I have a pension with Hewlett-Packard but have the option of taking a lump sum. From a financial security point of view would it make sense to reinvest it in an annuity with a company like New York Life?

Probably not. An annuity within an IRA adds a lot in fees that are not worth it. You should speak with a fee only fiduciary who isn't selling a product to help you make this decision.

My husband just turned 60, and I will be 55 in 2 weeks; is it too early to consider buying LTC insurance, and if so, when is the best time to buy it? Also, how do we find a seller that won't go out of business before we actually need the insurance?

You are in the sweet spot for when to buy coverage. Go to an independent agent to help you figure out the options.

What is the current thinking on long term care insurance? There seems to be so much conflicting information about their value. While it is obvious that many baby boomers are going to live longer, the insurance companies seem to have no compunctions about raising their rates once they have you locked into a policy.

It is a tough situation right now. With low interest rates and high claims on current policies, new policies are very expensive. This may change if interest rates go up, however, waiting always increases the risk you may become uninsurable. Talk with a fee only hourly planner to help you sort this out.

We have a more complicated tax situation due to buying and selling three homes this year and we are looking for professional help. I haven't been able to get any recs for tax accountants from friends and family. Do you have a suggestion for how to find someone credible and trustworthy? Feeling overwhelmed at this prospect. Thanks!

Independent small firms tend to offer great service at a reasonable cost. Start with interviewing a couple, sharing your situation, and asking for a quote to help you.

I saw your prompt hoping for young adults to join and figured I would as I've been enjoying reading your column for some time. My husband and I are both 30, fully employed, and saving towards retirement through our work-sponsored programs (401K for me and gov. thrift savings for him) as well as a Roth Ira account as we are anticipating no social security by the time we retire. It seems that many articles are geared either towards stats on how millennials aren't saving enough or those that are a few years away from retire. Any suggestions for us that fall in between those ranges aside from paying close attention to fees charged?

Great job! The key is to balance enjoying life now and do a good job saving for the unexpected and future financial independence. Your safest asset is your human capital - your ability to work - so first and foremost, make sure you are in jobs you love. Even though you are on a great track, we cannot predict the next 60 years for you, and people who stay financially engaged in an occupation they enjoy are healthier, happier, and more financially secure.

As a former emergency doctor, I saw bad things happen to people way too young, so that is why it is important to strike a balance.  

If you are already in jobs you love, and are doing things to create a great life now, doing a great job saving, and have money left over, sock it away in a taxable account for an earlier "security blanket" for when the world changes.

 

Hi Doctor, I am 61 and see the light at the end of the tunnel ... my question is this: There are so many rules of thumb for retirement, from retiring with 10 times your annual salary on hand (no way) to withdrawing a certain percentage every month during retirement and many more. In your experience, which of the rules of thumb are actually myths, and which are actually good to follow?

They all have their holes. Planning is an ongoing endeavor and spending is never static - sometimes the air conditioner blows up! The 10 times annual salary is the worst one and the 4% rule is better, but far from perfect. The answer depends on how much of your spending is discretionary versus required and your health.

B/c I need to plan my investments. Thank you.

I have learned that predictions are worthless. Given that, the stock market is currently very richly valued however, it has been higher in the past. We recommend that people understand how much risk they can take financially and psychologically and adjust their portfolio accordingly.

It is important to stay diversified, so even if your portfolio is conservatively bent, you should always have assets allocated to domestic and international stocks. Likewise, money allocated to bonds should be diversified in domestic and international bonds.

I recommend consulting an hourly fee only planner to help you determine the right allocation for you, then you can take it from there. 

We were all ready to buy a new car for cash, because we saved long and hard, and drove those beaters into the ground. (One of which is still in use!) But when we got offered 0% financing, we realized that we had an opportunity. We took the deal, and took the money that we had saved (plus a little bit more from our checking account, nothing we couldn't spare) and paid off our mortgage 4 years early! Even this close to payoff, we were paying hundreds of dollars a year in interest, which now go back in our pocket. And the new car loan is less than half of our old mortgage payment. We also set up a savings account to function as our escrow account, and those two together are still about 2/3 of our mortgage payment....so the next 1/3 is going into the now-depleted New Car Fund! We might be able to replace the second beater with something nice in 3 years or so at this rate! Thanks, Michelle, for promoting the ideas of separate savings accounts and paying yourself first by rolling over any savings or raises!

So proud of you. 

Mortgage-free baby!!!!!!!!!

I can't wait for the day.

I have a 401 (k) Account that is heavy in Equities. It has performed well in the past. Can you tell your thoughts in reference to Future Gains based on the new president and His policies?

We cannot predict the future. There have been 20 year time periods where stocks have made nothing. Because of this, it is important to be appropriately diversified. 

Based on the Schiller 10 year p/e (you can google that) - stocks are very richly valued which means their chance of going higher is much less. However, they have been higher before. Wouldn't it be great if people really could know when they will take a downfall? :)

How do I determine if my long term care insurance policy provides adequate coverage?

It is important to put a price to your potential long term care needs? Do you plan to age at home or in a facility? Are you healthy (which has potentially higher LTC costs) versus unhealthy (which usually means lower costs) - yes, I know that is counter-intuitive, but healthy = higher risk of dementia. Then you need to look at the costs in the area where you plan to age. Genworth has a great website that will provide that information.

when is the right time to buy LTC insurance, I am 55, my husband is 60

That is a good age to start looking at LTC insurance

How do I find one? I have gone to my bank and Google and have been disapointed. Is there a magic answer?

Look at Garrett Planning Network - hourly planners or napfa.org - fee only fiduciaries. 

I'm 51 and only have $130K saved in a self directed IRA. I don't have a SEP now because I'm not receiving 1099 income this year, but I will open a new one when I do. I contribute the max to my IRA every year, but that's not enough to save the amount I will need in about 16 years. What other retirement vehicles can I use to save more (Roth, other)?

It depends on your income level, but you may be able to save more into a solo-401k than you can in a SEP. If you have lots of money ($300k plus range) a solo defined benefit plan is an option. However, it is also good to save money in a taxable investment account, as this will provide more tax flexibility when you are living on your savings.

always gets questions about "connecting" to her chat every week? Are there a lot folks coming in from outside the Washington Post website who expect this to be a video chat?

Chat producer here, again -- Yes and no? Or, more accurately, hard to say? It actually makes a lot of sense to me. So many "chats" online today have video (Facebook Live, etc.). I'll leave a note at the top of every chat in the future to clear up confusion. 

I'm 50. Not much in reitriement - about $5k. Just got a good job. Plan to pay off cc debt and keep it at zero and then max out this year with $6500 and $24000 in retirement. Should I be looking at something else?

If your employer has a 401k match, I would start putting money in the 401k to at least get the match while you are paying off your credit cards. Most employers match 50% to 100%, and you can't beat that return. :)

When I need new lenses and want new frames, I go to Goodwill and buy decent donated frames for about $3 bucks and ask the lens place to use them. Thriftstores in general are great if you're lucky enough to live where there are good ones.

Love it.

I know I have more penny pinchers out there.

Come on. Dish.

I am confused by your advice to pay off a mortgage. What if your interest rate is really low and you think you can make more in an index fund?

Because your return in an index fund is not guaranteed.

If you pay off your mortgage early for sure you will save on interest.

Plus, people don't do what you may be able to do. They don't take the extra money they would pay on the mortgage invest. 

They spend it.

Plus, you have to earn a lot in that index fund to beat the fees you still have to pay + the interest you are still paying on the mortgage.

Plus, the biggest expense you have is housing. Get rid of that before you retire and you don't have do drawn down as much on your savings.

Plus, I hate debt. All of it. I want to encourage people to hate it and get out of it as soon as they can.

Plus, no debt gives you more options.

Plus...Shoot. I just hate debt. 

I am in reasonable shape to retire in 1-3 years (latter age would have me between age 64-65), and am wanting so badly to do it sooner rather than later. I have around 10x annual gross salary in 401 K and will probably get up to 12 x (I live on 51% of income, not counting income taxes). Would it make a significant difference one way or another if I persuaded myself to eke out that final year, but drastically reduce my 401 K contribution and try to, well, buy things I have put off? I'm thinking that it's another year that I wouldn't be using my 401K, but I wouldn't be saving much into it either.

This really needs to be answered by an hourly financial planner. If your investments are aggressively invested, you could be taking a lot of risk and could lose a lot of money which would blow your plan away. Also, part of the answer depends on how much of your spending is discretionary - if it isn't much, and the markets don't deliver for you, that may put you at risk. 

We recommend that clients consider phasing in retirement - work part time or take another "fun job" - this depends on health and how much you need to spend.

So many of these calculators talk about how much you need after Social Security. I'm in my 40s; Social Security will be in pretty dire straits before I'm old enough to collect it. I think it is likely that either benefits will have been reduced across the board or that it will be needs-based. Shouldn't we, if we are born after about 1970 or so, assume $0 Social Security to figure into retirement planning? Just to be safe? How does that change your response the question about how much one needs for retirement?

It is always safer to not assume social security, however, don't suffer too much now saving for an uncertain future. Save as much as you can comfortably and if you don't love your job, try to find one you do love so you can work longer in a happy state.

I differ a bit. I don't believe Social Security will be taken away completely. The politicians would be be run out of town.

But, as you point out, there may be changes. The time to full retirement may be pushed back. Heck I see a time when you can't college full retirement until you're 70. 

So count it but don't count completely on it.

As a federal retiree with a pension, I find recent stories regarding insolvent pension funds and resulting reductions in retiree pensions scary. Do you think pensions of current federal retirees could be in jeopardy?

I never try to predict the future. Too many people think of the government as a household and impart austerity when it is least needed. If our country (including politicians) understood modern monetary theory and basic macroeconomics, they would quit using worry minutes over balancing the budget and would focus more on cutting waste and inefficiency. 

Given that, it is important that you understand how much of your spending is discretionary versus needed so if they ever do cut benefits, you can make the appropriate changes in spending. And I would also call your lawmaker incessantly to let them know that cutting current benefits is a bad move.

As a sponsor of investor education and protection programs nationwide, I frequently ask individuals "are your health costs part of your retirement plan?" Healthcare, housing and how you plan to live your life are all important things to consider as you prepare your future self for retirement. As both a physician and financial planner, I would love to hear Dr. McClanahan's advice! Don B.

I have written about this extensively, and in fact was interviewed about this in an article that showed up on marketwatch.com today. Yes, health care costs are important, and the only real way to plan for them is to focus on what you can control - take care of your health and become an empowered patient. 

I couldn't agree more.

I'm doing some things now to get healthier. In my 20,30, and even 40s I could eat anything and not really gain weight.

Then POW! A peanut = 5 pounds.

I'm in new territory and I'm struggling. But I know I have to do this because I want to not just live but live without a lot of ailments I can prevent. 

My doctor started equating my weight loss to saving money and boy did that help me buy in.

So cutting my beloved Utz  :(

 

Most retirement calculators, even those "ballpark ones", require an understanding of financial considerations many of us don't have. I don't know what to put in for inflation, investment percent increases, etc. Is there something simpler? For example, you make $100,000 a year now, take out taxes you won't be paying against your paycheck, assume mortgage paid off, you'd need x percent of current net. Anything like that?

I wish it could be that easy. There are many considerations to having "enough" - longevity and discretionary spending needs are important factors. It might be useful to visit a fee only hourly planner to help you determine "your number" needed for financial independence.

My husband and I have had a LTC policy in place for about 5 years.. The costs has almost doubled in that time. We're debating whether or not to cancel it and take our chances - we are 58 and 60. I keep hearing that LTC is just not worth the money. Confused

Consider keeping it but reducing the benefit to premiums you can afford. Many facilities will take you if you have a policy even though you may eventually end up on Medicaid. Many won't talk to you if you have no way to pay for coverage.

Good Morning Michelle, My husband and I are in our early 60's and retired. We currently carry COBRA insurance through my last employer, which will end in the Fall of this year. Our retirement plan had been to jump into the California health exchanges once COBRA was exhausted. We wouldn't qualify for any reduced rates, but at least we'd be able to get some insurance to tide us over till we're Medicare eligible. With the Republican Congress push to shut down the ACA, I'm worried this will no longer be an option. And if the ACA is repealed, then we will probably be unable to get insurance at all, since most of us don't reach our 60's without some kind of "pre-existing condition". I'm wondering if I should try to go back to work (and what kind of job could a person in their 60's that's been retired get) just for the insurance? Any idea what financial advisors are telling people in our situation? Thanks for all your help!

The good news for you is that you are in California. Most of the decisions about insurability will be pushed to the states and California has been one of the best in protecting citizens of the state. Most likely, your policies will continue to be guaranteed issue. People in Florida and Texas will most likely suffer.

I so feel you. My pension plan was changed and retiree health care eliminated. Fortunately, my family could jump on my husband's plan, which has health insurance for retirees.

So I feel you. And so many others.

It's a mad, mad world out there. I'm praying -- and I mean that -- Congress and the President come up with a plan that will not leave people without viable options for healthcare.

This is not the first time I have seen reference to retirement and taking Social Security at 65. Do these people not understand that getting Medicare is not dependent on receiving Social Security or is there something else going on?

Yes, people generally don't understand how social security and Medicare are separate. 

I usually cut my "empty" lotion bottles in two to get the last squeezes of lotion out. Usually get another couple days worth...

I keep a pair of scissors in my bathroom for the same reasons!

Remind people to refresh/reload their pages to get the new Q/A. People who are new to chat may not know to do that.

This is a great point. Thanks for sending.

I am 59 and collect all the age-related discount cards for the restaurants my husband and I frequent. It's amazing how many restaurants give big discounts. I have one card for 35% off. I also use my AARP card when I don't have a discount card. In addition, I use all those discount cards that come in the mail (again only the restaurants we frequent). It drives my husband nuts when I am scrambling for my card when they bring the check, but then he is really happy when we pay substantial less for meals. The least amount we paid for a meal was $11 which included mixed drinks. Big win for me!

Love it. I drive my husband nuts too. And boy does my wallet look crazy with all my cards and coupons.

I make low 6 figures. I pretty much buy all my clothes at the thrift store. I honestly find it nearly impossible to spend more than $15 on an item of clothing after this. Plus I like that it helps me make up my mind. I needed a new lined rain coat. third week of checking and I found a lovely one - right size, right length, right everything. And it was a very nice dark greyish green. So I don't have to pick whether to get the beige one or the black one or the red one. I got the green one. For $15.

Love it. 

Wow. 

Just wow. 

Clearly you guys have a lot of retirement concerns. So many leftover questions. 

But not to worry.

Starting Monday I'll be doing a weekly Q&A newsletter with retirement questions answered in this forum. Also, once a month, I'll devote this chat just to retirement.

From that chat, I'll have a retirement expert answer questions we couldn't get to in the time allotted. So Carolyn is answering more now that will appear in the Monday newsletter coming up next week.

If you haven't subscribed to my Thurs. newsletter, please do. And if you haven't signed up for the Monday newsletter, please do. The link is on the chat page. And here it is again

 http://wapo.st/personalfinance

Thanks for joining me today. 

In This Chat
Michelle Singletary
Michelle Singletary writes the nationally syndicated personal finance column, "The Color of Money," which appears in The Post on Thursday and Sunday and is carried in more than 120 newspapers.

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Carolyn McClanahan
Carolyn McClanahan, M.D. CFP® is a physician turned fee-only financial planner. In addition to her financial planning practice, she speaks and writes on the intersections of health and personal finance, including aging, health care costs and long-term care issues.
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