Just out of curiosity, I played around with firecalc again, you know, just to get a rough idea of where my parents stand. The results... does not look good. At all.
Most simulations show that their money will run out as early as 10 years time, 20 if they're lucky. And that's assuming a liquid portfolio of $350k, which they don't have.
So, something like a reverse mortgage, annuity, or down-sizing their house is NOT optional. They must leverage their house somehow. According to AARP's reverse mortgage calculator, it looks like they can get about $600 a month, which is just enough to pay for home expenses such as insurance, tax, and utility. Ugh.
I mean, I still think they can pull this off. They are very frugal, and expenses is apparently one of, if not THE biggest factor in making your retirement money last.
Still, it'd be ridiculously tight. This is no joke. I'd be sweating bullets if I were them. I'm already sweating bullets about myself, but at least I'm still youngish you know?
Parent's retirement revisited
January 21st, 2010 at 04:20 pm
January 21st, 2010 at 04:42 pm 1264092171
January 21st, 2010 at 04:56 pm 1264092984
January 21st, 2010 at 04:57 pm 1264093052
HOWEVER, if you convert the money back to US dollars here, and factor in the fact that it's much more expensive to live here in the US than it is back there, then... well, here we are.
But yes, my parents might have more money than this, but frankly, I don't want to count on it. As far as my mom knows, this is the bulk of their nest egg.
January 21st, 2010 at 04:58 pm 1264093126
January 21st, 2010 at 05:57 pm 1264096677
January 21st, 2010 at 06:12 pm 1264097547
Just a reminder that the Kiplinger's free advice days are coming up--Jan. 22 and 26. Maybe they could offer some insight!
January 22nd, 2010 at 12:46 am 1264121183
January 22nd, 2010 at 06:59 pm 1264186781
Jerry