Hi Woodwose, different industry studies have suggested that the average stay in a long term care facility is between 3 - 5 years. And yes, people with Alzheimers or other such conditions can end up needing longer periods of care. You should consider working with a fee only planner to determine if you will be able to afford to pay for long term care without having an insurance policy in place. A fee only planner can also help you find isnurance quotes from reputable insurance companies.
Sarah, if you made say 7% on your money (both the current and future savings), your husband is right. In 20 years you would have 2.7 million IN :FUTURE DOLLARS. As I've said earlier, there is no need to take more risk than you need to take and sometimes, it actually reduces your chance of success. So what do you want this money to do for you? (retirement income, travel, gifts to children, new cars every so often....) A planner could help you create a model that would tell you what you need to make on your investments to fund your goals. That said, some of my younger clients still prefer to invest more aggressively than needed and, as their time horizon is long and if they have demonstrated the ability to wait out downturns, I am fine with this. As they get closer to retirement they still need to move toward a more conservative portfolio. As for bonds, Jack Bogle, the very bright founder of Vanguard, says that bonds are not included in portfolios to make a lot of money; that their main purpose is to anchor the portfolio. I agree. So I have kept fixed income in all my portfolios but have shorted up the duration (sensitivity to changes in interest rates). All this is very technical and what I "hear" from you is that the current allocation really worries you. I am concerned that a big pullback in the market would make it hard for you to agree with 'staying the course" which is what is needed in such downturns, that you would encourage your husband at that time to switch to some fixed income which is horrible timing (selling low). I suggest you share you fears openly with your husband, acknowledge the fact that technically he could be right, but that you would sleep much better with a little less risk. If you have accounts in both of your names, perhaps he could put the safer investments in your accounts and put the most aggressive in his accounts. Good luck!
Scotteeth. Walt has signed off but I'll try to answer your question. Unfortunately, there is a process that has to be follwed when terminating a DB plan that requires IRS approval. Walt is right in that it can take time and you need to pay professionals to valuate the plan assets, funding, benefits etc. Small DB plans work best for older professinal who have not saved for retirement or who are looking for tax relief. This may or may not be you but, you have a situation that is goingt to cost you some money to correct.
Hi Roger, your wife will have to start taking RMDs from her ROTH 401k once she is 70.5 years of age unless she is still working. If she is still working, she may not have to take RMDs from the 401(k) of the company where she is currently working if she also owns less than 5% of the company and the plan has a still working exception – a fairly common provision.
Also Roger, she can do an in-service withdrawal and roll to a ROTH IRA if the employer permits it. Doing so will allow her to access a larger variety of investment choices that the limited set of funds that the company 401k allows her to invest in.
Joseph. This happens fairly often with profit sharing plans. Please be patient. Your rights are protected but profit sharing plan valuations can be delayed for a variety of reasons.
Bob I am looking for your original post so I can answer your follow up.
DickSue, that is the $100,000 question. The one thing we know right now is that health care costs are going up faster than inflation. Recent reports I've seen have the inflation rate for health care pegged at around 6%, but there is a lot going on in the healthcare arena which could ultimately tame that rate.
Hi John, since you are still working you can only delay RMDs on the 401(k) of the employer where you are currently working. And you cannot be a greater than 5% owner of the company where you are still employed.
Jaimin -- Would you mind resubmitting?
Oh, just kidding Jaimin! You are next in the queue! Thank you for your patience.
Simon, you do get a tax deduction for investing in the Oregon 529 plan so there is value in that.
Simon, go to savingforcollege.com and check out Oregon's plan
Simon, just so you know, I used the Oregon plan to get the tax deduction then later moved it in the Vanguard Utah plan because I liked the investment options better.
Simon. Either is fine but you may want to check with the Oregon 529 program to see if you would qualify for any special tax benefits. Each state has it's own program and some are better than others. Where I live (Virginia) we have one of the best 529 programs in the country so I tend to direct clients to it. I'm afraid I'm not familiar with Oregon's plan but you can look it up at Savingforcollege.com.
When rates go up they affect all bonds. Actually I can't recommend specific Ohio municipal bond funds. Try looking at T Rowe Price, Fideltiy or Vanguard funds.
hi Jaimin, it is likely that the Health Sciences Fund and the Media & Telecommunications funds are actively managed, expensive funds. I would consider using a mix of stock and bond index funds which will have lower expenses. The mix of stock/bond funds should be tailored to match how much risk you are willing to take. I suggest working with a qualified financial advisor
Chris. I answered you earlier. Walt is signed off. A personal investment account is one that you would set up with a discout broker like TD Ameritrade. You can buy stocks, bonds or anything you like but i would stick with well diversified mutual funds like the KIP 25
Jaimin, you do have a lot of eggs in 2 baskets. I would suggest greater diversification. Your target date fund is well rounded while your other investments may cause you to be over-weighted versus a well diversified portfolio.
Bob, thanks for the additional information. I just love a paid off house in retirement. We are starting to use reverse mtgs when doing our planning. Right now, the products for those aren't great but I suspect they will improve quite a bit if you do need one in the future. The idea is a comforting safety net at the very least. Now the additional income you mentioned makes a big difference and could likely reduce the needed draws on your portfolio. That said, there is no way to know if it will work without doing a plan. A plan would also let you know how much you could draw and be sure you maintain lifestyle in the future. For instance, I have many of my retired clients put all of their income in a single account (at a brokerage usually) and then take withdrawals monthly for the amount that we have calculated is doable (and sometimes, they can spend MORE than they thought without reservations). Those monthly amounts are increased annually to keep up with inflation. Also, it could be very good to speak with an advisor BEFORE you decide how to draw your social security. There are many options that people aren't aware of that could significantly increase their lifetime benefit ....especially for people who are going to live until 90 :-) Good luck!
Joseph, it is common for a company to take months to determine the year end valuation of their plan. That being said, I could roll it over as soon as they will let you.
Sorry, Joseph, I meant to say I would role it over as soon as possible.
Joseph, I just answered this a few minutes ago. The responses seem to be crossing each other Unfortunately, the issue you describe iis faily common with profit sharing plans. It can take that long for a variety of reasons and I do not believe you have a reason to sue.