WSJ article about senior debt

[Tybee]

This article about senior debt showed up on my screen with the clickbait about the Boomer woman having 15 dollars to her name:

http://www.msn.com/en-us/money/retirement/with-dollar15-left-in-the-bank-a-baby-boomer-makes-peace-with-less/ar-AAn1mmn?li=BBmkt5R&ocid=spartanntp

After reading the article, I am impressed that she turned things around by moving to Midwest, out of high price California, sold her condo for 400k, boughta 4 bedroom house in Iowa for 70k, and is living off of 1k a month.

The debt amounts for folks over 65 are very sobering.
But this lady seems to have met the monster and overcome it.

Lots to think about, including how much money she amassed between 200-2005 and how much money she spent during the high years, and how much money she lost.

She seems to be doing okay, but doing okay on very little.

Interesting read.

[Teacher Terry]

I would have moved to a bigger town in the midwest that had more to offer and still would have a low COL. What's up with buying a 4 bedroom house?

[jp1]

I was wondering the same thing about the house. I get that it was cheap but wonder what her heating bills will be like.

[awakenedsoul]

Great article, Tybee. Thanks for posting it. She's a hoot! Good thing she had that condo. That must be quite an adjustment for her to deal with that weather.

I've noticed the same thing about some of the seniors that I know here in Southern CA. One of my friends is in her seventies. She has an expensive two story home that she bought with her husband in 2007. He has since passed away, and she lives there on her own. She has a large mortgage, and she just bought a brand new Mercedes. I had assumed she was rich. She had bought some of my hand knit sweaters, and they are expensive. ($200.-$350. a piece.) After talking with her a little more, I'm realizing that she's making payments on everything.

Old age comes quickly, and many of us don't anticipate needing things like surgery, glasses, a new car, or expensive home repairs. I try to live on $1,000. a month, too. It makes a huge difference to have a healthy emergency fund.

I find it also helps to have different streams of income. If you know that you have a paycheck, and/or a business, that is such a relief.

[ToomuchStuff]

What did I miss? I didn't see it saying where in Iowa she lives. So I don't know if it is close to a college town (rent rooms), or if due to the lack of larger numbers of people, the typical home has more bedrooms, from the days of lots of kids?
I seem to remember it saying she used to flip houses in CA, so maybe this was to be a project (thought the value would go up with her changes), before she had the ceiling/water issues.

[Tybee]

Yeah, my husband and I were talking about the article and we got stuck on the 4 bedroom house as well, and wondered if she plans to rent out rooms. I don't think she is close to a college town because she said there's no yoga, lol. But 4 bedrooms is a big place to take care of--maybe she is planning to flip it, although doesn't sound like much market.

"Old age comes quickly, and many of us don't anticipate needing things like surgery, glasses, a new car, or expensive home repairs. I try to live on $1,000. a month, too. It makes a huge difference to have a healthy emergency fund. "

You are so right, Awakened! And I am impressed about the 1000 dollars--I know I could not do it, at least not as long as I had a car. Well, I shouldn't say that, as I have not tried, and I ought to look into that, as a long term project, since that is about what I would get in ss. Right now, my medications are at about 350 a month, just the copays.

[iris lilies]

I wish I knew where this town in Iowa was.


If I were buying a $70,000 house some of the places I would consider are Hermann Missouri and Highland Illinois. Also, I have always told DH that if I had to choose between his hometown or my hometown, I would choose his because it is a small town that is far away from a big town. But by small I mean 5000 people. My personal opinion based on not much other than having lived in Iowa, is that the thriving farm communities of Northern Iowa are pretty decent places to live and they could have strong community organizations such as garden club, library, Civic organizations. My hmetown is a suburb and as such didnt have organizations tat interested me.


It is the bedroom communities near big cities that are devoid of strong community organizatins because everyone drives to the nearest city.

[Tybee]

I was only in Iowa once, to Decorah to see the Seed Savers Exchange farm, and it blew me away--it was absolutely gorgeous, and very hip. If you are into farm culture, Decorah is kind of a mecca.

My grandmother and my husband's grandmother were both born in Council Bluffs, so someday I'd like to get out there and see it.

Another great part of Iowa is East Dubuque--very pretty and also a hip place to live, near Galena, Illinois.

700 people would be too small for my tastes, unless you could get to something in the 1000s with a good library, and I like living near water--oceans, lakes, and rivers, in that order!

[19Sandy]

When I work on genealogy, (hobby), it is amazing to see how many people had boarders, but today, you probably can't do it because it is illegal in many regions. You have to get permits, follow zoning laws and so forth. If you break a non boarders law, then you are fined or the government can take your property. Laws vary according to a region and can also change but that is something to think about before considering it.

[awakenedsoul]

"Old age comes quickly, and many of us don't anticipate needing things like surgery, glasses, a new car, or expensive home repairs. I try to live on $1,000. a month, too. It makes a huge difference to have a healthy emergency fund. "

You are so right, Awakened! And I am impressed about the 1000 dollars--I know I could not do it, at least not as long as I had a car. Well, I shouldn't say that, as I have not tried, and I ought to look into that, as a long term project, since that is about what I would get in ss. Right now, my medications are at about 350 a month, just the copays.[/QUOTE]

Wow, Tybee. That's a lot of money. We just never know what's going to happen. I usually go over the $1,000. a month, but I strive to live on that amount. I've started driving further, and will have some work this year that will require me driving about 30 miles each way.

I'm impressed that she left California. I've always thought that if I needed to, I could sell my house and move somewhere cheaper, like Nebraska. We are pretty spoiled here with the weather, though. It sounds like quite an adjustment. It's so important to prepare for retirement, because it comes so quickly.

[pinkytoe]

We also had to move to a different part of the country recently in order for both of us to be able to retire. It would have been impossible financially to stay in our continually gentrifying fancy pants city which coincidentally has become a destination for Californians. I guess being able to buy a house for less than a mil seems like a real deal to them. Anyway, in our new locale, our property taxes are now $783 a year vs the $8000+ we were paying. Everything seems to be less expensive and less crowded which is a huge plus. Haircuts are $15 and not $65, etc. Making this move allowed us to be able to buy a house for cash here. The same house in our old city would have been almost three times the price. It is slightly larger than we need but the basement is actually an efficiency apartment which can be rented out should we ever need to. The downsides are of course not having access to all the trendy things we had grown accustomed to. No more artisan groceries, no more hot yoga, only a few trendy bars, blah blah - boo hoo. We do get homesick and miss family and friends but you do what you have to as this lady did.

[Teacher Terry]

I think moving can be a smart solution to $ worries. OUr retiree health insurance just went up from 10k/year to 11.5/year. We are going to move to the PPO which costs half but pays less and keep track for a year to see if we save $ over the year. From taking a close examination I think we will. We pay 330/month for pet meds for 4 old dogs.

[awakenedsoul]

Wow, these numbers are eye opening. Thanks for sharing your stories and strategies. I guess I am fortunate to live in a lower income area of California. Things are very affordable where I shop for groceries. (I watch the flyers and buy what's on sale.) I can get my hair cut for $10.00. It helps to have cheap hobbies, too. I buy my yarn for knitting on clearance. The library has great books, and fortunately I am still able to get work with a local ballet company and sell my soaps and knits through etsy. Health insurance and property taxes are the largest expenses in my budget. I hadn't thought about meds for older dogs. I think I may have to just have one dog in the future.