<p>I appreciate the information on liability insurance. We currently have umbrella coverage as a perk of dh’s job, but will have to provide our own when he retires. I had no idea that it couldn’t be purchased without HO or renter’s insurance. We’ve talked about buying an inexpensive older house in a small town we’re familiar with as a second home, but hoped to skip HO insurance since the premiums are very high there. We also talked about skipping HO ins. on our next primary residence since we plan to downsize considerably and were considering self-insuring. Guess that won’t work.</p>
<p>@Silpat, We had to have auto, home, and umbrella all from the same company, and not in minimal amounts in order to get umbrella.</p>
<p>Wow. That’s good to know, too. We might be selling our house sooner than expected, and if we do one of the first things I want to do is change insurance companies. We’ll need renter’s insurance for a while until we build again (landlords here seem to require it.) If I have to get HO insurance on the next house, then I may as well make sure the company will write earthquake, flood & sinkhole coverage on it, too. </p>
<p>Good point about liability insurance. It goes to show you how the fear of law suits drives our life. Our lives get les flexible because of it. Undoubtedly, there are times law suits are needed and do good to maintain the social order. When there are too many lawyers creating lawsuits necessary and unnecessary, it gets in the way.</p>
<p>The reason umbrella policies are so cheap is that they are behind your HO and auto insurance, and by requiring you to have large minimum liability amounts on those policies, the umbrella won’t even come into play unless it is a large lawsuit.</p>
<p>There are companies that just sell umbrella policies and don’t care who your auto and HO insurance is from.</p>
<p>"@Silpat, We had to have auto, home, and umbrella all from the same company, and not in minimal amounts in order to get umbrella."</p>
<p>Ditto. </p>
<p>I have a rider policy for jewelry etc, and I really am ‘tied’ to my ins company because to list all the items, appraised values etc to move policy is a PIA. However policy was good - I lost an expensive bracelet and agent could write out a check (he could do so with value under $10,000). No deductible. Payout will essentially pay 10 years of premiums and peace of mind.</p>
<p>My level of optimism is high. My medical oncologist said today they determine ‘cancer free’ based on initial diagnosis, so in Oct I am a 5 year person. Radiation oncologist told me when I had lumpectomy and primary tumor site showed no cancer, which was 4 years ago. 5 years sounds better!</p>
<p>SOSConcern,</p>
<p>Fantastic!</p>
<p>Yay @SOSConcern!! </p>
<p>@SOSConcern, that’s great news. </p>
<p>For those of you who don’t have an umbrella policy, the usual recommendation is to have it in an amount equal to your “at-risk” assets (I.e., those assets that could be taken from you by a court). The additional premium for each addition increment of coverage is not large. </p>
<p>@SOSConcern Yay!!!</p>
<p>@IxnayBob - The umbrella policy is the best insurance one can buy! I agree with your recommendation. It is worth every penny!</p>
<p>SOSConcern, What wonderful news! I’m so happy for you!</p>
<p>SOSConcern, yay and fingers crossed for many, many years of happy and healthy retirement for you! :)</p>
<p>Did anyone gIve actual dollars amounts besides post # 7?</p>
<p>Morrismm, :).</p>
<p>My very conservative numbers…
Take how much you are going to spend the first year you retire. (Dont add some huge cost like a new car or a new kitchen or a trip around the world the first year. :)) </p>
<p>Multiply this by how many years you are going to live. I understand we are now getting into guessing. </p>
<p>This is a conservative ballpark number where your returns after tax equal inflation.</p>
<p>For example…you spend $80,000 the first year of retirement. Your costs increase with inflation each year. You live 25 more years. You need $2,000,000.</p>
<p>Then you want to get more aggressive?
Subtract SS from your ballpark number.
Subtract pensions. </p>
<p>Your ballpark number drops. Add taxes from your ira to your ballpark number. Now the ballpark number rises. </p>
<p>Lastly… If you think your inflation adjusted return,. Your real return is 1 percent… Subtract 10 percent from your ballpark number.</p>
<p>If you think your real return after inflation is 2 percent, subtract 20 percent from your ballpark number.</p>
<p>If you think your real return is a negative 1 percent… Add 15 percent to your ball park number.</p>
<p>Now you have an idea what you need…</p>
<p>But this is not actual numbers, Give an example of some real world thingsl</p>
<p>I edited my post.</p>
<p>I will restate this…</p>
<p>You spend $80,000 the first year of retirement. Your costs each year you live increase with inflation. You live 25 years. You need $2,000,000 if your returns after taxes match inflation.</p>
<p>Now let’s say you have SS of 20,000 a year. You spend 80,000 the first year. But now you need 20,000 less a year…so you only need 1,500,000 over 25 years. </p>
<p>1,500,000 is a ballpark number…</p>
<p>Here’s a real number for you morrismm, 10 million. No good reason, no formulas. Just a nice round number that is enough to not be fearful. Even though I have a pension. It seems like enough that anything could happen and you’d be okay.</p>
<p>$10 million is a little ridiculous. Only a couple of million people will be able to retire. Most people, but not all, will be able to relax with $10 million. It is funny…many people with $10 million dont feel they can retire on $10 million. Never enough syndrome. Quite a few wealthy people have this syndrome. </p>
<p>I guess if you spend 500,000 a year and dont have pensions or SS, $10 million isnt enough. (spend less if this is a concern).</p>
<p>Spending less does make it easier to retire. One of my kids just got a great job. No more support. :)</p>
<p>Yay to no more support! I want to ensure we can always take care of ourselves and we may not want to sell the house. Many years to pay off the mortgage. But who knows if we’ll get there. It’s just a thought that at that point I’ll feel completely secure.</p>