Author: Quentin Fottrell

My retirement accounts are now worth $2 million. I also have $500,000 in investments and savings that I’ve considered using to buy my ex out of the house. I wonder if it is worth using $400,000 of those savings to buy the other half of the house. Or I could spend a bit more time in this home and use the sale proceeds to buy a smaller house or condo near friends and family.

I initially planned on working until age 62. Over that time, with average returns and maxed-out additional contributions to my 401(k) and IRAs, along with employer matches, those accounts may be worth $2.4 million. I could also add another $100,000 to my savings, bringing me up to $3 million.

‘I am very confident in my career and have an MBA from a top school, but since the divorce I feel financially vulnerable.’

Social Security at 62 would amount to $30,000 a year. Since the divorce, I have spent $50,000 per year, which includes insurance and property taxes. I have $60,0000 in a health savings account to pay for COBRA insurance after I retire, and I would plan on taking advantage of the double duration COBRA period of three years for 62-year-olds.

Now, however, I want to retire in three months to spend time with friends and on my hobbies. I am tired from the divorce and uninspired in my job. Even if I spend $80,000 per year, it seems like I will have more than enough money. If the rule of 4% is applied, I could use savings and the proceeds from my house sale to buy a condo, and at 62 draw $110,000 per year with no debt.

Given that I don’t need to leave an inheritance, I feel like I could probably take 5% and live on $130,000 a year. Why am I so afraid to retire or, at least, pull the trigger on retirement. And why I am reluctant to buy my ex out? I am very confident in my career and have an MBA from a top school, but since the divorce, I feel financially vulnerable.

Gray in the Pacific Northwest

Related: ‘I have fear of financial insecurity’: I’m 58, recently widowed with $1 million saved for retirement. What if the economy tanks?

Dear Gray,

Your divorce gave you wings, and those wings cost you $1.2 million. But you are already flying.

You’re rebuilding your savings. You will give up half of your home when you retire, but you have $2 million in retirement accounts and another $500,000 saved. That’s multiple times what the average American has at your age and, while you are comparing yourself to the person you were five or 10 years ago rather than to the average American, I hope you prefer the person you are today — emotionally, professionally and financially. 

You are reaching the end of your career in very strong shape. Perhaps you didn’t get the encouragement you needed during your marriage, and that has left you feeling more fragile than your circumstances would suggest. Americans between the ages of 55 and 64 who have retirement accounts have an average of $537,560 in those accounts, and those between the ages of 65 to 74 have an average of $609,230, according to the Federal Reserve. I hope that makes you feel proud of everything you have accomplished.

“The bottom-line goal of retirement planning is deceptively simple: accumulating enough money to live the life you want once your career is no longer occupying most of your time or generating a regular paycheck,” according to Edward Jones. “Achieving that goal requires asking questions that have no easy answers: How much money will you need? How can you measure your progress toward a target decades in the future?”

Compare and despair

Comparing yourself to other people is often a fool’s game. Sure, it can serve as inspiration and context, but it can also make us feel like we’ll never have enough. Others may feel those same emotions when they read your letter and wonder why someone in your position is feeling so vulnerable, but you are comparing your life now to the life you believed you would have. While the life you have may be more modest than what you had originally planned, it’s also better.

Now that you are single again, despite how heartbreaking your divorce has been for you, your time is your own. You lost a chunk of your net worth, perhaps, but you have earned back multiples in time, the most valuable asset any of us have. You get to wake up and be the designer of your own destiny, pursue your leisure activities — whether that is skiing or golf or hiking or playing bridge — and then return to a safe space that is yours and yours alone.

I can’t answer exactly why you are afraid to pull the trigger on retirement, but I can offer some suggestions. Even work that is fulfilling can drain your psychological and emotional energy as you enter your 60s, but at the same time, it provides security and gives structure and purpose to your life. It would be weird if you didn’t feel nervous or anxious about giving it up. Perhaps you could explore working part time, or take a long vacation as a test run.

Waiting for Social Security

Hold off on claiming Social Security, if you can. Most people — 28.4% of men and 26.5% of women — take Social Security when they reach full retirement age, which is between 66 and 67, depending on the year a person was born. Meanwhile, 8.4% of men and 9.3% of women wait until age 70 or later to take their benefits, according to data from the Social Security Administration. 

Social Security offers a bump in their benefit amount if they wait, although there’s no advantage to waiting longer than age 70. Research published by economists at the Federal Reserve and Boston University recommended that “virtually all” workers ages 45 to 62 should wait until after they turn 65 to draw their Social Security, and — here’s the kicker — more than 90% should hold out until they are 70. For people born in 1960 or later, like you, full retirement age is 67. 

Social Security is an insurance policy against living longer than you think you might. The best time to claim your benefits is when you stop working. Some people will advise you to take your benefits at 67. If you are more optimistic, you’re healthy and have “good genes,” and you don’t smoke or drink to excess or engage in other activities that could shorten your life, you may feel comfortable waiting until 70. Remember that even if you delay claiming Social Security, you still need to sign up for Medicare at age 65.

Creativity and community

Uncertainty can be both unsettling and an opportunity for creativity and change. Moving is stressful and your home has a lot of memories and probably represents the last piece of your marriage. If your husband keeps his share of the house, you still have a connection to that past. The sooner you buy him out and take back the psychological reins, the more empowered you will feel. Talking with a therapist may help you prepare for the road ahead. 

Reading your words, I want you to be happy as much as I want myself or that person opposite me on the bus or subway to be happy. I believe the small acts of kindness we show others and ourselves can release those fears of financial insecurity and help us plan ahead with a clear mind. Some people have more than others, but ultimately, we’re all in the same boat.

What was it all for — the hard work, the disappointments, the marriage, the career — if you can’t allow yourself to take the leap into this next chapter? You don’t have to do it today, but the stronger you feel, the more willing you will be to make the jump. Everything you have done up until now, you have done as a couple. This is something you are doing by yourself. But I hope you have friends and a community to support you both now and in retirement.

Related: ‘My retirement is going to be a disaster’: I’m 59 and have $45,000 in my 401(k). I earn $72,000. Am I doomed?

You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com. 

Check out the Moneyist private Facebook group, where we look for answers to life’s thorniest money issues. Post your questions, tell me what you want to know more about, or weigh in on the latest Moneyist columns.

By emailing your questions to The Moneyist or posting your dilemmas on The Moneyist Facebook group, you agree to have them published anonymously on MarketWatch.

By submitting your story to Dow Jones & Co., the publisher of MarketWatch, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.

The Moneyist regrets he cannot reply to questions individually.

Previous columns by Quentin Fottrell:

‘Is this ethical?’ I want to leave my home to my children from my first marriage — and not to my second husband.

I’m 50, earn $172K a year and married, yet I’m still living paycheck-to-paycheck. My family want me to return home. What should I do?

‘I have nothing left for retirement’: My husband and I have 9 kids and $70K in student debt. How do we pay it off?

Our wills split our money, with a third going to charity, a third to his daughter and a third to our son. While I have never been a huge fan of this distribution, over the past year I have become unhappy for two reasons.

First, his daughter will receive a separate inheritance from her mother. 

The second, larger issue is emotional. I have treated her like a bonus daughter. She is in every family picture (the same is not true of her mother and her mother’s second family).

I attended every school event and every sporting event, contributed equally to her college fund, included her on every family vacation – even though she is 28, she contributes almost nothing to those trips, and her dad does not wish to force her to as she would otherwise not likely attend, even though we are just talking about a cabin and nothing elaborate. Birthdays and holidays are treated equally for each of the kids.  

I wanted to be sure to wear an understated outfit for the mother of the bride’s sake, and yet be dressed nicely as a person who has been in her life since she was 8 years old.

This year she got married, and I was completely left out of any planning, bridal-shower and wedding activities. Her mother and I get along without drama. In fact, her mother said she wanted me to be included because I was part of her family. When I asked my stepdaughter to go shopping together for my dress, her response was “get whatever you want.” 

I wanted to be sure to wear an understated outfit for the mother of the bride’s sake, and yet be dressed nicely as a person who has been in her life since she was 8 years old. It is obvious to me that my husband’s former wife views me as a person who is her husband’s wife, and not as a friend. That makes me sad as I viewed her differently and we have never had cross words. 

Since my stepdaughter is my son’s only sibling, I do want that relationship maintained. However, I am becoming uncomfortable with her receiving an equal inheritance. I came from almost nothing and have worked extremely hard to be financially secure. She has a job but expects money to be handed to her. My son, on the other hand, is a go-getter and is working very hard. 

When I am gone, I am gone. But I am having a hard time leaving her half of my hard-earned savings. Thoughts?

The Stepmother

Related: My stepdaughter is executor to her late father’s will, and believes she’s now on the deed to my home. Is that possible?

Dear Stepmother,

You can’t be liked by everyone, as much as you try.

You could fly to the moon and back and still not get a “welcome home” from your stepdaughter, or a card congratulating you on your trip from your husband’s former wife. The more you do for your stepdaughter, the more you believe she should appreciate you, respect you and like you. But life doesn’t work that way. In fact, your efforts may be having the opposite effect. She might even consider you pushy, even if that is unjust.

Yes, it would have been nice for her to acknowledge your position in the family during her wedding celebrations, given everything you have done for her over the years, even if she felt agnostic about your presence at her wedding or in her life. But this is a time for her to do things the way she wants them done. Your frustration with her is likely mirrored by her eye rolls. You may have to accept that she’s not going to come around.

You and your husband have two financial hurdles to overcome: the decision about how to split any inheritance, and how you make that decision. 

You and your husband have two financial hurdles to overcome: the decision about how to split any inheritance, and how you make that decision. You could go to battle with him and argue that you would like the satisfaction of knowing that your son will receive as close as possible to 100% of your separate assets. This may be a difficult task given that you have commingled so many of your marital assets, including — I presume — your home.

There are ways you can divert funds to your son. First, if you own your house through tenancy in common, you can deed your 50% share to your son. Second, you and your husband can divide your joint accounts 50/50, and you can add your son as a beneficiary to your own. It may not get him to 100%, but it could get him pretty close. Third, you can set up a trust that becomes irrevocable upon either one of your deaths so that neither of you can alter the terms on their own.

Even if you and your husband come to a mutually agreeable arrangement, taking such precautions would give you peace of mind that your husband won’t have a change of heart if you should die first. If you simply write a will together, your wishes would not necessarily be carried out if he outlived you. He could, for example, decide to split your marital estate 50/50 between your son and his daughter. After all, it might make more sense for him to want to leave each of his kids an equal share.

On the upside, if you did go first, you would never need to know.

Related: ‘Don’t be naïve’: I have a wake-up call for divorcing women — you’ve been giving up too much for too long. Am I wrong?

You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com, and follow Quentin Fottrell on X, the platform formerly known as Twitter. 

The Moneyist regrets he cannot reply to questions individually.

More columns from Quentin Fottrell:

‘I’m struggling with grief and loss’: I inherited seven figures after my parents died young. Why do I feel guilty?

I’m 54 and have terminal cancer. I have a wife, 47, and 8-year-old child. How do I split my $1.2 million retirement and life insurance between them?

‘She’s the queen of CDs’: My mother-in-law, 83, opened 12 CDs at different financial institutions. Should I intervene?

Check out The Moneyist’s private Facebook group, where members help answer life’s thorniest money issues. Post your questions, or weigh in on the latest Moneyist columns.

By emailing your questions to The Moneyist or posting your dilemmas on The Moneyist Facebook group, you agree to have them published anonymously on MarketWatch.

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While Roy’s daughter was visiting me (we’re close) she casually mentioned to me that her brother would either be “moving in” with my mother as a roommate or “buying out her half” if Roy predeceases her. He is 85 and not in great health; mom is 82, spry and sharp as a tack. I smelled a rat, as it seemed Roy’s kids knew something I didn’t. 

I researched the refinance deed online and I discovered that the default deed in Illinois is “tenants in common” — not “joint tenants with the right of survivorship” (JTWROS) and sure enough that’s what they had in spite of instructing the title company they wanted JTWROS. 

‘All five of us kids are fine financially and we don’t need anything.’

I advised my mother and Roy that if their wish was, indeed, for the survivor to have the house, they should call a lawyer, write new wills and get a new deed. Roy was typically lax in his approach, but mom persevered and it has since been handled. At first, they just did a joint will, but I stayed on their case and now they also have a new deed under JTWROS.

Their wills provide 75% to his kids and 25% to my brother and I should they both pass while they still own the home. I thought this was quite generous as mom has lived with Roy for about 10 years now, and Roy feels she has earned some equity. 

All five of us kids are fine financially and we don’t need anything. My expectation is that eventually, the survivor will sell the home to fund a condo or long-term care or a nursing home. I plan on offering my share to Roy’s grandsons and my niece. 

I wanted to share this positive outcome with you, as I know in your work you must almost never hear something that turned out for the good. Indeed, I wince at many of the issues people write to you about, but I learn something each and every time, so thank you.

The Son

Related: ‘We have no credit-card debt’: I’m getting married for the second time. We’re combining our $500,000 in assets. Is that a good idea?

Dear Son,

I was waiting for the “rub,” but it never came. Bravo!

You acted swiftly and didn’t give up. You knew that information was your friend — both the “off-the-cuff” comments from your step-siblings about taking ownership of your mother and stepfather’s house after he passed away, and the deeds you found online in your county recorder’s office files. You protected your mother’s future, and put in place plans for your stepfather and mother’s grandchildren to inherit any remaining assets after they’re both gone. 

For those who are not familiar with types of home ownership, your story is a cautionary tale: JTWROS gives all owners an equal share of the property and does not allow one owner to add another person to the deed — and, importantly, if one owner dies, their share of the property goes to the other owners. If you are tenants in common, however, you would not have the right of survivorship in the event that your in-laws predecease you. 

The irony is if your step-siblings had not told you of their plans, you would have been none the wiser. They knew your parents had JTWROS, so I can only assume they were involved in the refinancing of the house and — this is a wild guess — somehow influenced the process. It’s hard to know why they decided to mark your card in the way that they did; perhaps they figured the plans were set in stone, and this information would force you into submission. 

Quiet inquiries and a steady, calm approach to helping vulnerable family members can do more than bullying or subterfuge. 

Obviously that didn’t work as they planned, and you sprung into action. Powerlessness and fear are powerful emotions, and they paralyze us into a stalemate where we believe everything is hopeless and nothing we do will make a difference. But as long as both of your parents were of sound mind and willing and able to make the required changes to the deed of their home, and create wills that took care of their long-term care, there was a lot you could do.

Too often, I wish the person had written before the “big” twist. This man accepted $300,000 from his in-laws so he and his wife could buy a home, only to receive a demand to give their niece $125,000 when they sold the house or face a lawsuit. The letter writer said this amounted to putting a lien on their property in all but name. The sooner they extricated themselves from this mess, the better, as the house would likely only continue to increase in value.

Your step-siblings did you a favor in their attempts to bully you or strongarm you into acquiescing to their demands when the time came. (Or, maybe, they just had to tell you of their dastardly plan and merely couldn’t help themselves.) Either way, as your situation shows, quiet inquiries and a steady, calm approach to helping vulnerable family members can do more than bullying or subterfuge. Your parents’ futures are secure, thanks to your refusal to lie down.

One more thing: Joint tenancy is the most common form of property ownership for married couples, so I’m flummoxed as to why your mother and stepfather were listed as “tenants in common” on the deed. Did the attorney make an innocent mistake or misinformed decision? Or was there communication between your step-siblings and your parents’ attorney? It’s all conjecture now, and hardly worth digging into. The less your step-siblings know, the better. 

Related: ‘She’s the queen of CDs’: My mother-in-law, 83, opened 12 CDs at different financial institutions. Should I intervene?

You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com, and follow Quentin Fottrell on X, the platform formerly known as Twitter. 

The Moneyist regrets he cannot reply to questions individually.

Previous columns by Quentin Fottrell:

‘I wish Dad were here’: I received $500,000 after my late father’s wrongful-death lawsuit. My adviser suggests annuities. How do I invest it?

’I became very frugal’: My husband and I are 40. I have $200,000 in student debt, while he has $600,000 in retirement savings. Are we in trouble?

‘I keep hearing about break-ins in my neighborhood’: Should I keep valuable items in a safe-deposit box? What are my options?

Check out the Moneyist private Facebook group, where members help answer life’s thorniest money issues. Post your questions, or weigh in on the latest Moneyist columns.

By emailing your questions to the Moneyist or posting your dilemmas on the Moneyist Facebook group, you agree to have them published anonymously on MarketWatch.

By submitting your story to Dow Jones & Co., the publisher of MarketWatch, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.

Am I a hypocrite for going to this wedding and not the family wedding?

Guilty Guest

Related: My girlfriend and I are having a symbolic ‘wedding.’ She does not want to lose her health benefits — and I don’t want to lose my shirt.

Dear Guilty,

Your money, your choice.

Attending a destination wedding is expensive, so you should only go if you want to go. You could have sent your family your regrets, adding, “We’d be there in a heartbeat, except we don’t want to go.” Most people would not be so blunt. They’d weigh up the pros and cons (“we don’t want to leave our child alone for three days, it costs a lot of money and it’s not worth it as we won’t have that good a time to justify the hassle”) and send a gift and their regrets. The hosts don’t need an explanation, and you don’t owe them one.

There are also a few things that are different this time around. 1. You’re no longer new parents, so you have more bandwidth and willingness to travel without your child and you’re probably less sensitive about the no-child rule. 2. After years of married life as parents, you understand the mental-health benefits of getting away by yourselves. 3. The location is more exciting this time around. 4. You may like this couple more and have a better connection with them. 5. You can choose your friends, but you can’t choose your family. 

Destination weddings and a ‘no-child’ policy are two ways to whittle down the guest list.

They are two different weddings in two different places, so you have the right to choose one over the other. This poll by the personal-finance platform LendingTree found that destination-wedding guests spend about $1,400 on average, including on travel, gifts and personal items, and they spend upwards of $2,500 for such weddings outside of the U.S. That’s close to a monthly rent or mortgage repayment for most people, and it’s money that you could spend on your children’s schoolbooks and clothes, and/or summer camp.

What’s more, destination weddings are expensive to host and expensive to attend. So having a wedding in a far-flung location is one way to whittle down the guest list; you get to invite people who expect to be invited, but you know a higher percentage of those invitees will send their regrets, while closest friends (for the most part) will probably be more likely to attend, especially if they’re there with a larger friend group. The “no-child rule” is also a way of whittling down the guest list. Many parents won’t leave their kids at home.

Here’s my macro take for anyone who is invited to a wedding, whether it’s a destination or otherwise. The world doesn’t stop just because two people are getting married. You don’t have to turn your life upside down, fly in the in-laws to mind your children, and spend thousands of dollars on gifts, clothing and air fare and hotels to show up for a couple to say “I do.” The best weddings I’ve attended have been held in a village hall in the English countryside or the backyard in a house in Long Island. 

The bigger the fuss, the more stress. That’s why micro-weddings are growing in popularity. 

The bigger the fuss, the more stressful the wedding. That’s why micro-weddings are growing in popularity. People understand that intimacy and having a wedding without the need to post pictures on social media adds value to the day for everyone involved. It turns it from an off-Broadway production that nobody wanted to see into a special event that not only doesn’t cost $30,000 (the cost of the average wedding if you believe some wedding websites) but has that rare quality in the 21st Century: privacy.

Does anyone remember when weddings were supposed to be fun? Your relatives who married five years ago don’t need to read about your friends’ wedding on Instagram META, but nor do you have to hide it from them if it comes up in conversation. It’s a different wedding, at a different time of your life and, therefore, you made a different decision. If they are truly concerned about people who sent regrets to their wedding and had the nerve to attend another destination during their lifetime, they have bigger problems than the one contained in your letter. 

Enjoy your guilt-free trip to the Caribbean sans kids. 

Related: ‘Marriage sure does make love suck’: My fiancée wants a big, expensive wedding — I want to a downpayment for a house

You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com, and follow Quentin Fottrell on X, the platform formerly known as Twitter. 

The Moneyist regrets he cannot reply to questions individually.

Previous columns by Quentin Fottrell:

‘We’ve had two cars for 40 years’: With congestion charges, insurance and gas prices — should we sell our second car? Or will we regret it?

‘I’ve never been happier’: I married a wonderful lady from Ukraine. I have two successful kids. Do I put my wife on the deed to my home?

My sister made frequent withdrawals from the ‘bank of Mom and Dad.’ Now our family is torn apart. What can I do?

Check out the Moneyist private Facebook group, where members help answer life’s thorniest money issues. Post your questions, or weigh in on the latest Moneyist columns.

By emailing your questions to the Moneyist or posting your dilemmas on the Moneyist Facebook group, you agree to have them published anonymously on MarketWatch.

By submitting your story to Dow Jones & Co., the publisher of MarketWatch, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.