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June 19, 2008


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It's interesting how it's anathema to a lot of people to even consider the idea of roommates. But I'm an adult and I can say that having a roommate has enlarged my life immensely. It's great. And, yes, there is a huge amount of money to be saved.

Those sound like people who spent WAY too much on their pets throughout their lives.

It is interesting to me that if two people choose to live together they can reap the benefits described. However, if those two people that live together happen to be married, then the government treats their income differently and they are taxed much more than if they were not married (this is the case at least if their incomes are similar). Doesn't sound fair to me (you guessed it - my huband and I suffer greatly from the "marriage penalty tax"!)

Yes,it is possible for two,three, four and five people to survive and retire on $12,000 a year. But I do not see a lot of privacy happening here. It would far better to lead a life full of enjoyment and recreation with a mate of once choice rather than the above scenario. A little financial planning early in live is a much better alternative.

The Hoss

It is not that difficult to live on that without sharing expenses. The key is to own assets that provide necessary services at minimal cost. Have company provided health care in retirement. Live in a less expensive area. Own that house. It amazes me that someone would consider retiring without owning their home.

dwr - what is up with you and pets? You need some perspective on what people spend money on.

As for the roommate idea, to a certain extent some retirement communities have these communal living price benefits built in. My grandparents moved off a farm several years ago and now live in an apartment building with hundreds of other retirees. Everyone is very social and there is always the option of dinner downstairs to buy if people want. Living in one place eliminates the much of the need for travel and there is always something going on.

But, I think the real value of their place and the ideas mentioned in the post is the social aspect of living with others, especially in retirement. I am sure it makes you live longer and happier than going it alone. Not that we all need to share a bathroom mind you!

Thinking about this, of course living together in old age is not new. It was normal to move in with your children when you got old in the past and whole families living together made life much easier and provided a very strong community.

I think it's a good idea as long as you can align yourself with other folks that share your interests. My wife and I have a roommate in our home right now for this very reason; it's cheaper for us. We get some extra money each month (goes toward debt repayment) along with help with some of the common household chores (house cleaning, dishes, etc). It's tough every once in a while, but overall we think it's worth it.

Lord: That's good advice for someone who still has time to plan for such things... although I laugh at the idea that anyone more than 10 years from retirement will be able to plan on having company-provided healthcare.

Re: owning your residence: My parents sold their house when they divorced (after retirement for my mom, and shortly before retirement for my dad). My mother moved to a higher cost-of-living area to be close to her family, and could not afford to buy her own place without severely depleting her nest egg. It's better for her mental health to be renting somewhere where she's happy and engaged than to own in a place where she'd be miserable.

That said, I do suspect that she will eventually move in with us when her health gets worse and/or her expenses increase.

People who work for $7.25 dollars an hour, after SS, Medicare, Federal and state taxes have about $12000 left (assuming they are full time 40 hour types). There are people who end up living the majority of their lives like that. Its called poverty. A noticeable percentage of this country lives in it. Note that $7.25 dollars is next years minimum wage.

Its depressing, but its true.

Well, Kiran, if those folks don't like making $7.25 an hour they should find another job that pays more. For example, I didn't much like making $3.35 an hour back in the early 80s (that was the minimum wage then), so I decided to go to college and then to law school and now I make a bit more than $3.35 an hour. As a result, I'm no longer depressed. :-)

Interesting article and I'm sure people can make that work. My goal is to retire financially independent.

I hope my wife is the only "roommate" I have when I'm retired. Roommates are fun in college and on trips, but doesn't sound too great later on in life.

And Chris, the pet thing is a recurring joke around here. Pretty sure rwh was trying to get FMF riled up.

Whoops, meant dwr not rwh.

This post reads like a shining endorsement of polygamy. In purely financial terms, of course. :)

I was thinking the same thing that Kevin posted, to wit: the only roommate I want is my wife. Fortunately, since I don't have any children, I have saved enough that I should be able to have more than $12,000 a year to live on. (Take that, FMF!)

Yes I got tons ;) .. law of diminishing returns for one.

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