I have friends, a couple in their early 60’s. They had a paid-for home. About 5 years ago, they sold the home and built a new, bigger one with a mortgage. [I thought they were crazy— and the economy was still good.] The husband’s 401K lost about 60% of its value. She can’t retire, although she’s reached the point where, physically, she needs to. He’d like to retire, but he shouldn’t with the way their retirement income looks. People need to plan for the worst and hope for the best.
Back in the mid early-mid 2000’s people were purchasing lots in the NC mountains at absurd prices with the hope of it being their retirement location. At that time their 401K’s were soaring and their primary residence was appreciating at a ridiculous rate.
The bubble burst, the resort developments went into bankruptcy and those $250,000 lots are now worth between 1/5 to 1/10 of their original purchase price, the primary residence value crashed and the 401K’s are in the toilet.
Busted dreams all around.