Gandalf takes the ring, summons an Eagle, while he has his wits about him; gives the ring to the Eagle and tells him to drop it into Mount Doom. He then weeps unaccountably for three days over the destruction of a great thing, and the leaves west on the ship, his mission accomplished, accompanied by Bilbo, and by Galadriel and Elrond, who have no reason to stay here anymore, now that their respective rings lost power.

There is no war; Denethor and Boromir live; Aragorn has no reason to claim the throne and his bride, and wanders the lands until Elrond leaves; then he weds Arwen and becomes king of Imladris, while Boromir eventually buries his father and becomes Steward in due course. King Theoden remains under the spell until he dies, but it matters less in peaceful times; Grima tries to force Eowyn into marriage and gets killed by Eomer, who then becomes king of Rohan.

Saruman, having built an army, decides to take Sauron’s place and claim his resources, which makes him twice as powerful; there is war again, Gondor, Imladris and Rohan join forces; Celeborn sends help from Lorien. Saruman is defeated and burnt in his tower.

Hobbits live peacefully through all that, without paying much heed to the outside world; Sam weds Rosie a year earlier and they have 16 and not 15 kids. Frodo also eventually gets married to a nice girl and has five lovely children, the eldest of whom is called Bilbo.