Do you factor in SS with retirement number? (rates, dispute, vehicles)

[mathjak107]

Originally Posted by Lowexpectations

You pay fees when you buy gold and silver and they never produce income, you would also need to purchase insurance to cover the loss due to theft. You would also pay fees when you sold the metals and would also owe taxes at that time too. I think the advice you are giving is terrible

gold ,silver and any collectables do not produce income but neither do many stocks which are growth stocks only.

i only care about total return. i don't really care about income ,dividends or anything else.
i have art work which pays me not a dime that has gone up more than my portfolio.


gold is a store of value more than something i would consider a growth investment.

125 years ago an ounce of gold bought a good mans suit and a pair of shoes. know what an ounce buys today? a good mans suit and a pair of shoes.

[nicet4]

Originally Posted by Lowexpectations

The poverty line is 11k single 15k for 2. The average monthly benefit for retired folks from SS is 1294.00 or 15k which is pretty damn close to the poverty line.

More data that further supports what I am saying

Social Security is the major source of income for most of the elderly.

Consider the following:
Nine out of ten individuals age 65 and older receive Social Security benefits.
Social Security benefits represent about 38% of the income of the elderly.
Among elderly Social Security beneficiaries, 52% of married couples and 74% of unmarried persons receive 50% or more of their income from Social Security.
Among elderly Social Security beneficiaries, 22% of married couples and about 47% of unmarried persons rely on Social Security for 90% or more of their income.

Consider the following:



The low amount of $1,294 (the chart above shows $1,261 after the COLA) is the average of all workers.

If the husband receives $1,800 his wife will receive her own benefit or 50% of her husbands benefit whichever is more. In the case of the wife taking 50% of her husbands benefit the husband and wife together they will receive a combined benefit of $2,700.

In this case if we average the benefit between the two we have a monthly benefit of $1,350 each which appears definitely cat foodish.

Not great but very doable when you consider at that income level, assuming here social security is the only income, social security is not taxed and a number of states don't tax retirement benefits.

Georgia is one of those states; when I elect to collect I will not be subject to state income taxes on retirement income up to $60,000 for a married couple.

With 4.33 weeks in a month $2,700 is exactly like a weekly take home check of $623.55. This is close to a $20.00/hr job and grandma and grandpa should live very well on that when we consider they shouldn't have any debt and the house should be paid for.

Much of the lower benefits are caused by folks who elect to take their social security benefits early.

Appears to me nearly 70% elected to take it prior to reaching full retirement age which, in my opinion, should never be done unless 1) you have so much money you don't need social security, 2) you discover you have a terminal illness at which time why not take it and 3) you have no other options, not even the option of moving into your kids basement.

How does taking early social security effect someone? (Food for grammar Nazi's, is that affect or effect?)

Pretty dramatically, can make the difference of grandma and grandma living a decent life or living on cat food.

I am one of those who don't have as much savings for retirement as I should have. No, it wasn't buying motorcycles or Bali vacations. What I had was a pretty successful business where my biggest client went bankrupt on me leaving me holding the bag. I could have declared bankruptcy and kept my 401k money but morally I couldn't; I never went bankrupt and I did pay every last one my bills both personal and business. I kind of wish I had spent the money on vacations and motorcycles.

But snarky people who ask "I have $800k saved for retirement, why doesn't everybody?" kind of disgust me. It's a childish question to ask because the answer is simple; it's life and things happen just ask the people living on pensions from Enron, WorldCom and Maddoff Investments. Sometimes things just happen like having a heart attack at 55 and yes, it does happen.

But the entire concept of retirement is flawed. Why retire at all?

Working a little longer can make up for a lot of past mistakes of not being able to save the right amount.

I am 66 and if I were to take ss my benefit would be $2,250 and my wife would receive 50% (this comes next year) of that or $1,125 for a combined benefit of $3,375 all of it free of federal and state income taxes.This is equivalent to a job earning a weekly take home check of $779. With no debt and the house paid for we'll do just fine, thank you.

But why stop? I have good health, have a job I enjoy doing so unless something happens I plan to continue working to at least age 70 which goes a long way towards making up for my sin of not saving enough.

If I take benefits at 70 my benefit will increase by 32% to $2,970 and my wife's $1,125 benefit we will have a combined benefit of $4,095 tax free dollars from social security alone. I've worked on our budget and we'll be able to live just fine on $3,000 which will enable us to save $1,095 a month out of our social security money never touching our savings. Yes, we do have savings but just not as much as I wished.

Next year my wife turns 66 so I will have to file then suspend for my wife to receive the 50% of my full retirement age benefit. We don't need the money so we'll just save the tax free $1,125 for three years.

A couple years ago I added up what I would had in savings if I had been allowed to deposit all my social security taxes and my employers portion into a simple bank passbook savings account earning the average interest of the day.

I calculated I would have $780,000 today which, at a rate of $4,095 monthly, will take me 190 months or 15 years 10 months for me to reach the break even point. I will be nearly 86 years old and we're assuming both of us will reach that age.

The added plus is the knowledge if something happens to me my wife will lose her benefit but pick up mine.

Now, not relying on social security?

Don't be silly, whatever it takes social security will always be paid in one form or another. If you think either party will vote to cut benefits to millions of retirees who vote you're in la la land.

If they did cut benefits, they won't but if they did, what makes anyone think they won't go after your personal 401(k) savings accounts in order to make everything "fair and even"?

Means testing will never happen, political suicide. If it did happen would Obama and Harry Reid give up some of theirs?

[Lowexpectations]

Originally Posted by mathjak107

gold ,silver and any collectables do not produce income but neither do many stocks which are growth stocks only.

i only care about total return. i don't really care about income ,dividends or anything else.
i have art work which pays me not a dime that has gone up more than my portfolio.


gold is a store of value more than something i would consider a growth investment.

125 years ago an ounce of gold bought a good mans suit and a pair of shoes. know what an ounce buys today? a good mans suit and a pair of shoes.

All of which is irrelevant. Telling someone to dump all their savings into one or two areas is just bad advice. More so when one has no chance of income. I'd say the same if he suggested dumping into a single no dividend paying tech company

[mathjak107]

rather than a file and suspend at 66 i will do restricted application most likely. i will file for 1/2 my wifes ,just the opposite of file and suspend and let my own grow to 70.

at age 70 with an 80% greater payment than my age 62 payment our withdrawals will fall by 1/2 from savings.

i can spend a lot of money from savings between 62 and 70 and just replace it with the much larger payments down the road.

in the mean time from 66 to 70 i will have 1/2 her full fra benefit and she will collect her own reduced since she already filed at 62.

my benefits are 22k at 62 ,30k at 66 and 40k at 70. hers are a lot less .

for us the difference between file and suspend vs restricted application was about a 4k a year difference in favor of going with restricted application..

[nicet4]

Originally Posted by mathjak107

rather than a file and suspend at 66 i will do restricted application most likely. i will file for 1/2 my wifes ,just the opposite of file and suspend and let my own grow to 70.

at age 70 with an 80% greater payment than my age 62 payment our withdrawals will fall by 1/2 from savings.

i can spend a lot of money from savings between 62 and 70 and just replace it with the much larger payments down the road.

in the mean time from 66 to 70 i will have 1/2 her full fra benefit and she will collect her own reduced since she already filed at 62.

my benefits are 22k at 62 ,30k at 66 and 40k at 70. hers are a lot less .

for us the difference between file and suspend vs restricted application was about a 4k a year difference in favor of going with restricted application..

I could file on my wife's as but most of her work was for state government for which she started receiving benefits at at 60.

We have a slightly reduced survivorship pension but if something happens to her I will pick up the state pension. It isn't a lot of money but just like credit card debt $400 here, $300 there with $350 over there and after a while that can add up to a lot of money.

Her social security at full retirement age is pitiful.

Everything I do is geared towards giving her the highest sum of money possible should something happen to me first. I'm not looking to "break even" or even collect anything, it is all about how much she will receive.

[mathjak107]

check the numbers both ways as she gets survivor benefits based on your record not hers as long as she files for survivor benefits at her fra and not before. she could file early for her own ss benefit as did my own wife but that does not effect her survivor benefit if it is based on yours .

she gets what you get less a penalty if she takes survivor benefits before her fra. that is seperate from when she filed for social security benefits if she filed early.

[nicet4]

Originally Posted by mathjak107

check the numbers both ways as she gets survivor benefits based on your record not hers as long as she files for survivor benefits at her fra and not before. she could file early for her own ss benefit as did my own wife but that does not effect her survivor benefit if it is based on yours .

she gets what you get less a penalty if she takes survivor benefits before her fra. that is seperate from when she filed for social security benefits if she filed early.

She is getting close to FRA now and for three more years I have a term life insurance policy that would more than make up for the reduced benefits if she had to take the benefits before her FRA.

But in three years the term life is gone but she won't need it then.

[TuborgP]

Originally Posted by darrell2525

I have a few questions:

I am 34 (married, kid) now and saving/investing in my 401k.

I am calculating my retirement needs based off:

1. NO social security benefits at retirement.
2. 3% inflation and 6% annually return.

Because I do not include SS in the calculations, I am falling about 1 million short of goals at retirement.

If include SS in the numbers in the calculations, I am able to retire comfortable with out saving so much in 401k now!

Should I save enough assuming I will not have SS at retirement age of 63? Why do people say plan to no have SS? I don't want to be oversaving now if I really don't have too. I can use the money towards other things like house fixtures or lately I have been thinking of increasing my cash savings account to be more liquid.

I am not sure why I think SS will not be there at retirement, maybe too much reading. lol But I am thinking of cutting back on saving for retirement.

Thanks

Let me come at this from another angle and perspective. I have over the years made comments here there and elsewhere about the role of counting pensions/SS in Asset Allocation formula's etc for future years. We have been retired over six years with a couple more new income streams to kick in. My full SS at 70 and RMD's etc. Dividend and interest is just reinvested and that will continue. As MathJak says it is all about cash flow when being actually retired. Until that happens all you have is a promissory note that increases each year you work and have reached the appropriate retirement eligible status. So yes you have a SS promissory note as did those of us now retired. My suggestion is too look at all of your assets based on if I retired today. When you are younger they are very low or zero if not eligible etc etc. As you get in your 50's,60's they are greater and the day you reach what you consider to be the amount you can fly with then that is what your retirement income will actually be. For now just work contribute and strive for the maximum. Trying to cut it short may leave you just that.

[mathjak107]

funding ss is a drop in the bucket compared to something like medicare. there is no question that with ss being so in grained and for many the sole income that the ss system is here to stay.

what age you get to collect full benefits is another issue and that may change as well as options like file and suspend and restricted application may end.

you see how fast a war can be funded, ss is peanuts compared to it.

[Escort Rider]

Originally Posted by MrWillys

I will say this. My father told me to save as much as possible, and I did. SS will be around unless the naysayers get the chaos and anarchy they wish for. In this case one bullet can solve your problem, or you will learn to adapt. The system may not be perfect and currently allows a very small percentage massive wealth. Sooner, or later the working class will rise and demand their fair share. I'm retired now, and still have 8 years to go to get my SS. You must work 35 years, and your highest will determine your payout. I've meet this, because I started working at 15.
Save everything you possibly can, so that you'll have enough to enjoy, and SS will be an added bonus. I do find it funny that my generation never pissed and moaned about SS deductions, so who's promoting this, and believing it is a moron.

Wrong on the bolded part. It is not necessary to work 35 years in order to get a Social Security retirement benefit at age 62 or older. One has to work only 40 quarters (ten years) to qualify.

Here's where the 35 years come into play: In calculating the benefit, SS indexes our wages for inflation, then takes the highest 35 years and averages them, then applies formulas. If you have less than 35 years, zeroes are averaged in for the number of years less than 35. That brings down the benefit either slightly or a lot, depending on how many zeroes there are, but only 40 quarters of earnings are required.

For example, someone with only 10 years of earnings would have 25 zeroes averaged in to come up with the highest 35 years of averaged earnings. The benefit would be very severely reduced in that case, but there would still be a benefit.