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Old 09-26-2014, 06:49 AM
 
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but the flip side is you will be spending your own assets down later possibly for decades instead of more other peoples money once the higher payments kick in.

if i waited until 70, which i am not for tax reasons ,my dependancy on my own money ,markets ,rates and sequence risk would drop way way down to very little needed.. we would be spending very little of our own money and for a lot longer than just 8 years laying it out up front but more possibly decades later on...

odds are for most couples if the man dies the wiife will live long enough to enjoy the fact she does not have to take risks, invest a lot and be held hostage to markets and rates.. .
most woman hate taking risks after the husband is gone. that is something few men consider when they shy away from larger ss payments and annuity products because they feel they can invest better on their own.

spousal wants and abilities have to be taken in to the equation too.

i am 62 but if we waited until i was 70 for ss we would have 40k in ss between us , a small 20k pension ,some investment property income and if i go forward with it a 60k annuity income ,all without a penny coming out of our investments and most important all pretty much as guranteed as a paycheck would be .

.

Last edited by mathjak107; 09-26-2014 at 07:31 AM..
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Old 09-26-2014, 07:07 AM
 
Location: Central Massachusetts
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Quote:
Originally Posted by mathjak107 View Post
but the flip side is you will be spending your own assets down later possibly for decades instead of more other peoples money once the higher payments kick in.

if i waited until 70 my dependancy on my own money ,markets ,rates and sequence risk would drop way way down to very little needed.. we would be spending very little of our own money and for a lot longer than just 8 years laying it out up front but more possibly decades later on...

odds are for most couples if the man dies the wiife will live long enough to enjoy the fact she does not have to take risks, invest a lot and be held hostage to markets and rates.. .
most woman hate taking risks after the husband is gone.

Excellent points math. waiting to take at 70 to maximise is a good idea but if your savings will only last a shorter finite time then is comfortable taking it at FRA could be a good option for couples as well as singles.

Now if health is a concern then waiting too long is not a good idea either. A break even point around 80 years old is easy enough to gage. We can only guarantee todayand promise tomorrow so no one can know for certain.

As for my BH I expect her to have the same feeling. She will take a chance but that chance can't cost much or she will balk.
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Old 09-26-2014, 07:10 AM
 
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my wife is actually the one not comfortable giving up such a big lump sum for the annuity.

she finds the newsletter we get all she needs to maintain the investments on her own.

of course if they ever stop , then what. i would rather see her with the pay check income.

Last edited by mathjak107; 09-26-2014 at 07:32 AM..
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Old 09-26-2014, 08:22 AM
Q44
 
Location: Hudson Valley, NY
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Originally Posted by mathjak107 View Post
actually statistically we are adding one year of life every 4 years since 2000 to life expectancy.

but i don't get to wrapped up in statistics ever ,especially anything pertaining to long term care ,social security and break even points or what folks supposedly have or not..

why? because it only means a darn thing to an insurer . the rest of us only have 2 outcomes. things work out for us or they don't.

statistics mean little in our own llives.

our sweet spot is going to be fra in my own case because if we wait until 70 the higher payments and rmd's will bring our taxes up to high.

we are also thinking of locking in essential expenses with an annuity product. the annuity will require quite a bit of dough so spending to much between the waiting and annuity may be more than we want to committ. but in effect we are buying a pension so the fact we take ss at fra and not 70 is offset.

Huh??? Who is this? And what have you done with mathjack?!?!?!?
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Old 09-26-2014, 09:08 AM
Q44
 
Location: Hudson Valley, NY
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mathjack, I'm not ready to say you've got convinced to wait until 70 for Soc. Sec. But you've got my attention, because of the SS taxation issue.

Since whether I've got a higher SS check coming or not, I'd still like to have MY OWN savings -- just in case.....my question would be if I'm getting a pension and tapping my 401K -- in order to delay SS...how far down would you take that 401K before you start taking the Soc Sec?

I knwo every one's comfort level for savings, or and emergency fund is different, but I'd still like to hear some numbers.

So folks, how far down WOULD YOU draw your own funds in order to delay taking Soc Sec.?

We'll be retiring in a few years with the same situation of a pension and SS and a 401k. We will be drawing SS early at 62 and 63+, each of us drawing our own. I'm a max earner on SS so even the pre-FRA amount is pretty good. In it's simplest it comes down to this: 2 SS checks + pension > than our expenses = 401k covers discretionary spending or reserve or legacy.

I've looked at the breakeven age if I delay being the higher earner. It's around 82/83. After that we or the surviving spouse would have to draw about an additional 1% a year from the 401k to offest the lost SS increase - at a time when by all accounts your actual spending decreases. So it's more SS starting at an age when most people spend less or start collecting SS at a reasonable age and hold my 401k.

If instead of using the 401 to temporarily replace delayed SS income I use minimal withdrawals to supplement it, I think we can have a more enjoyable retirement and that's what all the planning was about.
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Old 09-26-2014, 09:49 AM
 
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Originally Posted by rdflk View Post
mathjack, I'm not ready to say you've got convinced to wait until 70 for Soc. Sec. But you've got my attention, because of the SS taxation issue.

Since whether I've got a higher SS check coming or not, I'd still like to have MY OWN savings -- just in case.....my question would be if I'm getting a pension and tapping my 401K -- in order to delay SS...how far down would you take that 401K before you start taking the Soc Sec?

I knwo every one's comfort level for savings, or and emergency fund is different, but I'd still like to hear some numbers.

So folks, how far down WOULD YOU draw your own funds in order to delay taking Soc Sec.?
How far down is a great question that I expect few would answer in this forum. It would seem like bragging to some and any answer given would seem like a lot of money to others who wished they had as much. I would, just offer some of the recommended critical amounts for health care cost that are published along with emergency funds based on income. On top of that there are in other forums suggestions as to what is a critical mass investment floor to be able to earn decent returns moving forward. On top of that is your asset allocation and how much is reasonable to lose in a down market. 20-50 percent.
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Old 09-26-2014, 09:58 AM
 
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Originally Posted by mathjak107 View Post
that is a very important question . how low is to low to spend down.

i think the answer is more a level of comfort vs any number based on logic.

in our case we are talking almost 6 years of heavy withdrawals but since we do have a decent size nest egg it won't be a blip . but that isn't going to be the scenerio for most.

the less you have ,the later you are taking ss the more you really may not be able to afford to retire younger then you take ss.

having choices like this is one of the benefits from accumulating a nice savings.

i already commented on adding the annuity and buying a pension above.
In reality you have set a minimum fixed income threshold which in your planning as I remember meets your expected expenses. That in theory/practice places your portfolio in a growth and not draw down mode. I just read a piece on using your RMD's as a yearly income flow and not touching your taxable accounts and letting them grow untouched having created sufficient income streams.
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Old 09-26-2014, 12:45 PM
 
71,470 posts, read 71,652,652 times
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Originally Posted by Q44 View Post
Huh??? Who is this? And what have you done with mathjack?!?!?!?
ha ha ha , i believe in data and numbers crunching but not things that involve averages.
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Old 09-26-2014, 12:48 PM
 
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How far down is a great question that I expect few would answer in this forum. It would seem like bragging to some and any answer given would seem like a lot of money to others who wished they had as much.
I get what you mean, but if someone says their 'minimum comfort level" is 500K or a million, or just 200K, or 100K. It is what it is.

To someone who only has 100K, they might think, "Sure it's easy for someone else to say their minimum is 750K" -- or even be envious -- but but so be it. It is what it is.

For example I'm single with no kids. And work in a field that's NOT paying in the six figures. So clearly, I might not have the same ability to garner resources as a two earner couple would if they were individually making the same as I do, or even less. Everyone's case is different. SINKs, DINKS, couples with kids, people who are divorced, etc.

I'd like to think many of us are 'adult' enough to realize each person's situation is different, so our numbers would be different -- and so therefore keep an "judgments" to ourselves. And we are anonymous, so it's not like we know who anybody is....

I asked because I thought I could learn -- because If I say my minimum would be "200K" -- I might be advised that IF I'm comfortable with that, that the higher steady monthly income of the Soc Sec. wold offset taking by own nest egg that low. That's all. But I've got years to go until retirement so it's just conversation now.....
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Old 09-26-2014, 12:54 PM
 
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i think the problem is really everyones view of to low or high is different and it depends on not only the percentage but the amount in dollars.

i would have no reservations putting 1/3 or so of our portfolio in to an immediate annuity . marilyn on the other hand can see about 1/2 that amount going in.

she isn't comfortable giving away so much money in dollars and cents even though it is only 1/3.

i guess it is no different than up and down days in the markets. a day like yesterday's big drop can see things move more than my wife makes in a year which can be gut wrenching in dollar terms yet the percentage change is very small..

the more you have the bigger the swings in dollars and cents and our brains react to dollars and cents not percentages of things.

it is like our portfolio can move up or down more in a year than most folks even have in total.

that can be nerve wracking even for the most experienced investors.

Last edited by mathjak107; 09-26-2014 at 01:12 PM..
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