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Old 01-13-2015, 12:09 AM
Location: Los Angeles area
14,018 posts, read 17,732,288 times
Reputation: 32304


Originally Posted by RonkonkomaNative View Post
You can supplement it Do you have a craft or a talent? I know a group of artisans who make candles, soaps, baked goods, glass workers, and painters who supplement their income doing something they love. Social Security allows you to work up to a certain amount.
Originally Posted by eok View Post
If you're full retirement age, I don't think there is any limit to how much money you can earn and still get your full SS benefits. But it's sometimes beneficial to put off getting your SS till age 70, to get more per month then, if you're earning plenty in the meantime.
Eok is correct. Once "full retirement age" (66 for most of us posting here) is reached, there are no more earnings limitations connected with receiving Social Security.
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Old 01-13-2015, 01:25 AM
71,517 posts, read 71,694,121 times
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Originally Posted by fumbling View Post
Yep that is what Warren advises his wife (actually his wife's trustee) to do:

What I advise here is essentially identical to certain instructions I’ve laid out in my will. One bequest provides that cash will be delivered to a trustee for my wife’s benefit…My advice to the trustee could not be more simple: Put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund. (I suggest Vanguard’s.) I believe the trust’s long-term results from this policy will be superior to those attained by most investors…

from Warren Buffett: 'Investing Advice For You--And My Wife' (And Other Quotes Of The Week) - Forbes

I think his idea is to just do that, pay no mind to fluctuations and have a happy life.

if you think the typical wife or even an alone woman is not going to pay attention and cringe and worry herself sick at market drops you are kidding.

most women are far more reactive to those drops then men are.

my wife was already left on her own once and never wants to live with that fear ever again.

she is fine as long as i am in the drivers seat and riding herd on our investments but as she made clear she has zero interest in growing richer once i am gone. she wants a stable income that will out live her , as little dependency on markets and interest rate whims as she can get without penalizing heirs.

in fact the dream structure for my wife would be a huge monthly pay check which is more than she ever needs and life insurance for heirs.

hypothetically she could take our assets at age 65 and get a guaranteed 189k a year from an spia vs only 120k from our own investing. she could take a portion of that 60k difference and buy life insurance guaranteeing the kids a few million and still have thousands more left to spend on whatever than our own investing unless markets were real favorable..

not that she would do it but it gives you an idea about the fact you can have it both ways, a monthly pay check in the mail box and money for heirs if you totally wanted to avoid volatility..

there are ways to meet everyones needs out there . but you need to stop believing myths and misinformation about various products.

these are tools and like all tools you can hurt yourself or you can build works of art . it isn't the vehicle you use as much as how it is being used.

in my opinion far to little regard for the surviving spouse is incorporated into the retirement planning i see usually.

Last edited by mathjak107; 01-13-2015 at 02:47 AM..
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Old 01-13-2015, 06:45 AM
Location: Backwoods of Maine
7,112 posts, read 8,150,955 times
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I'd go for the annuity.

For heaven's sake, get your money away from the sharks!
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Old 01-13-2015, 08:16 AM
29,775 posts, read 34,860,277 times
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Aren't there two basic choices to either cut spending or grow your wealth. Perhaps a combination of both but isn't that a simplistic way of looking at it? So for some it is a process of cutting spending or perhaps how to best grow or maintain wealth. Sounds like many forum participants have opted either or.
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Old 01-13-2015, 08:23 AM
3,492 posts, read 4,954,544 times
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Originally Posted by WellShoneMoon View Post
I'm 67 years old and a widow for almost a year. I'm living on Social Security and whatever I withdraw from my savings. My question has to do with how best to make those savings last me the rest of my life. Mathjak, whose opinions I hold in high regard, has said that women fear becoming bag ladies, and at least as far as I'm concerned, he's right.

Let me state at the outset that I am not capable of investing my money myself. I consider myself a smart person, and I have tried to educate myself about investments, but I find that the more I read the more confused I get.

Until six months ago, my savings were invested in a number of different types of funds that were basically doing nothing. So on the advice of a relative, I consulted with a person who works with one of the very large, well-known investment companies, the name of which I won't say here.

He consolidated all my investments into one managed account at his large, well-known investment company, and he said my money would be invested in moderately conservative funds and that I should probably expect to realize an average of 5% gain annually.

That was six months ago. As soon as my money was invested in this company, my balance went down by an amount that scared me. Since then, it has gone up a little bit, and down a little bit, but at this point I'm still almost 1% below my initial investment.

They tell me not to worry, that the decline in my balance has to do with the decline in the stock market. My feeling is, if I'm so dependent on the stock market in a managed fund, why do I need to pay them to manage my money when I can just invest it in an index fund and ride the market without paying their fee?

They tell me that I have to take a longer view, that six months doesn't mean anything, that the 5% annual gain they projected is an average over time. My feeling is, I don't have a lot of time. I'm retired now. I can't afford for my balance to go down. It needs to go up if I'm going to withdraw money from it to live on.

So, as I see it, here are my options: (1) stay the course and hope that the company is right; (2) get out of a managed fund and invest in an index fund; (3) take the money (or some or most of it) and buy an immediate annuity.

What, in your view, is the best of my three options, or are there other options I'm not seeing? Thanks in advance for any guidance you can offer.
You need a better adviser.

If he actually told you an average amount to expect annually, he wouldn't pass ANY of the ethics tests for working in personal finance. That's a big red flag in the industry. Secondly, he should have conducted a risk tolerance assessment with you before investing a single cent to ensure that you signed off on knowing the range of deviations that could occur in your money.

I'm a financial analyst, I know this industry extremely well. The variations you saw in your portfolio were probably very normal short term bumps. However, you should have someone that is doing a better job of explaining those things and listening to your needs.

The most efficient way for educated investors is usually through index funds, but casual investors will panic and sell low and then buy high because they don't have the knowledge base necessary to remain calm. The proper investing portfolio for you would involve a few indexes, but I won't prepare it. I don't do individual financial advice. I am paid to do portfolio analysis and individual company analysis. Since I don't desire your business, I have no vested interest in your choice. However, the things you told me about your adviser are things that would cause me great concern if I were to hear them from a family member.
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Old 01-13-2015, 01:28 PM
Location: Idaho
4,622 posts, read 4,462,694 times
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Originally Posted by nicet4 View Post
...our combined social security will exceed $4,300 tax free dollars every month...
Just want to mention that even though you live in a state that does not tax SS income, the federal government still does. Something to keep in mind for planning purposes.
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Old 01-13-2015, 01:37 PM
4,649 posts, read 6,480,471 times
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If your just looking for a lifetime of payments the annuity is the way to go. Keep it simple. When looking at the markets just ask yourself is it worth the risk? Can you handle any loss?

Just remember your retired and go from there. Many people will say go equities but many
people rely on that guaranteed soc sec check every month. I say get a final expense life insurance policy for a funeral and start enjoying life. Spend it all because with all the savings plans available to young folks today they can build their own nest egg.

67 is young and weed is legal in Colorado. Go to a concert and partay. If not that try Vegas for a weekend d.
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Old 01-13-2015, 01:50 PM
Location: Mount Airy, Maryland
10,460 posts, read 5,924,770 times
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Originally Posted by Escort Rider View Post
Eok is correct. Once "full retirement age" (66 for most of us posting here) is reached, there are no more earnings limitations connected with receiving Social Security.
But there are tax implications for earning over the level set by SS
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Old 01-13-2015, 05:05 PM
29,775 posts, read 34,860,277 times
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Originally Posted by DaveinMtAiry View Post
But there are tax implications for earning over the level set by SS
Many think higher earnings are worth the resulting increases on taxes at any age
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Old 01-14-2015, 01:52 AM
2,064 posts, read 3,698,819 times
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A few things:

1) Re-evaluate the financial advisor. You are obviously very risk averse and he should have taken that into consideration when investing your funds. You are ok with gaining 5% when the market is gaining 15% but you are not ok with losing 10% when the market loses 10% so he should have you mostly in fixed income and only some equities. I'll bet if he had stuck you into 80% vanguard total bond market and 20% vanguard total stock market, you would have come out ahead and something like this is probably more aligned with your goals. Heck, if you have enough capital where minimal growth is all you need, an inflation protected security (vanguard tips) is probably good enough as well. I'll also bet that he's taking a lot of fees and buying a lot of dubious and high cost funds.

However, if it does make you feel better you don't have to do everything DIY. It isn't hard but if you're not comfortable with it, don't do it. Find a good fee-only advisor who is part of NAPFA and interview a few of them.

2) An annuity (as others have mentioned) is also a good idea here since it's guaranteed income that you will be getting.

3) Don't trust anyone that comes referred to by friends or family who work at a big firm (especially firms such as Edward Jones, LPL, etc.)
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