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Old 03-15-2015, 03:40 AM
 
Location: Northern VA
512 posts, read 632,148 times
Reputation: 621

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Scary retirement income reality Bankrate, Inc.

Short article but some good points in it.

Issues:
Social Security full retirement age is rising
Medicare premiums are going up
More Social Security benefits are taxed

Steps to Take:
Work longer
Put off claiming Social Security
Save more
Tap your home equity

The only thing I didn't like was the chart on suggested retirement savings targets. I've never seen retirement savings goals shown this way.
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Old 03-15-2015, 03:44 AM
 
71,535 posts, read 71,712,424 times
Reputation: 49120
the biggest issue is most who retire before fra do so not by choice . jp morgan did a very nice study on alot of different aspects and only 27% of those who retire early did so on their own terms and were fully prepared.

healthcare costs have blown most ball park savings estimates out of the water .

at one time studies showed we spend less as we age reducing the need for inflation proofing every year as the calculators use.

what we no longer did or bought covered the increases in what we did . but healthcare costs un-did the entire study . they are escalating so fast that it is eating up the money that was used to cover that inflation adjusting and bigger savings are now needed to compensate,

at one time these calculators over stated what you needed since they planned on more inflation adjusting than folks really needed but today that may not be true anymore because of all the costs of healthcare even if we are well..

while folks will always find a way to make do , the lifestyle they planned on will take a hit or they will live a lot more stressful lives with every unexpected expense being a horror in the budget as the slack in the budget for these things gets eaten up by increasing healthcare costs..

while we don't want to work longer many with that choice will have to or risk a big shortfall in income by going out to early.

marilyn and i are healthy and the two of us blew through 17k in dental last year between us . it is incredible what healthcare eats up .

with me on cobra , marilyn on medicare and a medigap plan and our long term care policy it is more than many folks have as an entire budget to live and that is without dental , glasses or hearing aids if needed. .

http://mm-photography.smugmug.com/ph...vR8KC2d-X3.png

http://mm-photography.smugmug.com/ph...TG8M7Fz-X3.png

Last edited by CaseyB; 03-15-2015 at 03:01 PM..
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Old 03-15-2015, 04:04 AM
 
Location: Los Angeles area
14,018 posts, read 17,735,102 times
Reputation: 32304
I found the article too simplistic. As for the "issues", the full retirement age is going up only a year, from 66 to 67. Yes, that makes a difference, but not an earth-shattering one.

"Medicare premiums are going up". The article states that they are "expected" to go up. Indeed the expectation may be met, but it remains speculation.

"More SS benefits are taxed". This is because of inflation, not because of any increase in the percentage of benefits subject to taxation or increase in tax rates. Since the tipping points for triggering taxation of SS (set in 1984, if I recall correctly) are not indexed for inflation, over the years (gradually) more and more people reach those tipping points.

The "steps to take" are rather obvious and have been discussed ad nauseam.

I agree that many people will be between a rock and a hard place going forward, but the article is too short to be very meaningful. It's sort of a sound bite.
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Old 03-15-2015, 04:25 AM
 
Location: Colorado Springs
4,837 posts, read 4,952,340 times
Reputation: 17302
The answer you'll get from all of the articles written by investment advisers like Fidelity is for you to continue working and saving and of course, sending your savings to them so they can invest it for you and take their commish.

As for me, I could retire now but I really enjoy my work.

If it's this much fun it doesn't seem like work.
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Old 03-15-2015, 04:54 AM
 
5,619 posts, read 8,551,029 times
Reputation: 7705
Really?!?

At 67 you should only have 8 years worth of income!?!
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Old 03-15-2015, 04:56 AM
bUU
 
Location: Georgia
11,881 posts, read 8,660,399 times
Reputation: 8401
Yes, those numbers seem a bit low, and they're arrayed rather simplistically.
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Old 03-15-2015, 06:29 AM
 
2,429 posts, read 3,223,870 times
Reputation: 3330
Do we really need a study to know this. If you can't afford to retire or need more money in retirement...work longer. If you want to save money...live below your means, or cut your expenses. No &#(@ Sherlock. Thank goodness my taxes dollars didn't pay for that "article."

Quote:
Steps to Take:
Work longer
Put off claiming Social Security
Save more
Tap your home equity
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Old 03-15-2015, 06:39 AM
 
71,535 posts, read 71,712,424 times
Reputation: 49120
some of the studies do produce worthwhile facts as things change .

i don't think most planners even realize that healthcare costs have just about negated the sun life study and ty bernkes work on retiree spending.

that study has played a big part in the past in allowing retirees to retire with as much as 30% less than calculators tell you that you needed,.

the whole study showed that retirees spend in a smile shape.

more early on , less in the middle and then more after 80 on healthcare.

but with us living alot longer and healthcare costs soaring it has pretty much wiped out the savings we were seeing from reduced descretionary spending.

it was that lack of inflation adjusting that made those amounts needed so over stated , but that may not be the case anymore.

it isn't just about medicare anymore it is about the medigap and advantage plans as well .

while you can get advantage plans in all price ranges the coverages vary as well.

http://mm-photography.smugmug.com/ph...hRkHnMf-X3.png

Last edited by CaseyB; 03-15-2015 at 03:02 PM..
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Old 03-15-2015, 09:12 AM
 
Location: Jamestown, NY
7,841 posts, read 7,328,515 times
Reputation: 13779
Quote:
Originally Posted by Escort Rider View Post
I found the article too simplistic. As for the "issues", the full retirement age is going up only a year, from 66 to 67. Yes, that makes a difference, but not an earth-shattering one.

"Medicare premiums are going up". The article states that they are "expected" to go up. Indeed the expectation may be met, but it remains speculation.

"More SS benefits are taxed". This is because of inflation, not because of any increase in the percentage of benefits subject to taxation or increase in tax rates. Since the tipping points for triggering taxation of SS (set in 1984, if I recall correctly) are not indexed for inflation, over the years (gradually) more and more people reach those tipping points.

The "steps to take" are rather obvious and have been discussed ad nauseam.

I agree that many people will be between a rock and a hard place going forward, but the article is too short to be very meaningful. It's sort of a sound bite.
Bankrate.com articles are always like this.
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Old 03-15-2015, 11:34 AM
 
Location: UpstateNY
8,612 posts, read 8,301,089 times
Reputation: 7523
Folks, please check out the Aetna Vital Savings health discount plan. For a family membership it's 12.99 a month and saves me 25 percent off dental. vision, chiropractic and prescriptions.

Saves me 80 bucks a month at the chiropractor for the two of us. I first read about it in AARP mag, then called my dentist to see if she participated. They were all over it. I signed up after making that call and had my membership cards in a week. No I don't work for them.
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