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Old 04-11-2015, 12:29 PM
 
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A financial show I listen to regularly (Hanson and McClain on KFBK out do Sacramento..fee only advisors) advise to take SS early if you DONT need it at 62. Their reason is that they think it will be means tested down the road.

I'm curious to know if anyone is going to take it at 62 or before FRA for that reason primarily? I'd hate to wait u til 70 to discover I won't get as much as I thought!
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Old 04-11-2015, 01:00 PM
 
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I'm 55 this year. So 8 years from possible ER even if I do it at 62...and 10 years from 65....and even then my FRA is 67.

Yes, I do fear means testing. But I'm so far from retirement. I can't really worry about it. Other than staying informed, voting against politicians, who support that there's nothing I can do but execute MY plan to have as much of my own money as I can.

Heck I think, the government might try to just seize some people's money, if they think they have too much. Look at what greece tried to do a year ago. I don't put ANYthing past ANYone...especially politicians. I live in a state where they passed a RAIN tax! They want to tax you for the water run off from your freaking house!
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Old 04-11-2015, 01:15 PM
 
Location: Los Angeles area
14,018 posts, read 17,735,102 times
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I have no crystal ball. However, it seems strange to me to base a major decision on speculation about what MIGHT happen in the future legislatively. I have serious doubts whether such a measure would pass Congress. For one thing, the valid argument would be raised that Social Security retirement benefits are already means tested in two significant ways:

1. Low wage earners receive a substantially higher percentage of their average wages back as benefits than do high wage earners.

2. People who have significant income in addition to Social Security retirement benefits pay federal income tax on 85% of the SS benefits, whereas people who have Social Security income only (or mostly) do not pay any federal taxes on it.
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Old 04-11-2015, 01:32 PM
 
Location: Great State of Texas
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What used to be static is now turning fluid.

Congress just approved certain unions in financial problems to cut their current retiree pensions.
That would have been unheard of a mere 5 years ago.
So even if you take it early is no guarantee you are "locked in".

Your best bet is to stay on top of the hearings that go on inside the various labor departments.
There was a flurry of "We should manage 401K/IRA accounts" meetings a few years ago which ended up in some infighting between Congress, DOL and that new Consumer Protection Agency all saying they could do it themselves.

We have the upcoming "SSDI has run out of money" next year so pay attention to how that gets solved.

And even though SS is our money that we contributed over the years, it's treated as another entitlement program right up there with welfare as far as most of the media is concerned and the youth is convinced we are draining all their finances.

SS is full of non negotiable Treasuries from all the borrowing Congress has done and Congress has no money to pay them off.

I think we all realize that the status quo is unsustainable and the height of the boomer birth was 1957 which means the greatest number of boomers will turn 66-67 in another 8-9 years. That means we have 8-9 more years of increasing SS recipients until we peak in 2023 and then start dropping.

Between SS going broke and talk of government managing our 401K/IRA accounts there are days that I think my safest bet is the "First National Bank of the Mattress".

But at this current time government is pushing for current workers to have automatic savings taking out of their paychecks. Both states and the Fed are doing this so they now have a revenue stream and investors get low yield special Treasuries at about 2% interest rate.

Just keep abreast of what is going on in DC and don't wait for headline news because when it hits the headlines it's too late to act.
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Old 04-11-2015, 01:34 PM
 
Location: Great State of Texas
86,093 posts, read 72,507,006 times
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Quote:
Originally Posted by Escort Rider View Post
I have no crystal ball. However, it seems strange to me to base a major decision on speculation about what MIGHT happen in the future legislatively. I have serious doubts whether such a measure would pass Congress. For one thing, the valid argument would be raised that Social Security retirement benefits are already means tested in two significant ways:

1. Low wage earners receive a substantially higher percentage of their average wages back as benefits than do high wage earners.

2. People who have significant income in addition to Social Security retirement benefits pay federal income tax on 85% of the SS benefits, whereas people who have Social Security income only (or mostly) do not pay any federal taxes on it.
It's not means tested when it's paid out to you. That is what the means testing applies to..your payments after you retire. That is static.
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Old 04-11-2015, 01:53 PM
 
Location: Los Angeles area
14,018 posts, read 17,735,102 times
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Quote:
Originally Posted by HappyTexan View Post
It's not means tested when it's paid out to you. That is what the means testing applies to..your payments after you retire. That is static.
Sure it is means tested when it's paid out to you. I'll try to explain it to you again. It's means tested by the formulas which are used to compute the amount you receive. You don't receive as much percentage wise if you were a higher wage earner. Then AFTER you receive your payments they are means tested a second time by whether you pay federal income taxes on them. Both of those things have been true since 1984, and the differentials in the formulas probably before 1984.

Now it is possible that Congress may at some point pass additional means testing on top of the two means tests which I enumerated. Those potential additional means tests are the subject of this thread. However, everything has its context and I am placing the thread topic in a proper context for understanding.
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Old 04-11-2015, 01:59 PM
 
2,294 posts, read 1,560,729 times
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Quote:
Originally Posted by HappyTexan View Post
It's not means tested when it's paid out to you. That is what the means testing applies to..your payments after you retire. That is static.
Currently, but not necessarily in the future. And not if someone such as our current President has his/her way.
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Old 04-11-2015, 02:04 PM
 
Location: WA
5,395 posts, read 21,395,985 times
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Quote:
Originally Posted by Escort Rider View Post
I have no crystal ball. However, it seems strange to me to base a major decision on speculation about what MIGHT happen in the future legislatively. I have serious doubts whether such a measure would pass Congress. For one thing, the valid argument would be raised that Social Security retirement benefits are already means tested in two significant ways:

1. Low wage earners receive a substantially higher percentage of their average wages back as benefits than do high wage earners.

2. People who have significant income in addition to Social Security retirement benefits pay federal income tax on 85% of the SS benefits, whereas people who have Social Security income only (or mostly) do not pay any federal taxes on it.
Agree... and all proposals to change SS rules thus far incorporate a notice so people 55 and older are not covered by the change.

There is no doubt the system will have to change to stay solvent but changing your financial plan based upon speculation is not sound reasoning.
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Old 04-11-2015, 02:11 PM
 
Location: Grove City, Ohio
10,133 posts, read 12,383,606 times
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Quote:
Originally Posted by Burkmere View Post
A financial show I listen to regularly (Hanson and McClain on KFBK out do Sacramento..fee only advisors) advise to take SS early if you DONT need it at 62. Their reason is that they think it will be means tested down the road.

I'm curious to know if anyone is going to take it at 62 or before FRA for that reason primarily? I'd hate to wait u til 70 to discover I won't get as much as I thought!
They're idiots.

Total idiots with idiot advice.

May be 30 years from now but not today and not inside the next 10 years at a minimum.
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Old 04-11-2015, 02:25 PM
 
29,779 posts, read 34,867,277 times
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Quote:
Originally Posted by Burkmere View Post
A financial show I listen to regularly (Hanson and McClain on KFBK out do Sacramento..fee only advisors) advise to take SS early if you DONT need it at 62. Their reason is that they think it will be means tested down the road.

I'm curious to know if anyone is going to take it at 62 or before FRA for that reason primarily? I'd hate to wait u til 70 to discover I won't get as much as I thought!
As with the entire income picture it is a concern. There are currently advocates for means testing SS and medicare above certain Income thresholds. It can also be a tool to destroy support for each program. The Ryan/republican Medicare reform proposal provideseams testing to Medicare/senior health assistance. If the federal govt contribution is capped at $6,500 those below certain income points would be eligible for other assistance prohrs and those above not,
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