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Old 06-15-2015, 04:51 AM
 
649 posts, read 554,063 times
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Quote:
Originally Posted by Tuck's Dad View Post
The wife wants to be closer to the grandkids, and I want to chase some dreams and do some traveling while I am still in good health and sound mind (always wanted to write, but had to be realistic about supporting a family, so now is my time - and if I am one of the ~95% that never make it big, well, no harm no foul!).
This is the one thing that I never see considered in all of these calculations, not saying that folks don't, just saying that they don't discuss how it impacts their decision.

I know that people are living longer, however, realistically, how many 80+ year old do we see doing world travel, etc. Maybe I am just not looking at this right, but I would think that by the break even point, which is 78-82 on average, most people would have minimal debt, less if any travel, buying less stuff, etc.

I get hedging inflation, probable higher med costs, which has a cap on out of pocket costs, but what is the point of having more money when most people won't actually need it?
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Old 06-15-2015, 10:13 AM
 
Location: Forests of Maine
30,680 posts, read 49,437,227 times
Reputation: 19129
Quote:
Originally Posted by mathjak107 View Post
i saw this little view of things on another website and liked it.

1) Take SS at 62 and die sooner than average. -- I paid more into SS than I collected, but I'm dead and don't care.
2) Take SS at 70 and die sooner than average. -- I paid more into SS than I collected, but I'm dead and don't care.
3) Take SS at 62 and die much later than average. -- Taking lower SS could hurt me if my retirement portfolio is not enough for my unexpected long life. Potentially a large cost.
4) Take SS at 70 and die much later than average. -- I'm getting the maximum, inflation adjusted SS benefit at the same time I'm spending more than expected from my retirement portfolio. Potentially a large advantage.

of course there are many factors to consider but it was a nice blurb any way.
If only we had reliable crystal balls.

With my military pension, there is a program for the spouse called Survivor Benefit. Basically the way it is explained is: if I put 10% of my pension into SB, then when I die she can get 10% of my pension. If I put 20% into SB, then she will get 20% of my pension, and so forth. I could put all 100% of my pension into SB, and she would get all of my pension.

It is all a gamble. The only way to make the 'right choice' is you first need to know the exact year of when you will die.
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Old 06-15-2015, 10:29 AM
 
Location: Whereever we have our RV parked
8,778 posts, read 7,698,666 times
Reputation: 15043
I didn't know it was a competition? Who Knew?
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Old 06-15-2015, 11:34 AM
 
530 posts, read 537,777 times
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Quote:
Originally Posted by mathjak107 View Post
i saw this little view of things on another website and liked it.

1) Take SS at 62 and die sooner than average. -- I paid more into SS than I collected, but I'm dead and don't care.
2) Take SS at 70 and die sooner than average. -- I paid more into SS than I collected, but I'm dead and don't care.
3) Take SS at 62 and die much later than average. -- Taking lower SS could hurt me if my retirement portfolio is not enough for my unexpected long life. Potentially a large cost.
4) Take SS at 70 and die much later than average. -- I'm getting the maximum, inflation adjusted SS benefit at the same time I'm spending more than expected from my retirement portfolio. Potentially a large advantage.

of course there are many factors to consider but it was a nice blurb any way.
... Very Good 'summation' of the different scenarios, mathjak! ... I think my personal experience

I got layed-off from my temp-contractor position in 2007, and drew California Unemployment until it ran-out (for me) ... That was some time in 2008. Here in Cali [Sillycon Valley], there were few jobs, people were leaving the state in droves (much like they still are, but that's a whole-other post), but we were "stuck-in-place" with no work - both my spouse and me.
We couldn't have made ends meet, had I not begun taking my SS - which I became eligible for in 2007 (62). Talk about learning to live on less ... But, we did it!

Toward the end of 2009, I finally got hired-on to another temp-contract job, my DW also got hired as a full-time employee, and we began banking my SS. She was still too young to begin drawing hers.
Came Tax-Time, we made some beautiful payments to both of our individual retirement plans (IRAs), which really helped us get better-prepared for our upcoming retirement (now ~2 years off).
We've followed that plan for the last 5 years, and I believe we're in much better shape for retiring because I began taking SS at age 63, than we would have been had we waited ... we'd be in a significantly-lower income category.

So, if I do live long enough, I'll have drawn my SS since age 63, and my Doc says I could live another 20-25 years (if I take care of myself ) ...

... Apologies for this overly-long post! ...
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Old 06-15-2015, 12:09 PM
 
11,933 posts, read 20,383,027 times
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Well -- OP, I think my sister nailed it!

She got fired from a job she didn't like but was good at, when she was 61. Her officemate was hysterical, my sister was calm. She went home and worked in her garden, expecting it to hit her, and she would break down and cry.

The next day, she woke up and thought, maybe today it will hit me... and went shopping and played with her grandkids.

the third day she woke up laughing she didn't have to go into that place anymore.

She was having trouble finding a new job, but was enjoying not working when she was talking to a friend who suggested she look at widows benefits. Her late ex husband and she had been married for 25 years....

And she confirmed with Social Security yes -- she could.

And thanks to him, she retired.... and on his SS, she's making way more money than when she worked....
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Old 06-15-2015, 03:53 PM
 
5,822 posts, read 13,313,859 times
Reputation: 9290
Quote:
Originally Posted by elliotgb View Post
I recently went to a Social Security seminar and it was stressed to wait until FRA, if you can.
Again, it's a YMMV situation and everyone's needs vary.

I will dig out my material later and highlight the salient points.
Some good info there that I am sure will be debated here.

Personally, I plan to "try" to wait until age 66.
One never knows, though.
SS Adm hopes that people wait until FRA so they have more $$ for the government to use as a slush fund and probably are betting many die before they collect.
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Old 06-15-2015, 06:23 PM
 
Location: Los Angeles area
14,018 posts, read 17,732,288 times
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Quote:
Originally Posted by Ellwood View Post
SS Adm hopes that people wait until FRA so they have more $$ for the government to use as a slush fund and probably are betting many die before they collect.
The Social Security Administration doesn't have any particular "opinion" one way or the other, since all of their policies and computation formulas are established by the United States Congress. The SSA simply administers the program by determining eligibility and writing the checks, etc. Only Congress has the power to change anything.

In the long run, it is pretty much a break-even game (a wash) as to the financial impact on the Social Security Trust Fund balance. For everybody who dies between ages 62 and full retirement age without applying for benefits (thus saving money for SS), there is someone else who files at full retirement age and lives long enough to collect more than they would have collected by filing at age 62. That is the system - that is the way it is set up, i.e., to be a wash.

It is an absurdity to impute some nefarious "hopes" to the SSA. If there are any "hopes" at all, they would be on the side of efficiently serving the retired population, which is their mission, just as intended by Congress and President Roosevelt when the whole thing was started back in 1935 or 1937, or whenever it was at about that time.
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Old 06-15-2015, 06:28 PM
 
Location: Eastern Washington
14,228 posts, read 44,895,263 times
Reputation: 12808
Am I oversimplifying it to think that the variations in payment levels with taking SS later in life are exactly balanced by what they think your actuarial remaining lifetime is? In other words, the statistically expected integrated benefit is the same for all retirement dates - right?
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Old 06-15-2015, 08:19 PM
 
Location: Florida
4,360 posts, read 3,696,311 times
Reputation: 4085
Quote:
Originally Posted by M3 Mitch View Post
Am I oversimplifying it to think that the variations in payment levels with taking SS later in life are exactly balanced by what they think your actuarial remaining lifetime is? In other words, the statistically expected integrated benefit is the same for all retirement dates - right?
This is the general idea. If everyone died on the average life expectancy date all would collect the same amount of SS.

So if you are in good health (or just one of the 50% that do not die on the life expectancy date) you can come out ahead.
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Old 06-15-2015, 08:46 PM
 
Location: Las Vegas (Winchester)
412 posts, read 307,310 times
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I look at SS as a deferred annuity. It is one part of my overall portfolio. I am juggling the decision whether to buy "longevity insurance" in the form of a deferred annuity that pays out after 80 or waiting to draw SS at age 70, instead of at full retirement age (66 1/3).

I don't fully trust models showing a specific return on investment unless you're using TIPS. I see SS as something that I know "should" be there regardless of what the markets might deliver in the future.

So long as my savings can cover my expenses and provide a little extra, I'll defer from gambling with my SS. I gamble more than enough with my existing savings.
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