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Old 03-29-2016, 10:29 AM
 
Location: RVA
2,172 posts, read 1,269,651 times
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Don't know what I was thinking. I think I was remembering the charts from SSAnalyze. So for say, a 58 year old where SSA estimates a top SS of $43k/yr at age 70, in todays dollars, the actual check, with even just 1% inflation per year, would be about $48,500. 1.5% inflation brings it to about $51,500.

Whereas, if you were to collect your predicted (in todays dollars) $24k at 62, (which would be a check of $25k then), by the time you were 70, that check (at 1% inflation), would only be $27k.

Thats a difference at 70 of over $21k. Very very significant.

Last edited by Perryinva; 03-29-2016 at 11:54 AM..
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Old 03-29-2016, 07:53 PM
 
Location: Florida
5,264 posts, read 3,025,579 times
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Cost of living increases are based on figures from the Bureau of Labor Statistics. They exclude food and fuel. If, as many seniors have, your home is paid for and you have no commute or job expenses, then food and fuel are major parts of your expenses. There have been no COLAs for a few years now. This does not apply to members of Congress.
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Old 03-29-2016, 08:18 PM
 
Location: RVA
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Wasn't 2016 the first year in quite a while that DIDN'T have an increase? Why would you say there haven't been any for years?

Further, the question from the OP was a hypothetical based on IF there were COLAs, then WOULD the estimates reflect them. I believe SSAnalyze states the average over the last 20 years was around 1.75%.
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Old 03-30-2016, 02:53 AM
 
71,735 posts, read 71,829,507 times
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Quote:
Originally Posted by engineman View Post
Cost of living increases are based on figures from the Bureau of Labor Statistics. They exclude food and fuel. If, as many seniors have, your home is paid for and you have no commute or job expenses, then food and fuel are major parts of your expenses. There have been no COLAs for a few years now. This does not apply to members of Congress.
wrong wrong and wrong .

the cpi index used for colas certainly does include food and energy . where do you people get this stuff ? do you actually look it up or just parrot what other mis-informed people say

the core cpi excludes it but the index's used for the cola adjustments the cpi/w most definitely include them.

this is where having a piece of information is not a good thing because folks do not understand the whole story .

the core cpi excludes it because it changes on a dime . we were paying 5 bucks a few months ago for strawberry's and i bought the same box yesterday for 1.00 .

the core is not used at all for calculating the cpi when it comes to colas .


SS COLAs are based on the CPI-W. The CPI-W is a price index intended to represent the prices faced by “urban wage earners and clerical workers.” The BLS tabulates the CPI-W by directly collecting price data from around the country on items in specified “market baskets.” The BLS uses consumer survey data to determine the contents of the market basket, but it’s meant to mirror expenditures felt by “urban wage earners and clerical workers.” the CPI-W does include food and energy for sure , and therefore SS COLAs, do respond to changes in food and energy prices.

but all the cpi's are only price change index's on baskets of good and they don't reflect anyone's actual cost of living . your personal cost of living is dependent on a whole lot more then just the changes on a basket of goods some of which you have no use for and some you use more heavily then other folks .

in the real world having a fixed rate mortgage is very different then renting . owning a car and driving is very different then not . the amount of inflation in higher end goods is more then lower end .

Last edited by mathjak107; 03-30-2016 at 03:09 AM..
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Old 03-30-2016, 03:28 AM
 
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here is a description of the popular cpi indexes



The Consumer Price Index for All Urban Consumers (CPI-U) was introduced in 1978. It includes all urban households within an area that have inhabitants of 2,500 or more. It does not include rural consumers and those that are in military and other institutions. It represents the buying habits of more than 80 percent of the population of the United States including those that are self employed, retired workers, professional workers, clerical, and part-time workers, and even those who are unemployed. It is more of a general index and traces how retail prices affect urban consumers of goods.

The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), on the other hand, includes sales, craft, service or labor, and clerical workers who must have been employed for 37 weeks or more. It represents 32 per cent of the United States population and is a subset of the CPI-U. It traces how retail prices affect workers who are paid hourly and those that do clerical work. The Social Security Administration uses data from the CPI-U to decide its annual rate of increase.


The CPI-W gives more importance on everyday needs such as food and transportation expenses, clothes, and other goods and services. Housing, medical care, and recreation are given less importance in the CPI-W.

Read more: Difference Between CPI-U and CPI-W | Difference Between | CPI-U vs CPI-W Difference Between CPI-U and CPI-W | Difference Between | CPI-U vs CPI-W
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Old 03-30-2016, 08:14 AM
 
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Yes, it will go up. The prediction goes up before you file, and the amount you get is adjusted after. How much is TBD.
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Old 04-01-2016, 12:55 AM
 
Location: Los Angeles area
14,018 posts, read 17,751,136 times
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Quote:
Originally Posted by Perryinva View Post
Don't know what I was thinking. I think I was remembering the charts from SSAnalyze. So for say, a 58 year old where SSA estimates a top SS of $43k/yr at age 70, in todays dollars, the actual check, with even just 1% inflation per year, would be about $48,500. 1.5% inflation brings it to about $51,500.

Whereas, if you were to collect your predicted (in todays dollars) $24k at 62, (which would be a check of $25k then), by the time you were 70, that check (at 1% inflation), would only be $27k.

Thats a difference at 70 of over $21k. Very very significant.
Why is it people never quote the amount which would have been received during the eight years between 62 and 70? In the above example, that would be a bit over $200,000. So the age 70 collector starts out $200,000 in the hole - also very significant. There is no way to get around the fact that the break-even age is somewhere in the late 70's. There is an advantage to taking SS at 70 only if one lives past the break-even age, which a lot of people do of course, just as a lot of people don't.

Waiting until 70 is good insurance against the possibility of living a long time, say, to 85 or 90 or 95. So I am not arguing against it. I am just saying that the difference between 62 and 70 is not the huge, overwhellming no-brainer that is so often described.
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Old 04-01-2016, 01:28 AM
 
10,819 posts, read 8,071,380 times
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Quote:
Originally Posted by Escort Rider View Post
Why is it people never quote the amount which would have been received during the eight years between 62 and 70? In the above example, that would be a bit over $200,000.
In my personal IRL experience with people who choose to start benefits at 62 rather than 70, it's because they pretend they'll invest the benefits instead of spending them and therefore come out way ahead of me.
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Old 04-01-2016, 02:43 AM
 
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it isn't so much the fact they don't invest the checks but rather the opposite . those who do delay are spending down already invested assets by delaying unless they have pensions , but then again for those who do the pay checks never really stopped .

figuring lost checks and a balanced portfolio returning a 6% average return break even would be 22 years but could be longer with spousal benefits figured .

if you figure TIPS instead of a balanced portfolio which assumes a lower return , break even is 20 years .

but the return you get by delaying quickly accumulates because we are talking a 69% bigger check plus colas so returns are real return .

if one of a couple makes it until 90 which there is almost a 50% chance one of them will , they will see a whopping 5% real return which rivals equity returns.

only difference is they did not have to be subjected to market swings , risk , rates and a pretty good chance they may not achieve that 6% return .

that is the reason we are going to try to delay .
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Old 04-01-2016, 11:49 AM
 
10,819 posts, read 8,071,380 times
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Quote:
Originally Posted by mathjak107 View Post
it isn't so much the fact they don't invest the checks but rather the opposite . those who do delay are spending down already invested assets by delaying unless they have pensions , but then again for those who do the pay checks never really stopped .
I actually don't know a single person who spent or is spending down assets while delaying SS, so that affects my perspective. In my bubble, people with assets also have adequate pension or other income (dividend, rental) without SS, and people without assets have no pensions so they of course have to draw SS as soon as they retire.
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