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I inherited not too long ago a fridge from the 1970s that still works perfectly after running continuously for all those years. I am lucky to have a modern appliance last 5 years yet alone 40+. Stuff today is made cheaply and prone to fail, even high end brands. A $700 front loader washer completely fell apart after less than 3 years of use every couple of weeks. It's just sad. .
One thing is most older appliances can be fixed and parts are reasonable... the moment circuit boards were introduced so was planned obsolescence...
A friend still regrets giving away her old Speed Queen laundry pair when she spent $2400 for new front loaders... she is retired and had the old pair over 15 years... the new ones were nothing but trouble... so much so she got rid of them... expensive when you are a widow and retired.
Mom worked on and off throughout her career taking time off for us kids... her Social Security totaled $600... Dad kept working until he passed away at age 74 and was still working getting chemo or dialysis early in the morning so he could get to work... Mom now gets his SS which was tripple what she was getting... that is exactly how they planned it and why Dad never retired...
I know a lot of people with a lifetime of work in the $1500 SS bracket at age 62.... medical is their biggest obstacle until 65
If a person worked from ages 22-65 is it possible they can live off of Social Security alone in retirement without savings and a pension plan?
Depends. How do they want to live in retirement? If one earned the maximum all the years he worked, didn't save a dime, he is forced to live on maximum SS benefit (today) of $2,639. Average SS benefit today is $1,335.
Thanks. After 3 years of hospice with her telling us that she did not want to live that way in her more lucid moments, it helped some to know it was relief for her but it still is hard seeing a parent pass.
It is one of the possible things the money is there for. I was responding to someone else bringing up one of our common complaints in that it doesn't seem like it should be so expensive (and isn't in other parts of the world). She co-owned a house with her SO that was not their primary residence but was going to be "someday" before her health faltered. He will likely lose that (had to put it in a trust to get her where she was).
That is so sad. We have dreams of what our lives could be, and we work so hard to try to put that into stone. Then life gets in the way- sorry for both of them.
That is so sad. We have dreams of what our lives could be, and we work so hard to try to put that into stone. Then life gets in the way- sorry for both of them.
Yes. One of my sisters and her husband planned to do some traveling in their retirement years. At 65, he was diagnosed with MS. When MS shows up that late, it's in a form that does not respond to drug treatment. He is 69 and just moved into a wheelchair.
They are ok with their retirement, not rich, but ok. But their plans are now drastically changed. The travel is out. How he feels and what he can do varies day to day.
Absolutely, but only if you're fairly high income for 35 of those years.
Here is the math from my Social Security statement with 35 years of maximum contribution to the system:
Collect at 62: $24,108/year in Social Security benefits
Collect at 66 8 months: $33,720
Collect at 70: $42,828
If I were wiped out financially, I'd have to move to a lower cost of living area but I could live on $24,108 in a very scaled back lifestyle. My plan is to not collect until age 70 since Social Security is COLA-adjusted. With a paid-for house, I'd have no problem living on $42,828. Where I live, I could rent something modest and be OK. My IRA/401(k) required minimum distributions end up being 100% disposable income.
Same numbers for me (also maxed out) since we are both the same age. Remember to point out that those values are in 2016 dollars. Use a SS calculator and determine, based on a guess at inflation, what the actual checks would be in say 2028, for age 70. More like $54k, assuming 2%. This is important because when one calculates what your withdrawals from IRA, etc, or income from investments, it will be IN 2028 dollars. One just hopes to have more of them to draw on then; ie what the growth is exceeds inflation for a net gain. If you have $500k saved now, and expect to have $750k due to growth and contributions at 70, you mentally think "I'm all set, I will have 50% more available to spend at 70". But you won't. With just 2% inflation that 500k has to grow to be $634k just to break even. So you really only will have 116/750= 15.5% more. Oops!
So the real value of delaying is not only the DRC increased amounts but the compounded COLAs for years.
Percents never really paint a great picture, especially if you don't account for inflation. 72% more, (70 vs 62) while sounding impressive, isn't as impressive when using the SSA numbers without taking inflation in to account, and say the age 62 amount is more like the average of $13k. So when one looks at the "logic" of delaying it becomes a "$13k a year now and for 8 more years vs $22.4k at 70" decision. So pass up $104k now, for $9.4k a year more later???
But make it $24k and the real inflation number of $54k, and WHOA, while you may pass up on $192k (24K x 8 years), it's for an inflation increased $30k a year, (54-24k) and suddenly its an easier decision to make IF you can afford it. $9.4 k more to pass on $104k VS $30k more to pass on $192k. Big difference. $30k more is more than double what you would have gotten, and $30 is just plain a lot more extra money a year than $9k is!
Sorry for the side track.
Last edited by Perryinva; 06-02-2016 at 12:20 PM..
If a person worked from ages 22-65 is it possible they can live off of Social Security alone in retirement without savings and a pension plan?
I dont understand this. Anybody working from 22-65 can save and invest for their future. Even investing $25 a week for 30 years would make a HUGE impact on retirement.
I dont understand this. Anybody working from 22-65 can save and invest for their future. Even investing $25 a week for 30 years would make a HUGE impact on retirement.
In a sense I don't understand it either, but the thing is people do lots of things that are irrational and that don't make sense. Spending every dime you have and more (by going into credit card debt) is one of those things, and I am talking about people who earn more than minimum wage. Some people seem to be incapable of taking a long-term view of anything. That's just reality.
When I took psychology in college some five decades ago, I remember one of the profs saying that one definition of maturity (and there are various definitions) is the ability to defer gratification in the interest of some longer-term gain. Consider a five-year-old. We don't expect a five-year-old to be able to defer gratification. But there are 30-year-olds who aren't much better at it. So the "understanding" involves the realizaion that not everyone is like you and me.
I dont understand this. Anybody working from 22-65 can save and invest for their future. Even investing $25 a week for 30 years would make a HUGE impact on retirement.
I understand it. I am fortunate not to have had to decide to live where I really don't want to because I can't quite afford the place I want to live and put away a little or live where I want to and hope there will be extra at some point in the future, but I know people who have faced or still face that decision. Not everyone who doesn't save is wasting money on frivolous things; lots are barely getting by. I do scold some younger coworkers who are not saving but wouldn't have to make hard choices to do it, but I understand it isn't that way for everyone. And just to be clear, when I say deciding between places to live I don't mean luxury living versus not quite as nice; I mean sub standard housing versus a nice safe place.
The men in my family haven't made it much past 70. I'm taking SS at 62 because I'm determined to retire from the daily grind. Knowing family history, it just doesn't make sense to wait.
The men in my family haven't made it much past 70. I'm taking SS at 62 because I'm determined to retire from the daily grind. Knowing family history, it just doesn't make sense to wait.
That makes sense. My Dad took an early retirement offered due to downsizing when he was 55. He had a service-related disability check coming in, too, so he could swing it even though he still had three minor children at home.
But one of the reasons he took it was that his father died of a heart attack at 59, and all but one of his father's brothers died of heart attacks in their 50s and 60s. One uncle lived into his 70s. He thought he might not have much time left, and he was a double amputee, which also put stress on his heart.
He lived to be 78, for which I am grateful.
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