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Based on the information shared I would not touch the 401(k) balance. This is assuming: 1) there are no other substantial balance savings to be a safety net, and; 2) no reason their monthly living costs would need to exceed the combined totals of their pensions and the wife's SS benefit.
to answer the one question our pensions are 100% survivor for both of us, and actually the surviving spouse gets a pension increase of about $200 more a month. As the surviving spouse doesn't have a survivor any more then that pension actually increases a little. We both have what is called a "pop-up" pension upon the spouse's demise.
In other words, the pension total goes UP when one of us passes on. From $6,500 a month to $6,700 a month. I guess that is what is meant by "better off dead"?
Sorry I sound like I'm bragging, just wanted to know what people might do? Take the 401K or take Social Security or now whether to not do either???
I believe my social security at 64 before taxes and medicare premium costs would be about 2,000 a month, at 70 about $3,000 a month.
Do you need to take one or the other? Are you able to live on the pension and wife's SS alone? If not, I say let your SS grow AND leave the 401k money alone. Though I too would definitely roll it to my own low-cost IRA, then invest it conservatively. You may need it down the road for medical costs.
no , it was a legitimate question . The bragging accusation is nonsense and is a typical response by some here that is unwarranted in many discussions here. This is a legitimate question the op has .
Keep hogging Mathjack! I love reading your reply’s to peoples questions. I’ve got a few years till I collect, but hope by then I won’t need anymore of your advice.
We are moving to Arizona to a 55+ community within the next 10 months, too. But, I don't think the costs will be much different than we are now experiencing so that is a moot point.
I appreciate all the responses, I think I may try to wait on the social security until as close to 70 as I can. We can always use a little of our 401K or other funds sporadically and not monthly until then if needed. Otherwise, leave them alone. Our expenses are minimal for the most part. Expenses we will save going to AZ will be otherwise spent on regular desert landscaping maintenance, the 55+ HOA and possibly hiring a housekeeper for the first time and our WATER bills! :-). But the savings on property insurance and property taxes and auto expenses will offset quite a bit of that.
As someone said earlier if you can live off the pension and wife SS then don’t touch the 401k and wait on SS.
The only real question I see if you are asking that you need to take your SS early or tap into 401k to live and hold off on SS. If that’s the case you can calculate how long it would take you to catch up on not taking SS early. In my case it would take 22 years.
Last edited by Beach Sportsfan; 12-05-2018 at 12:51 PM..
We are moving to Arizona to a 55+ community within the next 10 months, too. But, I don't think the costs will be much different than we are now experiencing so that is a moot point.
I appreciate all the responses, I think I may try to wait on the social security until as close to 70 as I can. We can always use a little of our 401K or other funds sporadically and not monthly until then if needed. Otherwise, leave them alone. Our expenses are minimal for the most part. Expenses we will save going to AZ will be otherwise spent on regular desert landscaping maintenance, the 55+ HOA and possibly hiring a housekeeper for the first time and our WATER bills! :-). But the savings on property insurance and property taxes and auto expenses will offset quite a bit of that.
Put me down as a supporter of "this". Your social security benefit increases about 8% per year as long as you defer collecting from it. Unless you can beat this rate of return on your 401k, I'd spend down the 401k dollars before taking SS earlier than age 70. Minimizing the 401k withdrawals is icing on the cake. Obviously, it depends on your collective health, genetic crap shoot, heirs, desire to leave something for charity, etc., so it is pretty complicated. Keep your water bills low by showering together, it may keep your marriage solid as well, LOL.
Bottom line, there is a guy named "Laurence Kotlikoff" who is probably the pre-eminent authority for advice on when to take social security, and he has a very reasonably-priced calculator available. Do some research on his columns, I believe most are on PBS. And no, you are definitely not "bragging" you have been both industrious and fortunate, and you are simply looking after what you have worked so hard for - congratulations! https://maximizemysocialsecurity.com/
Put me down as a supporter of "this". Your social security benefit increases about 8% per year as long as you defer collecting from it. Unless you can beat this rate of return on your 401k, I'd spend down the 401k dollars before taking SS earlier than age 70. Minimizing the 401k withdrawals is icing on the cake. Obviously, it depends on your collective health, genetic crap shoot, heirs, desire to leave something for charity, etc., so it is pretty complicated. Keep your water bills low by showering together, it may keep your marriage solid as well, LOL.
Bottom line, there is a guy named "Laurence Kotlikoff" who is probably the pre-eminent authority for advice on when to take social security, and he has a very reasonably-priced calculator available. Do some research on his columns, I believe most are on PBS. And no, you are definitely not "bragging" you have been both industrious and fortunate, and you are simply looking after what you have worked so hard for - congratulations! https://maximizemysocialsecurity.com/
You are correct that any investment would be hard to beat the SS increases in waiting but you also have to consider as you stated health and longevity since the 401k would pass on to family members while SS dies with you or if married spouse whoever lives longest. At the end one depends on market the other on longevity.
Would you rather have more early in retirement while you may enjoy it more or later when you may not.
I would just leave it, and see how life unfolds. The amount isn't huge that RMD's will be significant. Take a year of budget inventory and re-assess whether you have met all your needs and wants.
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