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Old 06-10-2019, 11:50 AM
 
Location: Gilbert, AZ
3,182 posts, read 1,962,242 times
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Quote:
Originally Posted by JayCT View Post
His reasoning is this. At 62 1/2 he would get $1,900 a month from SS. At 70 the benefit would be $3,600. If he starts taking it at 62, he would earn a total of $171,000 in those years between retirement and 70 ($1,900 x 12 x 7.5 = $171,000). If he waits to 70, it will take over 8 years to break even and get that $171,000 back ($3,600 - $1,900 = $1,700; $171,000/$1,700 = 100.59 months or 8 years, 4 months).

He feels he should take that money and, assuming he does not need it, invest it to get a better return. Does this make sense? Is he missing something? Jay
If he truly does not need the money I suppose he should just do whatever makes him feel good. For most people, SS is a significant part of their retirement... even so-called wealthy people with 7-figure retirement accounts.

I will make one point, however. Looking at this on a pre-tax basis is not going to give the best answer. Yes, it is much easier to do the math pre-tax, which is why all of these armchair economist types do not consider taxes. For starters, many states that levy an income tax on 401k/IRA withdrawals do not tax SS benefits. That is the easy part. Federal tax is much trickier, and there is no easy way to give general advice here IMO.
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Old 06-10-2019, 12:05 PM
 
Location: Gilbert, AZ
3,182 posts, read 1,962,242 times
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Quote:
Originally Posted by Ralph_Kirk View Post
Well, never be reckless. At least not at 60. Recklessness is for the young and dumb, who still have plenty of time to recover from stupidity.
One problem with these safe withdrawal guidelines is that they are very conservative. They have us pulling assets at such a low level that one can survive an economic armageddon that is unlikely to occur, leaving us with a huge pile of assets when we are too old to enjoy it. (Even schemes that allow "raises" due to good markets still have us starting out at those very low draw percentages).

If one's primary goal is to leave a big inheritance, that route is probably fine. But if one's goal is to maximize the enjoyment of their retirement assets they should spend more heavily up front when they are young, knowing that there is some chance they will end up on a path that is sending them toward zero assets. Of course this is not smart if one's budget consists of mostly "needs" like food, utilities, etc. But if a large part of one's budget is discretionary, they can afford to spend assets at a higher rate when they are a "young retiree", knowing that they can cut back on the fun spending if needed.
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Old 06-10-2019, 12:08 PM
Status: "Be yourself. What's the alternative?" (set 21 days ago)
 
8,695 posts, read 10,847,720 times
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Quote:
Originally Posted by mathjak107 View Post
If you take yours before fra you will always be at less then half
They gave me an estimate on paper last year, but it didn't seem it would have been 1/2. I'll have to check on that.

If I switched over to his (as a survivor benefit at some future point) I would get a reduced amount of his by about 6.4 % per year, if before my FRA, I think I saw.

Last edited by Nanny Goat; 06-10-2019 at 12:21 PM..
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Old 06-10-2019, 12:31 PM
 
71,630 posts, read 71,777,271 times
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Survivor can start at 60. At 60 you would x.71 his full , at 62 x.81 his full
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Old 06-10-2019, 01:04 PM
 
Location: Near Falls Lake
2,791 posts, read 1,915,889 times
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Take it early or take it late....it is a mathematical crapshoot! I have choose to delay as my grandfather lived to 99 (on his own and in very good health past 95) and my father is nearly 90. If they had passed in their 60's I'd be thinking of it much differently. Should something happen to me before the break even point I won't care....I'll be dead.

Last edited by carcrazy67; 06-10-2019 at 02:26 PM..
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Old 06-10-2019, 01:07 PM
 
2,103 posts, read 717,805 times
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Quote:
Originally Posted by hikernut View Post
One problem with these safe withdrawal guidelines is that they are very conservative. They have us pulling assets at such a low level that one can survive an economic armageddon that is unlikely to occur, leaving us with a huge pile of assets when we are too old to enjoy it. (Even schemes that allow "raises" due to good markets still have us starting out at those very low draw percentages).
To me, the economic armageddon would be years in LTC. That, of course, would be the point at which I don't really "enjoy" my money (no longer in a position to spend it on world travel), but I can choose a place with Wi-Fi, a library, an indoor pool, decent food and sufficient staff. I won't have to rely on DS and DDIL to take me in or spend all their spare time rushing over to my place to change light bulbs, take me shopping and to the doctor, etc. DDIL's parents may end up in that position. They're very good people and hard workers but they've had modest jobs and she stayed home with the kids for years. They don't need me to take care of, too. If that means I'm not spending as much as I could now, I'm fine with that.
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Old 06-10-2019, 02:17 PM
 
20,581 posts, read 16,645,141 times
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Quote:
Originally Posted by JayCT View Post
I was talking to a friend the other day about Social Security and when to take it. A family member is waiting until 70 to get the maximum benefit but my friend thinks that may not be best. He noted that you are losing 7 1/2 years of income by waiting and it would take a number of years to recoup that money.

His reasoning is this. At 62 1/2 he would get $1,900 a month from SS. At 70 the benefit would be $3,600. If he starts taking it at 62, he would earn a total of $171,000 in those years between retirement and 70 ($1,900 x 12 x 7.5 = $171,000). If he waits to 70, it will take over 8 years to break even and get that $171,000 back ($3,600 - $1,900 = $1,700; $171,000/$1,700 = 100.59 months or 8 years, 4 months).

He feels he should take that money and, assuming he does not need it, invest it to get a better return. Does this make sense? Is he missing something? Jay

I would wait because I don't have enough saved to live on that $1900 a month, and there's a limit to how much you can make while collecting. If I were still able to do my job at 62, I would be much better off taking that much higher salary and trying to save more for a few more years, and then I would have a good shot at being able to live on that $3600.



The answer to this completely depends on how much you have saved, your monthly living costs, and whether you have other sources of income in retirement. There isn't any right or wrong that fits everyone.
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Old 06-10-2019, 02:28 PM
 
Location: Living on the Coast in Oxnard CA
15,735 posts, read 26,780,942 times
Reputation: 20373
Quote:
Originally Posted by pknopp View Post
Do you mind if I ask what you do there? Really, it's none of my business and no offense if you want to leave it at that. I was just curious.
I am a project manager for the Facilities Department. I oversee construction projects within our clinic system and our main hospital campus. I am qualified to operate a hospital facility physical plant. In addition I manage energy saving projects for the healthcare system as well as oversee the physical facility security operation or in other words the Mechanical and Electronic locking systems, access control for over 2,500 employees, CCTV, and other security related building systems.

I work directly under the Director of Facilities, can often be found meeting with members of the C suite, VP's from within the organization, and Directors and Managers within the healthcare system.
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Old 06-10-2019, 03:00 PM
 
Location: Gilbert, AZ
3,182 posts, read 1,962,242 times
Reputation: 3321
Quote:
Originally Posted by athena53 View Post
To me, the economic armageddon would be years in LTC. That, of course, would be the point at which I don't really "enjoy" my money (no longer in a position to spend it on world travel), but I can choose a place with Wi-Fi, a library, an indoor pool, decent food and sufficient staff.
Yes, an excellent point. This is part of the so-called "smile-shaped" spending pattern. First phase of retirement is higher spending due to travel and going to events. Second phase is lower spending... mostly staying at home but no serious health problems. Third phase is higher spending due to medical and/or LTC costs.

I've never seen anyone put this spending pattern to the test. It would be interesting to see the outcome.
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Old 06-10-2019, 03:13 PM
 
Location: Central IL
15,243 posts, read 8,538,301 times
Reputation: 35674
Quote:
Originally Posted by Beach Sportsfan View Post
At the end you should do what you think it’s best for you and enjoy your retirement.

I have debated it the decision and looked at Firecalc done my own spreadsheets. I would have to live past 82 to collect same amount than if I started at 62. I will take it at 62 and have other assets so if I’m still kicking after 82 I would still be ok with my decision.

Enjoy life no one knows when our time is up
I plan on retiring at 62 and collecting SS at 70 but my budget is the same for that whole period. I have a modest pension and will withdraw from my investments at a somewhat higher rate until 70 to make up for not taking SS. I certainly don't plan to get by on less and then live it up ONLY after 70!

If finances change, I can start collecting at any point - it's not an either/or decision except of course once you start collecting you can't stop. Well, maybe you can for a short period (with a payback) but they did change some of those regulations to make it tougher, IIRC.
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