Average Monthly SS Income (alcohol, meal, adult, singles)
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Yes, I noticed you said 'often', Ariadne22. I just think your post #84 presents a picture of cushiness which could be misconstrued and does not apply to all people receiving low monthly amounts from Social Security.
With my $1292 monthly Social Security, the federal government removes $104 every month from that check for Medicare. And I have a great Medigap plan for $70 per month which I purchase to supplement Medicare.
(you mentioned most in my category get Medicare Advantage plans - but my state has great Medigap plans for low costs)
I do not qualify for the 'free Medicare' that you describe nor do I qualify for the 'free' payment of the monthly Part D drug insurance which you describe.
It is good for those new to the system to know about the benefits you mention.
I just wanted to point out that the somewhat cushy benefits you describe are not easily obtained across the board for all receiving a low amount of monthly Social Security and/or around the national average amount of monthly Social Security.
Last edited by matisse12; 09-14-2016 at 12:13 AM..
I'm about to retire. My average net pay will be about $3250. My average outgo will be about $1950, including all insurance and I even have long term care insurance. I have a condo which is paid off, no car payment either. My long term financial forecast looks pretty good. I hope I'm right.
A 67% net income buffer of 1300/mo is pretty dang good. It allows you to build up a nice after tax nest egg and allow your Pretax savings to go untouched and grow. How you can live and have LTCI for that amount I'd like to know!
I'm 68 and not yet collecting benefits while my wife, who is 66, has been collecting hers since last April.
When I do retire, which I plan to do when I reach 70, I will collect my benefit and together my wife and I will enjoy the equivalent take home income of $1,000 per week ($4,300/month) on just our social security benefits alone.
I say take home pay because with a Based on the worksheet provided in the most recent IRS Publication 915, your Social Security benefit(s) of $51,600 will be 4% taxable increasing your taxable income by $2,300 and creating a federal income tax liability of $345. Yippee, we receive $51,600 and with what other income we have, it is less than $1,000/month, we have a federal tax liability of only $345 on our combined social security benefits. Less than $30/month in taxes... somehow I think I will manage.
But what if I collected my benefits today while I am still working? First off they would be less by about $400/month but based on my wage income 85% of our combined benefit would be taxes and we would lose $9,945 ($829/month) to federal income taxes alone.
So by taking early I will pay plenty in taxes which has an effect of lowering the number of years I have to go to "break even".
And then there is the spouse. I love my wife and by my working to 70 she will have a tax free income of at least $3,000/month after she pays all her medicare and insurance premiums. I sleep better at night knowing if something happens to me she will be taken care of at least in a financial sense.
The moral of this story is do not collect unless you fully retire.
Repped you for that excellent post! I don't suppose you have your SS statements from when you were, say 60, that stated your age 70 predicted SSI, so that amount can be compard to what you are predicted to get at 70, now, do you? It would SO help to reinforce the numbers that people plan with vs the reality.
Why does everyone try and get the most possible payout? I mean technically speaking if you get placed in a nursing home they will take the $ anyways if you can't afford it on your own personal savings. Right?
Not sure who you mean "they" are? If you have heirs or a spouse, and you get put in to a nursing home, the more that can be paid out of income, the less that will come (or none) out of savings. Or exactly as Selhars said, the choice exists for in home care, because if you need it at 90, just your SS income is 77% larger by then by having delayed filing until 70,mwhich can be as much as $30k a year. If you mean the government automatically takes whatever your SS is when you are in a nursing home, then, no, that is not true. Anecdotally one always hears that because typically, since the average persons SS is so low, the cost of any type of nursing facility is way more. So it all goes to that.
Last edited by Perryinva; 09-14-2016 at 07:06 AM..
^ They as the nursing home or the state. Yes the horror stories I have heard is when they couldn't afford the $8000 a month nursing home bill. Then they have to start liquidating assets, then comes ss monies. And if you are single they can force you to sell your house.
I guess the best thing to do is add your kids as a co-owner of estate ass soon as you retire so this dont happen?? Because I know some states go back 5 years.
I really dont know, Im asking you guys. Elder law is not my forte.
Making your kids co owner can create other issues. The house goes from being protected as far as the value not being counted to qualifying for medicaid in the first place to now having your share counted as dollars needed to be spent down.
Using co-owners other than a spouse can have the house being sold just to qualify .
Law suits and divorce can put the house at risk in many states too. It also hurts them tax wise as they retain your original cost basis unlike inheriting it
Many moves to protect assets have pros and cons. You just have to weigh those out.... in terms of short and long term benefits. And try not to sacrifice too much of one for the other.
You can have the house in more than one name if you like to keep if from being "force sold." As mathjack, rightly points out, there are just other ramifications to doing that, that's all. Not all may apply in every case.
I know plenty of people who had a house transfer into a kids' name. Never an issue. But yes. More taxes will be due IF/when it's ever sold, than if it had been inherited. They figure better to avoid this Medicare issue now, and we'll give up the stepped up basis. As long as they are aware of that -- it's a judgement call they made for their case and their family.
A 67% net income buffer of 1300/mo is pretty dang good. It allows you to build up a nice after tax nest egg and allow your Pretax savings to go untouched and grow. How you can live and have LTCI for that amount I'd like to know!
It helps that I live in a low cost of living place - Indy. My LTC insurance I bought about 14 years ago when it would be a lot cheaper that if I had waited. The LTC insurance also includes a 5% inflation provision each year and better yet, it is a lifetime benefit, and not just 3-4 years. My $1950 spending also includes all my credit card spending so this figure will fluctuate a bit.
Yes, I do have my statement to know what MY benefit will be, but I was curious how that compared with others. I make a decent income but was out of the workforce for about 15 ish years (maternity leave lol) so I was just basically curious.
If I start at age 66, it would be slightly over $1800.
My spouse has been retired for about 10 years- not drawing yet. His will be in the same neighborhood. He is turning 65 this year.
I guess the medical is the true wild card.
I appreciate all the comments.
I just got my statement the other day. At age 66, I will collect $2500/mo. If i wait until age 70, I'll get $3300. I doubt I'll wait that long though.
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