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TigerWu
TigerWu
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June 12th, 2017 at 12:47:08 PM permalink
Quote: Skeptic

In a perfect world SS will be means-tested within the next 15-20 years. This kind of waste is bankrupting the country.



Actually, in a perfect world, everyone has a job that provides a fair and livable wage, and everyone is given a comprehensive financial education during their school years so that everyone knows how to properly save and invest money and things like Social Security are not even needed.
lilredrooster
lilredrooster
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June 12th, 2017 at 12:54:57 PM permalink
Quote: odiousgambit

the income generated by the "rule of thumb" that says, for someone expecting to retire at the point where life expectancy is multi-decade, to figure being able to initially withdraw 4% of liquidatable assets and get an annual figure in income that should mean their money will not run out.



there is yet another option. according to the linked annuity calculator you and your wife if you were both age 65 you could buy a single premium joint immediate lifetime annuity for $100K which would generate $5616 per year or $468 per month which is considerably more than 4%. One of the two of you would have to live about to age 83 in order to have been paid back the entire $100K. One of the two of you would need to live about to 92 to have generated $150K in annuity payments. the downside of course is that if you both leave early you will be able to bequeath less to your heirs. there is also an option to have the monthly payments increased each year according to an inflation calculation but that will of course lower your initial monthly payouts. i plan to do this for myself when the time comes. of course you are paying the house to assume the risk but i'm willing to trade that for the certainty. in this situation i'm not looking for an advantage play. just a fair deal.

https://www.immediateannuities.com/information/annuity-rates-step-1.html
Last edited by: lilredrooster on Jun 12, 2017
everybody wants to go to heaven but nobody wants to die
Skeptic
Skeptic
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June 12th, 2017 at 1:02:08 PM permalink
Quote: TigerWu

Actually, in a perfect world, everyone has a job that provides a fair and livable wage, and everyone is given a comprehensive financial education during their school years so that everyone knows how to properly save and invest money and things like Social Security are not even needed.



If someone doesn't have a job they aren't contributing to social security in the first place. I'm not buying the lack of financial education either. Someone old enough to be collecting social security has had decades to educate themselves about their own retirement. Sorry, but that isn't my responsibility. If they can figure out the pay tables on the crazy slot machine they're sitting at then by god they can figure out how to plan for retirement. I'm 43 and never married. I've paid more than my share of taxes and I doubt I'll ever see a meaningful dollar from social security. To think that as I type this a percentage of my withholding is being fed into a slot machine - right now - is infuriating.
lilredrooster
lilredrooster
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June 12th, 2017 at 1:36:02 PM permalink
Quote: Skeptic

I I'm 43 and never married. I've paid more than my share of taxes and I doubt I'll ever see a meaningful dollar from social security.


i'm not sure exactly what you mean. but if you mean that you think s.s. will be bankrupt or drastically changed so that persons such as yourself will get almost nothing i think you are mistaken. i think you are underestimating the financial power of the u.s. yes, there are scare stories out there from economists but there always have been. they were saying that the national debt would bankrupt the u.s. in 5 years 40 years ago. think about it. if an economist or financial analyst doesn't predict disaster what use is he? no one is going to be interested in a book or column from an economist if everyone believes the economy is healthy.
everybody wants to go to heaven but nobody wants to die
777
777
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June 12th, 2017 at 1:41:51 PM permalink
Quote: lilredrooster

i saw a guy post elsewhere a very good non mathematical reason for deferring s.s. to age 70. it works best for a guy who for whatever reason is not considering his spouse or his heirs. his reasoning was this: if he delays to age 70 and lives well beyond 70 then he has some extra money for those years which is great. but what if he decided to defer to 70 but he didn't live to age 70? is he pissed off because he didn't get anything? no, he's not pissed off about anything. because he's dead.



What you stated is also my attitude about when to draw social security benefit and my decision when to draw social security benefit is dynamic & solely based on the standpoint of cost/risk v. benefit, and risk management.

If you donít have sufficient net worth, asset, saving, or other source of supplemental income, then you have no choice but to draw social security benefit early. But if you are fortunate enough to have considerable asset, saving, or other source of income, then I think it would be wiser to delay drawing social security benefit as long as practical.
Skeptic
Skeptic
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June 12th, 2017 at 1:44:32 PM permalink
I mean the dollar will be inflated away to nothing in 20 years and whatever I've contributed will be worthless by the time I'm able to draw.
TigerWu
TigerWu
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June 12th, 2017 at 2:09:51 PM permalink
Quote: Skeptic

If someone doesn't have a job they aren't contributing to social security in the first place. I'm not buying the lack of financial education either. Someone old enough to be collecting social security has had decades to educate themselves about their own retirement. Sorry, but that isn't my responsibility.



That's exactly why I said, "in a perfect world," which we obviously don't live in.

You and I are about the same age. If absolutely nothing is done about social security -- not a single bill passed, not a single budget readjusted, not a single politician running on a "fix social security" campaign -- by the time you and I retire we will still be able to collect almost 80% of what we otherwise would have. Social security is not going away in our lifetimes, even if nothing is done to "fix" it.
Skeptic
Skeptic
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June 12th, 2017 at 2:19:13 PM permalink
Of course it's not going away but the purchasing power of $1 will be nothing in 20 years just as $1 today buys a whole lot less than it did 20 years ago. Our SS payments are based on the dollars we are earning today (and the last 20 years), not the value of a dollar 20 years from now. The only thing that can stop that is serious deflation which will wipe out asset values (meaning a segment of retirees will have even less to work with at retirement).
TigerWu
TigerWu
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June 12th, 2017 at 2:23:05 PM permalink
Quote: Skeptic

Of course it's not going away but the purchasing power of $1 will be nothing in 20 years just as $1 today buys a whole lot less than it did 20 years ago.



What are you going to do with your Social Security money in 20 years when you start drawing?
Skeptic
Skeptic
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June 12th, 2017 at 2:28:39 PM permalink
Quote:

What are you going to do with your Social Security money in 20 years when you start drawing?



At this rate the ATM fees for a withdrawal may exceed the monthly payment.

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