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Good, short read on longevity insurance
Old 01-29-2015, 03:33 PM   #1
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Good, short read on longevity insurance

Money on Seahawks or Patriots? No, I Just Bet I’ll Live to 80 - Total Return - WSJ
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Old 01-30-2015, 08:22 AM   #2
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Basically, it is a guy making a choice to buy a deferred annuity. He spends $5K at age 47 to get $2.6K/yr starting age 80. The unstated assumption (I think) is that he sees the risk of the insurance companies failing as less than the risk of his own alternative investment failing. Not a compelling argument to me. The $5K bet is sort of academic - how much would it help in any event? If you substitute $5K with $100K at age 47 it is more meaningful but I am betting most would go with the self insurance.
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Old 01-30-2015, 09:15 AM   #3
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I think it would help a lot - this of this like a QLAC in a 401k plan - it's a hedge against outliving your assets
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Old 01-30-2015, 01:05 PM   #4
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Excellent article by a well known proponent of longevity insurance. To me, if one is interested in longevity insurance, by far the first thing to ask is can I finance myself to age 70 before drawing my SS? (Ignoring fancy footwork for marrieds, older parents with you children etc.)

Waiting until 70 for SS dominates any commercial longevity product.

Ha
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Old 01-30-2015, 01:34 PM   #5
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Quote:
Originally Posted by haha View Post
Waiting until 70 for SS dominates any commercial longevity product.

Ha
depends on your age (and desired retirement income level) - by the time I'm 70 the fund is projected to pay benefits at 72% (or less) sans legislative action

Social Security Trust Fund Runs Dry In 2029, CBO Signals - Investors.com
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Old 01-30-2015, 05:29 PM   #6
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For sure.


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Old 01-30-2015, 06:28 PM   #7
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Perhaps I am foolish, but I am not particularly worried about a haircut to SS. The fixes are relatively easy. Bigger concern is Medicare. I'm hoping my SS will cover increased Medicare expense!
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Old 01-30-2015, 06:56 PM   #8
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Quote:
Originally Posted by Big_Hitter View Post
depends on your age (and desired retirement income level) - by the time I'm 70 the fund is projected to pay benefits at 72% (or less) sans legislative action

Social Security Trust Fund Runs Dry In 2029, CBO Signals - Investors.com
Fortunately, we don't need to start making this decision until we are 62. And then, we can review it each year and bail if we think the situation has changed.

I think about it every year. But, at age 67, I'm still deferring.
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Old 01-30-2015, 07:02 PM   #9
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I thought the last paragraph was a good point. It addresses the "don't buy an SPIA today because rates may go up" idea.
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