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01-06-2016, 03:35 PM
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#41
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Thinks s/he gets paid by the post
Join Date: Oct 2012
Location: Colorado Mountains
Posts: 3,165
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Quote:
Originally Posted by Independent
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It's correct that lots of elderly Americans have very little income other than SS:
Quote:
For 65 percent of elderly beneficiaries, Social Security provides the majority of their cash income. For 36 percent of them, it provides 90 percent or more of their income. For 24 percent of them, it is the sole source of retirement income.[18]
Reliance on Social Security increases with age, as older people are less likely to work and more likely to have depleted their savings. Among those aged 80 or older, Social Security provides the majority of income for 76 percent of beneficiaries and nearly all of the income for 47 percent of beneficiaries
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Policy Basics: Top Ten Facts about Social Security | Center on Budget and Policy Priorities
Most of the people who post here don't want to be in the group that gets most or all it's income from SS.
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When I start collecting SS on my account at 70, it will be just above 50% of my income. The other portion will be my pension. Nothing close to poor for someone that is single having half their income from an upper level SS check. I'll be way past the 15% tax bracket and likely banking money every month.
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01-06-2016, 03:49 PM
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#42
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Thinks s/he gets paid by the post
Join Date: May 2014
Posts: 1,867
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Quote:
Originally Posted by Bigdawg
from your TKR post I would say you might need to cut thru the ice to catch those fish. Might need to elevate that leg too. Hope all goes well rayinpenn. BTW, I love my 15 yr old chevy truck.
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Yeah I'm not on the sunshine bridge yet but, soon.
Sent from my iPad using Early Retirement Forum.
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01-06-2016, 04:45 PM
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#43
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2008
Posts: 35,712
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Quote:
Originally Posted by Bigdawg
+1. Just off the top of my head my net worth is way south of 1M. But, my monthly sit at home and do nothing and get sent money # is like 9K.
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Hey, $9K/month is certainly nothing to sneer at.
People without pension would have to run FIRECalc every which way, and many do not get anything like that.
__________________
"Old age is the most unexpected of all things that happen to a man" -- Leon Trotsky (1879-1940)
"Those Who Can Make You Believe Absurdities Can Make You Commit Atrocities" - Voltaire (1694-1778)
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01-06-2016, 05:05 PM
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#44
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gone traveling
Join Date: Sep 2013
Posts: 1,248
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Quote:
Originally Posted by btdt22
So a two income couple retires with each receiving $75k in cola guaranteed pensions, and $36K in SS benefits. They rent a luxury condo on the water, lease a $150K car, yet their net worth by definition is $0.
It must be hell to have zero net worth, yet have to survive on close to $20,000 per month in retirement income..
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No your net worth is valued to amount of money that one needs to buy 2 COLA annuities that pay 75k a year (if it is COLA pension).
So it is astronomically high if you are 40....and it is pretty low if you are 90.
That is if you do not have anything else....
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01-07-2016, 08:58 AM
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#45
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Thinks s/he gets paid by the post
Join Date: Dec 2009
Location: Alberta/Ontario/ Arizona
Posts: 3,393
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Ignoring pension in your overall financial position(some people call this net worth) seems wrong. But net worth is really only for asset allocation decisions and bragging rights ( or feel good points). It really is cash flow that counts in retirement. Probably cash flow survey for retirees would be more interesting to me.
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01-07-2016, 09:15 AM
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#46
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Moderator
Join Date: Apr 2012
Location: San Diego
Posts: 14,212
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Quote:
Originally Posted by Danmar
Ignoring pension in your overall financial position(some people call this net worth) seems wrong. But net worth is really only for asset allocation decisions and bragging rights ( or feel good points). It really is cash flow that counts in retirement. Probably cash flow survey for retirees would be more interesting to me.
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Would you participate? Not to be impertinent - but you expressed reluctance to participate in the 2015 expenses discussion. I suppose it could be set to bands of income stream totals as an anonymous poll. But it would have to have rules to make it consistent...
__________________
Retired June 2014. No longer an enginerd - now I'm just a nerd.
micro pensions 6%, rental income 20%
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01-07-2016, 09:48 AM
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#47
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Thinks s/he gets paid by the post
Join Date: Dec 2009
Location: Alberta/Ontario/ Arizona
Posts: 3,393
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Quote:
Originally Posted by rodi
Would you participate? Not to be impertinent - but you expressed reluctance to participate in the 2015 expenses discussion. I suppose it could be set to bands of income stream totals as an anonymous poll. But it would have to have rules to make it consistent...
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I won't expose myself by disclosing actual cash flow numbers but would vote in an anonymous poll. My pension is about half our cash flow and the other half is dividends. The problem in a poll will be cash flow generated by your portfolio. If you don't include WR , what about divs? Interest?
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01-07-2016, 09:51 AM
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#48
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Moderator
Join Date: Apr 2012
Location: San Diego
Posts: 14,212
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I set up the poll. To clarify (and I'll post there)... divs, cap gains, interest are all part of the nest egg - because you can reinvest them automatically and are part of your nest egg total return.
__________________
Retired June 2014. No longer an enginerd - now I'm just a nerd.
micro pensions 6%, rental income 20%
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01-07-2016, 11:59 AM
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#49
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Thinks s/he gets paid by the post
Join Date: Oct 2009
Posts: 1,190
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Quote:
Originally Posted by Danmar
Ignoring pension in your overall financial position(some people call this net worth) seems wrong. But net worth is really only for asset allocation decisions and bragging rights ( or feel good points). It really is cash flow that counts in retirement. Probably cash flow survey for retirees would be more interesting to me.
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While there is some truth in what you say I personally would rather have net worth wealth than pension wealth. As to it "really being cash flow that counts", that is also true, but you can spend down a net worth to create cash flow. Now, I will qualify my comments that it does depend how much net worth we're talking, but when measured in the millions it gives an awful lot of flexibility that a straight pension does not. Obviously with a pension you can try to replicate net worth through borrowing against the future stream, but that is terribly inefficient/costly.
Sent from my iPad using Early Retirement Forum
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01-07-2016, 03:13 PM
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#50
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Thinks s/he gets paid by the post
Join Date: Dec 2009
Location: Alberta/Ontario/ Arizona
Posts: 3,393
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Quote:
Originally Posted by LARS
While there is some truth in what you say I personally would rather have net worth wealth than pension wealth. As to it "really being cash flow that counts", that is also true, but you can spend down a net worth to create cash flow. Now, I will qualify my comments that it does depend how much net worth we're talking, but when measured in the millions it gives an awful lot of flexibility that a straight pension does not. Obviously with a pension you can try to replicate net worth through borrowing against the future stream, but that is terribly inefficient/costly.
Sent from my iPad using Early Retirement Forum
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Rather have net worth wealth? Perhaps, but it's nice having some of each. I treat my pension as a FI proxy and can invest my whole portfolio in equities. The pension is a nice base which covers most of our base expenses. Most retirees should annuitize some of their net worth I think. Less risky.
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01-07-2016, 03:59 PM
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#51
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gone traveling
Join Date: Sep 2013
Posts: 1,248
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Quote:
Originally Posted by LARS
While there is some truth in what you say I personally would rather have net worth wealth than pension wealth. As to it "really being cash flow that counts", that is also true, but you can spend down a net worth to create cash flow. Now, I will qualify my comments that it does depend how much net worth we're talking, but when measured in the millions it gives an awful lot of flexibility that a straight pension does not. Obviously with a pension you can try to replicate net worth through borrowing against the future stream, but that is terribly inefficient/costly.
Sent from my iPad using Early Retirement Forum
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And you can pass your net worth wealth down to your kids not so with your pension wealth.
You are free to buy pension wealth via Immediate Fixed Annuity if you desire to convert some of your net worth wealth into pension wealth.
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01-07-2016, 04:20 PM
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#52
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Thinks s/he gets paid by the post
Join Date: Oct 2009
Posts: 1,190
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Quote:
Originally Posted by Danmar
Rather have net worth wealth? Perhaps, but it's nice having some of each. I treat my pension as a FI proxy and can invest my whole portfolio in equities. The pension is a nice base which covers most of our base expenses. Most retirees should annuitize some of their net worth I think. Less risky.
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Yes, all else being equal I would personally prefer net worth (again assuming larger numbers). Clearly, both would be better!
As to annuities, as many have said in the past, that is exactly the reason to delay SS to at a minimum full retirement (if indeed not waiting to 70).
Indeed, with SS, especially waiting for larger payout, an individual has the ability to have a "pension" and net worth.
Sent from my iPad using Early Retirement Forum
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01-07-2016, 10:26 PM
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#53
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2009
Posts: 5,308
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Of course, your home equity is part of your net worth. It is an asset. But, in terms of withdrawal rate, I don't consider it part of my investment portfolio. But, I could sell it and get money from it. And, if I so chose, I could buy another house (or condo or whatever) for less money or could rent.
As for the idea that people can't retire with a paltry $946,000 net worth, that depends on various factors. For the 40 year old retiree with no other source of income then that might indeed be the case.
But, for many people -- even without a pension -- it is unnecessary. I haven't taken SS yet but will be eligible soon. Between my husband and I, if I did take SS at 62, we would have about $47k in come just from SS, totally apart from any withdrawals from our portfolio. I assure you that many, many people happily live on $47k during retirement. And add in some withdrawals from the $946,000 portfolio and people could be perfectly content during retirement.
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01-08-2016, 08:21 AM
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#54
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Thinks s/he gets paid by the post
Join Date: Dec 2009
Location: Alberta/Ontario/ Arizona
Posts: 3,393
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Quote:
Originally Posted by eta2020
And you can pass your net worth wealth down to your kids not so with your pension wealth.
You are free to buy pension wealth via Immediate Fixed Annuity if you desire to convert some of your net worth wealth into pension wealth.
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Agree. Our portfolio would be plenty to pass down. Our pensions were something that just kind of happened and are very generous. Very low contributions on my part. I figure I have already received all my contributions back and I am only 65. Really lucky to have such a pension.
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01-08-2016, 01:25 PM
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#55
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Recycles dryer sheets
Join Date: Nov 2013
Posts: 238
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I totally have pension envy....lol We are retired almost two years, in our 50's with a long wait for full SS. We have one small rental property and are living off of that income and our nest egg. Hard to adjust from accumulation to withdrawal, but getting used to it. SWR should be around or just under 2% hopefully once both take SS. I just feel I would sleep better with a pension.
Sent from my KFTHWA using Tapatalk
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01-08-2016, 06:03 PM
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#56
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2014
Posts: 7,051
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My hubby and I each have a small pension of $20,000/year and I feel secure knowing that. It's the main reason we worked in the public sector for less $ then we could have earned in our professions in the private sector. WE also get raises every year starting with year 4.
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01-09-2016, 10:30 AM
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#57
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2006
Location: Pacific latitude 20/49
Posts: 7,677
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Quote:
Originally Posted by Danmar
Very low contributions on my part. I figure I have already received all my contributions back and I am only 65. Really lucky to have such a pension.
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Ours was totally non-contributory (other than giving up other contribution room). My Ex and I get half each. Although it is not COLAd, inflation has been very low in the last 20+ years we have received it when compared to the previous 20. And the markets have largely cooperated.
So yes, we are very lucky as well.
(I wonder how many people consider their luck when evaluating their financial performance?)
__________________
For the fun of it...Keith
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