Obviously in the realm of what we have all experienced as normal, planning only for 5 years is, well. . .stupid. However, I think that the current zeitgeist is one of fatalism. I don't mean that I think everyone thinks we're all going to be nuked, so "what the hell." But lately I've gotten feelings from peope that there's really no hope for the future so maybe there is no future, so live for today. I'm still planning for 30-40 years but at times I find myself hoping that I'm not wrong, a thought entirely foreign for this life-time penny pincher.
Retirees Only Planning Finances Five Years Ahead
- Thread starter mickeyd
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teejayevans
Thinks s/he gets paid by the post
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Instead of the annuity, how about just delaying taking SS until 70, you'll have a nice annuity with a COLA, guaranteed by the US govt.
TJ
Huston55
Thinks s/he gets paid by the post
Yup, sounds like Bud Hebeler.
Chuckanut
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
That thought has crossed my mind. But, it would really drain my personal funds. I guess I will have to compare the what I give up to what I will gain. I would give up about $100,000 in SS benefits ( not figuring in COLA and the earnings on the money). My main concern is that the insurance company won't be around to make the payments. Also, I can't imagine that such an annuity with a full COLA would be cheap.
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rescueme
Thinks s/he gets paid by the post
Plus, if you are married (as I am), you can claim against your spouses SS and get 50% between the ages of 66-69 (assuming a FRA age of 66) while earning delayed retirement credits at 8% per year (plus any COLA increase).
Assuming you are male and DW will pass after you, this also gives your DW an increased benefit after your passing.
BTW, DW/me have a joint SPIA (annuity) that is giving us income "up front" and allowing us to delay SS, per our personal plan.
That SPIA will just be "icing" on our SS "cake" when we start collecting. If we pass earlier than expected? Our joint SPIA pays to our estate at the time we both pass.
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We have the same strategy. We're maxing out our 401(k) and IRA contributions for our post-60 retirement fund, and we're setting aside what we can beyond that for our pre-60 FIRE fund. When the FIRE fund reaches the point where it can support us until we can tap "retirement accounts," we will have arrived!
We are still debating whether to deplete the FIRE fund or not. We can retire several years sooner if we plan to deplete it instead of waiting until the FIRE fund is so big that we can live off the interest only and never touch principal. I am in favor of assuming that we will deplete the FIRE fund to a certain point (leaving some in place for emergencies) but my husband wants it all to still be there once we hit 60... not sure which way we will end up going there.
wrong
scrabbler1
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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In my pre-60/65 ER budget, I have done something in between the views of you and your husband. I have set up a budget which, at least initially, has surpluses (dividends over expenses, but not counting anything withdrawn from my IRA) in the earlier years (until around age 58), then runs deficits until age 65.
I originally drew up this budget in 2008, before any federal health insurance changes were done ("Obamacare"). I also changed my individual health insurance plan earlier this year which costs me less (my original HI plan had risen 50% in 2 years and I had to get out from under it) but is far less broad than its predecessor. So I am running considerable surpluses right now.
