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Old 04-20-2014, 09:50 AM   #21
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Originally Posted by growing_older View Post
This seems like an excellent idea, but I am baffled about what the five (or more) streams could be. [...]I'm running out of ideas for "income streams" and would appreciate any pointers.
What you set up as income streams probably depends more on your particular, individual situation and what you have made available to you than anything else. The five income streams that I personally have available to me are,

1. FERS pension
2. SS
3. TSP G Fund (cannot decrease in share price, set up for regular monthly payments similar to a second pension)
4. Dividends from normal taxable investment accounts at Vanguard

I have temporarily delayed setting up the SPIA until I am older and can get a better rate. However, when I was younger and doing my retirement planning rates were higher and this was planned to be a (small) part of my retirement income right from the start. See my original post as the phrase you extracted was referring to past planning only.

Many of our forum members have more than one pension; several have two or three. Frozen or not, even a little pension provides some flexibility and diversification in income streams. Some have real estate or royalty income. Some have part time jobs. Some have disability or spousal or survivors' benefits. Some have alimony or child support (I never had either).

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Old 04-20-2014, 10:18 AM   #22
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Originally Posted by longranger View Post
So at 57 I and DW(58) are supposedly going to get full benefits at least while SS remains solvent.
As long as the payroll tax is collected, SS cannot go insolvent even if the SS Trust Fund is not honored.

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Old 04-20-2014, 10:19 AM   #23
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Originally Posted by growing_older View Post
This seems like an excellent idea, but I am baffled about what the five (or more) streams could be. Maybe this makes me more concerned about SS because it's one of my few possible income sources.

1. Personal savings (401k, IRA and taxable accounts)
2. Social Security
3. If desperate, reverse mortgage or sell house

I tried landlord (rental income) but didn't like it and too much like a job to enjoy after ER.

Pensions always got terminated or company folded before anything vested.

Side business. Tried a few and made small incomes, but again too much like a job to do long term.

Royalty from books, etc. Maybe I need to get busy and write a book? I'm running out of ideas for "income streams" and would appreciate any pointers.

In our case the income streams are

2 US private pensions

2 UK private pensions

US SS for DW

US SS for myself

UK SS for myself

Withdrawals from DW retirement IRA's/401k's

Withdrawals from my retirement IRA's/401k's

Withdrawals from joint after-tax accounts
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Old 04-20-2014, 11:55 AM   #24
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Originally Posted by racy View Post
SS will be there. The government is in the business of providing more & more, year after year, not taking things away....regardless of solvency.
I think it's likely that the SS payments will be made as promised for those at/near retirement, but there might be some reduction in the benefits earned by future payments for younger workers at some point.
But, I also think it's likely that "wealthier" retirees will see some clawback of SS payments, possibly soon, via increased taxation of these SS benefits (the amount of SS payments subject to taxation, the loss of other subsidies and tax breaks as income climbs, increased taxation of SS benefits for those who choose to work even after FRA, perhaps even a special higher tax rate on SS benefits phased in at higher income levels, etc). This could result in significantly reduced net SS benefits while politicians can still claim "the promise was kept, everyone got the checks they were promised." If these special/added taxes are ostensibly funneled back to SS in order to "save it", I think these changes would have popular support--it's only the rich old people who have had it so good who would be paying.
I'm in my early 50's and guessing I'll have an approx 20% SS haircut after all the shenanigans.
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Old 04-20-2014, 12:20 PM   #25
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I agree Samclem. Just how deep the shenanigans may go, if it happens at all, is hard to predict. Depends on the economy,politics etc.. Call it Means Testing, special tax or whatever creative name is applied the wealthy will be the first to be effected.
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Old 04-20-2014, 09:40 PM   #26
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Originally Posted by longranger View Post
So at 57 I and DW(58) are supposedly going to get full benefits at least while SS remains solvent. Just how sure are we Politics and SS solvency aside the longer the National deficit and inequity in income distribution grow the higher the likelihood that SS and any other government administered entitlements will become subject to MEANS TESTING. That would put a quick kink in many of our plans. By definition those of us who can FIRE are likely to be prime targets for benefit cuts. No one will care that you achieved what you did by LBYM and working harder than most. We will be lumped with the "evil 1%" because on paper looking at $$ only we are.
Working harder was okay but you were supposed to spend every last dollar! Consumer spending is one of the largest driving forces in the economy. How dare you save! Yes you were evil now you must pay for your inequity!

Actually long ago, in my late 20s when I started saving for retirement in a tax advantaged account I used to wonder what the government would do with all the money the savers were saving. Because clearly the majority were not saving and governments tend to tax where the money is. But then again, we are older, and older people vote. So most likely if the take increases, it will be on the newcomers. The old rates will be grandfathered. Or maybe not.
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Old 04-21-2014, 03:51 AM   #27
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The problem with MEANS TESTING Social Security is that it could then be spun as, depending on how aggressively this is done, just another welfare program.

With the progressive nature of the the payment formula (ie the majority of the benefits are accrued fairly early in a career) not much will be saved by denying a segment of the population their benefit.

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Old 04-21-2014, 08:19 AM   #28
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We did not include a penny of SS when we first started roughly calculating our potential retirement income maybe 25 years ago, since the ER date was too far away to have any feel for what SS might have been. Now? We have not taken SS yet, at 63 and 65, but we do know we will be adding it to the income streams of pension and the IRA dividends and capital gains we currently take.

Means testing is one of many things I don't feel I have any control over--if it happens, it happens, and we will deal with it then. If it doesn't happen, we won't gave spent time worrying about it.

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