Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 08-07-2012, 06:19 PM   #61
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 5,693
I thought I'd wait until 66 but then came the 2008 crash. It felt uncomfortable taking out higher then 4% of the portfolio each year. Even though one could argue that you will have more by waiting, you have to decide if you will feel alright spending in your 60's at the higher rate.

So at 64 I took SS. Now we can easily keep the spending in check. This coupled with refinancing and our son graduating for college makes things look a lot nicer.

I'd rather spend in my 60's and cut back a bit in my late 80's, if I even get that far. And then there are those FIRECalc lines that go up and to the right -- lots of them.
__________________

__________________
Lsbcal is online now   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 08-07-2012, 08:09 PM   #62
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,386
Quote:
Originally Posted by Lsbcal View Post
And then there are those FIRECalc lines that go up and to the right -- lots of them.
What I wonder is how long it will take for us to wake up to the evidence that the world from which the FireCalc database was abstracted is long gone, likely forever?

Not that there wil not be strong markets, but IMO they will reward thinking carefully rather than just trying to set our sails to catch prevailing fair winds

Ha
__________________

__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is offline   Reply With Quote
Old 08-07-2012, 08:24 PM   #63
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
REWahoo's Avatar
 
Join Date: Jun 2002
Location: Texas Hill Country
Posts: 42,129
Quote:
Originally Posted by haha View Post
What I wonder is how long it will take for us to wake up to the evidence that the world from which the FireCalc database was abstracted is long gone, likely forever?
Since "The Oracle of Omaha" title is taken, should we call you "The Swami of Seattle"?
__________________
Numbers is hard

When I hit 70, it hit back

Retired in 2005 at age 58, no pension
REWahoo is offline   Reply With Quote
Old 08-07-2012, 08:30 PM   #64
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Dawg52's Avatar
 
Join Date: Feb 2005
Location: Central MS/Orange Beach, AL
Posts: 7,440
Quote:
Originally Posted by REWahoo View Post
Since "The Oracle of Omaha" title is taken, should we call you "The Swami of Seattle"?
How about 'old wise one'.
__________________
Retired 3/31/2007@52
Full time wuss.......
Dawg52 is offline   Reply With Quote
Old 08-07-2012, 09:13 PM   #65
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Sep 2005
Location: Northern IL
Posts: 18,288
Quote:
Originally Posted by haha View Post
What I wonder is how long it will take for us to wake up to the evidence that the world from which the FireCalc database was abstracted is long gone, likely forever? ...

Ha

zzzzzzz, zzzzzzzzzz, Huh? What? Someone call?

Well, it's one reason I'm not comfortable with that 4% "SWR" and 95% success rate for 30 years. Clearly, the future 'worst case' could be worse than past 'worse cases'. Records were made to be broken.

And even though FIRECALC may report on about 101 data series, I tend to look at that as maybe a dozen or two economic cycles? Not really so much data when you look at it that way. For all we know, that may be like having a daily temperature for the first 101 days of the year, and thinking that is representative of the rest of the year.

I still think FIRECALC is a great, great tool. I can't think of any better way to back-test some ideas. But it is what it is, and the future is unknown.

I don't know what else to do other than throw a little fudge factor on top of it all. Gotta draw the line somewhere, or I'd work till I die.

-ERD50
__________________
ERD50 is offline   Reply With Quote
Old 08-07-2012, 09:17 PM   #66
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 5,693
Quote:
Originally Posted by haha View Post
What I wonder is how long it will take for us to wake up to the evidence that the world from which the FireCalc database was abstracted is long gone, likely forever?

Not that there wil not be strong markets, but IMO they will reward thinking carefully rather than just trying to set our sails to catch prevailing fair winds

Ha
Gone forever? We seem to currently be in a stealth bull market:







It always pays to be a bit optimistic. We shouldn't underestimate human ingenuity.
__________________
Lsbcal is online now   Reply With Quote
Old 08-07-2012, 09:45 PM   #67
Thinks s/he gets paid by the post
73ss454's Avatar
 
Join Date: Oct 2004
Location: LaLa Land
Posts: 4,378
Well, since we have no idea what the future brings, we can only base the future on the past. I'm good with it and will use Firecalc while it's still around.
__________________
Work is something you do to get enough $ so you don't have to....Me.
73ss454 is offline   Reply With Quote
Old 08-07-2012, 10:41 PM   #68
Thinks s/he gets paid by the post
 
Join Date: Nov 2011
Posts: 2,369
Like annuities, SS is tied to average life expectancy. IMO that makes the path to max benefits simple for most singles and working couples: if you expect to live longer than average, delay starting SS, otherwise start it ASAP.
__________________
GrayHare is online now   Reply With Quote
Old 08-07-2012, 11:02 PM   #69
Thinks s/he gets paid by the post
gauss's Avatar
 
Join Date: Aug 2011
Posts: 1,712
Quote:
Originally Posted by GrayHare View Post
Like annuities, SS is tied to average life expectancy. IMO that makes the path to max benefits simple for most singles and working couples: if you expect to live longer than average, delay starting SS, otherwise start it ASAP.

Actually, commercial annuities are based on average life expectancy of those who buy annuities -- not the population as a whole like Social Security.

As such, I am not aware of anywhere in the US where an actuarially fair annuity could be purchased (outside of delaying Social Security).
__________________
gauss is offline   Reply With Quote
Old 08-07-2012, 11:20 PM   #70
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,386
Quote:
Originally Posted by Lsbcal View Post
Gone forever? We seem to currently be in a stealth bull market: <graph snipped>

It always pays to be a bit optimistic. We shouldn't underestimate human ingenuity.
I need to clarify. Economic security is built on business and economic progress and sound policies. Bull markets, come, bull markets go, but it is cash flows of businesses that determine long term sustainable draw from securities. That, and of course real interest rates. How long since the prevalent real interest rate from the fixed 40% of a portfolio would support a real 1.6% of total portfolion draw? I don't know if you were on the board in 2006-2007. Lot's of bulls then too, and for the same reason-momentum.

As usual, we must pay our money and take our tickets. We can't expect that we would all see it the same way. And the human ingenuity thing is a red herring. I believe in human ingenuity, but it the world is different, and much of that ingenuity may help Asian economies more than Western ones

And we must not underestimate the ability of government to throw wrenches in the works.

Ha
__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is offline   Reply With Quote
Old 08-08-2012, 04:46 AM   #71
Thinks s/he gets paid by the post
teejayevans's Avatar
 
Join Date: Sep 2006
Posts: 1,222
Quote:
Originally Posted by haha View Post
Not that there wil not be strong markets, but IMO they will reward thinking carefully rather than just trying to set our sails to catch prevailing fair winds

Ha
We've heard this before, almost every FA is singing that tune. I'll stick to what has been working for the past 100 years.
TJ
__________________
teejayevans is offline   Reply With Quote
Old 08-08-2012, 05:51 AM   #72
Thinks s/he gets paid by the post
Marita40's Avatar
 
Join Date: May 2011
Location: St. Paul
Posts: 1,120
Single woman here who is quite security conscious, and a worrier. The women in my family tree live a long time, in some cases well into their 90s. Given good health and no major changes to the system, I'll definitely wait until 70--15 years in the future. Oh, by the way, I plan to work until then, too.
__________________
Marita40 is offline   Reply With Quote
Old 08-08-2012, 06:35 AM   #73
Recycles dryer sheets
Semiretired2008's Avatar
 
Join Date: Jun 2012
Location: Central Ga
Posts: 230
Quote:
Originally Posted by ziggy29 View Post
I'm still over 15 years from it but right now the main reason I plan to take it at 62 is because I think it is very unlikely that any future SS "reforms" will impact people already collecting it.
The current discussion afoot is not to impact anyone over 50 or 55. I have that covered, but my DW does not. I still use 75% for me and 70% for her in my calcs just to be sure...

I believe the biggest change they are going to make to SS is changing the inflation index used for inflation.
__________________
If you want someone to believe in you - First you have to believe in yourself and then you go from there...
Semiretired2008 is offline   Reply With Quote
Old 08-08-2012, 07:17 AM   #74
Recycles dryer sheets
 
Join Date: Aug 2012
Location: Elberta, AL
Posts: 146
Our initial plan was for me to work until I was 67 and the DW would be 62 and we would both retire at the same time. But my health changed and this is pushing me to retire at 62 instead. If I can find a non-stressful job that I enjoy then I will keep working. I started working in construction in 1975 and was in the supervisory positions for the past 23 years.
__________________
reubenray is offline   Reply With Quote
Old 08-08-2012, 08:11 AM   #75
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
easysurfer's Avatar
 
Join Date: Jun 2008
Posts: 7,896
This discussion is very insightful. I'm still several years away of being SS eligible. Though I did register with SSA to get my estimated statements online. I'm going to wait until about 60 or so, then take an inventory of my health so see which way to go.

The 62 vs 72 question is like the opposite of the immidiate annuity question.

Annuity: If I die too early, I'll never recover much of the premium I put in

SS: If take SS at 62 and I live too long past 70, then I'll be having smaller payments for the rest of my life
__________________
Have you ever seen a headstone with these words
"If only I had spent more time at work" ... from "Busy Man" sung by Billy Ray Cyrus
easysurfer is online now   Reply With Quote
Old 08-08-2012, 09:17 AM   #76
Full time employment: Posting here.
misanman's Avatar
 
Join Date: Apr 2008
Posts: 536
Sorry if I missed it, but I'm surprised that there has been no comment on the tax implications of taking early vs delaying. The gist of this is that only half of SS is accounted for in the calculation that is used to determine how much of SS is taxed. A strategy that some folks might investigate, depending on the specifics of their situation, is to skew their income towards SS in the later years so as to reduce the amount of it that is taxed. Is anyone considering this?
__________________
"The best thing about the future is that it happens one day at a time." -- A. Lincoln
misanman is online now   Reply With Quote
Old 08-08-2012, 09:18 AM   #77
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 5,693
Don't forget you can pick an intermediate age between 62 and 70.
__________________
Lsbcal is online now   Reply With Quote
Old 08-08-2012, 09:24 AM   #78
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 5,693
Quote:
Originally Posted by misanman View Post
Sorry if I missed it, but I'm surprised that there has been no comment on the tax implications of taking early vs delaying. The gist of this is that only half of SS is accounted for in the calculation that is used to determine how much of SS is taxed. A strategy that some folks might investigate, depending on the specifics of their situation, is to skew their income towards SS in the later years so as to reduce the amount of it that is taxed. Is anyone considering this?
Up to 85% of SS is taxed and that depends on your other income + deductions.

In California, there is no state tax.

One multi-year strategy we are using this year: (1) in year 1, take a big lump of IRA distributions with SS, (2) in year 2, take much smaller IRA distribution. For year #1 you hit the max SS taxed and then your marginal rate actually starts declining. For year #2, you are in a lower marginal tax situation because you are just starting to fully tax the SS. So this strategy depends very highly on whether or not you are in a tax position to use it.

P.S. All the above are just my wandering thoughts on taxes, you still have to do your due diligence.
__________________
Lsbcal is online now   Reply With Quote
Old 08-08-2012, 09:50 AM   #79
gone traveling
 
Join Date: Apr 2009
Location: Eastern PA
Posts: 3,851
Quote:
Originally Posted by Lsbcal View Post
Up to 85% of SS is taxed and that depends on your other income + deductions.

In California, there is no state tax.
Same in PA - no state/local tax on any retirement vehicle (SS, pension, SPIA, etc.)

As far as FIT on SS? We're planning on 100% taxability. Heck, it's currently only 15% of SS that is not being taxed. How long do you really think that will last in the future?
__________________
rescueme is offline   Reply With Quote
Old 08-08-2012, 10:18 AM   #80
Thinks s/he gets paid by the post
 
Join Date: Jun 2003
Location: Historic Florida
Posts: 1,647
Quote:
Originally Posted by misanman View Post
Sorry if I missed it, but I'm surprised that there has been no comment on the tax implications of taking early vs delaying. The gist of this is that only half of SS is accounted for in the calculation that is used to determine how much of SS is taxed. A strategy that some folks might investigate, depending on the specifics of their situation, is to skew their income towards SS in the later years so as to reduce the amount of it that is taxed. Is anyone considering this?
And the $99 that is taken out for Medicare Part B. (After 65)
__________________

__________________
"Arguing with an Engineer is like rolling in the mud with a pig. Just remember that the pig likes it."
ShokWaveRider is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


 

 
All times are GMT -6. The time now is 04:48 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.