50, just retired, $1m cash

[MichaelB]

What isn't covered by SS? My earnings were from a K1, nothing was ever taken out for SS for the past 15 years.

Did you pay into Social Security for 10 years? That is the minimum needed to be eligible for a pension.

 

[DrgLrd]

Yes, go to ssa.gov.

What an absolute PITA this was, for some reason they can't "identify" me, which itself is stupid because I'm the only one with my name and SS#. So I have to call them up just to make an account.

 

[Brat]

Rather than buying an annuity buy a couple of dividend ETFs.

Insurance companies price an annuity based on return on bonds. Bonds are paying little interest thus annuities offer low payouts.

 

[Bamaman]

I know some life insurance/annuity salesmen that'd love to meet you. Commissions are often generated on front end.

You might want to get some professional help from a CFA working as a fiduciary.

My father used to dream of being a millionaire. But that was back when $1 million was truly a lot of money.

 

[pb4uski]

What isn't covered by SS? My earnings were from a K1, nothing was ever taken out for SS for the past 15 years.

Do you end up filing a Schedule SE with your tax return? If so, that would help you qualify.

 

[Samsung4321]

Determine the minimum nominal rate of return required to attain retirement objective then compare that rate to investments that can provide that return to estimate the risks attached:

https://www.early-retirement.org/forums/f28/minimum-rate-of-return-in-retirement-111693.html

= (1 + RATE((AgeDie - AgeRetire), AnnualWithdrawal, -CapitalRetire, CapitalDie, 0)) * (1 + Inflation%) - 1

Examples:

= (1 + RATE((85 - 50), 10000, -1000000, 0, 0)) * (1 + 3%) - 1
= 1%

= (1 + RATE((85 - 50), 40000, -1000000, 100000, 0)) * (1 + 3%) - 1
= 5%

 

[pb4uski]

Determine the minimum nominal rate of return required to attain retirement objective then compare that rate to investments that can provide that return to estimate the risks attached:

https://www.early-retirement.org/forums/f28/minimum-rate-of-return-in-retirement-111693.html

= (1 + RATE((AgeDie - AgeRetire), AnnualWithdrawal, -CapitalRetire, CapitalDie, 0)) * (1 + Inflation%) - 1

Examples:

= (1 + RATE((85 - 50), 10000, -1000000, 0, 0)) * (1 + 3%) - 1
= 1%

= (1 + RATE((85 - 50), 40000, -1000000, 100000, 0)) * (1 + 3%) - 1
= 5%

The one-trick pony is back!

 

[Samsung4321]

The one-trick pony is back!

OP needs to provide more information for estimation of the minimum rate of return required.

 

[DrgLrd]

Do you end up filing a Schedule SE with your tax return? If so, that would help you qualify.

E, not SE. I haven't paid tax in a decade thanks to the FEIE, before that I pre-paid estimated taxes, about $10k to $16k a year for a few years but that was all from K1 and Schedule B, no wages or salaries. No idea if that counts for SS.

 

[pb4uski]

E, not SE. I haven't paid tax in a decade thanks to the FEIE, before that I pre-paid estimated taxes, about $10k to $16k a year for a few years but that was all from K1 and Schedule B, no wages or salaries. No idea if that counts for SS.

It doesn't count for SS, usually only Schedule C income which results in self-employment tax.

 

[DrgLrd]

It doesn't count for SS, usually only Schedule C income which results in self-employment tax.

After doing some calculations, my SS will be between $3000 and $5000 per year, which is why I'm planning to get some annuities.

 

[Time2]

I suspect there is a consensuses here, that if you invested in Stock market mutual funds instead of annuities you would have higher income over the next 30 years.

 

[pacergal]

Welcome to the forum. This is a great place to learn and share.

 

[pb4uski]

After doing some calculations, my SS will be between $3000 and $5000 per year, which is why I'm planning to get some annuities.

While it is peanuts for you because your SS is so small, the best annuity that you can buy is to defer SS untll you are 70... SS is a COLA adjusted life annuity and it is very hard to find anything like that in the annuity marketplace... most are fixed.

 

[DrgLrd]

I suspect there is a consensuses here, that if you invested in Stock market mutual funds instead of annuities you would have higher income over the next 30 years.

Without a pension or SS I will likely do both.

 

[Sunset]

Without a pension or SS I will likely do both.

I'm amazed you haven't been invested in the stock market for the past 25 yrs, at least that is what it sounds like.

 

[pb4uski]

I suspect there is a consensuses here, that if you invested in Stock market mutual funds instead of annuities you would have higher income over the next 30 years.

Or a good in-between all stocks or all annuities would be a CD or UST ladder for the first 10 years with the rest in something like Wellesley or some other conservative balanced fund and then automatic monthly redemptions from Wellesley that mimics an annuity. Not guaranteed lifetime income, but more income and more likely to keep pace with inflation.

 

[DrgLrd]

While it is peanuts for you because your SS is so small, the best annuity that you can buy is to defer SS untll you are 70... SS is a COLA adjusted life annuity and it is very hard to find anything like that in the annuity marketplace... most are fixed.

If I get around $3000 at 62, $4000 at 67, and $5000 per year at 70, how much would I get if I deferred until 70?

Deferred annuities serve the same purpose, also fixed with CoLA riders.

 

[DrgLrd]

I'm amazed you haven't been invested in the stock market for the past 25 yrs, at least that is what it sounds like.

There was never an option to risk anything, I never had a salary, pension, or plan. Still can't risk it, but once I get something guaranteed like an annuity then I can play with maybe 20%

 

[DrgLrd]

Or a good in-between all stocks or all annuities would be a CD or UST ladder for the first 10 years.

Why not a MYGA? The rates are higher. I haven't checked rates but a period certain 10 year annuity is another option.

I will definitely get into funds for some growth after the income is guaranteed.

 

[Sunset]

It's minor, but since I imagine OP is getting tiny interest rates on all the money.
OP should buy $10K of I-bonds for himself, and spouse if any.
That would be $10K per person.
It will earn 7.12% for 6 months, and then (I estimate at least 4%) for next 6 months, and always keep up with inflation. Beats ALL CD's available and bank accounts right now.
Can cash after 1 year with only a 3 month interest penalty

 

[Dtail]

Why not a MYGA? The rates are higher. I haven't checked rates but a period certain 10 year annuity is another option.

I will definitely get into funds for some growth after the income is guaranteed.

I am a fan of MYGA's and the rates are on the upswing.

 

[pb4uski]

If I get around $3000 at 62, $4000 at 67, and $5000 per year at 70, how much would I get if I deferred until 70?

Deferred annuities serve the same purpose, also fixed with CoLA riders.

Is this a trick question?

Or are you sampling the inventory?

 

[DrgLrd]

Is this a trick question?

Not, I assumed you mean if I deferred SS until age 70 the total yearly payouts would be more than what they would be if I don't defer (around $5000).

 

[DrgLrd]

I am a fan of MYGA's and the rates are on the upswing.

How many years? Or ladder?