Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 04-22-2020, 11:43 AM   #81
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
RunningBum's Avatar
 
Join Date: Jun 2007
Posts: 10,890
Quote:
Originally Posted by Perryinva View Post
But by that age it really wonít make that much difference on that amount for yourself. Heirs, yes, yourself, meh.
A lot of people here think they'll be spending less once they are done traveling or doing other active things, but you might want/need a private nurse, or want to live in a nicer care facility.
RunningBum is offline   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 04-23-2020, 05:36 PM   #82
Full time employment: Posting here.
 
Join Date: Aug 2012
Posts: 623
Quote:
Originally Posted by youbet View Post
But your feeling makes your number completely worthless. Nominal numbers do keep things "simple." But between the always changing levels of inflation and investment returns, I've never lived through a period where "nominal numbers" held, with the exception of very short periods of time.

Why would you ignore inflation and earnings in your analysis? That's not what happens in the real world.

Perhaps you don't like algebra, perhaps you didn't read the original post.
In either case the original question was about the following statement:


"That when you start taking SS at age 70, when you hit your early 80s your total payments will be more than if you started getting a lower benefit at age 62"


My numbers that you think are worthless are the same as pb4uski in post #4.


If you like to talk about anecdotal stories of someone taking it at 62 and investing it to change their "break even" age then you can just as easily envision someone taking it early and investing badly and greatly reducing the break even point.
Also inflation is a moot point in the equation because ss adjusts for inflation whether you took it at 62 or 70 or some point in between,
finnski1 is offline   Reply With Quote
Old 04-24-2020, 03:52 AM   #83
Full time employment: Posting here.
 
Join Date: Aug 2015
Posts: 832
Quote:
Originally Posted by RunningBum View Post
A lot of people here think they'll be spending less once they are done traveling or doing other active things, but you might want/need a private nurse, or want to live in a nicer care facility.
I agree, and currently @62.25, plan on delaying until age 69. My point was that an estimated ROI of 4.5% doesnít occur until age 90, so that small a return on an about 30% portion of just your SS isnít going to be any great shakes compared to the other benefits of spousal survival income, preferential tax treatment, and larger COLA/inflation protection. Especially when the increase in relative dollars vs percentage is considered. Delaying for the percentage when its a difference of $12.5k@62 vs $22k@70 isnít THAT big a deal compared to $27k@62 vs $48k@70 despite the same % gain. Itís a lot easier mentally (for me anyway) to delay for an over $20k compounding lower taxed income increase than for a less than $10k one. Especially if muted returns for the next 6 years occur. And as has been mentioned, one can always change their mind at any time and even claim 6 months retroactive if need be.
Perryinva is offline   Reply With Quote
Old 04-24-2020, 05:29 AM   #84
Thinks s/he gets paid by the post
 
Join Date: Jun 2003
Location: Historic Florida
Posts: 4,767
I would love to take my SS as would DW, but "Computer Says No", so does ACA, (At least in it's current form).
__________________
"Never Argue With a Fool, Onlookers May Not Be Able To Tell the Difference." - Mark Twain
ShokWaveRider is offline   Reply With Quote
Old 04-24-2020, 05:36 AM   #85
Full time employment: Posting here.
 
Join Date: Aug 2012
Posts: 623
Quote:
Originally Posted by ShokWaveRider View Post
I would love to take my SS as would DW, but "Computer Says No", so does ACA, (At least in it's current form).

The ACA has certainly added another consideration for when to start taking ss, as if it weren't enough of a decision already for many folks.
finnski1 is offline   Reply With Quote
Old 04-24-2020, 09:09 AM   #86
Thinks s/he gets paid by the post
 
Join Date: Aug 2016
Location: Northern Virginia
Posts: 3,104
Quote:
Originally Posted by Perryinva View Post
I have to partially take back whatI said. I remember now that someone pointed out to me that there are plenty of people that regard the bottom line balance as more important than income, as they have so much income that the only real objective is to maximize the estate for future generations. Something like that would never be on my mind.
Funny though how if you make a decision that maximizes your estate it is maximizing spendable funds, whether you call those funds "income " or something else.

Stated differently, at every point prior to break even, do you think you have maximized income because your income is higher for one year than it would have been had you begun at 62?

Surely not.
Montecfo is offline   Reply With Quote
Old 04-24-2020, 09:24 AM   #87
Thinks s/he gets paid by the post
 
Join Date: Aug 2016
Location: Northern Virginia
Posts: 3,104
Quote:
Originally Posted by pb4uski View Post
You can calculate an ROI for the decision to defer based on differential cash flows... I'm not sure it means much but you can do it. Below is an example based on 100 PIA at FRA of 66 and 132 at 70.

Obviously, the IRR is negative until you reach the breakeven point and then improves the longer that you live.

AgeSS at 66SS at 70DiffIRR
66100 0 (100)NM
67100 0 (100)NM
68100 0 (100)NM
69100 0 (100)NM
70100 132 32 NM
71100 132 32 NM
72100 132 32 NM
73100 132 32 NM
74100 132 32 NM
75100 132 32 NM
76100 132 32 -9.8%
77100 132 32 -7.0%
78100 132 32 -4.8%
79100 132 32 -3.1%
80100 132 32 -1.7%
81100 132 32 -0.5%
82100 132 32 0.5%
83100 132 32 1.3%
84100 132 32 2.0%
85100 132 32 2.6%
86100 132 32 3.1%
87100 132 32 3.5%
88100 132 32 3.9%
89100 132 32 4.2%
90100 132 32 4.5%
91100 132 32 4.8%
92100 132 32 5.0%
93100 132 32 5.2%
94100 132 32 5.4%
95100 132 32 5.6%
96100 132 32 5.7%
97100 132 32 5.8%
98100 132 32 6.0%
99100 132 32 6.1%
100100 132 32 6.2%
I have always thought of delaying as purchasing an annuity. And in post 30, that seemed pretty attractive. But above it certainly does not.
Montecfo is offline   Reply With Quote
Old 04-24-2020, 10:16 AM   #88
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
youbet's Avatar
 
Join Date: Mar 2005
Location: Chicago
Posts: 11,436
Quote:
Originally Posted by finnski1 View Post
Perhaps you....... perhaps you....... If you.......
WTF?
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
youbet is offline   Reply With Quote
Old 04-24-2020, 10:20 AM   #89
Thinks s/he gets paid by the post
 
Join Date: Jun 2003
Location: Historic Florida
Posts: 4,767
Mind you, if interest stay non existent, and Stock Market Returns are flat or keep declining, it may be OK to take SS and still take advantage of ACA subsidies.
__________________
"Never Argue With a Fool, Onlookers May Not Be Able To Tell the Difference." - Mark Twain
ShokWaveRider is offline   Reply With Quote
Old 04-24-2020, 10:24 AM   #90
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 29,183
Quote:
Originally Posted by pb4uski View Post
+1 I look at deferring to age 70 as a decision to buy a COLA-adjusted annuity benefit. I forgo $75/month beginning at age 62 for 8 years... so I forgo $7,200 ($75/mo * 12 * (70-62) years).

Then beginning at age 70 I receive $57/month (extra) for life, COLA adjusted. That is a 9.5% payout rate. ($57 * 12 months)/$7,200 paid for life annuity. Pretty sweet deal.
Quote:
Originally Posted by Montecfo View Post
I have always thought of delaying as purchasing an annuity. And in post 30, that seemed pretty attractive. But above it certainly does not.
I think it still is attractive.

As noted above, the payout rate is 9.5% for 8 year deferral from 62 to 70. For 4 years of deferral from FRA at 66 to 70, the payout rate is 8% ($32/year extra divided by giving up 4 years at $100). And in both cases those are COLA adjusted annuities.

For comparison, the payout rate for a 70 yo male in FL according to immediateannuities.com is 6.9%.

So deferring SS is a much better payout that commercially available fixed annuities and the COLA adjusted benefits is a big ol'cherry on top
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.

Retired Jan 2012 at age 56...target 65/35/0 AA TBD
pb4uski is offline   Reply With Quote
Old 04-24-2020, 10:42 AM   #91
Full time employment: Posting here.
 
Join Date: Aug 2012
Posts: 623
Quote:
Originally Posted by youbet View Post
WTF?

I posted a reply telling you my analysis to the OP statement /question.
I also mentioned how my numbers agree with post #4.
I explained how my numbers are not "worthless", at least to me and all you can come up with is "WTF"


Did you not read the OP, post #4 and my full response in post #82?
finnski1 is offline   Reply With Quote
Old 04-24-2020, 11:06 AM   #92
Recycles dryer sheets
SnowballCamper's Avatar
 
Join Date: Aug 2019
Posts: 291
__________________
--At what age does spending less now in order to have more later stop making sense?
SnowballCamper is offline   Reply With Quote
Old 04-24-2020, 11:17 AM   #93
Full time employment: Posting here.
 
Join Date: Aug 2012
Posts: 623
Quote:
Originally Posted by SnowballCamper View Post
finnski1 is offline   Reply With Quote
Old 04-24-2020, 11:50 AM   #94
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
youbet's Avatar
 
Join Date: Mar 2005
Location: Chicago
Posts: 11,436
Quote:
Originally Posted by finnski1 View Post
I posted a reply telling you my analysis to the OP statement /question.
I also mentioned how my numbers agree with post #4.
I explained how my numbers are not "worthless", at least to me and all you can come up with is "WTF"


Did you not read the OP, post #4 and my full response in post #82?
What you did was make several inferences about me using the expressions "Perhaps you....... perhaps you....... If you......."
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
youbet is offline   Reply With Quote
Old 04-24-2020, 12:02 PM   #95
Thinks s/he gets paid by the post
 
Join Date: Aug 2016
Location: Northern Virginia
Posts: 3,104
Quote:
Originally Posted by pb4uski View Post
I think it still is attractive.

As noted above, the payout rate is 9.5% for 8 year deferral from 62 to 70. For 4 years of deferral from FRA at 66 to 70, the payout rate is 8% ($32/year extra divided by giving up 4 years at $100). And in both cases those are COLA adjusted annuities.

For comparison, the payout rate for a 70 yo male in FL according to immediateannuities.com is 6.9%.

So deferring SS is a much better payout that commercially available fixed annuities and the COLA adjusted benefits is a big ol'cherry on top
Yes, I do see that part. The ok insurance element with cola.

I view SS as longevity insurance in general. So I tend to want to defer in order to maximize "coverage" and create room for Roth conversions.

So to me it seems the decision to take SS now or later is driven largely by considerations other than what may be "best" for SS in isolation. I think this thread is evidence of same.
Montecfo is offline   Reply With Quote
Old 04-24-2020, 12:06 PM   #96
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 29,183
+1 leaving room for higher Roth conversions before 70 is a big part of my reasoning... in case something happens to ne and DW gets thrown into a higher tax bracket.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.

Retired Jan 2012 at age 56...target 65/35/0 AA TBD
pb4uski is offline   Reply With Quote
Old 04-24-2020, 03:59 PM   #97
Dryer sheet wannabe
 
Join Date: Jan 2008
Posts: 14
If you knew the year you will die, then you could pick the perfect age for beginning social security. Otherwise, you are just making your best guess. Delaying the start of payouts is a bet on living longer and us a kind if insurance in case you do.
lonnie is offline   Reply With Quote
Old 04-24-2020, 04:14 PM   #98
Recycles dryer sheets
 
Join Date: Dec 2010
Location: Tequesta
Posts: 305
Without reading every comment, I believe it depends.

My circumstances allowed me to retire at age 63. My wife was 58. I could take SS on her account when she turned 62 and delay mine until age 70. I did and now get over $3,500 a month after they take Medicare out. I'm quite happy with that number and if I die sooner than I would prefer, my wife will benefit. I'm 70.5 and it was a good decision for me and my wife.

On the other hand, my younger brother died last year, 32 days after turning 62. He took SS early and got one payment. Very sad.

I think each of us has to make a decision based on our personal circumstances. Right now, $3500+ a month is pretty sweet but not a game changer.
67walkon is offline   Reply With Quote
Old 04-24-2020, 04:28 PM   #99
Thinks s/he gets paid by the post
 
Join Date: Apr 2008
Posts: 1,267
Quote:
Originally Posted by 67walkon View Post
My circumstances allowed me to retire at age 63. My wife was 58. I could take SS on her account when she turned 62 and delay mine until age 70.
I believe they have eliminated that option for anyone born after 1954 (or something like that). I'm sure someone will come along and correct that information.
statsman is online now   Reply With Quote
Old 04-24-2020, 05:02 PM   #100
Thinks s/he gets paid by the post
 
Join Date: Dec 2014
Location: St. Charles
Posts: 2,621
Well, I guess we have confirmed, again, that "when to take social security" is the most discussed, and controversial topic here.

And the CORRECT answer is:
__________________
If your not living on the edge, you're taking up too much space.
Never slow down, never grow old!
CardsFan 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


Similar Threads
Thread Thread Starter Forum Replies Last Post
The Suze Orman Report!!!!! Zoocat FIRE and Money 36 10-13-2008 11:13 AM
Suze Orman on Oprah ohfrugalone FIRE and Money 13 09-23-2008 09:33 PM
Score One for Suze Orman Dog FIRE and Money 64 09-04-2008 02:41 PM
Uh oh, I think Suze Orman got me into trouble cute fuzzy bunny Other topics 7 03-03-2007 07:01 PM
Suze Orman opinions nnkrealtor FIRE and Money 133 01-09-2007 06:41 PM

» Quick Links

 
All times are GMT -6. The time now is 01:01 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2021, vBulletin Solutions, Inc.