Retirees, does SS cover all your needs?

[Beer-man]

I ask cause it “appears” that even with cuts that SS would cover our expenses. Even retiring early the numbers are there as we are high earners and don’t spend much.
It would seem that we could still plan for a 30yr drawdown but have it be from 40-70yrs. At 40yrs we’ll be at 4%WR and that’s with pitiful 3% estimated returns.
Spending down tax advantage would avoid tax torpedo. Downsides?

 

[Bamaman]

Social Security doesn't begin to cover our expenses. I'd say it's $60K short. But I'm fortunate to have a defined pension seldom being offered in this modern world.

 

[RunningBum]

If you're living month to month on SS, you would run into trouble if a large expense hit. So you'd have to keep something for an emergency fund.

Runaway inflation could be a problem. SS is indexed for inflation, but I'm not sure it really keeps up with real inflation.

What happens if one of you dies at age 70? I don't know the answer since I'm not married, but the survivor only gets one benefit (the higher one), right? Can one of you live on one SS benefit?

 

[calmloki]

Just got word that my SS check will be bumped up in January. After the deduction for Medicare B and D they will be depositing a check in the amount of $215.60/month into my bank account. Good thing we don't have to pay rent. The cat will stay fed and I'm grateful.

 

[Another Reader]

No way. Doesn't even cover the mortgage.

 

[pb4uski]

We haven't started SS yet... a few years from FRA. SS will cover about 50% of our planned spending... however many years we spend less than planned so it could be more.

According to the SSA, it is designed to replace about 40% of pre-retirement income. It is one-leg of a 3-legged stool... that is why people need to save... and they need to save even more if they won't be getting a defined benefit pension. Unfortunately, many of my peers never got the memo on that or chose to ignore it and as a result will have to work longer.

 

[Teacher Terry]

Due to WEP mine will be 350 and DH 500 before deductions so no. Our small pensions total 40k together and our expenses run between 60-70k/year.

 

[CardsFan]

In 2 years (FRA), SS will cover 60-70% of our current spend. Frankly, we never expected it to be that much. Pretty much discounted it in the planning phase.

This will put our WR in the 1-2% range (and 2% is high).

 

[RunningBum]

Also, if you are planning to retire at 40, you should make sure you've calculated your SS benefits correctly. The benefit statement you get assumes you'll keep working until retirement. Put 0's in for your 40s, 50s, and 60s with their calculator to see what you'll really be getting.

 

[Beer-man]

I don’t get a benefit statement. I calculate from a spreadsheet that physicianonfire put together

 

[NW-Bound]

The OP asks: Retirees, does SS cover all your needs?

If we defer both of ours until 70, then SS benefit will match our expenses.

However, my wife will claim hers soon instead of delaying, and then there's the talk of SS being cut-back 20% due to funding shortfall.

 

[GravitySucks]

I'm expecting the FRA SS to cover needs but not wants. SS at 70 should cover needs and a little fun.
I don't want to live a minimalist life though.

 

[travelover]

Sure, it is more than enough now that we moved under a bridge and keep our possessions in an old grocery cart.

 

[street]

No, it won't but will take care of about 50% worth. I haven't received SS yet so that is a projection what it would cover in out life style.

 

[Katsmeow]

DH and I are both collecting SS. We did not wait to age 70. For this year, it didn't come close to covering spending as we had a lot of expenses involved with moving. Going forward I expect it to cover about 60% of spending. However, much of that includes things that are discretionary. If we really needed to, it would probably cover about 75% of our expenses if it really had to. I guess we could get that to 100% if we really, really had to but I would prefer not to.

And, of course, bear in mind that eventually there will be only one SS being collected as generally one member of a married couple dies before the other...

 

[misty57]

No, because we are not yet on Medicare and health insurance is outrageous.

It's a darn good thing that we are FI, otherwise this retirement thing would be a real drag. We spent almost $19K in medical (premiums + deductible and OOP) and over $4K in dental (no dental insurance) in 2018.

When we were planning for FIRE in the 80s, we did not count on getting any SS. We also never dreamed that our health insurance premiums would cost more than a mortgage!!

 

[daylatedollarshort]

SS and pensions will cover all our basic spending and a few frills. Any investment income we decide to spend will just go for extra travel / fun / asteroid strike. If one of us dies the other will have the higher SS, pension income, investment income and would probably rent out the current house, so more than enough for one person to still live well.

 

[ERD50]

Retirees, does SS cover all your needs?

I ask cause it “appears” that even with cuts that SS would cover our expenses. ...

What difference does it make to you if our SS covers our expenses or not? We are not you.

I see no value in that question. Different people have different SS due. Different wants/needs and comfort levels.

Is this the retiree version of "keeping up with the Jones's"? I don't get it.

-ERD50

 

[gerntz]

No, but we could change so that it would & feel OK.

 

[Beer-man]

Retirees, does SS cover all your needs?



What difference does it make to you if our SS covers our expenses or not? We are not you.

I see no value in that question. Different people have different SS due. Different wants/needs and comfort levels.

Is this the retiree version of "keeping up with the Jones's"? I don't get it.

-ERD50

I’m in my 30’s so I’m trying to get a feel for how retiree’s are doing with their SS. I have a decent SS earnings history(cause I work a ton of overtime) and a very low burn rate. I’d like to hope that trend will continue but time will tell.
Was hoping to see how like minded people a generation older than me were faring. All I read about online is about how SS barely covers anything and everyone at work in their 50’s and 60’s doesn’t want to talk about SS or retirement in general.

 

[daylatedollarshort]

I’m in my 30’s so I’m trying to get a feel for how retiree’s are doing with their SS. I have a decent SS earnings history(cause I work a ton of overtime) and a very low burn rate. I’d like to hope that trend will continue but time will tell.
Was hoping to see how like minded people a generation older than me were faring. All I read about online is about how SS barely covers anything and everyone at work in their 50’s and 60’s doesn’t want to talk about SS or retirement in general.

When we really started to crunch the numbers we were pleasantly surprised at how much our SS was going to be. That is one seldom mentioned benefit of living in a high cost of living area - higher salaries means higher SS. And your benefits stay the same if you move to a lower cost of living area after retirement.

You can check out the Consumer Expenditure Survey to get an idea of what other households spend in retirement. Higher end SS benefits compare pretty favorably to those kind of average U.S. household expenses.

 

[ERD50]

I’m in my 30’s so I’m trying to get a feel for how retiree’s are doing with their SS. I have a decent SS earnings history(cause I work a ton of overtime) and a very low burn rate. I’d like to hope that trend will continue but time will tell.
Was hoping to see how like minded people a generation older than me were faring. All I read about online is about how SS barely covers anything and everyone at work in their 50’s and 60’s doesn’t want to talk about SS or retirement in general.

OK, being in your 30's is a big factor. Hard to say if/how much SS will be affected by your retirement date.

But my point is, these are individual things. One person's experience may have little/no bearing on yours. Many/most of us have other savings, so we don't need to rely totally on SS. And some may get very little/no SS. Some have pensions. I think you could learn more by breaking it out:

A) What are the expectations for SS for someone like you in their 30's?

B) How do I go about estimating expense at retirement if I'm in my 30's?

C) You need to estimate your other sources of income (from savings).

Offhand, I'd say those are difficult to predict. But you can take a shot at it, knowing it is rough and you really need to review it every few years. And save as much as you can while maintaining some balance for fun/comfort. That will likely put you far ahead of most people your age. It's a good start!

-ERD50

 

[RobLJ]

We're not drawing SS yet. However, when we both reach full SS age, the pay out will be 50-65% of budget. Although in DW's first year we're only spending a little over 2/3s of the planned spending.


DW is travelling a lot but on a budget, so we could always up the spending some by blowing more on the optional travel.

 

[RobbieB]

Not even close. Pocket jingle.

 

[audreyh1]

No, not even close. We retired too early.