Mid 50's or younger... are you counting on Social Security?

[rk911]

I get the impression that those that do not plan on SS being there wear that as a badge of honor. I'd have to work another 5 years to retire without needing SS. That seems silly. Work 5 more years in case SS isn't there in 15 years? No thanks. I am planning on it, counting on it and retiring in 2 years expecting it to be there.

For those that don't need it, did you ever think about retiring a LOT earlier by including it?

speaking for us, 'need' does not mean 'must have'. we both have traditional defined benefit pensions that provide ~ 80% of our annual income. our SS payments provide the other 20% and allows our nest egg to remain untouched. we're still living well beneath our means with a positive cash flow each month. we prefer to not touch the nest egg but RMD's start next year. that's a good problem to have compared to the alternative.

 

[Scubamax]

I am 56. I think there is a high probability of adjustments around the margins in inputs and outputs for SS to keep it going along for quite some time.

Personally I have always taken the planning approach of having a “zero” in the SS column so anything received will be a bonus. Plus since I worked outside of the USA for decades my payout is not that much, but at least I have enough credits to qualify for Medicare which is going to be much more a material issue if that gets messed with by Uncle Sam.

 

[ckelly78z]

At 54, I will most likely wait until 62 to FIRE, but may not take SS until later (undecided when). I should have close to 1M, and a nice 30 year pension.

Yes, I am counting on SS to make my life easier when the time comes.

 

[retiringby50]

I'm 53 and optimistic that it'll still be around. i know it's against all the rules, but I'm planning to take it at 62. My mom received her 1 and only check when she turned 62... and passed away. Sadly, I'm not 100% sure that I'm healthier that she was (something I'm working on changing).

 

[Major Tom]

I turned 56 a few months ago, and have been retired for 9 years now. I don't need SS to make it, but it will be a welcome addition when it comes along, however much it happens to be.

 

[Toocold]

I have not yet hit 50, but I consider SS as two of the cashflow buckets that will come our way. I have 5 other passive income streams so I will not rely on it, but if it does come, great. I think the worst case scenario is that SS will be cut, not completely removed.

 

[Lawrencewendall]

I have SS figured in for future income. I will need the money to cover expenses. My logic is that it is better to draw SS at 62 and pay tax on 85% of it versus use my investments and and pay taxes on 100% percent of it. If there is a SS haircut, it just means that more will come from investments. Even doing conversions from my 401k to a roth to the top of the 12% bracket (about 25k a year), I will still have RMDs at 72 (55 now).

 

[ut2sua]

I expect SS to get reduced for me (53). I hope it won't be a large reduction because many are dependent on it.

 

[ATX78701]

I expect SS to be reduced for me, too (51). Not FIRE'd yet...I think I'm in the OMY syndrome since I can't really get my head around retiring at 51. I run Firecalc and other calculators with and without SS and all signs seem to point that I'll be fine.

 

[pjigar]

I am in late forties and I expect to receive at least 75%. I run fireflcalc with and without SS and results are almost the same since I run simulations for perpetual retirement i.e. balance never dropping below starting balance. I have a special need child so I have to plan for a perpetual retirement.

Little known fact about SS benefits: Disabled children can receive SS benefit on parents income records. So our lifetime family benefit can be maximized if we claim at 62!

 

[Steeler75]

I’m 55 and FIRE’d in 2018. Changes will probably be made as described earlier increasing FRA, age for early filing and increasing wage threshold, but I believe they will be applied to those under 50. Too close to retirement age for those over 50 to adjust to changes.

 

[tb001]

I’m 55 and FIRE’d in 2018. Changes will probably be made as described earlier increasing FRA, age for early filing and increasing wage threshold, but I believe they will be applied to those under 50. Too close to retirement age for those over 50 to adjust to changes.

Agree that should be the case. If you had asked me when I was in my 20s/30s, I would have said it wouldn’t be there. Now at almost 50 I’m including it, with a bit of discount. I can understand being conservative and discounting it, but I’m surprised at how many are not including anything. As another poster pointed out, that’s a lot of extra saving to do—easily 1mm extra. I wonder if we’d see the same answers if recent returns weren’t so strong.

I too am far more concerned about Medicare funding.

 

[tryan]

Yes SS is in my plan.

There would be blood in the streets if the gov cut or tampered with promised payments to retirees. Easier to just print the cash and let the economy take a hit in the form of inflation. Or slowly "raise the bar" to collect more from high wage earners and print less.

 

[GravitySucks]

Who's going to take care mom and dad?Not only would us Geezers revolt, so would our kids.
Any one telling you SS will not be there is using fear to sell you something. Either a financial product or a political/economic policy change.
Not to say it won't be fiddled with. It's not a divine policy. Worst case I foresee is a 25% cut for the upper end recipients. But I doubt even that much.

 

[corn18]

Seems to me a FICA rate hike is in order. The Base wage is certainly going up fast.

 

[SecondCor521]

So, this sort of prompts a number of questions for people roughly my age and younger...

- Should we expect SS to be there in full for our life time? Will the politics be strong enough to effect SS for years to come?
- Should we take the current solvency at face value? If so, what does that do to your timing/plans to start taking SS?
- If, like me, you did not factor SS in your modeling... should you? And if you do, how will you/should you adjust your spending up until you start taking withdrawals?

There are worst plans in the world... just plan on SS as found money. But, at the same time, if you believe it will be there, you effectively could make an argument to "blow the dough" a little more aggressively up until then.

What say you?

Posted without reading other responses.

I am 50 and FIREd about three years.

1. I expect it to be there my entire lifetime, although I expect there to be changes as we approach the solvency issues. I believe our elected officials will be sufficiently motivated to come up with some sort of compromise.

2. In my planning, I don't need it. But I plan on 60% of it. It does not affect my plans to take it at 70. I do think that people on SS already will be affected less by any cuts they might make, but (a) I doubt they will make any cuts; tax increases are historically more common, and (b) I think any change will be gradual and grandfather anyone close to SS, so by they time that happens I think I will be inside the grandfather window.

3. I should "blow more dough" because even 60% of my SS covers my current spending, and I still have my portfolio to spend. But I don't. Not sure if/when I will start spending more. One thing that I do is include the NPV of my future SS in my current FIRE stash, and I would fee comfortable spending 4% of that now, so in essence that does accomplish some of that task of blowing more now in anticipation of getting SS. But I'm only spending at 0.41%. So I'm not doing very well at that.

 

[imnontrad]

First off, Social Security was NEVER meant to be the only resource in retirement.

I think it is up to everyone to set up their finances so anything from Social Security is fun money. My SS, when I claim at 70 or when my ex-husband dies, will be used to pay the tax bill each year and one really nice trip.

If you are married and have a spouse who does not have as much SS eligibility on their own work record, It is a LOT better for them if you wait as long as possible to claim. So after you die, thy will have more money for life.

We have a FB group called "Social Security Intelligence" with a CFP as the owner and several CFPs (plus me) as the Moderators. The subject of when to claim, the benefits and pitfalls, are some of the items discussed.

 

[reneeh63]

I am 50'ish and do not consider SS at all. If it happens will be bonus spending money. I feel fortunate to be in this position.

Good point...if you don't HAVE to consider it in order to hit your targets then it's a bit easier to voice your pessimism as it makes no difference to you. If you will need it then it behooves you (mentally) to figure it into your calculations else you might never get to retire. Of course you can always hedge your bets and save as much as possible, just in case and it will only serve to further raise your standard of living if SS survives relatively intact.

 

[almost there]

Did not factor it in while working or when I retired. To play it safe.
But am now. 58 retired at 51. I paid a ton into it. Would like to at least break even. Is that asking too much?

They say inflation has been low. But all my utilities have doubled in the past 7 1/2 yrs.

 

[Rdub]

I am 50 and FIREd. I expect to receive some benefits (since I paid into the program) but I don't have any SS baked into my plans.

 

[JBmadera]

58, retired and yes DW and I are both expecting it. She’s 62 and just yesterday went to soc ser office and filed.

 

[2177V]

68 and SS worked out well for me. However, I am concerned about people who are not so lucky. I always considered SS as a government pyramid game. There may be no choice except to raise taxes to meet the shortfall.


When socialists want "Medicare for All" and point to socialist European countries as their model of success, they will never tell you that their taxes are the highest in Europe. We need to raise taxes to meet the SS shortfall but then stop.

 

[almost there]

Agree[MOD EDIT]. Have put 100's of thousands into it.
And do expect something back in return.

 

[Dtail]

68 and SS worked out well for me. However, I am concerned about people who are not so lucky. I always considered SS as a government pyramid game. There may be no choice except to raise taxes to meet the shortfall.


When socialists want "Medicare for All" and point to socialist European countries as their model of success, they will never tell you that their taxes are the highest in Europe. We need to raise taxes to meet the SS shortfall but then stop.

Ah but which taxes?

 

[almost there]

Ah but which taxes?

a
All of them. As they get disguised.