explanade
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- May 10, 2008
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So a "money management firm" for retirees generated a report finding that retirees missed out on additional money by taking it too early:
https://www.bloomberg.com/news/arti...paign=news&utm_medium=bd&utm_source=applenews
No mention of balancing longevity risks or opportunity cost from not claiming earlier, which would require having other financial resources to pay for living expenses before claiming at age 70.
Specifically, how are you suppose to determine the bolded?
But 2000 households took part in a long Univ. of Michigan study!
The report is based on about 2,000 households that participated in a long-running University of Michigan study. To calculate ideal filing years, United Income estimated retirees’ spending and longevity and ran about 500,000 possible scenarios for each participant, including various market conditions, for a total of about 1.1 billion simulations.
Only 4% of U.S. retirees are waiting until age 70 to claim Social Security; some 57% should be doing so, the report calculated. Meanwhile, more than 70% start taking checks before turning 64, a time when—ideally—only 6.5% of retirees should be cashing checks. The lost income from these less-than-optimal decisions amounts to about $111,000 per household, the researchers estimate.
The United Income analysis finds little rhyme or reason in Americans’ claiming decisions. If you’re healthy and expect to live a long time, you should maximize benefits received late in life by delaying. But the report finds that people don’t do this: Those who ended up dying before 75 were just as likely to have claimed early as those who died after 85. (There is a way to claim benefits, then suspend them until later, but it’s kind of complicated.)
https://www.bloomberg.com/news/arti...paign=news&utm_medium=bd&utm_source=applenews
No mention of balancing longevity risks or opportunity cost from not claiming earlier, which would require having other financial resources to pay for living expenses before claiming at age 70.
Specifically, how are you suppose to determine the bolded?
But 2000 households took part in a long Univ. of Michigan study!