What percentage of your retirement income is Social Security?

[leeg]

Next year, when I'll be 72, it will be about 1/3. Works out to approx.
1/3 SS (close to $75,000 next year)
1/3 RMD
1/3 withdrawals from taxable account

 

[meleana]

I am curious what percentage of your retirement income from all sources including withdrawals is from Social Security.

Right now we are living on cash savings and waiting to age 70 to collect. We are 68 and 66. Once we have two SS checks they will more than cover our expenses but if one of us passes then will need to maybe take out about $15,000 + per year from our savings, depending on what expenses are at that time.

 

[azxracer]

In 2023, depending on how the RMD works out, we should be:


SS (combined) -- 40%


Pensions (combined) -- 33%


RMD (just 1, DW is 100% Roth) -- 27%

 

[Hermit]

Thanks for the responses so far!

Sorry, I was not clear.

I went to a retirement planning seminar (not in any way a sales pitch, put on by a retiree from my company and very well done). He mentioned that Social Security was never meant to provide all retirement income but rather X % of retirement income and he noted that that number is pretty close to what the average amount for retirees is now. I'll tell you the actual % he gave in a few days.

He speciifically said "income" but included investment returns and withdrawals and one source of income, pensions being the other.

So I guess given that net income=expenses by definition for a retiree, % of expense would give the same answer. (If your income exceeds your enpenses that excess just goes back into savings, right)

I'm interested in seeing if the experience of people here is close to the average and the original intent of SS. If you are not yet taking SS then I would say it does not make sense to answer unless you want to report what you plan it to be.

Answers will vary greatly because SS vaies greatly from person to person. SS on the late wife's account was about 30% of income from 63 to 70. IRA withdrawals contributed 20% and pension 50%. At 70 I moved to my SS on my account at about 50% with 50% pension. That mostly covers expenses except real lumpy things like a new truck next year or really large construction expenses in years past.

 

[NW-Bound]

It's a pretty simple and easy question.

Just look at your last tax return and that should answer "what percentage of your income is from SS"

Yes, that's income as the IRS sees it.

As many posters demonstrated, it should be SS in relation to the expenses that the OP was curious about. He liked to know how much people are spending beyond their SS.

Younger ERs who are on ACA will manage their income by living off their after-tax savings while not drawing on IRA. Their expenses may be a lot higher than their income. And we don't know what their future SS would be.

At the other end of the scale are older retirees (no longer ER) who have to draw RMD. They most likely have a very high taxable income that may be a lot higher than their expenses.

So, the question could have been: "What is your SS as a percentage of your total living expenses?"

And the following post is a perfect answer to the above question:

DW's and my net SS (after Medicare, IRMAA & withheld taxes) is 49% of our annual average spending.

 

[RobbieB]

I am curious what percentage of your retirement income from all sources including withdrawals is from Social Security.

This is the OP original question. Nothing about spending mentioned.

 

[NW-Bound]

^^^^ I know.

I suggested that the OP asked the wrong question.

 

[zippy2020]

SS is 18% of our annual gross income. I take it, my spouse does not as he's under WEP, so he will lose 60% of his SS payment due to having a government pension. We'll wait until he's 70 to maximize his very minimal benefit. We figure by then it should just about cover his Medicare costs, LOL.

Both SS and his pension have COLAs. My tiny pensions do not. We take out about 3-4% of our portfolio in distributions for fun $$$$. Nothing to save it for: we don't have kids, have a minimal mortgage at those low giveaway rates that are now gone, have retiree medical benefits and separate LTCi policies of the type they don't even sell any longer because the carrier is on the hook for as long as one lives (no cap, no ending of benefits until you die).

We are lavish spenders but with the pandemic/lockdown, the cash kept creeping up despite several expensive home projects. We're back doing road trips but not as many. Getting older and don't enjoy being gone for several weeks like we used to.

 

[NW-Bound]

When I start to draw SS at 70, I suspect that our SS will provide much of our expenses, maybe 70 to 80%?

With no debt, no costly hobbies, no fancy tastes, what do I spend money on? We can only travel so much before we miss home. Old people don't eat or drink that much either.

Maybe buy a boat? Oh man, I don't know about toys that require me to work on them, and most toys do.

That's it. I will just leave my kids the money for them to BTD as they see fit.

 

[swabby01]

SS %

About 6% of pension plus dividends. Not drawing on IRAs and 401K

 

[RobbieB]

^^^^ I know.

I suggested that the OP asked the wrong question.

You suggested the OP asked the wrong question?

How can the OP ask the wrong question?

Me thinks the responders gave the wrong answer.

 

[Retired Expat]

Well I don't think the OP asked the wrong question if that is what he actually wanted to know. Just not really as useful as some of the other questions the respondents were answering.

But for me it is zero for another 6-7 years then in 7 years who knows? but if all things remain as they are it would be about 25% of income.

I have assumed that all of it will go to a LT care fund so it will not change my spending habits at all.

 

[RobbieB]

If you are not collecting SS, then the correct answer is zero.

If you are collecting SS then the answer is right on your last 1040.

The answer is either zero or a number. Like I said, really easy.

 

[SecondAttempt]

You suggested the OP asked the wrong question?

How can the OP ask the wrong question?

Me thinks the responders gave the wrong answer.

OP here! I asked the wrong question as clarified in later posts. Or maybe you could say I asked the right question using the wrong words.

 

[ecowtent]

skipro gorgeous!

 

[Montecfo]

Zero

 

[Surewhitey]

We have 5 to 18 years to go depending on the age of benefits and what age we take them. If both @70, we will be covering 40-50% of spending based on a 3% inflation rate & 2022 spending (higher than normal) so says my spreadsheet.

 

[camfused]

^^^ You may want to bump up that inflation rate a bit

 

[scrabbler1]

I'll play.

For me, zero. I am only 59 so I have at least 3 years before being eligible for SS. However, I know I'll wait until at least 65, if not the FRA of 67 or some later age.

For the last 14 years, I have been living off my investment income, as it has exceeded my expenses so I have not had to draw down principal. SS, along with my rollover IRA and my frozen company pension, are my 3 "reinforcements" I can begin having unfettered access to starting around now when the IRA opens up. The pension becomes available at 65. All 4 items will be gravy because I am getting by just fine without any of them. But it's nice to know I have a large safety net, just in case.

 

[PandaBear]

Currently 13% if our income.
It will be subject to change when we are required to make withdrawals from our retirement accounts.

 

[Surewhitey]

^^^ You may want to bump up that inflation rate a bit

Probably, but gotta start somewhere. This is starting next year & for 40 years...I have wriggle room for any given year though.

 

[albundyz]

SS 66% (2 long term high wage earners)

pension 13%

distribution from IRA 21%

 

[jerryo]

Social Security ~10%
Indexed Pensions (5) ~ 50%
RMDs ~30%
Consulting Income ~10%