Social Security Benefits

[BassCan]

We also worry about how our children are going to be able to retire.
Will social security be solvent in twenty years? Or will the government push the age back for retirement to 75 for collection of full benefits ?

[NWGetaways]

There is a long series on NPR.com written by Lawrence Kotlikoff that is well worth reading through if you are approaching this decision. It's a complicated process, to say the least. The wrong filing decision can easily cost tens of thousands of dollars in benefits. Google "Lawrence Kotlikoff NPR" to find the articles.

Kotlikoff strongly encourages waiting as long as possible to take your SS, and calls it "longevity insurance" - planning for the problem of living too long and running out of money late in life. Especially important point to consider is how much a surviving spouse will be able to collect.

That said, the theory is that the benefits are reduced/increased in an actuarily sound way, so that if you live out the "average" lifespan, you will collect approximately the same amount whether taking a smaller amount for more years or a larger amount for fewer years. Obviously YMMV.

I got a lot of value out of a $40 purchase of his software "Maximize My Social Security". His recommendation is always to wait wait wait and get the maximum, but there are so many moving parts it's really difficult to figure out what's best for you. The software imports your (and your spouse's) earnings records from SS and runs multiple scenarios, showing you exactly what you would collect year by year for each filing choice.

There's a note on the software web page stating that it will be updated by November 16 to handle the new rules surrounding file and suspend - one of his most recommended strategies.

No relation with him or his software - just a happy user.

[nvestysly]

Thanks to markdoane for starting this thread. I was not aware of the Social Security changes tied to the recent budget bill.

Originally Posted by 65CV

Some of you may find this website useful. It helped me understand the strategies of File and Suspend and Restricted Application. In any case, it attempts to optimize your benefits, depending on your goals. I haven't made a decision yet, but have seen this link recommended in more than one article.

http://www.bedrockcapital.com/ssanalyze/

Thanks for the heads-up on the 6 month window, Mark!

This looks like a useful web site. It referred me to the file and suspend strategy. I guess the web site will be updated when that when the rule changes.

Originally Posted by MaineStreamer

Here is a newsletter that I wrote on the Social Security retirement planning options in 2012 for an elder law organization named ElderCounsel, LLC in which I am active. It explains File and Suspend. This issue is one of many ElderCounselor e-newsletters on my firm's website. http://mainecenterforelderlaw.com/gl...(May_2012).pdf

Thanks for the link. I'm saving that for future reference and will pass it along to others.

Originally Posted by BassCan

We also worry about how our children are going to be able to retire.
Will social security be solvent in twenty years? Or will the government push the age back for retirement to 75 for collection of full benefits ?

I'm not specifically FOR or AGAINST Social Security and how it's used today but it seems like the proverbial "handwriting is on the wall" and anyone who is relatively young should be saving an appropriate amount of their own money in order to provide financial independence in later years.

There are lots of good web sites on the topic of savings/retirement/finances but the stories of Bob the Bad Investor and Gordon the Good Investor may be worth reading. See the entries for 2015-08-30 and 2015-10-10 under the Ramblings page of the web site HERE.

[Silverflames]

There are some options for making SS solvent.

http://m.huffpost.com/us/entry/2708000

[Wayward]

Originally Posted by Silverflames

There are some options for making SS solvent.

Those are fantasy. Social Security is $40 trillion in the hole and will never be solvent. We all need to get our heads around that and prepare depending upon our age.

In fact the end of SS has already started. Congress just voted to take $150 billion out of the general SS fund which pays normal retirement and transfer it to the Disability fund which is now only 2 years from insolvency.

This is a very significant action because they are taking money out the general SS fund (the one most of us are counting on) which is also near depletion.............

Social Security: Congress proposes a chilling resolution

""Officially, the US government is now $18.5 trillion in debt, and Social Security is the biggest financial sinkhole in America.

Social Security’s various trust funds currently hold about $2.7 trillion in total assets; yet the government itself estimates the program’s liabilities to exceed $40 trillion.

In the 2015 report of the Social Security and Medicare Board of Trustees they state very plainly:

“Social Security as a whole as well as Medicare cannot sustain projected long-run program costs…and that the government should be “giving the public adequate time to prepare.”

In a recently proposed resolution, H. Res 488, Congress states point blank that Social Security

“was never intended by Congress to be the sole source of retirement income for families.”

[OTRA15]

Thanks Wayward -- the main reason I signed up for SS benefits young. Those who wait until 70 may not have factored in various risks, which seem "unbelievable" to the mind.

Denial is a wide river to cross . . .

[KJRitchie]

Greece = USA

Sounds what the best strategy for us, after reading those articles, is when retiring in a couple of years, I'll be 66 and wife will be 62, is to take the benefits at these ages and try to use very little of our savings and investments. If SS goes belly up and the payments stop or are reduced then we still have our own money left to live on.

Kelvin

[prairieschooner]

Don't wait! I did the math and it was better for me to take it now! Besides who knows when they will make it harder to get!

[Nuvite-F]

Originally Posted by KJRitchie

Sounds what the best strategy for us, after reading those articles, is when retiring in a couple of years, I'll be 66 and wife will be 62, is to take the benefits at these ages and try to use very little of our savings and investments. If SS goes belly up and the payments stop or are reduced then we still have our own money left to live on.

Regarding saving for retirement, remember that Democrats in congress have considered stabilizing Social Security by nationalizing [i.e. , stealing] individuals' 401-Ks and IRAs. Briefly, individuals retirement plans would be taken and invested in government bonds, and the owners would be paid benefits from them determined by the government.

The other feature of this plan is that any balance in your 401-Ks and IRAs, which currently can go to your heirs, will go to the government upon your death.

Dems Target Private Retirement Accounts

[n2916s]

Originally Posted by Nuvite-F

Regarding saving for retirement, remember that Democrats in congress have considered stabilizing Social Security by nationalizing [i.e. , stealing] individuals' 401-Ks and IRAs. Briefly, individuals retirement plans would be taken and invested in government bonds, and the owners would be paid benefits from them determined by the government.

The other feature of this plan is that any balance in your 401-Ks and IRAs, which currently can go to your heirs, will go to the government upon your death.

Dems Target Private Retirement Accounts

Actually, no. A single witness postulated such an approach but no member of Congress of any affiliation has proposed any such thing. It would be political suicide.

Mike

[Nuvite-F]

Originally Posted by n2916s

Actually, no. A single witness postulated such an approach but no member of Congress of any affiliation has proposed any such thing. It would be political suicide.

Hope you're right. But one of the 2016 presidential candidates is an avowed socialist, and class warfare is the tone of current democrat political rhetoric.

[n2916s]

Well, I don't do politics in public but I also don't believe 99% of what I see on the Internet or on any of the networks. The truth is out there but it is pretty hard to find...

[Jim & Susan]

Originally Posted by Nuvite-F

Hope you're right. But one of the 2016 presidential candidates is an avowed socialist, and class warfare is the tone of current democrat political rhetoric.

Hey folks, there are actually several socialists currently running, they just won't "say it out loud" as some do, but that's not my ultimate point here. Before the Mods step in, it might be better to try and stay "apolitical" if possible. Political discussions are technically banned in these here parts.

Just a suggestion.

Jim

[Nuvite-F]

Originally Posted by Jim & Susan

Before the Mods step in, it might be better to try and stay "apolitical" if possible. Political discussions are technically banned in these here parts.

Can you tell me what part of Social Security is not political?

[Jim & Susan]

Originally Posted by Nuvite-F

Can you tell me what part of Social Security is not political?

Nuvi, apologies, wasn't trying to single you out. Obviously, you and I are on the same side of this issue. Just trying to make the point that political discussions here draw the ire of the staff if it gets pushed too far. I used to be a Moderator here and know how "the system" works from an insiders perspective.

And BTW, you are 100% correct, EVERYTHING about SS is political. And all of us old gray hairs need to remember that, at the ballot box and in the courts,if necessary.

Sorry if i offended you

Jim

[nrgtrakr]

For those that don't like "socialism" ... fine. No roads, bridges, or public parks for you. No public schools, state universities or hospitals. No fire or police departments. The list continues.
Carry on ...

[Nuvite-F]

Originally Posted by Jim & Susan

Sorry if I offended you

You didn't offend me at all--sorry if I gave you that impression.

[tjdonahoe]

I been receiving my check from SS for 2 years and also one from IBT, they are there the first of the month and I don't worry about either one stopping as I don't listen to the so called money managers and the doom and gloomers , my monies in the stock market have done very well, I never touched it when the market went down...So no worries..

[Wayward]

Originally Posted by tjdonahoe

I been receiving my check from SS for 2 years and also one from IBT, they are there the first of the month and I don't worry about either one stopping

It may all soon change. Many pension funds including union and public employees' are grossly underfunded (IBT's for example is only funded for 60 cents on the dollar). The Pension Benefit Guarantee Corp (PBGC) backing up pensions, is also underfunded by $26 billion. So read everything that you get in the mail from you pension fund very carefully.

My financial advisor told me to watch out for pension dumping because Dodd-Frank arranges for the establishment of annuity fund pools via the major insurance companies. Underfunded pensions can then transfer their assets and obligations to the pools and wash their hands of them. The annuity funds are then allowed to cut payments and obligations as needed to remain solvent.

Retirees in well funded pensions are not immune from payment cuts either as their healthy pensions may be pressured to move their assets into these pools to prop up the poor ones.

The reason to watch the mail is because you may be given options as these pensions are dumped...for example....taking a big cut and staying with the PBGC guarantee .vs. moving to an annuity pool with less of a payment cut but no guarantee.

Here is how pension dumping is played out at GM.

For people already drawing pensions it means a lose-lose scenario down the road.

For those getting ready to draw a pension - I say get as big a lump sum as you can, as soon as you can, and invest it yourself.

[Wayward]

I did my own research and concluded that we are being lied to, that Social Security is hopelessly insolvent, and that Congress is preparing for cuts to it.

I also concluded that Congress' recent "consumer protection" legislation for pensions is anything but protection.

I decided that the longer I waited the worse these people will rig the game. So I rolled the dice, retired early and...

• Took the largest lump sum allowed from my pension and invested it.
• Am planning for an eventual cut to my remaining monthly pension payment when the pension gets dumped.
• Drew money from my IRA to bridge my income to Social Security age.
• Started drawing Social Security as early as I was allowed