Cash coming in from SS would be nice because then we won’t have to draw down as much from savings. But, we don’t factor it in.
We are counting on our medical insurance costs going down once we are eligible for Medicare, though.
My SS amount is pretty low. Didn’t work all that long and didn’t make tons of money. Dh would be at the max amount, I believe. Is it around $4,500/month now?
Yes, I know the Medicare cost is subtracted.
It’ll be nice if we get it. We’ll be okay (I hope) if we don’t.
You’d get half of husband’s amount, right?
“If you’re eligible to receive retirement benefits on your own record, we will pay that amount first. If your benefits as a spouse are higher than your own retirement benefits, you will get a combination of benefits that equal the higher spouse benefit.
For example, Sandy qualifies for a retirement benefit of $1,000 and a spouse’s benefit of $1,250. At her full retirement age, she will receive her own $1,000 retirement benefit. We will add $250 from her spouse’s benefit, for a total of $1,250.”
Yes, I believe that’s right.
We’re still a few years away, so I don’t think about it too much.
I would not take someone’s word that they could stop filing federal taxes - yes, indeed they may fall below a threshold, but until one actually works up the numbers… You are probably right in your assumptions on how they qualify for not filing federal taxes.
DH and I have no pensions. DH had companies that were bought out, and the last buy out eliminated a pension (DH had stock and money at that point from what his pension amount was worth) - however no pension accruing on his highest income years. We both had 401k accounts, and later did rollover some funds to Roth IRAs. We purchased annuities, and as DH’s 401k grows too large (stock investments), we purchase annuities. We use cash distributions from annuities - after the first year, take out the max w/o penalty. We use these annuities like a pension would work.
There are good reasons why individuals need to save, be it with 401k, Roth IRA, or putting some money into a stock account - $50 or $100 to start perhaps at a young age. Saving money and have it properly invested to accrue.
At the time your DH takes SS, you can see what spousal benefit will be under his SS. You can actually set up your electronic information with SS (password accounts) and check earning records. Based on what you have previously said, no plans to go back to work. I did work about 5 years sunset career, and had enough with those earnings to make a bit more than off of spousal benefit. Neither of us waited for ‘full SS’; I drew SS right at age 65; DD waited a bit longer - and that made sense for us.
What was nice about the reports, is you can see based on that ‘snapshot’, what to expect at age 62, and at various other times (age 65, at full SS, at age 70). At the time you do want to file, in addition to the electronic information, you can find out/verify with SS representative exactly the amount.
Knowing a bit ahead of time can help you know approximations.
Since we have begun drawing SS, we have been getting some adjustments up, due to inflation factor. This gets set before the next calendar year begins.
If you have Medicare B, they will withdraw that portion out of your SS payment.
Once one starts drawing, it is what it is.
Once people retire and have all their things working/settling in (their health insurance if stopping from employer plan; drawing their pension if they have one; drawing from other sources for cash flow) it is then they see how smoothly things work out.
For us, it is the tax amounts we need to adjust to pay for what we convert over from 401k to Roth IRA, and what amounts we draw out of 401k. They withhold an amount for Federal taxes, but you need to calculate to pay your state taxes. We had rolled over overpayment of Federal and State taxes from 2022, but then still did need to pay more for both for 2023 - not much more for Federal, but a lot more for state. Have to think about taxes with the money trail. For State taxes, we requested no penalty - we shall see if we have a small penalty. No penalty for Federal.
This is relevant to our topic:
I can almost never tell if an article like this is per person (I’m guessing this one is) or per couple.
Just want to clarify here, that the “spouse’s benefit” referred to here is 1/2 the spouse’s PIA (or full benefit amount).
So Sandy’s husband’s benefit must be $2500/month.
I’m pretty sure they are referring to an individual. I would imagine a couple could do it for less than twice that amount though as many living expenses would be shared.
I wish more people understood that this is actually how SS works.
It is definitely one person. Here’s their methodology:
Methodology: In order to find out exactly how much you need to retire in your state, GOBankingRates found the annual cost of expenditures for a retired person in each state by multiplying the 65 year and older expenditures from the Bureau of Labor Statistics’ 2022 Consumer Expenditure Survey by the cost of living index for each state from the Missouri Economic Research and Information Center’s Q3 2023 cost of living series. To find how much money a retired person would need to save, we divided each state’s annual expenditures, minus the annual Social Security income as sourced from the Social Security Administration’s Monthly Statistical Snapshot, March 2022, by 0.0333%, 0.04% and 0.05% — assuming 20, 25 and 30 years of retirement respectively. All data was collected on and is up to date as of Jan. 8, 2024.
I wonder if this methodology includes taxes. Not as much of a problem if you assume the savings are in after-tax money and not in an IRA or 401k.
How can your 401K grow too large? The bigger it gets, the better. There is no restriction about the size of your 401K, not that the “tax the rich” crowd hasn’t attempted it.
Many (probably most if surveys regarding median retirement funds are to be believed) live on far less and are just fine. If the home is owned at retirement, those numbers are very inflated.
A friend made a snapshot of a loaf of regular bread at a grocery store in Hawaii - it was $7.79. I purchase a similar loaf in my state for maybe $2, or $2.80 depending where I purchase it.
I believe it might be reflective on a bundle of money perhaps invested quite conservatively lasting 25 years - but also reflective on rising health care and perhaps long term care needs. We have found we are not ‘spending down’ our nest egg because our investments have been making up for what we have been spending. DH’s parents both lived to 92, so he can be likely to live beyond the 25 years. IMHO one also needs more of a nest egg when there is no family safety net and need to hire everything out. Right now I am helping with grandchildren, and if time necessitates DH and I need to live close to one of our DDs, that they would participate in some way to stretch our financial resources. It is to their advantage to keep value with their inheritance while making sure DH and/or I are living well.
This is quite humorous, but reflective of a busy man during the college football (and his time with pro-football), and some adjustments in ‘semi-retirement’. As some of you may know, he retired from being Univ of AL head football coach.
I don’t think my kids would be onboard with that plan, to take care of us so we didn’t have to spend our money (or their supposed inheritance) on our care. I can just hear my youngest saying, “I’m not gonna change your diapers, that’s what you saved all that money for. Spend it!” 
from the article:
Here’s the income a single person needs to live comfortably in the 25 U.S. cities with the highest cost of living:
I never made half that amount and I raised my daughter as a single parent in Brooklyn.