You should be researching all of this NOW. We went to retirement workshops and such for at least several years before I retired at age 60. Every time we went, we heard something relevant to our situation.
There is a great website that can crunch the numbers for your wife in terms of her benefits at every age…and whether she should collect on your earnings.
@VeryHappy whats the name of that site?
Open Social Security?
Yes…that’s the one! Plenty of good info there…and the ability to crunch the numbers.
I’ll take a look. We just got ss accounts and checked our historical earnings.
Of course, at 62 (for her), i’ll be 60-61 and hopefully still working…so that’s the kind of thing to know - does it make sense.
We have time (I think) but yes we should start perusing around.
I’m more concerned with making sure that I have us set up well with our own assets, etc.
But yep, gotta learn about this stuff too.
And then medicare - if I’m still working and on company insurance, do i need it?
I know if I retire and am on company insurance, then I have to get on mediare - retiree insurance ends at medicare time.
My DH was still working at age 65…his FRA was 66 I think. He had coverage through his employer…which was creditable coverage. He took Part A at age 65, but waited on the rest.
I was on his plan until I reached Medicare age at 65, at which time I switched to full Medicare coverage.
A Medicare broker is a great idea as well. They are free, and can give you some idea of what’s what.
Yep, that is exactly what applied and what we did. DH waited 6 mos after the last HSA contribution to apply for Medicare A (as I explained above). Then, the following year his company set up/ paid us an HRA because we weren’t contributing to the HSA any more, but we had the high deductible plan. Its complicated. We changed to a low deductible plan now as DH is considering retirement and this stuff is confusing. But yes, many do not understand the penalty risk, and being on top of these issues is important. This is all “accurate information”. It’s just very nuanced and a frequently moving target, and, as you said, subject to subtle employment differences.
Yes! I am also watching this. I’m in the group where I had a dozen years paying into SS, and then a 20+ year career for public school, in MA. This law change has the potential to net me 10k per year in retirement (based on my own contributions), not to mention any potential survivor benefits for me/DH. My dad is also going to benefit (at almost 80!).
Regarding the repeal of WEP/GPO (as a widow and public employee with an additional 20 years SS-covered employment, both apply to me), this is the latest from the FB page of Patrick Yoes, National Fraternal Order of Police President:
UPDATE
President Biden will have a bill signing ceremony for the Social Security Fairness Act on Monday, January 6, 2025. More details to follow.
It’s funny that no one seems to have a specific number amount? We are thinking $5million in investable assets is the number. Our house is almost paid off and my H will work another 10ish years and I’ve probably got another 3 years. OTOH, my brother who is 8 years older than I am, just retired with $10million. He’s an entrepreneur and has been in real estate for 30+ years with his hands in multiple businesses. It be would take us way too long to get to that number!
I said up stream $3 million investable.
I agree that’s the title/ question being asked.
The amount is dependent on individual circumstances. The key is to figure out how much your expenses will be in retirement. Once you have a handle on that, you need to consider any guaranteed income you might have (pension, SS). You’ll need to have savings to cover the difference between income and expenses … and perhaps enough extra in case your guaranteed income is reduced for some unexpected reason.
Personally, while neither H nor I have pensions, we don’t need $3 or $5 million to cover our expenses. I mean, it would certainly make things really nice, but we don’t need anywhere near that much to cover our expected expenses. Others may need more than $5 million. It really is individual. Calculators like FireCalc can help you get an idea how well you are saving based on expected expenses, or how much you might need to cover your expenses. There is no magic number for everyone.
You don’t need a certain principal amount but you do need an income whatever that is so that you can protect your principal.
How much principal do you need to generate that income would be my question?
I say $3 mil because I think I can generate $120k.
Spending down principal is not good - in my opinion.
My DH is fortunately very good with investments. As I have retired and he nears retirement, we have had many discussions about income streams, etc. As long as he promises to outlive me (!) he can do as he pleases with the investments. I was more comfortable with some sort of cash flow, but he feels better enjoying his investments and if we need cash and there isn’t enough liquid in the margin accounts he’ll just sell some stock. His attitude is that he makes far more investing, so even if he sells off some, it’s probably profit from the investments and not really “principal”. We are fortunate to be financially comfortable, and if he enjoys playing with the investments, well that’s fine by me.
Isn’t it more useful to state a planned annual (post-tax?) income and work backwards? That’s what people saying “figure out your expenses” are effectively doing. Because some will say 4% withdrawal is the right number, others may assume something different, especially if they want to pass assets to their children. So I’m not sure how comparable a “specific number amount” can really be for people’s different circumstances.
$200K pa from investable assets plus social security (max could be $5000-$7000 per month) even if taxed, with no house payments except property tax and insurance is a pretty substantial sum. But if you have high ongoing expenses (medical, supporting family etc) it may not provide a luxurious standard of living.
Withdraw to spend is dangerous.
Withdraw to invest is what you want.
When one makes 20% gain on an investment, selling some is often better than keeping a low producing investment.
In my opinion, yes. And that planned income can be based off of expected expenditures.
It can be ok, in moderation. (For many folks, especially those without pension, it may be required.) I’d agree that spending down principal without having a grand scheme plan could be risky.
Yes - for some, for most truthfully, a necessary evil.
The reality for many is that they will be spending down their principal at some point if not from day one.
If one doesn’t have enough saved to live off of the investment income (along with other streams) then they could be pulling from principle.
Then again, looking basically at the 4% withdrawal technique, even if one earned no interest they would potentially have 20+ years of 4% income to look forward to.
Realistically, most retirees are going to have to spend down their retirement savings to cover expenses. Now hopefully they won’t spend them down to zero in their lifetime but the reality is not everyone has high amounts of retirement savings to work with.