Um, @Dadof3 : I don’t think you understand that what you don’t like is exactly the way Social Security is designed to operate. It is not an actuarially sound system and was never intended to be. It is has always been based on the concept that the contributions of current workers (the grandchildren) would pay the benefits for retirees (grandpa).
Yes, I know what Paygo is, and it’s flawed
I did not say it wasn’t. It is what it is. It is what we have – and have had since whenever.
I would like to point out that college is one of the reasons many parents are behind in saving for retirement. My husband was able to put himself through his state university. I think tuition was something like $1,000 a year which he earned and paid himself from summer and part time jobs.
That same state school now costs almost $30,000 a year tuition. On an after tax basis, over four years, that’s a boat load of money for a blue collar family to pay out of savings - and the parents have to spring for it because there is no way some 18 year old can net that kind of money.
Now take that $120,00 net cost and multiply that by two or three kids.
So before some of you sermonize about how families should just save more, please remember times are not what they were in the 60s and 70s.
^^ Amen. Well said.
Well said. Been through this, still live with consequence today.
And we only have one kid!
Another point: Many young men or women are loaded with student loan debt before they start to work. I saw many of them postpone their marriage. The quality of their lives is downgraded because of the heavy indebtedness. No wonder not many of them are interested in buying a house, and many of them even drive a cheap second hand car. (It happens that three of my coworkers who grew up in the US drive a car that looks like 10 to 15 years old. Ironically, those from overseas tend to drive a better car.)
Appearances can be deceiving. Our S drives a 2004 or so car because it was a gift from his late aunt, NOT because he can’t easily afford a new one. He is also deferring buying a place because he is not sure how long he wants to live in the area where he currently lives–NOT at all due to any debt.
It is true that SOME kids (and adults) do have significant debt (some of it educational), it is dangerous to make too many assumptions about why people are or aren’t buying certain things.
It may be true that babies died more in the old days bringing down average life expectancy. I find it hard to believe that’s the only reason avaerage life is longer these days. I am sure life expectancy fort 60 year olds is also increasing. SS has to support more people longer and there are fewer young workers to support them. I just had an annual physical. My doc said I should be financially prepared to live 95-100.
posted in error.
It’s not the only reason. Medical advances have extended old age life expectancy quite a bit.
But it is true that many more people live to age 65 now than in 1930, and people who reach 65 live longer than they did in 1930 - about 6 years longer. The long term trend is that life expectancy at 65 is increasing about one month per year. This will just increase the stress on social security in the coming decades.
Here is a really good summation of the various ways to “fix” social security, and what they would actually cost:
[How would you fix Social Security?](http://www.washingtonpost.com/wp-srv/special/business/get-there/social-security-fix/)
Well, hurray: I just filed and suspended by phone with the Social Security office. It took all of 10 minutes! SS will be sending me hard copy documentation of what I did, and then – fingers crossed – DH can file for my spousal benefit when he turns 66, in January 2017.
We’ll see how this all works out for the VeryHappy family. If we can still get the spousal benefit we previously thought we could, I’ll be VeryHappier. <:-P
Yay, VeryHappy! Isn’t it great when things work the way they should? It’s a major victory!
congrats VeryHappy! H is planning on doing the same soon.
Our newspaper carried an article about the SS changes. They said that after filing and suspending the spouse can file for spousal benifits at age 62.
The SS page says FRA and the Maximize site says FRA.
I find this lack of understanding frustrating.
Yes, I’m going by the MaximizeMySocialSecurity.com site. Also eagerly waiting for their software update, to confirm that my plan still works.
Access to the site was $40, and I ran my numbers in July 2014. It’s nice to know that the same $40 gives me access to their update. IMO, it was money well spent.
OK–finally recieved a clear explaination re: post 252.
After one person has filed and suspended the spouse can file for spousal benefits anytime after reaching 62.
If they file for spousal benefits before FRA they are deemed as filing for their own benefits and will recieve a combination of their own and the spousal benefits (sorry, do not know the formula for this.
If they wait until reaching FRA to apply for spousal benefits their own SS will continue to grow until it is applied for.
This has confused me because rarely are the details mentioned and therefore sounds as if you can just get your spousal support at age 62 after the other spouse has filed and suspended–and you can-- only with filing for you own at the same time.
VeryHappy, we had to rebuy the Max software as ours had expired after one year----?
http://news.morningstar.com/articlenet/article.aspx?id=721552
Here’s another good article explaining the changes, in case anyone is still confused.
And…my Medicare card came in the mail today…I will do parts A and B and then get that supplement for,everything else…right?
I guess I should read the booklet they sent.
But I’m happy to have that card. I’ll be calling my supplement folks tomorrow (they are through my state teachers retirement board) and finding out what to do next.
I am happy…as I needed this before December 1…and I have it!
patsmon–great article and also enjoyed the comments after. Thanks!
Pats mm, that article told me something I didn’t know. I thought I had to decide to take SS at either 66 or 70, but article said you could gain 8% every year you waited. Article said it is like an annuity, with no risk, to wait.
I haven’t lugged my numbers in, but I am under the impression the 66 or 70 rates cross at about age 82. So those with longevity will do best to wait.
Also confusing is that 1/2 of earnings above @$20000 are withheld. So, if I continue to work until age 70, I would be only collecting $7-8,000 a year.
I thought that earnings limit only applied before full retirement age…66 for me. After that, one can earn more than $20,000 a year without SS penalty…that’s what I thought.