Delaying Social Security until 70 may make sense from an absolute financial sense, but the elephant in the room is how will social security change. All indicators seem to be it may have to become more “needs based” to remain sustainable, possibly affecting benefits for higher earners and complicating the decision as far as best age to apply for benefits.
Good video. I am deferring for the following reasons, none of which have anything to do with the break even, which I calculate to between 87 and 88 with a conservative 5% investment return. 1. Maximize the survivor benefit to offset the loss of one SS check and higher single tax rate. 2. Maximize income where at least 15% is not federally taxable and zero taxable in MA. The total tax will be 10% lower compared to IRA withdrawals. 3. Allow IRA withdrawals between 62 and 70 without triggering IRMAA surcharges and minimize future RMDs. 4. Protection against inflation or a market decline.
It’s hard to say no to bond yields this high! Then again it was hard to say yes to cash on 12/31/21 and yet that was the best choice! Diversify and rebalance is key.
Morningstar does a great research study that projects which percentage is the current 'safe-withdrawal rate.' www.morningstar.com/retirement/morningstars-retirement-income-research-reevaluating-4-withdrawal-rule
Delaying Social Security until 70 may make sense from an absolute financial sense, but the elephant in the room is how will social security change. All indicators seem to be it may have to become more “needs based” to remain sustainable, possibly affecting benefits for higher earners and complicating the decision as far as best age to apply for benefits.
How do you think it will change?
Good video. I am deferring for the following reasons, none of which have anything to do with the break even, which I calculate to between 87 and 88 with a conservative 5% investment return.
1. Maximize the survivor benefit to offset the loss of one SS check and higher single tax rate.
2. Maximize income where at least 15% is not federally taxable and zero taxable in MA. The total tax will be 10% lower compared to IRA withdrawals.
3. Allow IRA withdrawals between 62 and 70 without triggering IRMAA surcharges and minimize future RMDs.
4. Protection against inflation or a market decline.
One edit. On point #2 the tax rate is 10% lower (20% vs 30%). The taxes paid is 50% higher on IRA withdrawals.
Yes, right on!
Way to plan it out!
I’ve been retired 17 years. I did not have to go out of my way and make sure to save.
Setting up your savings automatically can be a big help!
great talk, I don't think 50% stocks is easy in the upcoming years
It’s hard to say no to bond yields this high! Then again it was hard to say yes to cash on 12/31/21 and yet that was the best choice! Diversify and rebalance is key.
Instead of 4% use 3.8% currently
If I was confident of 3.8% would work I'd be confident that 4% would work.
Morningstar does a great research study that projects which percentage is the current 'safe-withdrawal rate.'
www.morningstar.com/retirement/morningstars-retirement-income-research-reevaluating-4-withdrawal-rule