"People borrow money they don't have, to buy things they don't need, so they can impress people that they don't like."
I tackle success like I tackle life... commando style!I got this in my fortune cookie tonight. I thought of all you folks who may be trying to decide if you are a success, ready to give up trying, or either way, you're done.
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Always get your life advice from fortune cookies!
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With the addendum of "while working on your rocket garden in your garage"I got this in my fortune cookie tonight. I thought of all you folks who may be trying to decide if you are a success, ready to give up trying, or either way, you're done.
View attachment 673121
Always get your life advice from fortune cookies!
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Building rockets commando? TMI!!I tackle success like I tackle life... commando style!![]()
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Dangerous when using CA.Building rockets commando? TMI!!
That'd be nuts!Dangerous when using CA.
Just sayin'.
Thank you and all the best to you too!Started this year with retirement as well. All the best to you!
I got this in my fortune cookie tonight. I thought of all you folks who may be trying to decide if you are a success, ready to give up trying, or either way, you're done.
View attachment 673121
Always get your life advice from fortune cookies!
![]()
I tackle success like I tackle life... commando style!![]()
![]()
With the addendum of "while working on your rocket garden in your garage"
Building rockets commando? TMI!!
Dangerous when using CA.
Just sayin'.
this is the peek of TRF right here...That'd be nuts!
A not so "nutty" topic!
One other thing I did recently was review my Social Security benefits. In my case (based on birth year), I can claim as early as age 62 and as late as age 70 and the monthly payment for later claiming is about 76% higher. So it's strange to me that so many of my friends (even those that are great with investments and finances and some are millionaires) don't really know for sure which to take and what it means. Oh, more money is always better, right? Maybe not.
Having had a lot of experience with spreadsheets and loving logic problems, I created an Excel spreadsheet to do a rough calculation of the breakeven point between the choices, even allowing for reinvestment of the payments to get a true sense of what you may be giving up if you hold out for the bigger checks. It's still WIP, but so far the logic seems good to me. If there is interest, I can see if I can share this sheet. The big question that we usually don't know for sure is how long will we live. In my calculation, I would need to at least live past 80 in order for the late claiming to start giving me more than early collection and that's assuming they don't do any cuts and inflation in the early years doesn't go crazy like it did recently (which means early collection dollars are worth/can buy more than late collection dollars).
If I spend the entire payment every month with nothing banked/invested (payments are made up, but ratios are the same for what SS told me):
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If I have all invested at 3% (about that of a bank) or half invested at 6% (market, cd):
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What many don't consider is that 8 years of payments (especially with compound interest) is very hard to catch up to. In my examples, it's about $200k in early payments. Heck, they keep saying you need to contribute to your 401k/IRA as early as possible since it's harder to catch up later, well, same reason here. Thoughts?
Of note is that my mother started collecting at 62 (which my older sister strongly disagreed with) and she ended up passing away at 69. YMMV
I actually did for my sister by her request, but it kind of complicated things a bit. Here is that sheet with 67 added and using the example $2,000 start plus increases in the same ratios as provided by my sister (Age 61) and no investment.You may want to add a middle column with "Collect at 67" and see how that factors in. Most advice I have been given is that waiting to 67 tends to be the sweet spot.
Then there is the whole getting the money while you are young enough to enjoy it. Wait until 70, but your health hasn't held up.
Agreed. From what I can tell, the early generations got off great since they got to collect without paying much in. However, after you've paid in for many years, would you want to give it up? No easy answers, but my generation was one that I was told to start a 401k at my first full time job in the 90's since SS wouldn't be enough to cover expenses and pensions were becoming dinosaurs.Social Security is the biggest Ponzi scheme in history. OK if the Government does it but not if anyone else does it. Now with less workers funding and retirees living longer it's coming back to bite us. How long before benefits will be cut severely? Also the Government has been stealing from the trust fund all along. It should have been invested to earn more money so it wouldn't be running out.
Nice spreadsheet! I definitely agree that you've gotta factor in the opportunity cost. It obviously depends on how long you live and how well the payments do as an investment, but I wouldn't be surprised if you're right that taking early does work out better a decent percentage of the time. I'm so far away I haven't bothered to do my own math. Looks like there is a ton of discussion on the mrmoneymustache forums on this.A not so "nutty" topic!
One other thing I did recently was review my Social Security benefits. In my case (based on birth year), I can claim as early as age 62 and as late as age 70 and the monthly payment for later claiming is about 76% higher. So it's strange to me that so many of my friends (even those that are great with investments and finances and some are millionaires) don't really know for sure which to take and what it means. Oh, more money is always better, right? Maybe not.
What many don't consider is that 8 years of payments (especially with compound interest) is very hard to catch up to. In my examples, it's about $200k in early payments. Heck, they keep saying you need to contribute to your 401k/IRA as early as possible since it's harder to catch up later, well, same reason here. Thoughts?
Not entirely true. You got this line from the mainstream media. SS would be solvent if it weren't raided, in the early 80s, by a certain political party, not known for their grasp of economics and numeracy.Social Security is the biggest Ponzi scheme in history. OK if the Government does it but not if anyone else does it. Now with less workers funding and retirees living longer it's coming back to bite us. How long before benefits will be cut severely? Also the Government has been stealing from the trust fund all along. It should have been invested to earn more money so it wouldn't be running out.
I would say that while it doesn't meet the definition of a Ponzi scheme, it's similar to one in that the new people pay to fund/pay the previous people in the system and it works/nobody loses as long as the proceeding payers are equal or larger in number (or contribution) than the earlier ones.Not entirely true. You got this line from the mainstream media. SS would be solvent if it weren't raided, in the early 80s, by a certain political party, not known for their grasp of economics and numeracy.
Oh yes, they knew, they saw the population aging bomb, and they (Congress) kicked the can down the road. Even when I was a kid.It astounds me that that this program didn't take into account decreases in population and how to account for it. Perhaps they knew, but didn't care. "Not my problem."
The good news, as I understand it, is that the Social Security trust fund doesn't actually fund a high percentage of SS payments. Something like 15 or 20%. So all this gloom and doom about it running out (unless Congress funds it again) doesn't mean SS will go away. Big cut, yes. Sux, totally. But we'll get something worthwhile out of it no matter what.
Just brainstorming, but maybe one possible solution is to raise the FICA amount. I know that's also not popular, but it should be less unpopular vs. cutting SS. Heck, it's basically kicking the can down the road again, but at least those now paying a higher tax (those working) should worry less about cuts when they retire since they can raise it again. I'd pay more FICA while working if they can guarantee me that they won't cut my SS after I start collecting.In practice the "big cuts" would be for later generations. Those drawing SS now, and those nearing retirement age, wouldn't bear the brunt of it. In addition the the humanitarian problem of telling grandma she's now going to be homeless due to a SS cut, the fact is that old people vote, and neither party is going to enact sweeping cuts to a steady voting bloc. Certainly, reductions in cost of living increases are on the radar, however.
The problem with that is that under our cusystem, Congress would just spend it, as they have with all the rest of the SS money. The only long-term.option that viable, in my opinion, is to privatize the entire SS system or otherwise completely remove Congress from having any access to its funds.Just brainstorming, but maybe one possible solution is to raise the FICA amount. I know that's also not popular, but it should be less unpopular vs. cutting SS. Heck, it's basically kicking the can down the road again, but at least those now paying a higher tax (those working) should worry less about cuts when they retire since they can raise it again. I'd pay more FICA while working if they can guarantee me that they won't cut my SS after I start collecting.![]()
I saw somewhere (no idea where so I can't quote it) today that they're estimating at least a 25 percent cut bu 2033 to prevent insolvency.Certainly, reductions in cost of living increases are on the radar, however.
The problem with that is that under our cusystem, Congress would just spend it, as they have with all the rest of the SS money. The only long-term.option that viable, in my opinion, is to privatize the entire SS system or otherwise completely remove Congress from having any access to its funds.
I saw somewhere (no idea where so I can't quote it) today that they're estimating at least a 25 percent cut bu 2033 to prevent insolvency.
That article links to another that said:
"To sum it up, Congress hasn't stolen a dime from Social Security; every cent in asset reserves is accounted for; and the program is generating interest income on its excess cash."
Another point in the second article (which for me is a great reason to collect as early as possible) is:
"Based on estimates from the 2023 Trustees Report, the Old-Age and Survivors Insurance (OASI) Trust Fund could exhaust its asset reserves by 2033. Should this occur, sweeping benefit cuts of up to 23% may be necessary for retired workers and survivors of deceased workers."
Pensions, same principle. Funds remain in great shape as long as no one is stealing from them.Social Security is the biggest Ponzi scheme in history. OK if the Government does it but not if anyone else does it. Now with less workers funding and retirees living longer it's coming back to bite us. How long before benefits will be cut severely? Also the Government has been stealing from the trust fund all along. It should have been invested to earn more money so it wouldn't be running out.