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| Social (in)Security: In the red | |
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| Tweet Topic Started: Aug 6 2010, 07:38 AM (596 Views) | |
| Copper | Aug 6 2010, 06:35 PM Post #26 |
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Shortstop
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To do with them? Like they are some kind of government asset that needs a disposition? One thing "we could do to them" is let them lead their lives as they see fit. |
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The Confederate soldier was peculiar in that he was ever ready to fight, but never ready to submit to the routine duty and discipline of the camp or the march. The soldiers were determined to be soldiers after their own notions, and do their duty, for the love of it, as they thought best. Carlton McCarthy | |
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| jon-nyc | Aug 6 2010, 06:45 PM Post #27 |
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Cheers
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4.5 might be a bit aggressive, the typical rule of thumb I hear is 4%, which would put it at 1.5MM. Still, whether we're talking about 1.25MM or 1.5MM, it's an eye opener for a lot of middle class people. |
| In my defense, I was left unsupervised. | |
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| George K | Aug 6 2010, 06:52 PM Post #28 |
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Finally
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Yeah. 4 - 4.5% is what I was told. However, that's the amount you'd need to have to EQUAL what SS would pay to a 2 earner couple, right? Personally, I have no plans for SS to do anything for me, but you're right about it being an eye opener. Back in 1982, just after I went into practice, one of my colleagues asked me how much cash I thought I would need to retire comfortably. I threw out an arbitrary number - a million dollars. He laughed at me. He was right. |
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A guide to GKSR: Click "Now look here, you Baltic gas passer... " - Mik, 6/14/08 Nothing is as effective as homeopathy. I'd rather listen to an hour of Abba than an hour of The Beatles. - Klaus, 4/29/18 | |
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| jon-nyc | Aug 6 2010, 07:03 PM Post #29 |
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Cheers
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Yeah, though it should be noted that a conservative withdrawal rate of 4% or so is designed to have a very high probability of success (meaning you don't run out of cash) in a variety of markets. A guy retiring in 1982 who withdrew 4% a year (indexed for inflation) would have finished his 30 year retirement with more in the bank than he started with. Not so the guy who retired in 1928. I've seen two different approaches that more-or-less confirm the 4% rule, one is looking at actual performance over every 30 year period over the last 120 years to see how many of those would be successful. The other approach does a Monte Carlo simulation using historic returns of various asset classes. It should also be noted that the 4% rule assumes a conservative mix using broad indexes, not individual stock picking or betting the farm on this or that tech stock. In other words it assumes a certain amount of discipline that most people lack. |
| In my defense, I was left unsupervised. | |
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| Mark | Aug 6 2010, 07:05 PM Post #30 |
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HOLY CARP!!!
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I'm betting the farm on my own tech stock.
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___.___ (_]===* o 0 When I see an adult on a bicycle, I do not despair for the future of the human race. H.G. Wells | |
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| George K | Aug 6 2010, 07:05 PM Post #31 |
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Finally
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Any idea what percentage of SS people are those who have the benefit of 2 earners? Also, if one dies, isn't that spouse's benefit gone? |
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A guide to GKSR: Click "Now look here, you Baltic gas passer... " - Mik, 6/14/08 Nothing is as effective as homeopathy. I'd rather listen to an hour of Abba than an hour of The Beatles. - Klaus, 4/29/18 | |
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| jon-nyc | Aug 6 2010, 07:08 PM Post #32 |
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Cheers
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No idea, George. I've never looked into it. I suppose like you I've always assumed Social Security wouldn't do anything for me. |
| In my defense, I was left unsupervised. | |
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| George K | Aug 6 2010, 07:08 PM Post #33 |
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Finally
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Another question: That 4% withdrawal assumes that you don't withdraw anything else (ie, you don't take the dividends, interest, etc) from your plan. IOW, you plan on withdrawing 4%, and let what happens to the nut happen to the nut. If I withdraw 40K from my 1MM investment, and it earns 60K, I still only withdraw 40K, right? So now, your nut is 1.02MM |
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A guide to GKSR: Click "Now look here, you Baltic gas passer... " - Mik, 6/14/08 Nothing is as effective as homeopathy. I'd rather listen to an hour of Abba than an hour of The Beatles. - Klaus, 4/29/18 | |
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| jon-nyc | Aug 6 2010, 07:11 PM Post #34 |
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Cheers
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Yep, that's the assumption behind the 4% rule. It also assumes you increase the original withdrawal rate annually by the rate of inflation. |
| In my defense, I was left unsupervised. | |
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| Horace | Aug 6 2010, 07:25 PM Post #35 |
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HOLY CARP!!!
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I think I should look up the life expectancy for 6'5 males and adjust how much I give a f*** about saving accordingly. |
| As a good person, I implore you to do as I, a good person, do. Be good. Do NOT be bad. If you see bad, end bad. End it in yourself, and end it in others. By any means necessary, the good must conquer the bad. Good people know this. Do you know this? Are you good? | |
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| Horace | Aug 6 2010, 07:31 PM Post #36 |
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HOLY CARP!!!
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Nobody responded to my original post, but I'll say again that if the question is, how difficult would it be to save enough to replace social security, then you have to adjust you assumptions about how much you make and how much you can save. In a world without SS you'd make 15% more and either you'd get to save that in a tax deductible manner or the gov't would get way more tax revenue. It'd be a different world where saving more would be easier. |
| As a good person, I implore you to do as I, a good person, do. Be good. Do NOT be bad. If you see bad, end bad. End it in yourself, and end it in others. By any means necessary, the good must conquer the bad. Good people know this. Do you know this? Are you good? | |
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| Copper | Aug 6 2010, 07:42 PM Post #37 |
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Shortstop
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Not yet |
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The Confederate soldier was peculiar in that he was ever ready to fight, but never ready to submit to the routine duty and discipline of the camp or the march. The soldiers were determined to be soldiers after their own notions, and do their duty, for the love of it, as they thought best. Carlton McCarthy | |
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| jon-nyc | Aug 6 2010, 07:47 PM Post #38 |
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Cheers
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While that seems very logical, few people make the mental step to live below their means though almost all people could do so. I suspect that increasing peoples pay 15% wouldn't dramatically shift the number of people who adopt such a mindset. |
| In my defense, I was left unsupervised. | |
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| Jeff | Aug 6 2010, 07:47 PM Post #39 |
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Senior Carp
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You should also take into account that the SS formula is highly progressive and highly beneficial to those of lower income - i.e. the amount of retirement income you earn from your SS tax on, say, 60k to 70k of income, is far less than the benefit you receive from the SS tax on, say, 20k to 30k of income, even though the amount of tax is the exact same on 10k of SS eligible income. There are also lots of disability and other benefits paid out of the system. It is basically a (fairly efficient) welfare system, and not a social "security" system at present. People who make 50k or more would almost certainly do better under a privatized system (assuming they were forced to save the payroll tax amount and not spend it), people who make less would almost certainly do better with the current system in which those who make more than 50k heavily subsidize the benefits of those who make less under the existing SS formula. Edited by Jeff, Aug 6 2010, 07:50 PM.
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| Horace | Aug 6 2010, 07:55 PM Post #40 |
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HOLY CARP!!!
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Thank you. That about covers it IMO. If you're a steadily employed middle class earner, you're not doing well with SS. Not that that's necessarily a bad thing socially, but let's be clear about that. |
| As a good person, I implore you to do as I, a good person, do. Be good. Do NOT be bad. If you see bad, end bad. End it in yourself, and end it in others. By any means necessary, the good must conquer the bad. Good people know this. Do you know this? Are you good? | |
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| Horace | Aug 6 2010, 07:56 PM Post #41 |
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HOLY CARP!!!
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Fair point, but enforced tax exempt savings of 15% to a private account is the closer parallel to what we currently have and the more interesting comparison. |
| As a good person, I implore you to do as I, a good person, do. Be good. Do NOT be bad. If you see bad, end bad. End it in yourself, and end it in others. By any means necessary, the good must conquer the bad. Good people know this. Do you know this? Are you good? | |
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| Kincaid | Aug 6 2010, 09:41 PM Post #42 |
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HOLY CARP!!!
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Okay, this is a little confusing for me. Not sure exactly what you're saying. I can't recall what my last SS statement said but I seem to recall it was either $1300 or $1700 a month benefit if I retired at $65. Assuming it's the higher figure, that is only $20,400 a year, isn't it? (Not going to even talk about paying taxes on that). So, my plan to have even $1 million in my 401k at retirement beats that all to hell, doesn't it? So, what size of "nut" is needed to generate $20,400 a year for 30 years? Isn't it a lot less than even $1 million? (None of this takes into account my wife's retirement or SS income). What am I missing? |
| Kincaid - disgusted Republican Partisan since 2006. | |
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| Larry | Aug 6 2010, 11:27 PM Post #43 |
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Mmmmmmm, pie!
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I've been telling you guys..... Plastic coffee cans... cash.. buried.... ![]() |
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Of the Pokatwat Tribe | |
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| Steve Miller | Aug 7 2010, 06:39 AM Post #44 |
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Bull-Carp
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FIFY. |
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Wag more Bark less | |
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| Copper | Aug 7 2010, 07:44 AM Post #45 |
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Shortstop
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So I'm a mean old man. And they can't possibly live their lives with our your careing guidance. Is that it? |
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The Confederate soldier was peculiar in that he was ever ready to fight, but never ready to submit to the routine duty and discipline of the camp or the march. The soldiers were determined to be soldiers after their own notions, and do their duty, for the love of it, as they thought best. Carlton McCarthy | |
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| George K | Aug 7 2010, 07:58 AM Post #46 |
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Finally
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I think, somehow, it's the wrong weekend to be making Marie Antoinette references. |
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A guide to GKSR: Click "Now look here, you Baltic gas passer... " - Mik, 6/14/08 Nothing is as effective as homeopathy. I'd rather listen to an hour of Abba than an hour of The Beatles. - Klaus, 4/29/18 | |
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4:57 PM Jul 10