I want to clarify the method used to calculate the value of S.S. When
taken at 62yrs vs 66yrs.


I'll assume the following benefits $1,500 at 62 and $2,049 at 66.

1500 x 1nn% = yy or one month benefit plus interest
yy x 1nn% = yy or two months benefit plus interest
…....
…....
yy x 1nn% =yy or 12 months benefit plus interest

yy minus taxes paid = new yy

repeat for 4 years and save yearly values


""I will use this calculator to do this.""
http://www.thecalculatorsite.com/fin...calculator.php


Using 8% annual growth compounded monthly.

year one $18,799 minus 15% = $15,979
year two $36,105 minus 15% = $30,689
year three $52,036 minus 15% = $44,231
year four $66,702 minus 15% = $56,697

$56,697 x 0.08% = $4,536*
$4,536 is the interest earned on four years of savings.

$1,500 x 12 mo = $18,000 Yearly Benefit at 62.

If I add $4,536* to $18,000 = $22,436
Benefit at 62 plus interested earned on 4 years of savings.

$2,049 x 12mo = $24,588 Benefit at 66

$24,588 - $22,436 = ($2,052)

So the 62yr benefit saved for four years plus interest is $2052 less
than 66 yr benefit.
Or you could make up the difference for about 20 years by spending
enough of the savings to be even. This has to be calculated to find
exactly how many years, but it's not simple.


Ok this is my first iteration.
I think 8% interest is optimistic.
I know I could add in COLA, but it goes into both so I think it's a wash.
What should I change?

Mikek

On 8/10/2014 10:22 AM, wrote:
On Sun, 10 Aug 2014 09:54:41 -0500, amdx wrote:


I want to clarify the method used to calculate the value of S.S. When
taken at 62yrs vs 66yrs.


I'll assume the following benefits $1,500 at 62 and $2,049 at 66.

1500 x 1nn% = yy or one month benefit plus interest
yy x 1nn% = yy or two months benefit plus interest
…....
…....
yy x 1nn% =yy or 12 months benefit plus interest

yy minus taxes paid = new yy

repeat for 4 years and save yearly values


""I will use this calculator to do this.""
http://www.thecalculatorsite.com/fin...calculator.php


Using 8% annual growth compounded monthly.

year one $18,799 minus 15% = $15,979
year two $36,105 minus 15% = $30,689
year three $52,036 minus 15% = $44,231
year four $66,702 minus 15% = $56,697

$56,697 x 0.08% = $4,536*
$4,536 is the interest earned on four years of savings.

$1,500 x 12 mo = $18,000 Yearly Benefit at 62.

If I add $4,536* to $18,000 = $22,436
Benefit at 62 plus interested earned on 4 years of savings.

$2,049 x 12mo = $24,588 Benefit at 66

$24,588 - $22,436 = ($2,052)

So the 62yr benefit saved for four years plus interest is $2052 less
than 66 yr benefit.
Or you could make up the difference for about 20 years by spending
enough of the savings to be even. This has to be calculated to find
exactly how many years, but it's not simple.


Ok this is my first iteration.
I think 8% interest is optimistic.
I know I could add in COLA, but it goes into both so I think it's a wash.
What should I change?

Mikek



All of these calculations assume SS will continue forever at the
current pace. (benefits ratio, COLAs, tax treatment etc)

That's about all we can do, my crystal ball works great except when
I use it to predict the future.

It is clear that there is a move to "reform" the program and that
means reduced benefits somewhere.
The last "reform" started taxing 85% of the benefits at normal tax
rates for anyone who has any other significant income.
Taking your required withdrawals from your 401k will put most people
over this threshold. A pension is a slam dunk.

I just hope they don't means test or asset test.
I suspect if you earned it and saved it, they'll find a way
to get it.
Mikek


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On Sun, 10 Aug 2014 21:13:01 -0400, BAR wrote:

The idea that the money in your 401k will be taxed at a lower rate
than when you were working is a joke.

SS is going to be a means tested welfare program.

There is nothing stopping you from pulling money out of your 401k/IRA
when you are 59 1/2 and investing it in other investment vehicles.

===

What stops you is having all of your funds become immediately taxable.
You're far better off to let your returns roll forward untaxed until
you withdraw them. I'm personally of the opinion that it is better to
roll 401K money into an IRA however. An IRA usually offers lower
fees and a wider choice of investments.

On Sun, 10 Aug 2014 21:22:22 -0400, BAR wrote:

That equates to
70,000,000 people with nothing else to do by yell and scream and vote to
keept the SS retirement they earned

===

As well they should.

On Sun, 10 Aug 2014 23:03:33 -0400, wrote:

On Sun, 10 Aug 2014 22:12:56 -0400, Wayne.B
wrote:

On Sun, 10 Aug 2014 21:22:22 -0400, BAR wrote:

That equates to
70,000,000 people with nothing else to do by yell and scream and vote to
keept the SS retirement they earned

===

As well they should.

That didn't stop congress from taxing social security in the 80s

That is the second time that money was taxed. You paid on it when they
collected it too.

I still think we ain't seen nothin yet. As the Ponzi character of
SS/Medicare starts becoming obvious to even the most rabid of bleeding
heart liberals, they will take it out on anyone they think does not
"need" it, no matter how much we put in.
I bet a couple making anywhere near $100k in retirement will have most
if not all of their SS completely taxed away.

===

We'll see.

There are a lot more senior citizens now than there were in the 80s,
and we are organized, and we vote. I think it would be political
suicide for anyone trying to increase SS taxes beyond today's onerous
levels.

At least I don't have New York and New Jersey reaching into my pocket
anymore, and our property taxes are only 25% of what we used to pay in
the NY 'burbs. Dockage is cheaper also. :-)

On Sun, 10 Aug 2014 23:36:29 -0400, wrote:

On Sun, 10 Aug 2014 23:24:15 -0400, Wayne.B
wrote:

We'll see.

There are a lot more senior citizens now than there were in the 80s,
and we are organized, and we vote. I think it would be political
suicide for anyone trying to increase SS taxes beyond today's onerous
levels.

At least I don't have New York and New Jersey reaching into my pocket
anymore, and our property taxes are only 25% of what we used to pay in
the NY 'burbs. Dockage is cheaper also. :-)

It all depends on whether the kids start voting their interests.
When their FICA taxes start being more than their income tax, they
might wake up. For some it is more now, they just don't know because
Sammy takes it before they see their check.

===

Isn't it true that the people with good jobs are very much a minority?

The government will eventually "fix" social security by either
fudging the cost of living calculations or eliminating COLA entirely.
That will be followed by a round of hyper inflation. The "official"
rate of inflation is already being fudged a great deal, and hyper
inflation with a weak dollar is the inevitable consequence of long
term defecit spending.

Wayne.B wrote:
On Sun, 10 Aug 2014 21:22:22 -0400, BAR wrote:

That equates to
70,000,000 people with nothing else to do by yell and scream and vote to
keept the SS retirement they earned

===

As well they should.

But a lot of those SS people did not put in anywhere enough to pay for an
insurance and annuity policy. Was not the national retirement act. Was
the widows and children's act. To keep them from starving. Was LBJ who
raised the vig and the payouts to pay for an unfunded war. So we are still
paying for SEA.

BAR wrote:
In article ,
says...

On Sun, 10 Aug 2014 15:30:01 -0500, amdx wrote:

On 8/10/2014 10:22 AM, wrote:
On Sun, 10 Aug 2014 09:54:41 -0500, amdx wrote:


I want to clarify the method used to calculate the value of S.S. When
taken at 62yrs vs 66yrs.


I'll assume the following benefits $1,500 at 62 and $2,049 at 66.

1500 x 1nn% = yy or one month benefit plus interest
yy x 1nn% = yy or two months benefit plus interest
?....
?....
yy x 1nn% =yy or 12 months benefit plus interest

yy minus taxes paid = new yy

repeat for 4 years and save yearly values


""I will use this calculator to do this.""
http://www.thecalculatorsite.com/fin...calculator.php


Using 8% annual growth compounded monthly.

year one $18,799 minus 15% = $15,979
year two $36,105 minus 15% = $30,689
year three $52,036 minus 15% = $44,231
year four $66,702 minus 15% = $56,697

$56,697 x 0.08% = $4,536*
$4,536 is the interest earned on four years of savings.

$1,500 x 12 mo = $18,000 Yearly Benefit at 62.

If I add $4,536* to $18,000 = $22,436
Benefit at 62 plus interested earned on 4 years of savings.

$2,049 x 12mo = $24,588 Benefit at 66

$24,588 - $22,436 = ($2,052)

So the 62yr benefit saved for four years plus interest is $2052 less
than 66 yr benefit.
Or you could make up the difference for about 20 years by spending
enough of the savings to be even. This has to be calculated to find
exactly how many years, but it's not simple.


Ok this is my first iteration.
I think 8% interest is optimistic.
I know I could add in COLA, but it goes into both so I think it's a wash.
What should I change?

Mikek



All of these calculations assume SS will continue forever at the
current pace. (benefits ratio, COLAs, tax treatment etc)

That's about all we can do, my crystal ball works great except when
I use it to predict the future.

It is clear that there is a move to "reform" the program and that
means reduced benefits somewhere.
The last "reform" started taxing 85% of the benefits at normal tax
rates for anyone who has any other significant income.
Taking your required withdrawals from your 401k will put most people
over this threshold. A pension is a slam dunk.

I just hope they don't means test or asset test.
I suspect if you earned it and saved it, they'll find a way
to get it.
Mikek


Count on it. The millennials are going to throw grandma from the
(gravy) train as soon as they figure out how to vote.
The idea that the money in your 401k will be taxed at a lower rate
than when you were working is a joke.

SS is going to be a means tested welfare program.

There is nothing stopping you from pulling money out of your 401k/IRA
when you are 59 1/2 and investing it in other investment vehicles.

You pay taxes now or later. I go later. And all my 401k's are now IRAs.

On Mon, 11 Aug 2014 09:06:51 -0400, wrote:

The housing bubble and the dot com bubble were just a sneak peak at
the debt and phony money bubble we have coming. It might happen as
soon as Warren Buffett dies and they try to liquidate Berkshire
Hathaway for charity as he promised.

===

The charities will not "liquidate" Berkshire Hathaway by selling off
the holdings. They will divvy up the stock shares and keep most of
them for the income stream, just like Warren does. The stocks are not
just paper, they represent actual ownership of some darn good
companies and a claim on their earnings and free cash flow.

wrote:
On Sun, 10 Aug 2014 23:51:40 -0400, Wayne.B
wrote:

On Sun, 10 Aug 2014 23:36:29 -0400, wrote:

On Sun, 10 Aug 2014 23:24:15 -0400, Wayne.B
wrote:

We'll see.

There are a lot more senior citizens now than there were in the 80s,
and we are organized, and we vote. I think it would be political
suicide for anyone trying to increase SS taxes beyond today's onerous
levels.

At least I don't have New York and New Jersey reaching into my pocket
anymore, and our property taxes are only 25% of what we used to pay in
the NY 'burbs. Dockage is cheaper also. :-)

It all depends on whether the kids start voting their interests.
When their FICA taxes start being more than their income tax, they
might wake up. For some it is more now, they just don't know because
Sammy takes it before they see their check.

===

Isn't it true that the people with good jobs are very much a minority?

The government will eventually "fix" social security by either
fudging the cost of living calculations or eliminating COLA entirely.
That will be followed by a round of hyper inflation. The "official"
rate of inflation is already being fudged a great deal, and hyper
inflation with a weak dollar is the inevitable consequence of long
term defecit spending.

I think the whole concept of SS/Pensions is in for a reality shock. No
matter how you slice it, you can't have as many people "retired" as
the demographics predict. We are already seeing the SS problem since
it is upside down for the first time in history. The supporters are
simply in denial about that. The next shoe to drop will be the effect
on the equities market when the boomers start drawing down their 401ks
and spending that money. That is money that will leave the market and
will not be back.
The Fed can't keep printing money out of thin air forever too cover
our debt and to keep investment growing.
I think that is why we have the 1% now. If those people actually tried
to spend some of those unrealized capital gains Harry is so mad that
they have, the whole house of cards would collapse. They keep the
market going with money they will never take out and spend.
Most of that money is just an illusion, numbers in a computer
representing nothing and simply making it look like we are prosperous
as a whole.

The housing bubble and the dot com bubble were just a sneak peak at
the debt and phony money bubble we have coming. It might happen as
soon as Warren Buffett dies and they try to liquidate Berkshire
Hathaway for charity as he promised.

You should change your handle to Mr. Apocalypse. 😳

--
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