What is the significance of SS full retirement age?

[GON]

This thread has evolved into the "chest beater" style that I occasionally complain about here. Most, if not all of the participants are showcasing how well they navigated life because they are responsible and well grounded (not a bad thing, per se).

I envied the two generations before me because it seemed that they matured with "golden parachutes" regarding retirement. Now, compared to my adult children's circumstances, I really seem to do have a golden parachute (workplace 403B 2x contribution, "free"* workplace health insurance til death post retirement, etc.).....my chest beating, lol.

Proper chest beating not necessarily bad in our cases. But, I would like to hear from the 30 to 40 year olds about the different challenges they face that makes retirement planning a much greater challenge than my and previous generations.


* relatively free, not 95% free as current.

I would go a different route with your question to the 30 and 40 year olds. The question I would ask is how will your generation pay off the monumental government debt your generation will be managing. And of note, this debt is not entirely due to generations before them.

 

[doitmyself]

I would go a different route with your question to the 30 and 40 year olds. The question I would ask is how will your generation pay off the monumental government debt your generation will be managing. And of note, this debt is not entirely due to generations before them.

Excellent point. They are challenged both personally, nationally, and globally. My mid-70's high school economics class taught us that cyclic recession was a key component of our economic system to rebalance and kick start it. I don't consider the Covid turn down as a true recession (pain). We are well past due for an economic rebalance. Maybe a depression? Hurtful as it will be, maybe this will be the solution? I'm very naive about national and global economics.

Getting off topic regarding retirement SS factors, other than the up and coming generations will have even far greater challenges than us older ones here.

 

[javacontour]

This thread has evolved into the "chest beater" style that I occasionally complain about here. Most, if not all of the participants are showcasing how well they navigated life because they are responsible and well grounded (not a bad thing, per se).

I envied the two generations before me because it seemed that they matured with "golden parachutes" regarding retirement. Now, compared to my adult children's (40's) circumstances, I really seem to do have a golden parachute (workplace 403B 2x contribution, "free"* workplace health insurance til death post retirement, etc.).....my chest beating, lol.

Proper chest beating not necessarily bad in our cases. But, I would like to hear from the 30 to 40 year olds about the different challenges they face that makes retirement planning a much different and greater challenge than my and previous generations.


* relatively free, not current 97% free.

Is it chest beating, or is a, "This is what worked for me, perhaps consider this approach" deal where people are passing on the path that works or the caution to get on this soon?


I mention it as the latter because the biggest resource people have when planning for retirement is time. The compounded returns are the biggest lever moving the pile of money.


A quick example. Someone who for 20 years from the age of 25 until they turn 45 starts with a $300/month investment in an S&P index fund and increases the amount by 3% each year for that 20 year period. (Invest $309/month the 2nd year, $318.xx/month the 3rd year and so on) and then doesn't invest anything more after 20 years will have more than the person who starts at 45 at the next 3% bump and invests until they are 65. (IIRC the first person annual contributions start at $3600 and end at $6300 at age 44. The second person starts at about $6500/year and ends at $11,400/year at age 64.)

The first person, if they leave that money alone will have just under $1.5 million using historic returns of the S&P500. Their investment was just over $93k

The second person, who waits 20 years before starting invests just under $175k and will have about 1/3rd as much at just under $450k

Almost double the investment for about 1/3rd of the result.

So, is it chest thumping, or advising someone to leverage their biggest resource, time and get their money into the game as soon as they can so those earnings can compound over and over and over again?

In my case, it's the latter.

Plan early, save early and reap the benefits.


.

 

[alarmguy]

This thread has evolved into the "chest beater" style that I occasionally complain about here. Most, if not all of the participants are showcasing how well they navigated life because they are responsible and well grounded (not a bad thing, per se).

I envied the two generations before me because it seemed that they matured with "golden parachutes" regarding retirement. Now, compared to my adult children's (40's) circumstances, I really seem to do have a golden parachute (workplace 403B 2x contribution, "free"* workplace health insurance til death post retirement, etc.).....my chest beating, lol.

Proper chest beating not necessarily bad in our cases. But, I would like to hear from the 30 to 40 year olds about the different challenges they face that makes retirement planning a much different and greater challenge than my and previous generations.


* relatively free, not current 97% free.

Life has never been more easy than it is today for 30 to 40 year olds. Way more easy than past generations.
I think that those who think life is tough need to mature and stop buying things they can not afford. They are living in the lap of luxury compared to past generations because they can’t say no to borrowing money and eliminating luxuries paid on credit.
Also they ignore and do not demand responsibility on the national debt.

Bottom line is not only do not control what we eat and our weight we are also fat on uncontrolled borrowing money

 

[SC Maintenance]

I would go a different route with your question to the 30 and 40 year olds. The question I would ask is how will your generation pay off the monumental government debt your generation will be managing. And of note, this debt is not entirely due to generations before them.

I am a little older, but may I answer?

They won't manage it, why would they? They will simply continue running deficits and stealing from Peter to pay Paul. Just like we have been doing since the early 1980's.

And at some point it will become unsustainable and the currency will collapse - like the Peso in 94 or the Yen in 86 or the Pound in 67.

If you read when money dies by Adam Fergusson - which is about the collapse of currency in Weimer republic of Germany, the ones that fared worst were pensioners and government workers - there money couldn't keep up. If you had marketable skills, you just demanded higher wages. Just like how during the pandemic fast food workers went from minimum wage to $18 an hour in a few months.

 

[Dave Hess]

Chest beating ???


Some folks were very fortunate to work somewhere and their employer had great benefits / retirement package.
This was not given for free and needed to be earned.

Hitler and the communists chased my dad out of Europe and he came to the USA with absolutely nothing, no family or relatives…… nothing. Only spoke a few words of English.
He worked very hard, lived the American Dream and retired comfortably. Not once did he complain or was bitter with the situation he was dealt with when he was younger.


Alarmguy is correct that younger folks here in the USA don’t know how fortunate they are to be here.

Is it harder today than 20, 35, 50 years ago ?
Definitely no doubt it’s more difficult due to the cost of living and crazy inflation.

Younger folks can still accomplish a lot if they stay motivated for the next 30-40 years.

 

[doitmyself]

Chest beating ???

Ya, it's not a popular comment. It's just something I'm biased about. I have my own story every bit as good as any. You know, the walking to school every day, in the winter, 4 foot drifts, uphill each way, lol. Maybe because I struggle with concepts of self worth? I'm a people pleaser for goodness sake (look up the negative connotation). It just seems to me, that I outgrew the need to let everyone else be aware of how well I did/do, constantly, over and over. Like, get over oneself. Oh, boy, did I open the flood gates???? See, people pleaser mentality trying apologize/explain why I might have offended some, LOL. Yes, we should all be proud of ourselves for what I just consider normal. And, many of us don't even begin to have the challenges that people do in other countries. Thank you immigrant father who instilled "nose to the grindstone" in me. I'm genuinely grateful for the opportunities in the U.S.. If I should die before usurping all of my SS, I hope that someone else gets to benefit from it.

 

[henni]

Tom Margenau has tons of useful articles on creators dot com, many in Q and A format

 

[JeffKeryk]

My chest thumping is being lucky to be in an area with opportunity, even for someone like me. Unbelievable!

 

[Fitter30]

Retired with disability at 61.5. Went to very good workman comp law firm 65 days later got my disability for ssi. They got over 9k was i pissed no. Everyone i talked to tried to do it on their own never happened. Never missed the money. Well spent didn't speak with a lawyer just their clerk after the first time.
If you ever been in a work man comp court its like a boys club.

 

[Dave Hess]

My chest thumping is being lucky to be in an area with opportunity, even for someone like me. Unbelievable!

Everyone has untapped potential…

 

[Sumboodie]

If you were born 1960 or later, your FRA is 67.
You can start collecting SS at 62.
For every year you start before FRA you lose 8%.
That is permanent. You still get the COLA.
For every year you wait after FRA you get an extra 8%, up to 70.

If you start early, you will get more money until 80-81 yrs of age, after that you would get more by waiting until FRA or later.

I'd venture to say by 80s many folks aren't able (mind or body) to do many things that they may have done at 65.

Like LIKELY an 80+ yr old isn't doing a cross country trip in a Winnabango, seeing the sights, mild hiking... ATV trips, doing yard work, building stuff, etc, etc.

And NO I'm not saying everyone that is 80 is in a diaper and barely is coherent. Not the case at all.... just more TOWARD that.

I'm sure you all know someone that's 90 and wouldn't guess they're a day over 65.
But also many that are the polar opposite too.

My Dad is 65 and currently needs a cane or walker to move around much. Can't feel his legs roughly mid thigh down.
2 years ago, wouldn't have really guessed he was in his 60s.

My point is don't hold out too long. No point of working hard 40+ years to build a nice nest egg if you never end up enjoying it.

I always keep in mind while I'm hoping to live to be a grouchy old man (haha) I may end up getting ran over by a busload of nuns tomorrow... never know.

 

[SC Maintenance]

I'd venture to say by 80s many folks aren't able (mind or body) to do many things that they may have done at 65.

Like LIKELY an 80+ yr old isn't doing a cross country trip in a Winnabango, seeing the sights, mild hiking... ATV trips, doing yard work, building stuff, etc, etc.

And NO I'm not saying everyone that is 80 is in a diaper and barely is coherent. Not the case at all.... just more TOWARD that.

I'm sure you all know someone that's 90 and wouldn't guess they're a day over 65.
But also many that are the polar opposite too.

My Dad is 65 and currently needs a cane or walker to move around much. Can't feel his legs roughly mid thigh down.
2 years ago, wouldn't have really guessed he was in his 60s.

My point is don't hold out too long. No point of working hard 40+ years to build a nice nest egg if you never end up enjoying it.

I always keep in mind while I'm hoping to live to be a grouchy old man (haha) I may end up getting ran over by a busload of nuns tomorrow... never know.

Thread revival. I love it!

The SS actuary tables are available online.

Male age 62 life expectancy is 20.27 years, so that is 82.27

Male age 70 life expectancy is 14.59 years. so 84.59. If course there was about a 9% chance you died between 62 and 70 and got nothing.

Assuming you met all the other requirement - like 35 years, etc etc, the median person should get exactly the same amount of SS during there collection period irrelevant of when they start - just how that amount is spread out.