|
|
Post by AztecBill on Aug 25, 2014 8:23:22 GMT -8
I knew she is a financial advisor but never listened to her. I came across a talk by her on PBS yesterday and stopped to listen for a few seconds. I couldn't believe what she said. She was talking about the age to take Social Security. She said it increases about 6% every year you delay taking it. And then said a 6% return is pretty good in this day so you should delay as long as possible. I couldn't believe she would say something so stupid and flat out wrong about a critical decision in personal finance. Was that an example of her typical financial knowledge or was she just wrong on this one thing?
|
|
|
|
Post by aztec70 on Aug 25, 2014 9:34:59 GMT -8
I knew she is a financial advisor but never listened to her. I came across a talk by her on PBS yesterday and stopped to listen for a few seconds. I couldn't believe what she said. She was talking about the age to take Social Security. She said it increases about 6% every year you delay taking it. And then said a 6% return is pretty good in this day so you should delay as long as possible. I couldn't believe she would say something so stupid and flat out wrong about a critical decision in personal finance. Was that an example of her typical financial knowledge or was she just wrong on this one thing? Years ago I heard her stuff and have ignored her since then. The fact that she would give advice without knowing her client is wrong. Every client is a different set of facts. |
|
|
|
Post by AztecBill on Aug 25, 2014 10:02:09 GMT -8
I knew she is a financial advisor but never listened to her. I came across a talk by her on PBS yesterday and stopped to listen for a few seconds. I couldn't believe what she said. She was talking about the age to take Social Security. She said it increases about 6% every year you delay taking it. And then said a 6% return is pretty good in this day so you should delay as long as possible. I couldn't believe she would say something so stupid and flat out wrong about a critical decision in personal finance. Was that an example of her typical financial knowledge or was she just wrong on this one thing? Years ago I heard her stuff and have ignored her since then. The fact that she would give advice without knowing her client is wrong. Every client is a different set of facts. I understand your concern and I am not sure she does not "taylor" her advice, but the part I heard is just wrong on the facts. Just because you would get 6% more in subsequent years, that is in no way a 6% return. |
|
|
|
Post by aztec70 on Aug 25, 2014 11:03:45 GMT -8
Years ago I heard her stuff and have ignored her since then. The fact that she would give advice without knowing her client is wrong. Every client is a different set of facts. I understand your concern and I am not sure she does not "taylor" her advice, but the part I heard is just wrong on the facts. Just because you would get 6% more in subsequent years, that is in no way a 6% return. It is worse than you think. SS grows at 8% per year, not 6, until age 70 if not drawn at full retirement age. That is what I thought you were talking about. |
|
|
|
Post by AztecBill on Aug 25, 2014 11:14:22 GMT -8
I understand your concern and I am not sure she does not "taylor" her advice, but the part I heard is just wrong on the facts. Just because you would get 6% more in subsequent years, that is in no way a 6% return. It is worse than you think. SS grows at 8% per year, not 6, until age 70 if not drawn at full retirement age. That is what I thought you were talking about. She said 6% from 62-65 and then 8% to 70. To totally ignore a cash stream from 62 to whatever year it starts is a huge mistake. The question comes down to two things making it even more invovled: 1. Assumed rate of return for the NPV, 2. Life expectancy. If one were to die at 80 years old, beginning at 62 is a no brainer. If ones expected rate of return is at least 4%, taking it at 62 is a no brainer, unless one expects to live to be 120. I will use $100 to make it simple. Starting at 62 instead of 63 means you get $1200 instead of $6 a month for life. If you got no interest on that money it would take 200 months (16 years 8 months) to expend it. That places the break even at 79 years 8 months. But if you get 1% interest, that pushes that break even higher. There is no 6% return anywhere in sight. |
|
|
|
Post by aztec70 on Aug 25, 2014 11:46:52 GMT -8
I will make it even more simple. A bird in the hand is worth two in the bush.
|
|
|
|
Post by tuff on Aug 25, 2014 13:32:22 GMT -8
Actually, I would take it as soon as you can. Who knows what will happen to SS program with the $17 plus trillion deficit. It may not be here in five years, at least as we know it.
|
|
|
|
Post by aztecwin on Aug 25, 2014 17:24:18 GMT -8
I knew she is a financial advisor but never listened to her. I came across a talk by her on PBS yesterday and stopped to listen for a few seconds. I couldn't believe what she said. She was talking about the age to take Social Security. She said it increases about 6% every year you delay taking it. And then said a 6% return is pretty good in this day so you should delay as long as possible. I couldn't believe she would say something so stupid and flat out wrong about a critical decision in personal finance. Was that an example of her typical financial knowledge or was she just wrong on this one thing? Years ago I heard her stuff and have ignored her since then. The fact that she would give advice without knowing her client is wrong. Every client is a different set of facts. Exactly, I can see how she could be right for some people and so wrong for others. If you delay, there is little chance to have the increased delayed payment value equal the value of the monthly payment compounded over the years if you invest it rather than spend it. There are many other variations and one of the ways it makes sense to delay payment would be if you were to continue work well beyond early retirement age and the tax on Social Security would be in a very high tax bracket. A hip shot from her would have been appropriate for more people if she said take it as early as you can. |
|
|
|
Post by aztecwin on Aug 25, 2014 17:33:22 GMT -8
Actually, I would take it as soon as you can. Who knows what will happen to SS program with the $17 plus trillion deficit. It may not be here in five years, at least as we know it. This is also a real concern. |
|
