Are you sure the second sentence is correct? I believe the survivor benefit is always 100% although not sure if of FRA benefit or of current benefit if past FRA.
I believe it is 100% of the current benefit.
Uh no, thanks for pointing that out. It was a brain-f__t. (The 50% is for spousal benefit, and that is of FRA.)
Survivor benefit is 100% of the higher-earner benefit, so the higher earner waiting to 70 makes the survivor’s benefit higher.
I honestly think USD 5M in cash without mortagage payment is a good target for retirement.
At what age? Don’t want to dig into it otherwise, would have a nighmare tonight. ><
I think that the max survivor benefit is 100% of FRA, even if spouse waited until 70. Anyone know for sure?
It’s based on what the spouse was getting when they died, not FRA.
From [Does the age I start my Social Security retirement benefit affect the amount my spouse will collect when I die?](Will My Early Retirement Affect My Spouse's Survivor Benefit?):
Thanks. I think the problem is timing. I expect/hope that I will still be working and doing pretty well when I am required to make distributions. If I’m not in the top bracket (I think I’ve been there for a number of years), I’d be at the next one so my effective rate would be between either 37% or close. So, I guess the real issue is what do we think marginal tax rates going to be five years from now. If significantly higher, I assume it make sense to do a conversion this year. Correct? I guess you have to consider the time value of money as well. That may have been part of @notrichenough’s calculation.
We’re in terrible shape although my eventual inheritance from my parents will help. The good news is that we’re doing well enough we’re finally contributing to our retirement account again. The Great Recession, followed by two kids in college for the same four-year period, really did a number on us.
It sounds like you are subject to the offset and windfall provisions for SS. These apply to folks who work in public jobs where they did not contribute to SS but got a public pension instead.
I’m a retire educator in another state…have the same provisions. I contributed to SS for at least 10 years prior to moving here, but the bulk of my work was in public education here so, I was subject to offset and windfall.
- You need to check...but I know in my situation there was a %age of time for these provisions to affect SS. If someone worked 30 years in another profession and contributed to SS, but then worked 5 or 10 years in education, they still collected their full SS, I believe.
- If you are subject to offset and windfall...I know in my case, I can never NEVER collect on my husband’s earnings. Even if he does before me, I am not entitled to any money per his SS.
- The offset and windfall provisions reduce your SS benefit by about 2/3. Mine would have been about $600 a month. It’s about $220...just enough to pay for Medicare. My SS earnings were before 1985. My pay was very low then!
I will say, there have been numerous bills introduced to eliminate the offset and windfall provisions…and none have passed…obviously!
The spousal benefit is based on FRA, the widow/widower’s survivor benefit is based on the then worker’s benefit amount.
Here’s the link to that paper, it was posted 6(!) years ago.
[Thinking About a Roth 401(k)? Think Again](http://www.joetaxpayer.com/images/ThinkingAboutaRoth401(k).pdf)
^^yes, but note that the author’s wrote this article for the “affluent wage earner client”; it does not apply to regular folk. 
The Windfall Elimination Provision https://www.ssa.gov/benefits/retirement/planner/wep.html
depends on the year you turn 62 and the number of years you have “significant” earnings in covered employment.
Government Pension Offset can also affect your SS. That’s the one that reduces your spousal benefits by 2/3.
Government Pension Offset can totally eliminate spousal benefit. My non-SS teacher’s retirement is low enough that I may get almost enough spousal benefit to pay my Medicare, which is what I’m hoping for.
Play with the calculator here:
https://www.ssa.gov/benefits/retirement/planner/gpo-calc.html
We converted to Roths the year that there wasn’t a $ limit (2010?) Seemed counter intuitive as we were in high earning/taxable mode. But a Monte Carlo analysis showed it to be the right thing to do. A decade later that does seem to be correct.
Many variables play into the decision to convert to Roths. Both our kids do that each year as their tax basis is (hopefully) less now than it will be in future years.
I was advised that my SS income would likely be penalized by the Windfall Elimination Act due to teaching part-time for a few years. I was required to contribute to a state teacher pension plan, even though I would never receive a full pension from it. It was my understanding that if made “substantial” income and paid into SS for 30 years, the penalty would not apply. Specific dollar amounts for each year are outlined on the SS website.
Any teaching income is not included in the substantial income calculations. Only income for which you paid Social Security taxes. I kept working a part-time job after teaching, primarily to meet the 30 year threshold. It was a yearly balancing act. It was tough to meet the 30 years, since I also worked less when the children were young.
@kjofkw I have met the 30 years of substantial income based on SS chart and my personal statement thru part time jobs. Hoping what you’re saying is correct. I’ll have to read up on it some more. But thanks for steering me in right direction.
It’s politically highly unlikely that they’ll cut Social Security benefits for people already retired and drawing benefits. Instead they’ll consider some conbination of raising FICA taxes, raising the maximum income subject to Social Security taxes, raising the full retirement age, cutting benefits for future retirees, and reducing the annual COLA. None of that will affect me much, even if I should be so lucky as to live beyond 2035. And even if they do cut benefits for current retirees, we should have plenty of income from RMDs on retirement accounts and returns on other investments. So I’m not worried in the least.
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I don’t think one needs to be so lucky to live beyond 2035… It’s only 15 years well with average life expectation.
I’m 67 and in poor health. By 2035 I’ll be 82. I’ll consider myself very lucky to be alive by then. But one never knows.