When Are People Claiming Social Security?
One of the hottest topics in retirement income planning over the past several years has been how to help individuals strategize on their Social Security claiming decisions.
Philosophy of Social Security Claiming Strategies
Social Security claiming strategies can be extremely complicated. Treaties on this topic, some of which are listed in the table below, provide page after page of details, nuances, and exceptions.
Calculating Social Security Retirement Benefits
I will discuss the philosophy of claiming strategies later, but first, it is meaningful to first consider how retirement benefits are calculated.
The Social Security Administration has now followed the same approach for calculating benefits since 1979.
Introducing the Social Security Claiming Decision
For the vast majority of Americans, Social Security benefits serve as the core of a retirement income strategy. As a government-backed, inflation-adjusted monthly income for life, Social Security benefits help to manage longevity risk, inflation risk, and market risk.
A Brief History of Social Security
Recipients of Social Security benefits today are not just retirees – they’re disabled workers, spouses and young children of deceased or disabled workers, and the spouses and survivors of retirees. This was not always the case.
What’s Really Going to Happen When Social Security Runs Out of Money
One of the hottest topics in retirement income planning over the past several years has been how to help individuals strategize on their Social Security claiming decisions.
Annuity Pricing Sensitivity
With all of my discussions of annuities lately, it is worthwhile to also consider the sensitivity of annuity pricing to interest rates, gender and age-related mortality factors. Relationship Between Payout Rates and Interest Rates Figure 1 estimates the relationship between annuity payout rates and interest rates for 65-year old males, females, and opposite-gender couples with […]
Securing Longevity Insurance Through Income Annuities
I have published a few pieces in the past couple weeks on how income annuities are priced and used. Understanding how to use annuities can be a great benefit when planning for retirement. Let’s consider another possibility.
Annuity Pricing 102
In today’s scenario, we’ll see what happens to the price of an annuity if:
1. We guarantee income will be provided for at least 10 years, regardless of whether the annuitant lives.
2. We provide a cash refund if the annuitant dies before at least receiving their full principal payment.
3. We include a cost-of-living adjustment for annuity payments.
Retirement Income Strategies with Annuities
Income annuities come in a variety of shapes and sizes. It can be overwhelming to know which one makes the most sense for your situation. In this column, I explore how income annuities work and what options are available.
