Baby Boomer Social Security Dilemma Revisited

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If an opinion piece in the Sunday Milwaukee Journal Sentinel Crossroads section is any indication, there is going to be a lot of discussion of the subject of Social Security in the years to come. Not all will be good advice.

In the article (To collect or not to collect), Carolyn Kott Washburne shares her personal struggle with the decision about whether or not to start collecting Social Security benefits at age 66. The author had a friend do the math and determined she would have to live to age 80 to recoup what she would lose by not starting at age 66.

The decision seems shortsighted to me. By focusing solely on how long she will have to live to break even if she delays collecting until age 70 – at which time her checks will be almost 30 percent more than if she starts collecting at 66 – she omits pertinent factors in making a sound decision.

She does not consider what affect her decision will have on a spouse. Taking it earlier may decrease the amount her spouse can take, depending on his work history. And it appears she doesn’t expect to live to age 80 or beyond even though her life expectancy is 84. In fact, life expectancy statistics indicate that she has a 50 percent chance of surviving past age 84, and 33 percent chance of living beyond 93. Every day people spend a lot of cash on lottery tickets with much higher odds against them.

I am about to leave on vacation so you probably won’t be hearing from me until the end of next week. At that time I intend to pick up where I left off with my thoughts regarding long-term care insurance.

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