# Living On Pensions



## Lon

I feel very fortunate to be able to live comfortably on three pensions, two govermental and one corporate and not have to draw from my IRA or Investment accounts, however, there may come a time when all the pension income plus IRA & Investments are consumed by Assisted Living Costs.


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## Josiah

I have a small corporate pension, a generous VA disability benefit, Social Security checks for both me and my wife, plus I still work and earn a comfortable income. My wife's nursing home bill is covered for the next three years by Long Term Care insurance. So I'm still adding to my investment portfolio. Plus I just learned that I'm going to inherit some money my mother invested overseas back in the 1970s. It never rains but it pours. As I've admitted elsewhere on this forum I've always been very insecure about money, but I'm prepared to admit that that insecurity stems from some profound psychological defect that will never go away. As I lie on my death bed I will question the nurse as to whether there isn't a generic form of the painkiller she's giving me.


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## lovemylittleboy

ok now, I am ready to sign up for SS. I am not sure what I need to do. My pension bridge will fall off when I am 63 but I can get my SS now and bank that for emergencies or for my kids when I die . I have everything paid for , for our burials , but have since decided to be cremated. 
So now I just need to pay for that and signing for SS now I can do that.


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## GeorgiaXplant

> _As I lie on my death bed I will question the nurse as to whether there isn't a generic form of the painkiller she's giving me. _


So what you're telling us is that you're tighter than bark on a tree? LOL!!!

I have my SS check (aka Rocking Chair Money), a pension from AT&T and my Cleaning Fairy income. Sold the investments when my husband died and used the $$ to pay the bills and build my hovel. Not sorry. I'm doing just fine.


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## Josiah

lovemylittleboy said:


> ok now, I am ready to sign up for SS. I am not sure what I need to do. My pension bridge will fall off when I am 63 but I can get my SS now and bank that for emergencies or for my kids when I die . I have everything paid for , for our burials , but have since decided to be cremated.
> So now I just need to pay for that and signing for SS now I can do that.



I suggest you find someone you can talk to about applying for your SS benefits. You might start by going to www.socialsecurity.gov. There are a number of options you will have to decide on and its important that you understand these options clearly. Locate the closest Social Security office and consider going there for advice. You do realize that by delaying your application for a few more years you will eventually get a bigger benefit check and that can be very important.


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## lovemylittleboy

Thanks Josiah. I read in the paper an article on signing up now...they said lots of people are doing it now and they said your checks may be smaller but you get more of them and end up with more money . I forget what paper that was.


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## Don M.

lovemylittleboy said:


> Thanks Josiah. I read in the paper an article on signing up now...they said lots of people are doing it now and they said your checks may be smaller but you get more of them and end up with more money . I forget what paper that was.



The best time to sign up varies greatly with each individual.  The longer you wait, the bigger your checks will be.  However, no one knows how long they will live...and, therein lies the quandary.  I think the break even point of taking benefits as soon as you are eligible is around 15 years....vs., waiting until you are 70.  Given the average lifespans in the US of 78 for Men and 82 for Women, many people would get more out of the system by signing up as soon as eligible.  If longevity runs in your family, you could easily get 30+ years of benefits by signing up early.  I know how much I paid in over my working career, and we signed up as soon as we became eligible.  I long ago passed the point of getting all my money back...plus, interest...and if we live as long as our parents did, we will get back 3 or 4 times what I paid in during my career....my wife never worked outside of the home.  I wish my other investments had such a steady and predictable rate of growth/return.


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## Josiah

Very helpful Don.


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## lovemylittleboy

Hi HIGHLY doubt if I will make it another 30 years.  And our family doesn't have real longevity. And Thank you for the input


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## ndynt

I saved and planned all through my working years.  Unfortunately, I was not aware that I needed to protect this money.   I became ill and went through all my savings, before I was eligible for Medicare.  So, my little SS check is all I have to live on.   It was more than enough, while I was able to sell my art work and do at home editing.  But, now just do not have the energy or mobility to do it all.   If I did not still have too many medical expenses, though living frugally, I would do fine.  
 My grandmother lived until a week before her 101st birthday, my mother lived until 98, so genetically, I have a few years left to live.  Although, I am not as healthy as they were.   
Gosh, I reveal more about myself on this forum than I do to my friends and family LOL.... It is nice though, that there are so many people in the same stage of life...with the same concerns, to compare. learn and share with.


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## ndynt

lovemylittleboy said:


> Thanks Josiah. I read in the paper an article on signing up now...they said lots of people are doing it now and they said your checks may be smaller but you get more of them and end up with more money . I forget what paper that was.


Although, it may be to your advantage to retire early, will you have health insurance with your pension?  You will not be able to get Medicare until 65.  Believe me, that can be disastrous, if you become very ill.  Just a few days in intensive care can wipe you out.


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## lovemylittleboy

My husband still has insurance so we would be ok.  I know how medical bills can wipe you out at the blink of an eye.....we went through it all with my parents who never had much. My dad was seriously injured at work at an early age, he passed away at 59 , . They both had serious health problems. My mom made it to 70 (barely), and my oldest brother passed at 45 years old.  Plus I experienced it with my son when he was born. He was seriously sick. I had very good insurance but the cost I had to pay was still overwhelming.....sigh............... I just have to pray about it .  Thank you Nona


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## Bullie76

Breaking even is a big concern for most when looking at SS. But I think of delaying as a form of buying longevity insurance. My family is a mixed bag when it comes to health so it's hard to project how long I will live. But if one has a history of health problems and their parents didn't live long, perhaps taking SS early is the right move. No one clear cut answer.


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## lovemylittleboy

Yes it is a hard call, but I will probably go for it. Cancer and bad hearts run in this family pretty bad. So why give the government back anything I earned with my sweat. (love your dog pic!Bullie76) 
Thanks everyone , you are all so nice. So much good advice and things to make a person think hard on , (which is dangerous for me ha! ha!)


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## LogicsHere

lovemylittleboy said:


> Thanks Josiah. I read in the paper an article on signing up now...they said lots of people are doing it now and they said your checks may be smaller but you get more of them and end up with more money . I forget what paper that was.



Actually you may NOT end up with more money. The way you would end up with more money is if you die sooner; however, if you live past the breakeven point which is about 84 for most, then waiting will have given you more money.


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## lovemylittleboy

Some one on here broke it down perfectly ,(one of retirement threads) like it did in the paper I read on it. It was also on Fox Business News once.   I have an appointment in April................... see what happens there


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## ClassicRockr

What I've wondered is.........knowing the fact that obviously today, not everyone stays with a job long enough to retire from it and get a pension, just what the percentage of people in the U.S. is that live strictly on Social Security. SS Early Retirement, SS Regular Retirement and SS Late Retirement was never ment to be a "retirement" income, but many folks must use it for that. When my wife retires, that is exactly what we will be living on.


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## Lethe200

Actually, a better statistic to estimate lifespan is "how old were you in 2012?" The reason for that is, the fastest growing group GLOBALLY are the people over 80 yrs. So, as several articles have quoted:

"...The average life expectancy for a person who was 65 years old in 2012 is 19.3 years – 20.5 years for women and 17.9 years for men. The difference in life expectancy at 65 years between males and females increased 0.1 year from 2.5 years in 2011 to 2.6 years in 2012."

Every time they measure longevity after 65 - it has increased. Here's the statistic that really got the financial industry galvanized: back in 2006, a very large study showed that if a couple reached 65 in good health, the* second spouse's* life expectancy ended at age 94.

We could never convince my MIL that she actually had a 50-50 chance of living to 100 (she was 84.5 when we moved her to a facility). But once she moved there, she was astonished to find they considered her "the young one" because her tablemates were 87, 92, and 101! All had been living at the facility for 20-30 yrs. MIL had simply never met anyone that old, and hadn't been able to imagine it possible. Quite an eye-opener for her!


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## Butterfly

I'm apparently in the minority here, but I believe the better option is to wait until you reach full retirement age (in my case it was 66) to take the social security retirement benefits.  In my case, there was a substantial difference between what I would get at 66 an what I would have gotten had I taken the benefits at 62.  

Do be aware that when you become eligible for Medicare at 65, some regular insurance policies won't cover you any more, and if you wait too long to sign up for Medicare, you may have to pay a penalty.  I signed up for a Medicare Advantage plan at 65 (no choice, regular insurance company would not cover me any more), but didn't take the retirement benefits until 66.  Then I still worked another year and a half and just put the SS in the bank.

ALSO be aware that if you take the benefits at 62 and continue to work, your benefits may be reduced.  It's a minefield, and you have to be sure you understand your situation and what impact your decisions will have.

Best way to get info from the horse's mouth is to call the Social Security 1-800 number and make a telephone appointment for them to call you back  (or you might get lucky and find an agent available when you call in).  I've always found I got better info from the 1-800 number than from my local SS office.  For some reason,my local office sometimes seems a bit muddled. 
The 1-800 agents can pull up your records and know exactly what your situation is as to the social security benefits.


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## QuickSilver

Butterfly said:


> I'm apparently in the minority here, but I believe the better option is to wait until you reach full retirement age (in my case it was 66) to take the social security retirement benefits.  In my case, there was a substantial difference between what I would get at 66 an what I would have gotten had I taken the benefits at 62.
> 
> Do be aware that when you become eligible for Medicare at 65, some regular insurance policies won't cover you any more, and if you wait too long to sign up for Medicare, you may have to pay a penalty.  I signed up for a Medicare Advantage plan at 65 (no choice, regular insurance company would not cover me any more), but didn't take the retirement benefits until 66.  Then I still worked another year and a half and just put the SS in the bank.
> 
> ALSO be aware that if you take the benefits at 62 and continue to work, your benefits may be reduced.  It's a minefield, and you have to be sure you understand your situation and what impact your decisions will have.
> 
> Best way to get info from the horse's mouth is to call the Social Security 1-800 number and make a telephone appointment for them to call you back  (or you might get lucky and find an agent available when you call in).  I've always found I got better info from the 1-800 number than from my local SS office.  For some reason,my local office sometimes seems a bit muddled.
> The 1-800 agents can pull up your records and know exactly what your situation is as to the social security benefits.



You are correct about everything except Medicare..  If you are working, you can use your Employer insurance without penalty..  BUT you have to show Medicare that you were insured up until the time you do decide to sign up for Medicare... there will be no penalty.


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## Butterfly

QuickSilver said:


> You are correct about everything except Medicare..  If you are working, you can use your Employer insurance without penalty..  BUT you have to show Medicare that you were insured up until the time you do decide to sign up for Medicare... there will be no penalty.



My health insurance wasn't through my employer.  Health insurance was not offered by my employer so I had to purchase individual coverage.  My private insurance policy would no longer cover me once I was eligible for Medicare coverage.  So it varies from carrier to carrier, I suppose, or perhaps by whether it is insurance offered through your employer or private coverage.  I think it is wise to check and see what your siiuation is at 65, so you don't get any nasty surprises.


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## QuickSilver

Butterfly said:


> My health insurance wasn't through my employer.  Health insurance was not offered by my employer so I had to purchase individual coverage.  My private insurance policy would no longer cover me once I was eligible for Medicare coverage.  So it varies from carrier to carrier, I suppose, or perhaps by whether it is insurance offered through your employer or private coverage.  I think it is wise to check and see what your siiuation is at 65, so you don't get any nasty surprises.



My employer has to offer me its insurance benefit, even though I am eligible for Medicare.  To  not do so would be discriminatory.. Also, since my husband is NOT yet Medicare eligible, I have to carry him on my employer coverage, and since they offer spousal coverage, they have to cover him also.    So when I decide to retire next year, I need to prove to Medicare that I have HAD insurance in order to not be penalized.   There is no time frame involved.


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## Butterfly

Unfortunately, small employers were not required to offer the insurance benefit, and most law offices are small employers, so people like me (paralegal) got left to ferret out our own private insurance.  I'm not sure now how employees of small businesses fare under the ACA.  I hope there will be something to force small business to assist their employees with health insurance; the employers' excuse for not offering it is that they can't afford it and they don't have to.   Here, at least, there are many, many people working for small businesses, which are defined by the number of people they employ.


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## imp

Each month, I submit my two corporate pension checks to my bank teller, asking if his cash drawer has sufficient funds to cash them. He always looks, then smiles, and the conversation turns to "lunch money". 10 years vested pension  rights in each company: Sears Roebuck, and Dana Corporation. The combined monthly gravy:    *$158.07!*


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## Ameriscot

imp said:


> Each month, I submit my two corporate pension checks to my bank teller, asking if his cash drawer has sufficient funds to cash them. He always looks, then smiles, and the conversation turns to "lunch money". 10 years vested pension  rights in each company: Sears Roebuck, and Dana Corporation. The combined monthly gravy:    *$158.07!*



My smallest pension is one I get from a state university in the US.  I worked there for 9 1/2 years and was not highly paid as it was TN.  But I started getting $225 a month from them at age 60.  Better than a kick in the butt and it all adds up.


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## Capt Lightning

I must ask my American friend here in the village, to explain some of these terms as our British system seems to be somewhat different.  I took early retirement in my mid 50's with an immediate works pension (IBM).  That and some investments has kept us going and now my wife's works pension, another small works pension and my state pension are coming on-line shortly.  That should give us a comfortable, if somewhat modest, lifestyle.

Generally, if we contribute to a works pension, we pay less "National Insurance (N.I.)" and so (currently) get less State pension, but a higher occupational pension.  Most large companies offered a 'final salary' scheme where your pension was a proportion of your final salary for each year of service.  This is fairly rare now.   Medical care was covered by your national insurance and is still free at 'point of delivery' - ie. if you're ill, no matter what, treatment is free.  The downside is that you have to wait ages for treatment for minor complaints,  so some private health insurance is useful.

Our state pension is changing to a more simple (?) system based on number of years N.I. contribution. You wil need 35 years to get a full pension, but it's nowhere enough to live on.


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## AZ Jim

When I retired at 55 I did so on what was called a level income option.  My SS at age 65 along with my pension for 30 years service were added together and until I reached 65 that is what I received per month.  At age 65 they discontinued the SS portion.  There was no payback at all.  I also receive a benefit for life to help buy health insurance.  I am very pleased with how retirees are treated at General Dynamics.


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## Don M.

Capt Lightning said:


> I must ask my American friend here in the village, to explain some of these terms as our British system seems to be somewhat different.  I took early retirement in my mid 50's with an immediate works pension (IBM).
> 
> Hello, fellow "Ex-IBM'er"...I'm one too.  I bailed out at about age 59, when the company was making noises about Downsizing, and changing the Defined Pension rules.  They gave me 6 months pay to retire early, and the IRA kicked in shortly thereafter.  Now, the IBM pension, the IRA, and SS combine to fund a decent retirement.  The latest annual statement from IBM indicates that they are holding pretty steady at about 75 Billion in their U.S. Defined Pension fund, so unless the bottom falls out Globally, that source should remain viable for as long as we live.  I'm sure the IBM plans vary somewhat from nation to nation, but on balance, that company is about as good as it gets...IMO.


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## Capt Lightning

Don M, most UK defined benefits pensions pay into a pension protection scheme whereby if the  scheme goes bust, members will still get up to 90% of their pension.  The IBM (UK) scheme is in a reasonable state, but is not considered to be particularly generous.  Still, when we get all our pensions, (about age 101 at the rate the UK is going) we should have about the average UK household income - but without the burden of mortgage, debts, National Insurance etc... (note that except for England, medicines & eye tests are free for all ages in the UK).

I get my state pension in September, and we're off for a holiday in Europe to celebrate.


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## Don M.

Here, we have something call the Pension Benefits Guaranty Corporation....a Government program that is supposed to continue the retiree payments to people whose company goes belly up.  However, like most other government programs, it is substantially underfunded, and exists largely via "smoke and mirrors".  It's getting to the point where if a person doesn't plan for their own retirements fairly early in their working careers, they are going to be sadly disappointed when their time arrives.  Company pensions are quickly becoming a thing of the past, and if a person doesn't participate in a good 401K plan while they are working, they may one day find themselves living a pretty meager existence.  Even the Social Security program is going to be coming under increasing pressure, as people live longer, and there are fewer workers paying in.


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## Capt Lightning

It sounds like your 401K is similar to our occupational pension schemes, and as you observe, these are becoming increasingly rare. It was possible to make 'Additional voluntary contributions  (AVCs)' to the works pension or independently as 'Free standing AVCs (FSAVC)' which provided a seperate pension.   These are nearly all being replaced by 'Workplace pensions' which are run by various companies.  The plan is that the employee would accumulate a 'pension pot' and then use this to buy an annuity.  The amount varied widely from provider to provider and depended on such things as index-linking and providing a spouse's income in the event of death.  Generally, they were nowhere near as good as the works (401K) pensions.

This has changed now, and retirees can access all or some of their 'Pension pot' - subject to tax regulations.  Currently the average UK salary is around £26k ($40k) but the average pension pot is only around £40k ($60k), so that won't buy much of a pension - in fact you need nearly 10 times that to have a comfortable income .  Basic state pension (for 30 years contributions) is around £115 ($175) per week, paid 4 weekly - awkward for those of us used to getting their salary cheque monthly.  Many people who didn't contribute to a works pension, paid more towards National Insurance, and will get possibly twice that amount .

That too changes next year with a higher basic pension (for 35 years contributions), but no uplift for additional NI contributions.

The bottom line is that we are increasingly responsible for looking after ourselves financially in our later years.


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## Ameriscot

Capt Lightning said:


> I must ask my American friend here in the village, to explain some of these terms as our British system seems to be somewhat different.  I took early retirement in my mid 50's with an immediate works pension (IBM).  That and some investments has kept us going and now my wife's works pension, another small works pension and my state pension are coming on-line shortly.  That should give us a comfortable, if somewhat modest, lifestyle.
> 
> Generally, if we contribute to a works pension, we pay less "National Insurance (N.I.)" and so (currently) get less State pension, but a higher occupational pension.  Most large companies offered a 'final salary' scheme where your pension was a proportion of your final salary for each year of service.  This is fairly rare now.   Medical care was covered by your national insurance and is still free at 'point of delivery' - ie. if you're ill, no matter what, treatment is free.  The downside is that you have to wait ages for treatment for minor complaints,  so some private health insurance is useful.
> 
> Our state pension is changing to a more simple (?) system based on number of years N.I. contribution. You will need 35 years to get a full pension, but it's nowhere enough to live on.



It's confusing here in the UK since social security here means welfare.  In the US you pay a tax which is for social security retirement benefits.  But you pay this tax as a percent of income.  So when you retire benefits are based on what you paid in.  I believe the maximum based on your contributions is $3,000 a month.


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## Don M.

The bottom line is that we are increasingly responsible for looking after ourselves financially in our later years.[/QUOTE]

Exactly!  As more and more company pensions become history, and governments are coming under increasing stress to supply retiree programs, Individual Responsibility is going to have to become the major part of the Equation.  People are going to have to resolve to put a portion of their paychecks aside...early on...if they expect to live decently in their elder years.  A Mandatory Individual Savings plan...IRA/401K, etc...may have to become the Mandate in the not too distant future.  People cannot afford to wait until they are 50 years old, before they start thinking about retirement.


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## Ameriscot

Don M. said:


> Exactly!  As more and more company pensions become history, and governments are coming under increasing stress to supply retiree programs, Individual Responsibility is going to have to become the major part of the Equation.  People are going to have to resolve to put a portion of their paychecks aside...early on...if they expect to live decently in their elder years.  A Mandatory Individual Savings plan...IRA/401K, etc...may have to become the Mandate in the not too distant future.  People cannot afford to wait until they are 50 years old, before they start thinking about retirement.



We're fortunate in that our main pension is my husband's teacher's pension out of England.  He paid in extra all his working life and it was worth it.


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## Don M.

It's pretty hard for young people to think about their retirements...when they are trying to raise kids, and make mortgage payments, etc., But as time passes, it is going to become increasingly important for people to set aside a portion of their paychecks...From Day One...if they don't want to live off beans and hot dogs when they retire.  Government Entitlement Programs are increasingly stressed, and companies are abandoning traditional pension plans, so that does not bode well for future generations if people fail to start planning Now.   My kids and grandkids probably get a bit tired of my telling them to cut back on the new cars and "entertainment", but hopefully they are taking some of it to heart and thinking about the future.  Old Age creeps up on us a lot faster then most of us realize.


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## IKE

I retired upper blue collar April 1 of this year at age 65 and my net income now (after B, F and D supplements) with monthly SS, company pension and VA disability checks has doubled plus a few hundred more than my monthly net was while working after all deductions.......I feel very, very blessed and fortunate.


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## Lara

Sounds like you deserve it, IKE. Thank you for your military service. Enjoy your well earned retirement.


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