Retirement

Reality Check – Can you really “live” on Social Security alone? 

That depends! But dont count on it. Okay, the truth is that what matters is how you want to live.

CAN YOU LIVE on Social Security alone? The answer is a big fat “it depends.” I was recently taken to task by a reader, who stated he and his wife live just fine on their combined $30,000 in Social Security benefits. I also know of a retiree who says he’s quite happy living in a trailer out west on $1,300 a month.

How does that square with the conventional wisdom that, once retired, you need 80% of preretirement income, let alone with my unconventional wisdom that you should strive for 100% income replacement?

It all boils down to how you want to live. If you say you can live comfortably on just your monthly Social Security check, you’re saying that, on the day you retire, you can absorb a 60% cut in income for the rest of your life.

Source: Reality Check – HumbleDollar

Advertisements

4 replies »

  1. .

    Since I am single, frugal and debt-free including my house, most months I comfortably live on less than my monthly SS. But as Evelyn mentioned, sometimes there are unforeseen expenses so one also needs liquid savings as a back up. In the 11 years I’ve been early retired, my nest egg continues to grow. I’m more worried that future RMD will cause my SS to be taxed and put me into a much higher tax bracket.

    .

    Like

  2. .

    Since I am single, frugal and debt-free including my house, most months I comfortably live on less than my monthly SS. But as Evelyn mentioned, sometimes there are unforeseen expenses so one also needs liquid savings as a back up. In the 11 years I’ve been early retired, my nest egg continues to grow.

    I’m more worried that future RMD will cause my SS to be taxed and put me into a much higher tax bracket.

    .

    Like

  3. No, not unless one has a good back up in savings, especially with large repairs coming all at once, it can really drain your earnings/savings That is when a credit card is necessary My recent repairs/replacement amounted to over $20,000 all within 2 months time. Does anyone have that much in savings or does it clean out your savings with one set of repairs/replacements, then there are car repairs, today they cost a fortune. A Levelor on my 2004 Mercedes cost over $1,000. and that was for only 1 thing on my car! These type things clean out a savings/etc and then one wants to know how does a senior get along with these type repairs/replacements on our incomes! As for Medicare, the increase from 1608 a year to 1626 the normal most of us pay for premiums is only $18 more a year, not a lot, but for what? We are not offered the most up-to-date meds on our formularies, we have to take what the government says we can take, and our physicals have been minimal from our docs yet they charge Medicare a fortune to take our bp, check our weight, and talk with us for less than 15 minutes, The above type things are what wipe out our savings, and we have to depend on SS or the large interest the credit card companies are now charging in order to have our repairs done, or wipe out our savings! So, no, we do need some sort of retirement that we can use as well especially when all these things repairs/replacements happen together, then there is the costly cost of dentists with most of us having dental repair/replacements at our ages. So, those people living on their $30,000, I would like to see their budget and how they handle things that I mentioned above on their $30,000 income from SS unless they also don’t have a mortgage! (I will be eating peanut butter and jelly for the next 10 years trying to pay off all of these repairs/replacements!! )

    Like

What's your opinion on this post? Readers would like your point of view.

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s