LOL. Believe it or not I like this plan. I like it so much I intend to share useful yet boring stats about sources of retirement income. Some of which you know, some maybe not. First off, my advice is collect at 62. Big brother forced you to pay all those years. It's time to get some back. Your payout will be reduced if you claim early, and increase if you postpone collecting your payments. Example: if you are entitled to $1,000 per month at age 66(which is your full retirement age) you would get 25 percent less, or $750 per month, if you signed up at age 62. However, if you waited until age 70 to collect, you would get $1,320 per month, 32 percent more. And no additional benefit for delaying claiming beyond age 70 ( assuming you even live that long after a career at Fedex)
Immediate Annuities. Guaranteed income for life is a big time benefit, but it comes at a cost. The first concern is that you are giving up access to your money in exchange for the income stream. If you are going to invest in an immediate annuity, only a portion of your total portfolio should go in. (Example: $100,000 investment will yield your around $755/a month. As you age, and whither away access to new money becomes vital. Retirees use an annuity to cover their fixed costs, and describe it as similar to having a salary to meet regular expenses.
Problem is most immediate annuities provide for fixed payments, which are not adjusted for inflation. And more times than not you never end up making money on your investment, your lucky if you live long enough to break even. And since inflation goes up and your money is not adjusted for it. You ultimately lose. However, if your pension is crap or non exisistent, it's a great way to supplement income. (side note) Your guaranteed 755 bucks a month makes your royalty is places like Latin America! Not to mention your SS payment.
What I plan on doing is simple. At 62 come hell or high water, don't have a mortgage payment. Start drawing a Social Security payment. (Statistics say most 55 and ups presently do not have at least 143,000 in their 401k plans) Don't be a statistic. I figure I can save at least 200,000. Roll about 130,000 into an annuity. I'll get Around 800 from SS assuming it still exists. Around another 800 from the annuity. Have at least 30-45K cash in a savings account. And take the lousy PPA in a lump sum, which I'm assuming won't even be more than 20k. My other job pays for car, insurance, mortgage, taxes, strictly.
Own the house and live on my front porch like Clint Eastwood in Grand Torino in a tac deffered state income state like Tennessee, New Hampshire or Texas. Or sell it and head to Bangkok. Run for Mayor. Either way, the point is you do have options. And for a lifetime of being exploited, extorted, under appreciated, and run down. You still, can make it work.
