Quote:
Originally Posted by Caymus
Does your model include anticipated life expectancy? 😊That seems to be the big issue when deciding when to take SS.
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The model doesn't tell you
when to do anything, The future is always uncertain, sometimes more uncertain than others. if you want to put a constraint on an input, then you run an optimization routine against the constraint for the best outcome of a strategy listed below.
The model tells you what happens when you plug in any date for taking social security at your current cost of lifestyle, or how much to take out of your IRA and taxable investment accounts without taking SS, or any combination of the three depending upon the size of each of the three piles:
Income from SS
Income from IRA
Cover expenses from taxable investments which doesn't drive the same tax expense impact.
There are several ways to optimize the model, which requires keeping a certain lifestyle, and then optimizing on one or more of the several dimensions over time:
Maximum asset value (minimizing asset withdrawals)
Minimizing your tax expense (doesn't care about amount of assets)
Minimizing the tax effect post your death on your beneficiaries (doesn't care about your assets nor your taxes)
Keep in mind that your lifestyle and the wrong strategy given the size of each pile can bankrupt you before your dirt nap.
but still doesn't answer the impact of the admin fee. . adding or subtracting, but that doesn't answer the question of why the principal repayment values are different than the standard loan amortization schedule, but still totals the loan total. ie, their schedule they publish as gospel manipulates the numbers slightly to pay for their staff to manage the money stream and accounting / auditing requirements.