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Author: TwoCybers Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 19483  
Subject: Re: Social Security questions Date: 10/23/2012 3:42 PM
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In terms getting the first SS check -- it depends on when you apply in the month. The shortest time is 6 or 7 weeks. The longest is over 2 months. I get my deposits on fourth Wednesday of every month. Clearly if I started the process so the earliest possible payment was on the 4th Thursday, I would have almost a month longer to wait than if all the ducks lined up just right. There are some processes at happen within the Social Security Administration. Another thing that gets into the equation is how you get paid. Trust me, have your check deposited in a bank account. I moved from the fee happy big brink and mortar bank to Ally Bank. They give me ATM rebates and I can use any ATM in the country. I may switch to Schwab bank, since Schwab is where my brokerage accounts are. Both Fidelity and Schwab have very nice banking options for folks with brokerage accounts. We do have a checking account in a community bank. That way we have a lock box and a place to get papers notarized as needed.

Regarding Wellington's bonds -- drill down into their non-equity holdings. Yes there is some risk, but much less than traditional US Treasury type bonds. I would not worry about Wellington being in this or that sector. Banks are going to make money. No matter what mutual fund you look at there will be something you think/"know" is a stupid investment or worse. But you might be wrong - I was wrong once back in the mid 90s (VBG). Very few banks are going bust and once interest rates return to normal, they will make money like a printing press. The higher interest rates will cut into profits for say manufacturing, home builders, etc. So having a balance across the economy is a very smart plan. The difference between good and great can be just the stuff you don't see by examining a mutual fund's holdings. Today are they 22% large cap US vs. 20% in 2009 and 18% in 2007. Those small adjustments between sectors can minimize taxable gains, lower trading costs and give the investor in the range of 1% additional return annually. Some years will be better than 1% and some will be worse.

When you were talking COLAs, I thought you were talking Social Security. In my world of pensions COLAs have never existed. Last time I checked anything is better than zero.

There are multiple ways to plan/budget for retirement spending. Some people have a car funds, a travel fund, etc. I take a different approach. I have used Quicken since 1986. While I don't count pocket change and balance with Quicken daily, I have less than 0.5% of our spending that I cannot get into our Quicken categories. One year's data in my view was not enough, but I knew when the pay checks stopped what we spent in an average year. I knew at retirement we would stop that large expense call Retirement Savings. Healthcare insurance costs went up. Now that we are in retirement, I still keep Quicken going and I keep a running total on our spending. I track the trailing 12 months - that factors out things like August that has all our State Farm Insurance bills plus 50% of our Property Taxes. Spending for use in not uniform throughout the year.

Very few people are good at investing and those who are better have the danger of creeping senility. The fact you understand the advantage in having a pro, puts in into at least to 90th Percentile!

If you have not checked out the Bogleheads, they are worth a read. See http://www.bogleheads.org/forum/index.php
Spend some time reading before either believing somebody or acting. Some folks there are good. Some are good and also selling services or books. I am not saying this is a corrupt place, but there is a difference between good and great. There is a difference between people who want to "set it, forget it" and those who want to adjust/rebalance yearly or monthly.

Now I will share with you the best single idea I every had. It is
http://www.amazon.com/Conserving-Client-Portfolios-During-Re...
Not a cheap book. He has a web site.
For us this is important because we have no pensions. We opted for cash payment. Generally cash payment is not an option for government workers, so Bengen's approach may not suit your needs. I will warning you, this book is not easy to read, but I dug into all the math and found only one tiny error.

Gordon
Atlanta
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