How to beat government bonds — Using Social Security

by online.wsj.com

social security retirementFor an investment return that tops those offered by hedge funds, insurance firms or Wall Street banks, baby boomers should look to Social Security.

That’s right: The same math that is driving Social Security costs higher can provide fat returns for people approaching retirement. All you need is a way to make ends meet while delaying the start of Social Security benefits from age 62 to as late as 70.

Sure, those who defer will miss a bunch of checks in the early years—but then will lock in bigger payments for life. This trade-off can be calculated as an investment return, just like a bond yield.

I asked John Shoven, director of the Stanford Institute for Economic Policy Research and author of numerous books and studies on Social Security, to perform such an analysis. The numbers might come as a surprise.

Advertisements

About smartspending5

I am business-minded college student who has a heart for helping others attain emotional independence and psychological stability. My background lies in Broadcasting, network marketing, and Human Services. I believe that crises and extreme stress is necessary for one to grow and figure out what matters in life (Tony Robbins). This keeps me going when frustrations arise in my business. View all posts by smartspending5

Leave a Reply

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 )

Twitter picture

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

Facebook photo

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

Google+ photo

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

Connecting to %s

%d bloggers like this: