Why does everyone say you need so much money to retire when Social Security is supposed to pay you most of your best salary?
As others have said, it’s not intended to come close to matching your historical salary. Even if you have been working full-time at the minimum wage, it won’t come close. If you have been surviving by working about half-time at the minimum wage, the you can survive just about as well in retirement. I found this explanation and calculator on the Motley Fool website Here's How the Social Security Retirement Benefit Formula Works -- The Motley Fool. Quoting, where “AIME” is “Averaged Indexed Monthly Earnings” - which for recent years with low inflation is effectively your monthly earnings.90% of the first $895 in AIME32% of the amount of AIME greater than $895, up to $5,39715% of the amount of AIME greater than $5,397Notice that AIME of $895 per month, multiplied by 12, is less than $11,000 per year. That’s the part you pretty much get back. So 90% of that is about $10,000, but let’s round it up to $10K. The next tier, at 32%, takes you up to a salary of about $52,000. Maybe that’s average middle class. Where I live, that about the standard salary of public school teachers. So, $41,000 of that pays you back at 32%. 41 x .32 is about 13. So add that $13,000 to the $10,000 but from the bottom tier, and you will get about $24,000/year, to replace your $52,000 working income. So, less than half of what you were making.But, is your social security benefit based on your most recent salary? Hardly. Quoting again from the Fool: The formula uses your 35 highest years of earnings to determine your AIME. 35 years. Basically most of your employed lifetime, much of it before you reached your peak earning potential. It’s not based on the lifestyle you’ve become accustomed to. You lived on less when you were younger, maybe you can live on less now that you’re older.You do catch a break on federal income taxes. Your income from social security is taxed at a lower rate than salary income. But if all you’re living on is the social security, you would barely be taxed at all, so that exclusion doesn’t help you much.
How would you earn 10k per month illegally (no drugs/killing)?
Alrighty! I want $10,000 dollars a month… can’t do it legally… can’t kill… can’t be drugs… hmmm. Ok, I think I got it.Step one: get to a large city. This works better in larger cities.Step two: get duct-tape. Needs to be duct-tape, not just any tape.Step three: Locate and plot a map of all vending machines in the area (avoid police stations and schools). There are typically a couple in hospitals, large office buildings, recreational facilities, etc.Step four: Use the duct-tape to clog up the coin dispensary in the vending machine.Step five: Make sure you have 100- 150 vending machines plotted out… preferably get more.Step six: Go around once per week to every vending machine. Do this on a rolling basis, meaning do 1–30 on day one, then 31–60 on day two, etc.Step seven: sleep. You always need this!Calculations: Assuming 100 vending machines… average of three dollars change per day (there will be losses if someone figures it out… most people won’t even bother if there change doesn’t come out… most people kick the vending machine and walk away in frustration), you will get 100 * 3 * 30 = $9000 per month. Not quite 10K, but this was the low end… get more vending machines and you’ll be golden! Of course, until you get caught… which is the problem of doing things illegally.Personally, I recommend erring on the side of the law. It’s typically a lot less work and you avoid jail time by making your money that way! In no way do I advocate stealing!Also, to supplement your income… and this is a really twisted move… stay in a building, that has one of those charity coin/ money things that you can roll down coins into, after it shuts down for the night. Use a small scooper attached to bicycle spokes to grab bills and coins. Then hide in bath room or somewhere else safe for the night… and walk out with the crowd the next morning:)… also, I advocate for not doing this!