Y Squared Advisors: The Value of Social Security as a Deposit

Monday, April 13, 2009

The Value of Social Security as a Deposit

Consider this. When you receive your Social Security benefits you are able to reduce the amount of retirement account withdrawals by the same amount as the benefit. This keeps your assets invested longer giving them more time to grow. So, it makes sense that the earlier you take benefits the longer your assets stay invested. As this diagram shows, when you start benefits at age 62 - the earliest you can - think of the benefit as a deposit to an investment account (in other words - your retirement assets stay invested) the value of the deposit in the future is always greater starting at age 62, even though the benefit is less than at age 66 or 70. Why? Your benefit is inflation adjusted and you may be able to earn more than a 5% return (I know - just go with it for now) on the assets that stay invested.

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Why "Y Squared"

All of us know the phrase “the eighty-twenty rule”. In business the idea that there can be such a disproportionate weight in the contribution of employees and customers to our goals and purposes has confounded many an executive and owner.

We at Y Squared Advisors believe that accepting the 80-20 rule is just keeping with the status quo and not a way to differentiate your self, your business, of for that matter any endeavor. To be distinguished one need not only be inside the “20” they need to be in the top 20% of the 20. This we call “Y Squared”.

Possessing “Y Squared” attributes is natural for some, they’re born with it. It is also an attribute acquired from the hands on application of abstract and critical thinking to achieve real and measurable improvement. These are the “Y Squared” thinkers you want whenever a radical break from the status quo is necessary.

When you consider adding talent to your organization do you expect that individual to just help you maintain the status quo? Of course not, you must keep your competitive edge and your reputation as a forward thinking organization, particularly in an economy where one has to do more with less. The special results delivered to you by those who scorn the status quo, you should also expect from your key projects and initiatives. Unfortunately, many times you find that deliverables costs more, take longer to achieve and may not satisfy defined goals and objectives. A status quo outcome.

From our work, we know that the ROI (Rate of Impact) of any project is often determined during the crucial first steps of the initiative, before much of the funds and resources are committed. Defining strategy, identifying risks, vesting stakeholders early on in the need for change, aligning executive management with the purpose and modeling the before and after effects are just a few of these steps. Furthermore, our work has shown that the ROI phase is the least costly and most productive way for achieving successful project implementation.

From you own experiences you already have learned that the return on investment (the financial ROI) is too often eroded during implementation. One of the observed reasons for this is a weak or incomplete ROI phase.

Our mission is to help you realize the impact of you projects at the point of decision and avoid the risk of waiting until the end to find out how you did. This is a “Y Squared” result.

Pease give us a call to discuss a no-obligation three day scoping engagement to review your most troublesome projects or to help you kick-off an idea you’ve been thinking about. Our expertise is in finance, investments, financial services and technology planning. We work only with decision makers.

For Education and Thought - "A Century of Life"

The content within this blog is meant to communicate ideas and provide information that will let you determine how specific factors that exist within our lives may impact our future.
We make no recommendations about how to invest or spend your money or how to run your life. These are your personal decisions.
While the presentation and format of the essays and charts represent original work - the data and calculations embedded within them are from sources and use methods generally available to anyone.

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Always consult your own financial advisor before making any investment decisions no matter where the information comes from.
Tom

The Great Transition

We are undergoing a tremendous change in this country that will continue for the next 10 to 15 years.

This transition is unprecedented because it is the first time in our nation's history that there are four generations living at the same time. This will have significant, sometimes sweeping, and for certain far reaching consequences on our quality of life for decades to come.

If you follow this blog regularly, we will present you with the issues, help you understand what they mean and give you insight into how to adapt your life to the "Great Transition".

Check in and follow our key quality of life indicators:

Our weekly "B" Generation 401k Watch - the Countdown to Retirement

The National Net Worth Per Capita Index - our proprietary measure of the the nation's net worth derived by subtracting the sum of consumer and public debt per capita from real GDP per capita. Updated quarterly.

About Y Squared Advisors

How often have we heard we have to “think outside of the box”? This phrase has become the ubiquitous mantra of the modern era. It has replaced “have a nice day” or the sticky smiley faces of days past. What does it mean? Our business leaders and politicians are telling us to “think outside the box” everyday. How do you do that when you have lived and worked your entire life in that box? When asked to document your plan for getting outside the box, you can study it over and over again, but in the end your plan may still be a blank piece of white paper.

What Y Squared Advisors can do is help you define that box before you try to get outside of it. Sometimes we need assistance defining where we are before we are able to create a plan for” outside the box”. Once defined, Y Squared Advisors will provide you with the “out of the box ideas”. These ideas will be carefully crafted with you so that in the end nothing looks the same and all possibilities are explored. Y Squared will ask the tough questions of you to help determine your best path and more important will provide the stimulus for you to think “what if”.

Y Squared is derived from the 80/20 rule. Most people work, play and think the same as everyone else – the 80%. Those who demonstrate independent or break away - thinking, belong to the 20% segment. They become trend setters, possessing the privileges that come along with being in the 20. The 20% segment bifurcates into another 80/20 dimension – the 80% comprise the “X”, the 20% comprise the “Y”. The Y element exhibits extraordinary creativity, has enormous power, and often thinks about matters that no one else does. Hence “Y Squared” – Discover what you’re not thinking!

Y Squared Advisors

Monday, April 13, 2009

The Value of Social Security as a Deposit

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Why "Y Squared"

For Education and Thought - "A Century of Life"

The Great Transition

Wall St to Main St a View

About Y Squared Advisors

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