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News

West Nile fogging commences Sept. 2

West Nile fogging commences Sept. 2


Courtesy of the Santa Clara County Vector Control District
Fogging commences Wednesday within the highlighted area.

The detection of West Nile Virus-infected mosquitos means that Santa Clara County officials will begin mosquito fogging operations...

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Schools

LASD trustees reopen negotiations with Los Altos Teachers Association

The Los Altos School District Board of Trustees last week directed staff to reopen negotiations with the Los Altos Teachers Association, a move intended to shore up the district’s financial picture.

According to the district’s current co...

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Community

LA teenager crowned Miss Golden State, advances to national pageant in Florida

LA teenager crowned Miss Golden State, advances to national pageant in Florida


Alicia Castro/Town Crier
Alexandra McCarthy, crowned Miss Golden State Teen in July, earned “Ms. Personality” honors from her peers.

Alexandra McCarthy has a ways to go before reaching her coveted role as a U.S. Supreme Court justice. Bu...

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Sports

After rough year, Eagles aim to soar once more

After rough year, Eagles aim to soar once more


Megan V. Winslow/Town Crier
Los Altos High senior running back Patrick Vargas snares a pass in practice last week.

Don’t dismiss the Eagles. Coach Trevor Pruitt is adamant that his Los Altos High football team will be better than expected.

&#...

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Comment

Car spotting 2015: A Piece of My Mind

When I was a kid, September was exciting, almost like Christmas, because that was when the Big Three automakers would reveal the new models for the upcoming year.

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Special Sections

Loving on the Edge

Loving on the Edge


Courtesy of Ford
The Ford Edge has been redesigned for 2015. Ford lengthened the wheel base and added cargo space, among other things. The Titanium model sells for approximately $42,000.

Once in a while, a vehicle we test-drive is just right for our...

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Business

Wine bar aims for October opening

Wine bar aims for October opening


Rendering courtesy of Honcho
Honcho, the wine and beer lounge on First Street, expects an October launch. A rendering of the space reveals the interior layout, which includes bar and lounge-style seating.

A downtown libations lounge that anticip...

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People

LOIS CAROLINE WALLES

LOIS CAROLINE WALLES

November, 1928

Lois lost a long and courageous battle with a prolonged illness on July 14th, 2015. She passed away knowing how well she was loved. She was always the life of the party and loved bringing everyone to her home for dinner or an event,...

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Travel

Carmel Valley Ranch unveils upgrades

Carmel Valley Ranch unveils upgrades


Courtesy of Carmel Valley Ranch
Carmel Valley Ranch recently upgraded its Vineyard Oak suites, which feature sweeping views, rocking chairs and private outdoor tubs for soaking under the stars.

Things are heating up at Carmel Valley Ranch, with 30 n...

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Stepping Out

'Dead Man' comes alive at Bus Barn

'Dead Man' comes alive at Bus Barn


Richard Mayer/Special to the Town Crier
The cast of Los Altos Stage Company’s “Dead Man’s Cell Phone” includes, from left, Marjorie Hazeltine (as Hermia), Kristin Walter (Jean) and Adrienne Walters (Carlotta).

Los Altos Stage Company opens its ...

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Spiritual Life

Inside Mountain View

MV actress/playwright Garvin wins NY festival award for

MV actress/playwright Garvin wins NY festival award for "Corners Grove"


Courtesy of Undiscovered Countries
Kaela Mei-Shing Garvin received a New York arts festival award for a featured role in “Corners Grove,” a play she wrote.

New York recognized that one of Mountain View’s own can “make it there” when the Planet C...

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Are there benefits to taking Social Security early? Part 2

Following is the second in a two-part series exploring the pros and cons of taking early Social Security payments.

In Part 1 of this series, I explained how Social Security (SS) works and how a breakeven analysis might be used to determine at what age to start taking benefits. Doug Lemons, a retired Social Security Administration deputy assistant regional commissioner, recently performed a fairly detailed break-even analysis with various return on investment (ROI), inflation rate and tax rate assumptions. He reached a very interesting conclusion: the ROI on the invested income must generally exceed the rate of inflation by 5 percentage points or more to justify taking benefits at age 62 rather than at Full Retirement Age (FRA), and by 3 percentage points or more to begin at FRA rather than waiting until age 70.

In today’s low inflation environment, getting a consistent real return (return in excess of inflation) of 4 or 5 percent or more is extremely challenging. What’s more, Lemons found that when inflation rates and/or marginal tax rates are high, the rate of return needs to be as high as 7 or 8 percentage points above inflation to justify collecting early benefits. Both those findings were for men. For women, whose life expectancies are longer, the rate of return needs to be even higher. In other words, in most situations you would be hard-pressed to start early SS and get a real rate of return on your investments high enough to come out ahead. Therefore, based on a break-even analysis, it’s probably better to delay starting benefits as long as possible under almost any circumstances.

But the breakeven analysis is not the only way to think about Social Security. Consider that SS is the only annuity you can get that is guaranteed by the federal government and adjusts for inflation. As a complement to a well-diversified retirement portfolio, it can significantly improve your chances of having enough money to last the rest of your life, however long that turns out to be. With that in mind, it would make more sense to follow a strategy that maximizes your monthly payments on the assumption that you might have a very long life. In short, it’s again better to delay starting SS until age 70, taking this perspective. Skeptics might argue that the government is poised to start taking away some of these features. That’s certainly a possibility. But unless you currently have some diagnosis of terminal illness, do you really want to bet that you’re going to die sooner rather than later? What will happen if you turn out to have been wrong? 

So far we’ve been considering Social Security for a single individual. The decision gets more complex for a married couple. When one spouse dies, the surviving spouse may start receiving the deceased spouse’s SS payments if they’re higher than his or her own. This is especially valuable for couples where only one spouse worked. If you’re the primary breadwinner in your family, and had chosen to start your benefits early, your reduced payments would carry over to your spouse if he or she outlives you. Do you really want to limit your spouse’s SS income after you’re gone? Especially if he or she ends up living for many years after you’ve passed away?

As I’ve written previously, if you are married, widowed or divorced there are many strategies you can follow to further maximize your social security benefits (visit losaltosonline.com, Parts 1 and 2, June 29 and July 27, 2011, Artie Green’s articles on how to maximize Social Security benefits). But as to what age to start collecting benefits, I believe it’s almost always better to delay as long as possible, unless you have a terminal illness or you absolutely need the money sooner.

Artie Green, a Los Altos resident, is a certified financial planner and professional investment adviser. For more information, call (408) 747-1222.

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