Critical Acclaim for MaxiFi

Even sophisticated investors tend to be under-informed and overwhelmed by the complexity of Social Security claiming and how to choose (and time) the best strategy for their situation.

While some people would only gain a few thousand dollars by delaying until age 70, those at the high end would gain about $900,000 over the course of their retirement by waiting, according to a National Bureau of Economic Research paper by authors at Boston University and the Federal Reserve Bank of Atlanta.

A NBER study finds postponing Social Security benefits can substantially increase retirement income, yet only 10.2% delay

There are some important decisions that you'll have to make with respect to Social Security along the way. Some of them have big consequences. There's one Social Security mistake that could even cost you $182,000.

The majority of Americans should wait until they're age 70 to begin collecting their Social Security benefits to maximize their monthly payments, according to a study published by the National Bureau of Economic Research.

Typical workers' lifetime spending could increase by 10.4% if they simply waited until age 70 to start Social Security benefits. But, according to a new study, “How Much Lifetime Social Security Benefits Are Americans Leaving on the Table?” only 10.2% of Americans do so. This means a median loss of “lifetime discretionary spending of $182,370.”

Deciding when to file for Social Security benefits can be daunting. Some choose to file early, while others believe it is a better bet to wait.

“They think they're going to make a killing in the market one day,” he said. “That's largely Wall Street convincing them that they need to leave it in there and the reward will come. It might. But you certainly can't count on the kind of return you get in Social Security checks for the rest of your life if you have the planning and patience to wait.”

Laurence Kotlikoff has another good example of pulling certain levers involving a couple that comes to him with their proposed retirement plan.

An Economist's Look Into Personal Finance

When the objective is well defined by the household and the characteristics of the household are known, life-cycle theory offers the foundation for the best solution. In other words, the optimal standard of living is the objective, and the magnitude of savings is dictated by household inputs to that goal.

Figuring out when to collect your Social Security benefits is a personal decision. You'll want to account for factors like your current health status, spouse and additional sources of retirement income.

One of the toughest things to do when you're self-employed or running your own business is to save for retirement.

More importantly, the Preston case study serves to motivate how to better think about the education decision in the spirit of Personal Finance Economics.

In his new book, Money Magic: An Economist's Secrets to More Money, Less Risk, and a Better Life, Laurence Kotlikoff says everything financial planners tell you is wrong

MaxiFi Planner is a fee-based Social Security tool developed by economist Laurence Kotlikoff. The software focuses on helping retirees smooth consumption over time. In other words, it creates a plan for retirees that allows them to have a standard of living that stays constant once they're done working.

A variety of online tools can guide retirees looking to make the most of this benefit - which many older Americans depend on.

In this episode, Stephen Stricklin continues his conversation with Laurence Kotlikoff, a Professor of Economics at Boston University and best-selling author. They cover several more details about Laurence's new book, “Money Magic: An Economist's Secrets to More Money, Less Risk, and a Better Life”.

In part one of this two-part interview, Stephen Stricklin is joined by Laurence Kotlikoff, a Professor of Economics at Boston University and a best-selling author. They discuss Kotlikoff's brand-new book, “Money Magic: An Economist's Secrets to More Money, Less Risk, and a Better Life”.

This week, I read a provocative new book by Kotlikoff called, “Money Magic: An Economist's Secrets to More Money, Less Risk, and a Better Life.”

Lots of readers responded to my Jan. 5 newsletter discussing a new book, “Money Magic: An Economist's Secrets to More Money."

If you're going to read just one financial book this year, read Money Magic by well-known economist Laurence Kotlikoff, who also co-authored the definitive book on Social Security, “Get What's Yours.” Kotlikoff has the extraordinary ability to make complicated money matters understandable – and to debunk the lures of Wall Street and the financial planning community.

Economist Laurence Kotlikoff thinks that most financial planners go about it wrong. Rather than helping clients amass wealth for a retirement-income target, the Boston University professor says the emphasis should be on smoothing and protecting spending throughout a person's life and then saving toward that goal.

If you demand the deepest and most powerful financial planning engine, look no further.

This article discussing whether eliminating mortgage debt makes sense.

“Advisors are systematically telling clients the wrong thing about retirement planning because they're trying to maximize their profits,” he argues in an interview with ThinkAdvisor.

This article reviews MaxiFi, focusing on its ability to compare an unlimited number of alternative financial plans.

For most people, Kotlikoff argues, the ideal path for allocation to stocks is high when they're young, low in the years just before and after retirement and then higher again in the last stage of retirement.