When to start drawing Social Security

[KFC911]

Originally Posted by vash

subscribed to learn stuff from you older codgers.

Me too kiddo

[Halm]

Originally Posted by Crowbob

. . . The solution is to raise the taxable income limit for FICA, raise the age of eligibility for benefits and push gramma and her wheelchair off the cliff.

It sure sounds like you don't want a strategy discussion of how to maximize benefits but rather one dealing with Social security as a whole.

Fair enough. But start a new thread and don't hijack this one.

[scottmandue]

First off I would like to say WHAT THE HECK BAZ I THOUGHT YOU WERE A KID!!!

I will be coming back to study this thread.

I'm 61 and plan on retiring at 62.

I work for the state so I have a pension.

My parents are gone and left us a trust fund (+/- $2000 month)

I plan on getting a job (will drive my wife and myself crazy if I camp out at home), probably be self employed because not many people will hare a 62 YO.

[Crowbob]

Originally Posted by Halm

It sure sounds like you don't want a strategy discussion of how to maximize benefits but rather one dealing with Social security as a whole.

Fair enough. But start a new thread and don't hijack this one.

Sorry for your misunderstanding.

The benefit-maximizing discussion is pretty much played out-except for the enormous unknown which you apparently want to dismiss as irrelevant.

Fair enough.

Bottom line is the decision-making is as personalized as it can get.

Here's a hankie.

[wdfifteen]

I'm not going to start taking SS until I'm 70 for two reasons:

My parents lived to be 84 and 86. I live a lot healthier lifestyle than they did, so I think I'll surpass that.
When I do croak my wife, who is 4 years younger than me, will draw my SS amount and I want her to have as much $$ as possible coming in.

[icemann427]

I think the biggest determining factor in when to start Social Security is when you want to stop working. Prior to being 66, your maximum income can only be about $16k before it affects you. Within the year you turn 66, that amount goes up to about $45k.

With that being said, I did a cash flow based upon how much I would get when I turned 62 vs. waiting until 66 to find the break even point. The break even point, for me, was 77 years old.

[JackDidley]

I took mine at 62. I want to have the extra $$$$ to play with while I am still able to play. I am 65 now and starting a drag car project. SS will fund that and it gives me activity that I need . If not for the SS I would have to tap into my IRA for this project and have to pay taxes on that. Every person has different wants and needs. Waiting for age 66 or 70 sounds good but I am not sure I will be physically able to do this project then. For the record, I had a blue collar career and do not have big retirement savings compared to many .

[ckelly78z]

Originally Posted by Crowbob

Not taking your check is donating but you dont get to choose to whom it is donated.

I would much rather take a reduced amount SS check for 4-8 extra years, and enjoy life while I still can. After 75-80 years old, the desire to take big trips, buy sports cars, eat fancy meals is somewhat diminished, so the need for every penny in a big SS check should be reduced as well.

I have told my kids that I won't be saving them a windfall as an inheritance, so prepare accordingly.

[Seahawk]

Since there are penalties involved with working and earning over a set amount, I plan on waiting to collect SS until my FRA, 66 and 4 months. After FRA there are no restrictions on earned income.

https://financeandretirementinformation.blogspot.com/2009/04/how-much-money-can-you-make-after-you.html

Running the math, if I wait until I am 70, in simple terms (no interest on SS income, etc.) it would take 12 years for me to recoup the opportunity cost of receiving a lesser SS income from 66.4 to 70.

My wife has a good pension and will also have a healthy SS income.

Daddy needs Porsche Parts!

[Crowbob]

Good strategy, ckelly.

So good in fact, it is also mine.

[aigel]

This is far away for me, but I like the bird in the hand. So I will take it early.

As others have mentioned - you feel great now at 62, but don't assume it will stay like that. Sure, you likely will be 85+, but from what I have seen many times - family and friends, even in good health, after 75, you will be geriatric and your options to spend money on fun stuff (besides medical expenses) will likely go down.

So, in all reality, you have about 10-12 good years. Waiting for SS benefits doesn't sound the best way to spend them, unless you really have to worry about making it to end of life without running out of funds.

Look at the age demographic on this forum. Not many over 75 even posting and the ones that are, often have pretty sizeable health challenges keeping them back.

G

[wdfifteen]

Originally Posted by aigel

Sure, you likely will be 85+, but from what I have seen many times - family and friends, even in good health, after 75, you will be geriatric and your options to spend money on fun stuff (besides medical expenses) will likely go down.
G

Keep in mind your idea of “fun stuff” changes over time. In my experience “fun stuff” at the age of 67 tends to be more expensive than it was 10 years ago. We all make our own decisions - and live with them. I would never forgive myself if I reduced my income at age 62 to have fun and the love of my life had to live in poverty at the age of 80 because of my decision. I want the best for her - always.

[Baz]

Originally Posted by icemann427

I think the biggest determining factor in when to start Social Security is when you want to stop working. Prior to being 66, your maximum income can only be about $16k before it affects you. Within the year you turn 66, that amount goes up to about $45k.

With that being said, I did a cash flow based upon how much I would get when I turned 62 vs. waiting until 66 to find the break even point. The break even point, for me, was 77 years old.

So you're saying as long as you reach the age of 77......you would make up the difference in dollars you did not get by starting your SS at 62?

Which means if you live to be 97.......you could calculate the upside of additional income you will make by waiting (difference x 20), right?

Say for the sake of discussion it's $400 per month. That's $4.8K/year (x 20) = $96K.

Quite a difference!

My Mom turns 95 next Tuesday so reaching the age of 97 is not unreasonable......

[scottmandue]

As a state worker I see a lot of people stay on at a job they hate to ratchet up there pension payment.

And then they die while still working... just sayin.

[Crowbob]

Yep. A friend hung on to maximize over the long-term but passed away reading the newspaper one Sunday morning instead.

Another acquaintance passed while shaving the morning of his last day of work.

My dad signed up as early as possible after three full careers and lived 20 more years. Not very rich but he sure seemed happy.

[flatbutt]

I didn't have a choice. I had to take disability leave just after I turned 62 which turned out to be permanent leave. Years ago I bought a very nice disability insurance policy that provides me a nice income. What I didn't realize was the policy required me to start my SS benefits at the same time which they deducted from my insurance benefit.

So I ended up with the reduced SS benefit but my private insurance benefit more than makes up the difference. I'm not sure what happens at FRA though.

[rfuerst911sc]

I retired on 12/1/17 at the age of 59 and 11 months . My wife retired at 57 we are now both 60 years old . We both have a company pension which is our sole income at this time . We both worked for the same defense contractor her for 30 years me for 26 . We both contributed to our companies 401K and have a nice nest egg built up . Our plan is to not touch our 401K until we are 65 or so EXCEPT for an emergency.

We have a financial advisor that we consult with on a regular basis and we are going to look at drawing SS when we are 65 . Depending on what's going on with our lives at that time we may wait until 66 but that's as long as we are going to wait . We both have worked since we were 15 and we want to get out at least as much as we put in . Our house is paid for our cars are paid for . We are living comfortably but not high on the hog . Our biggest expense is health insurance .......... don't get me started !

[fintstone]

The mistake that most people make is they do not consider both themselves and their spouse at the same time. You need to do both and consider longevity of both of you at the same time. Although in almost every case, if you live a long time...both of you get more money of both live to 70 (assuming you do nothing with the only you got earlier investment-wise)...but the math changes if she is getting her's because of you, not her work...or if you die (she gets the amount you got or hers...whichever is higher) Personally, it appears to me that in most cases, one or both of you should start at 62...(or when you stop working if older). For example, if my wife takes hers now on her income)...she will start to get my higher amount when I die (if I die first)...so I might want to wait. I won't and will start mine as soon as I stop working (or certainly no later than my full retirement age of 66) because I have plenty for her/us otherwise and everything will be long paid off by 70 (where I have to start taking massive amounts out from my 401K. Best bet is to work out every permutation. This is a great calculator that does just that:
SSAnalyze - Bedrock Capital Management

[CurtEgerer]

It's all a bit of a gamble isn't it? I calc'd mine once and I wouldn't have any advantage waiting for the max monthly payment until I collected past age 85 (male life expectancy is only 78)! I'll play the odds, take it at 62 and enjoy my money for 23 years. If I'm still breathing at 85, I won't care much one way or another

And then there's this from actuarial studies of Ford, Boeing, and Lockheed pension funds. I retired early, your mileage may vary

retire-at-55-and-live-to-80-work-till-youre-65-and-die-at-67-startling-new-data-shows-how-work-pounds-older-bodies/

[Crowbob]

And the Stones hoped they'd die before they got old.*

It all depends*, of course, on what you're doing at age 85. Some folks just plain 'ol get tired of living. Not happy, not unhappy but simply 'done'. That's what I'm shootin' for. At that age, it seems like the people around you are the most important they'll ever be.

Doing stuff for other people while you can really is an investment. But I do not advertise nor volunteer for anything.

Neighbor brings me cookies, another invites me to their family BBQ's. My grand kid keeps getting shoved on me. House is dusty but I dont care.

Way better than sitting in front of a computer or driving around all day so I can retire rich.




* pun alert