Taking Social Security Early?

[4czn10]

Happy Friday! I'm sure there's some answers already out there, but I did a title search and nothing popped up, so here I go...I will be 62 next Feb and retiring then. We have enough between 401k, roth, defined benefit plan and 1 year of emergency cash to get us to 70. My wife is 57 and would like to go out the same time as I will. My budget during that time is for "comfortable" living, with 1 or 2 nice trips every year. We carry no debt, and have about 1/2 saved for our daughters 529 plan who is a freshman in HS.

We've all heard what Suzy Orman say's which is the same thing my CFP say's...Wait until 70, but lately I've been hearing/reading that it's a better idea to start taking SS at 62, because the breakeven point is somewhere around 15 years. So if I wait until 70 to start, I wont break even until 84 or 85. will i even still be around? If i take it now, I would be enjoying it at an age where i can still enjoy it, vs. later, where I may not be in as good health to enjoy it. The other question I have with all these breakeven calc's is are they taking into consideration the after 2034(?) our benefits will drop 25%? how does that play out?

Thoughts brain trust?

 

[rivermobster]

If you take it early...

The monthly payment is less, but the total dollars you're likely to recieve over your lifetime is Way more.

 

[Done-it-again]

Seems like you are pretty set, do you need your SS if you retire at 62? If not wait to 70 to apply for it.

 

[hallett21]

I keep hearing that it won’t be around much longer. Best to get it while you can .

 

[Joe mama]

My dad took it at 62 1/2 and mom took it at 70. We figure she will catch him and pass him at 88. She needed to wait since she is by herself and needs all she can get. Then again she worked till 70.

 

[DRYHEAT]

If you don’t need it, take it early and invest it it will grow a hell of a lot more than it would if you waited until you’re 70. If you wait till 70 and God for bid you die shortly there after all that money you paid in is kind of a waste.

Depending on your Health at 70 you may be on a downhill slide and the extra money isn’t gonna do anything for you anyway other than pay medical/assisted-living costs.

 

[TPC]

I keep hearing that it won’t be around much longer.

I've been hearing that for 50 years.

 

[hallett21]

I've been hearing that for 50 years.

I was just messing around.

I’d take it early and invest. You’ll make up the difference and be ahead vs waiting.

 

[TPC]

Does Suzy Orman mention you'll be paying Medicare?

Remember:

You'll be paying Medicare either deducted from your Social Security or you mail a check each month. (I do both)
From the Social Security Website:
"Social Security Administration will automatically sign you up at age 65 for parts A and B of Medicare. (Medicare is operated by the federal Centers for Medicare & Medicaid Services, but Social Security handles enrollment.) You'll pay $499 each month in 2022. If you paid Medicare taxes for less than 30 quarters, the standard Part A premium is $499."

Make sure to get a PPO supplement (not HMO).
Those of us that survived Colon Cancer that had a PPO are normal, those with HMOs are pissing through their ass because of radiation treatments and are shitting 24/7 in a bag attached to their abdomen.

 

[Riverbottom]

My wife has not paid in as much as I have. My planner tells me to wait till full retirement which is 67 and 7 months. If I pass away first, my wife will be able to continue to get the larger benefits. Otherwise, I would probably have taken it at 62.

 

[Go-Fly]

I retired at 55. Get my first SSI check this month. I have one plan for it....spend. Dont waste time chasing the last dollar. Make a plan that you are happy with and go. Retirement is so much fun. It's even better if you planned for it and it sounds like you did.

 

[Ol Man]

I am 77 now and retired at 61 (wife 60). I started SS at 62. I think back then I had calculated a cross-over at 12-14 years.

 

[Gonefishin5555]

how old were your parents when they died? You are really just gambling with your life expectancy. I’d say to wait until full retirement age of 67 Unless you think you will die sorta young then take it asap.

 

[clarence]

If you take it early...

The monthly payment is less, but the total dollars you're likely to recieve over your lifetime is Way more.

?

Check out any SS break-even calculator.

 

[clarence]

If you don’t need it, take it early and invest it it will grow a hell of a lot more than it would if you waited until you’re 70.

?

A guaranteed return (8% from FRA) is hard to beat.

 

[monkeyswrench]

Here's my view, but I'm also years behind most here, take it early. Both my parents paid heavily into it. Didn't take it early...didn't really need it...but did not make it to the next check-in.

F' it! It's yours, you put it there. Try to burn through whatever they get you!

 

[hallettheck]

I took mine early....ENJOYING LIFE.....NOW, not later...it worked for me.
Good luck on decision...

 

[mjc]

I took mine early....ENJOYING LIFE.....NOW, not later...it worked for me.
Good luck on decision...

this. started at 62 and enjoying life now.

 

[Mandelon]

There are plenty of professionals who specialize in this decision, as the answer varies depending on your financial standing. I would suggest consulting someone who does this for a living.

No offense to all the capable financial experts on here.

 

[Go-Fly]

There are plenty of professionals who specialize in this decision, as the answer varies depending on your financial standing. I would suggest consulting someone who does this for a living.

No offense to all the capable financial experts on here.

Lol. I'm taking my private jet to Kino Bay next week to do some fishing.

 

[fmo24]

I took it at 62. partner and I retired at 59 Did pension and 401 draws and now added the SS. Life is good in retirement. We travel full time and have cut our expenses from when we worked and had a house.

 

[bilz]

Take it now. No guarantee on the financial stability of the country with all the biden bucks going out. Spend it and enjoy or save it for later. Buy an F 150 or a new prop.

 

[Flatsix66]

I'm in a similar position and timing as you, we have three CFPs that are adamant that we wait till 70. Our outlook for planning is that we are planning to not count on SS being there in the whole but it will be a nice bonus if it is.

 

[jetboatperformance]

Took it early , no regrets

 

[RandyH]

I read that the only way to save SS is to extend the retirement age, raise the income threshold limit, cut benefits. its not looking good. Too many people bailing out and getting on the SS band wagon. I would get on it now and not look back. My broader opinion is we should drift towards eliminating SS all together and teaching the younger generations to save and not depend on a Government pension plan. Meanwhile asking them to pay for those that are recieving. its a tuff nut to figure out. But when we can pass trillion dollar bills in the middle of the night, I think its time we make meaningful changes to our system. And that will probably mean some sort of means test for recieving your SS. You may not get it if you live above certain means. It won't be a fun debate.

 

[Heylam]

There are plenty of professionals who specialize in this decision, as the answer varies depending on your financial standing. I would suggest consulting someone who does this for a living.

No offense to all the capable financial experts on here.

You could get banned for that type of thinking.

 

[4czn10]

If you take it early...

The monthly payment is less, but the total dollars you're likely to recieve over your lifetime is Way more.

Until the breakeven point which is around 84-85. will I and SS be around that long?

 

[4czn10]

Seems like you are pretty set, do you need your SS if you retire at 62? If not wait to 70 to apply for it.

That's what I was going to do...but I'm worried there will be more changes coming down the line in SS that no one is telling us...

 

[4czn10]

If you don’t need it, take it early and invest it it will grow a hell of a lot more than it would if you waited until you’re 70. If you wait till 70 and God for bid you die shortly there after all that money you paid in is kind of a waste.

Depending on your Health at 70 you may be on a downhill slide and the extra money isn’t gonna do anything for you anyway other than pay medical/assisted-living costs.

Yea, 70 seem old, but all of a sudden I'm 61 and don't feel it! i like the investing it part, as long as it doesn't burn a hole in my pocket!

 

[Go-Fly]

That's what I was going to do...but I'm worried there will be more changes coming down the line in SS that no one is telling us...

If your holding out thinking it's going to get better and they are going to give you more, look who you are dealing with. It's a long list of government programs that end with the news story, we are going to grandfather the people already in but.....

 

[4czn10]

I took mine early....ENJOYING LIFE.....NOW, not later...it worked for me.
Good luck on decision...

I'm starting to lean that way...biggest concern is it will 2031 when I'm 70 and then there will be 3 years left before only getting 75%! or less!!

 

[4czn10]

Take it now. No guarantee on the financial stability of the country with all the biden bucks going out. Spend it and enjoy or save it for later. Buy an F 150 or a new prop.

Thanks! I guess if I take it early, and boat prices crash, I can get my go fast back!

 

[4czn10]

I'm in a similar position and timing as you, we have three CFPs that are adamant that we wait till 70. Our outlook for planning is that we are planning to not count on SS being there in the whole but it will be a nice bonus if it is.

So does that mean your leaning towards taking it early?

 

[4czn10]

I read that the only way to save SS is to extend the retirement age, raise the income threshold limit, cut benefits. its not looking good. Too many people bailing out and getting on the SS band wagon. I would get on it now and not look back. My broader opinion is we should drift towards eliminating SS all together and teaching the younger generations to save and not depend on a Government pension plan. Meanwhile asking them to pay for those that are recieving. its a tuff nut to figure out. But when we can pass trillion dollar bills in the middle of the night, I think its time we make meaningful changes to our system. And that will probably mean some sort of means test for recieving your SS. You may not get it if you live above certain means. It won't be a fun debate.

Wow! Didn't even think of a means testing. Very insightful! thanks!

 

[rivermobster]

Until the breakeven point which is around 84-85. will I and SS be around that long?

SS will be.

You? Better ask your wife!

 

[Flatsix66]

So does that mean your leaning towards taking it early?

70 is my plan at the moment. But could change to sooner if: 1. If for some reason my health declines and we expect shorter longevity or 2. Some financial disaster that depletes our nest egg.

 

[4czn10]

how old were your parents when they died? You are really just gambling with your life expectancy. I’d say to wait until full retirement age of 67 Unless you think you will die sorta young then take it asap.

Mom 79, Dad 83. Mom would have lived much longer except she was diagnosed with ALS. She was waterskiing at 78 and gone at 79. RIP Mom! So that kind of makes me think!!!

 

[4czn10]

SS will be.

You? Better ask your wife!

Now that's funny!

 

[LuauLounge]

I took it at full retirement age, rather than waiting. My viewpoint is the Govt won’t take benefits from the people receiving them but has no issue changing the rules for those not yet receiving them.

 

[TimeBandit]

I'm planning to wait until I'm 65 and I'm eligible for Medicare otherwise medical will take a big chunk out of whatever I receive at 62.

Of course in September when I'm 62 I could change my mind!

If I collect at 62 vs. 65 the balancing or break even point is age 75.

If I wait to 65 to collect and live to 85 I will collect $60,000.00 more between age 75 and 85 than if I start at age 62.

 

[530RL]

If you go to the SS website it will tell you exactly how much you get depending upon when you start taking it. Everyone is different.

I get 2,345 if I start taking it at 62 and 4,173 if I start taking it at 70.

Ignoring the time value of money and the taxes, by taking it at 62 versus 70, I would get 28,140 a year times 8 years or 225,120 dollars.

But I would get 1,828 a month less than if I waited until I was 70.

At 1,828 a month, the 225,120 dollars received starting at 62 takes about 10.26 years to make up at the higher 4,173 rate. So I have to live at least to 80.26 for it to make sense to wait until I am 70. Assuming a time value of money as I am receiving the dollars in earlier years by taking it at 62, the breakeven would take even longer.

So the question naturally becomes, how long do you think you are going to live and what is the difference you will receive off the SS web site?

 

[clarence]

My viewpoint is the Govt won’t take benefits from the people receiving them but has no issue changing the rules for those not yet receiving them.

Age 55 is considered the cutoff where politicians normally don’t want change the rules for folks too close to retiring.

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[rivermobster]

If you go to the SS website it will tell you exactly how much you get depending upon when you start taking it. Everyone is different.

I get 2,345 if I start taking it at 62 and 4,173 if I start taking it at 70.

Ignoring the time value of money and the taxes, by taking it at 62 versus 70, I would get 28,140 a year times 8 years or 225,120 dollars.

But I would get 1,828 a month less than if I waited until I was 70.

At 1,828 a month, the 225,120 dollars received starting at 62 takes about 10.26 years to make up at the higher 4,173 rate. So I have to live at least to 80.26 for it to make sense to wait until I am 70. Assuming a time value of money as I am receiving the dollars in earlier years by taking it at 62, the breakeven would take even longer.

So the question naturally becomes, how long do you think you are going to live and what is the difference you will receive off the SS web site?

The facts are...

There is a reason they pay you more to wait. Why? Cause they know they will pay you less!

The guberment ain't as dumb as the look...

 

[TCHB]

1. Wait
2. Draw out of IRA first (Helps with RMD later).

 

[clarence]

The facts are...

There is a reason they pay you more to wait. Why? Cause they know they will pay you less!

The guberment ain't as dumb as the look...

That's just not so.

SS is designed to be actuarial neutral (average lifetime benefits will be roughly equal regardless the claiming age).

If you can afford to though, and you live long enough, you'll come out ahead by delaying as long as possible.

 

[530RL]

The facts are...

There is a reason they pay you more to wait. Why? Cause they know they will pay you less!

The guberment ain't as dumb as the look...

Unfortunately, government is not that smart.

It is purely math based upon the actuarial projections for life expectancy and an assumed future return.

They are agnostic if one takes it early or late. They make their annual assessment, and adjust the numbers accordingly so the pool of retirees meets the assumptions. It is all math driven without emotion or care.

 

[steamin rice]

I have a while to go before I am there, but at this point I plan to take it as soon as I can. It will mean less $$ per month, but The breakeven point is so long that I would rather get the extra $$ earlier.

 

[bowtiejunkie]

I took it at 62. partner and I retired at 59 Did pension and 401 draws and now added the SS. Life is good in retirement. We travel full time and have cut our expenses from when we worked and had a house.

Since you retired at the age I plan to (I’m 45 now), did you research whether quitting paying into the system before 62 had any effect on your monthly payout? Just curious as of the reading I’ve done, I haven’t exactly run across the answer.

 

[cofooter]

You guys realize that you can only earn a small amount of money while collecting social security otherwise the amount of your SS check goes down. If it is a matter of not wanting to work anymore that is one thing, but if you plan on continuing to work AND collect your full Ss check you're going to be disapointed

 

[2Driver]

You guys realize that you can only earn a small amount of money while collecting social security otherwise the amount of your SS check goes down. If it is a matter of not wanting to work anymore that is one thing, but if you plan on continuing to work AND collect your full Ss check you're going to be disapointed

True, it it is a sliding scale up each year how much you can earn and not get dinged and the penalty eventually goes away. It is only wage income not investment income.

Schwab does a good job covering stuff. We both took ours at 62 and don’t really need it so it’s just more fun money or a cost of living increase, but that’s us.

Charles Schwab