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Old 01-31-2015, 02:43 PM
 
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Quote:
Originally Posted by NHartphotog View Post
Here's one tidbit that I came across on a CPA site: Be very careful about holding off on taking your SS benefits until age 70. One very frugal woman that had scrimped and saved her whole life when to a CPA, who told her to wait until age 70 to take her SS benefits, in order to get a higher amount. She lived like a pauper and eventually made it to age 70.

Then, she found out that her higher SS benefit was JUST ENOUGH to disqualify for her many public assistance programs that would have helped her immensely with her health problems. So she got her pitiful SS monthly benefits, but lost everything she had saved in short order, and spent her entire LIFE in poverty.

I suggest taking your SS benefits as early as possible, just to avoid the near-certainty of either dying before getting anything, or getting your benefits reduced over time as the insolvency of the Ponzi-Scam SS system forces government to rob the Baby Boomers of a "retirement plan" they've paid for twice over already.
On the other hand millions of folks are enjoying a much more financially secure retirement because they waited until 70.
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Old 01-31-2015, 05:56 PM
 
Location: Jamestown, NY
7,841 posts, read 7,339,474 times
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Quote:
Originally Posted by Curmudgeon View Post
I have to be honest - it's a curse - I find the entire premise of this thread distasteful just as I do the loopholes, schemes and contrivances permitting and used by the wealthy to pay taxes at a lower rate than the middle-class.

The country has to run on something and living in the "land of the free" is not free, nor should it be. Someone has to pay for the infrastructure, defense and "general welfare" of the people and to spend so much time and effort to dodge paying one's part is not attractive in my opinion. I see it as mere greed.
I agree. I have no problem with paying taxes, and personally, I prefer that those taxes be on income rather than on goods and services (sales taxes) or on real estate. Sales taxes have the greatest negative impact on those who have the least, and real estate taxes can force retirees out of their homes. Furthermore, neither accounts for a drop a person's ability to pay, which could very well happen when a spouse dies.
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Old 01-31-2015, 06:15 PM
 
Location: Jamestown, NY
7,841 posts, read 7,339,474 times
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Quote:
Originally Posted by NHartphotog View Post
Here's one tidbit that I came across on a CPA site: Be very careful about holding off on taking your SS benefits until age 70. One very frugal woman that had scrimped and saved her whole life when to a CPA, who told her to wait until age 70 to take her SS benefits, in order to get a higher amount. She lived like a pauper and eventually made it to age 70.

Then, she found out that her higher SS benefit was JUST ENOUGH to disqualify for her many public assistance programs that would have helped her immensely with her health problems. So she got her pitiful SS monthly benefits, but lost everything she had saved in short order, and spent her entire LIFE in poverty.

I suggest taking your SS benefits as early as possible, just to avoid the near-certainty of either dying before getting anything, or getting your benefits reduced over time as the insolvency of the Ponzi-Scam SS system forces government to rob the Baby Boomers of a "retirement plan" they've paid for twice over already.
I disagree. Taking SS at 62 instead of FRA results in a 25% penalty, so your $1600 a month SS benefit drops to $1200 a month or your $2000 a month benefit drops to $1500. If you hold off until you're 70, you get a much larger check. If your SS check is going to be 75-90% of your income, can you afford to throw away 25% or more of it?

Furthermore, if you worked at low paying or part time jobs or took time off to raise children or worked at a job not covered by social security for several years, working until at least FRA can significantly increase your SS benefit. In my case, working an extra 4 years increased my SS benefit almost 50% from what it would have been if I'd retired at 62.
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Old 01-31-2015, 11:56 PM
 
6,544 posts, read 3,099,024 times
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Wow this discussion took a strange turn.

But, in case anyone is interested, voluntary contributions to pay down the national debt are tax deductible.

In FY 2012, Americans contributed 7.7 million to this cause. The federal government spent that money in about 3 minutes. Somehow, I doubt Warren Buffet was among those who contributed despite how he loves to discuss how he pays less taxes as a percentage of his income than his secretary.

Voluntary Contributions To Pay National Debt Hit Record: 0.00005% of Total | CNS News
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Old 02-01-2015, 12:35 AM
 
2,702 posts, read 3,749,049 times
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Quote:
Originally Posted by rdflk View Post
What are some good strategies for keeping retirement income low enough to not pay taxes on Soc Sec.?

I was looking at the options of converting a 401K to a Roth IRA (ROTH IRA withdrawals are NOT counted toward the combined income for Soc Sec taxability). But it doesn't look like that makes sense....paying taxes on a half million....just to not pay taxes on 85 percent of my Soc Sec.

I just hate the idea of paying taxes on my Soc Sec.

One strategy could be to not work (earn) ....or pull from the 401k -- so much that to puts me over the earnings threshold. But I'm also not crazy about limiting my income just to avoid taxes.

So I'm looking for options for income that's not counted in the combined income calculation.
I don't pay any SS tax on my retirement payments....
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Old 02-01-2015, 02:43 AM
 
71,769 posts, read 71,875,234 times
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Quote:
Originally Posted by Linda_d View Post
I disagree. Taking SS at 62 instead of FRA results in a 25% penalty, so your $1600 a month SS benefit drops to $1200 a month or your $2000 a month benefit drops to $1500. If you hold off until you're 70, you get a much larger check. If your SS check is going to be 75-90% of your income, can you afford to throw away 25% or more of it?

Furthermore, if you worked at low paying or part time jobs or took time off to raise children or worked at a job not covered by social security for several years, working until at least FRA can significantly increase your SS benefit. In my case, working an extra 4 years increased my SS benefit almost 50% from what it would have been if I'd retired at 62.
survivor benefits are another big reason for waiting. there can be a cut of almost 1/2 from what a spouses fra would have been if the surviving spouse has to file early too.

coupled with the loss of one check, that can be a disaster for your spouse .

never ever listen to anyone who spews a blanket statement about when to take ss. it is likely the biggest financial decision in your life .

it has so many complexities to it involving taxes , surcharges ,spousal benefits ,rmds and survivor benefits that there is no one answer.

the 2 worst possible reasons for making a choice are what if a I die since dead is dead and the bigger question is what if you live . number 2 is take it early it is all going away - bull. that is about as likely to happen as you getting hit by lightening .

in fact waiting until 70 may have to be the choice for many.

waiting may be the only way they can afford to retire.

http://www.forbes.com/sites/janetnov...when-you-dont/
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Old 02-01-2015, 05:29 AM
 
Location: Grove City, Ohio
10,138 posts, read 12,400,312 times
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Quote:
Originally Posted by Linda_d View Post
I disagree. Taking SS at 62 instead of FRA results in a 25% penalty, so your $1600 a month SS benefit drops to $1200 a month or your $2000 a month benefit drops to $1500. If you hold off until you're 70, you get a much larger check. If your SS check is going to be 75-90% of your income, can you afford to throw away 25% or more of it?

Furthermore, if you worked at low paying or part time jobs or took time off to raise children or worked at a job not covered by social security for several years, working until at least FRA can significantly increase your SS benefit. In my case, working an extra 4 years increased my SS benefit almost 50% from what it would have been if I'd retired at 62.
People living in retirement, especially those who have lost a spouse, often find themselves living in poverty and a big culprit is taking benefits early.

I find it amazing 44% of the population opted to take retirment benefits at age 62 and when you look at it over half the population took benefits at age 63 or less.

A couple receiving just $2,048 had better have some savings and the thought of a widow(er) living on $1,214 makes me dizzy with fright.

What strikes me as well is the small number, appears to be less than 5%, of people who delay benefits past FRA.



I'm aproaching 67 and so want to put off taking benefits until 70 because if we do social security is really all we need as it will provide a combined benefit of over $4,300 tax free it's the same has having a $70,000/year full time job. With very few exceptions a couple with a mortgage free home and no debt should be able to live comfortably on proceeds from a $70k job in nearly any part of the county.

As an added bonus in another year my wife will be 66 at which time I will file and suspend so she receives 50% of my FRA benefit and we'll just save that.
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Old 02-01-2015, 05:32 AM
 
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your assumption about so many seniors taking it early based on that chart is not totally correct correct.

that chart above is skewed since it does not look at the total oasdi situation. many at 62 are on disability ss or they may get ss benefits for for minor children included in that number.

here is an actual breakout by age .

the amount of seniors that take early retirement benefits at 62-64 is far less than the overall number suggests in that bar graph . only 10% of seniors take it at 62-64 . the bulk is 65-74.

when you only look at the numbers for seniors the percentages are more in line with what you would expect.

" Beneficiaries, by Age, December 2010
About four-fifths of all OASDI beneficiaries in current-payment status were aged 62 or older, including 23 percent aged 75–84 and 10 percent aged 85 or older. About 15 percent were persons aged 18–61 receiving benefits as disabled workers, survivors, or dependents. Another 6 percent were children under age 18.

http://www.socialsecurity.gov/policy...t_facts11.html



Last edited by mathjak107; 02-01-2015 at 06:02 AM..
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Old 02-01-2015, 06:06 AM
 
Location: Jamestown, NY
7,841 posts, read 7,339,474 times
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Quote:
Originally Posted by mathjak107 View Post
survivor benefits are another big reason for waiting. there can be a cut of almost 1/2 from what a spouses fra would have been if the surviving spouse has to file early too.

coupled with the loss of one check, that can be a disaster for your spouse .

never ever listen to anyone who spews a blanket statement about when to take ss. it is likely the biggest financial decision in your life .

it has so many complexities to it involving taxes , surcharges ,spousal benefits ,rmds and survivor benefits that there is no one answer.

the 2 worst possible reasons for making a choice are what if a I die since dead is dead and the bigger question is what if you live . number 2 is take it early it is all going away - bull. that is about as likely to happen as you getting hit by lightening .

in fact waiting until 70 may have to be the choice for many.

waiting may be the only way they can afford to retire.

Big Retirement Mistake: Thinking You Know When To Claim Social Security, When You Don't - Forbes
Interesting article, mathjak. The thing that caught my attention was the 76% increase in SS benefits between taking SS at 62 and waiting until 70! That basically means that an individual or couple trying to get by on just SS could see a $2000 a month benefit at 62 increase to $3500 a month. That's serious money, especially if you do not have much income from other sources.
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Old 02-01-2015, 06:12 AM
 
71,769 posts, read 71,875,234 times
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working and waiting can be one powerful deal .

the difference between retiring at 62 and 70 for someone who can't afford 62 can be huge.

not only is the payment 79% bigger plus the colas but you are working and not spending down for 8 years. you may still be letting your portfolio grow as well as adding to your portfolio by delaying retirement.

that can make the difference between a stressful marginal retirement ,always sweating the next unexpected bill and a very comfortable one.
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