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Old 06-19-2016, 06:12 PM
 
71,507 posts, read 71,674,131 times
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if you are going to take a check when you are 70 just file 2-3 months before and tell them when to start .


if you are 69 and not waiting until 70 then wait until 2-3 months before the end of the year and tell them you want your first check after the 1st of the year .
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Old 03-09-2017, 11:55 AM
 
Location: Northern VA
511 posts, read 631,490 times
Reputation: 621
My 2016 earnings are now posted.

May 2014:
FRA (67) - $2,501
age 70 - $3,177
age 62 - $1,673

March 2015:
FRA (67) - $2,544
age 70 - $3,233
age 62 - $1,700

April 2016:
FRA (67) - $2,618
age 70 - $3,324
age 62 - $1,752

March 2017:
FRA (67) - $2,685
age 70 - $3,404
age 62 - $1,801


All four years were at max earnings.
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Old 03-10-2017, 09:25 AM
 
708 posts, read 501,901 times
Reputation: 1165
Quote:
Originally Posted by djplourd View Post
My 2016 earnings are now posted.

May 2014:
FRA (67) - $2,501
age 70 - $3,177
age 62 - $1,673

March 2015:
FRA (67) - $2,544
age 70 - $3,233
age 62 - $1,700

April 2016:
FRA (67) - $2,618
age 70 - $3,324
age 62 - $1,752

March 2017:
FRA (67) - $2,685
age 70 - $3,404
age 62 - $1,801


All four years were at max earnings.
Very interesting to see how much people are losing taking their SS at 62!
In your case $884 per month difference from your FRA and 62. Lots of money!
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Old 03-10-2017, 11:00 AM
 
29,772 posts, read 34,856,103 times
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Quote:
Originally Posted by mathjak107 View Post
you have to take it by 70 regardless . unlike pre 70 where you earn credits while delaying until years end ,once you hit 70 there are no more credits so it does not pay to hold out to years end . you will give up a check each month you wait and get no additional benefit .
If you can wait until age 70 you probably have a lot more going for you than the norm and your thinking process may well be different. I am probably going to apply next week but my benefits information is locked and I can only get it when I actually talk to the person handling my filing. I know we have talked and my thinking has evolved.
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Old 03-11-2017, 04:39 AM
 
Location: Central Massachusetts
4,800 posts, read 4,844,519 times
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Quote:
Originally Posted by Willistonite View Post
Very interesting to see how much people are losing taking their SS at 62!
In your case $884 per month difference from your FRA and 62. Lots of money!
Trouble with looking at just those numbers is you do not get the entire picture. Most people (that is just around 40%) have nothing and are in jobs that wear a body down. Collecting at 62 is absolutely crucial if they are going to make ends meet.

Another thing at looking at the numbers you don't take into account that over the time up to the break even point (80 - 84) taking at 62 or 66 brings in more money to the house than getting nothing and waiting until 70. That 15 to 22 year period can be long and cold.
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Old 03-11-2017, 04:48 AM
 
71,507 posts, read 71,674,131 times
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delaying ss allows higher spending and assuming average live expectancy ,especially for a couple a bigger balance at the end .

that is because ss has no sequence risk and no inflation risk so less powder has to be kept dry .

the break even point based on delaying and spending down a balanced portfolio is about 22 -23 years . however from that point on roi grows quickly , by age 90 you can have a 5% after inflation adjusted return . it would take the best outcomes in investing to rival what amounts to a gov't bond .

odds of 1 in a couple seeing 90 is almost 50% .

but delaying ss is not a choice for most who retire at 62 unless they are going to take a big pay cut pre ss and that makes little sense . you draw your full income day 1 by laying it out from your portfolio then when the bigger ss check cuts in part of that check refills what was layed out . you need the assets to safely delay and most people do not have those assets . so delaying is really not a choice for them .

delaying is not usually done by those who have the choice so they can get the biggest bucks . it is done to reduce the dependency on markets and rates for those who depend heavily on their portfolio's for their income.

delaying makes you more dependent for the 8 years you delay on your portfolio but then draws drop by a 69% bigger check plus colas for a life time .
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Old 03-11-2017, 05:50 AM
 
Location: RVA
2,164 posts, read 1,265,106 times
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Or they are working past 62, of course. A lot of people retire way before 62, underestimated inflation and over estimated how long their savings would last, and by 62 HAVE to take SS because that's the only income they can rely on and have now defined their standard of living. Typically, they are less financially educated than they think they are.

I watched this with my own parents. In his mid 30s, my father left his job as a carpenter working for a large commercial company to become a 3 person construction company, with one hourly employee. My mother had a very minimun salary, while my fathers was kept as low as their "accountant" said would not raise any red flags. They "hid" the rest of the money in the corporation so the tax bite would be less, which also means they paid less in to SS, and would define their lower benefit.

The corporation existed far longer than any actual construction work was performed and morphed into a rental real estate company, where they bought and fixed up and resold. So again, they minimized their SS premiums, to maximize their "savings", which "allowed" them to retire in their low 50's. They turned over the corporation accounts to Merrill Lynch to generate salaries for life. Fast forward to their 60s and bored with retirement, my mother keeps "borrowing" money from the corporation to "invest", which turns out to be gambling.

My uneducated father, when seeing the accounts reduced by her spending and the current recession, decides to file for divorce and cash in at the markets lowest point, before " the stock market crooks take it all".

Bottom line, they would not heed any investment advice to let the money work in conservative investments for income to add to or delay their SS. By the time my father hit 70, his only income is his Filed@62 SS, but with a paid off house, and maybe 200k in CDs, "in case I need to go to a home". He looked long at paying back his SS (around $100k and was still available then, but not now) to get the larger annuity at 70, but in the end wouldn't pull the trigger, because "what if I die before I break even".

No amount of math or common sense would make him understand that if he died, he would be dead and break even meant nothing. But if he lived, he would have an almost double income, inflation adjusted, for life, which was way more than needed, so be could actually build his savings the older he got. Now that he is 78, he regrets it.

Statements like "that 15 to 22 year period can be long and cold" make absolutely no sense what so ever. The longest you can wait is 8 years, from 62 to 70. From then on you enjoy an almost double inflation adjusted income for life. If you have "nothing coming in" while you wait, then you couldn't afford to delay in the first place, so why have an opinion on it? Its a fantasy.

The vast majority of people do not have enough saved to delay until 70, simply because the vast majority don't have at least $400k saved. People that delay are either working until they file, and often, their delayed SS will be their highest net income in their lives, or they have saved enough and are savvy enough to live off the savings at the same, or higher level, than they would have filing at 62. For life. It takes either discipline or a huge savings where the cost of buying that delayed annuity is not major, to live solely off savings.

The reward is a COLA adjusted income for life, at the by far lowest cost of any annuity ever available! Only your heirs take a hit if you die before filing, (just like if you bought an annuity) by the reduction in your savings. The reality for those that have enough saved to delay, is that if they die before filing, their heirs would still collect a huge inheritance earlier, or the spouse, a higher SS with a smaller savings. If they live a long life, then their heirs collect a typically larger inheritance later, thanks to that far larger income requiring much less of no withdrawals from savings to live.

In the numbers below, remember that the predicted age 70 SS numbers are in age 62 dollars. So if the OP collects his $1800 at 62, then at 70, he is still only at $1800, in age 62 dollars. Inflation raises that amount to maybe $2000, but the buying power is still $1800. At age 70, when he files, he does not collect $3400. He collects the COL adjusted amount. Which, if $1800 becomes $2000, then $3400 becomes $3775. So at age 70, his income is $1775 more than his $2000. $24,000 a year vs $45,300/yr. And in pure dollar amounts, every COL increase is that percentage larger. Each 1% increase at 70 means $240/yr for Mr Filed@62. It means $453 for Mr Filed@70.

Compared to withdrawal from a fully taxed tIRA, that extra $21,300 is not taxed by most states and in the 25% tax bracket, only 85% of it is taxed federally, AND you have reduced your RMDs at the same time. My estimates show that alone is worth an extra $3000 a year net in my pocket. Based on retirement calculators, that greatly increased SS income, allows me to have an extra $6000/yr more net income, while at the same time greatly reducing sequence of risk due to market downturns.

I'm absolutely not advocating that delayed filing makes sense for everyone. It makes sense for anyone that can afford it and expects to live past 77. It can provide security that you or the stock market can't screw up. You may not be really rich by investing, but you would never be poor.

Last edited by Perryinva; 03-11-2017 at 06:09 AM..
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Old 03-11-2017, 04:01 PM
 
Location: Coastal New Jersey
56,013 posts, read 54,523,130 times
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@Perryinva - That was a really helpful explanation. Thank you.
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Old 07-19-2017, 07:54 PM
 
1 posts, read 897 times
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Husband collecting social security. He is working full time and still paying into social security. When do they recalculate and increase. We are paying on a full time salary. I feel like they are giving in one hand and they are taking back in the other. We have been paying for 4 years now. He will also be 70 in November. He is looking to retire next year. Any info would help
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Old 07-19-2017, 09:32 PM
 
Location: OH>IL>CO>CT
5,230 posts, read 8,392,545 times
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Quote:
Originally Posted by Edegr10500 View Post
Husband collecting social security. He is working full time and still paying into social security. When do they recalculate and increase. We are paying on a full time salary. I feel like they are giving in one hand and they are taking back in the other. We have been paying for 4 years now. He will also be 70 in November. He is looking to retire next year. Any info would help
Here is what SSA says at:
https://faq.ssa.gov/link/portal/3401...ement-benefits

"Your benefits may increase when you work: As long as you continue to work, even if you are receiving benefits, you will continue to pay Social Security taxes on your earnings. However, we will check your record every year to see whether the additional earnings you had will increase your monthly benefit. If there is an increase, we will send you a letter telling you of your new benefit amount."
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