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Old 03-28-2015, 01:45 PM
 
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Old 03-28-2015, 01:46 PM
 
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to what ?
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Old 03-28-2015, 01:48 PM
 
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I'll try the old fashioned way:

Here's effects of early or Delayed Retirement on Retirement benefits...

Early or delayed retirement
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Old 03-28-2015, 01:50 PM
 
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it changes by the month to. ss has a chart with the exact multiplier to use off your full.
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Old 03-28-2015, 01:53 PM
 
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I guess another possible benefit of waiting is in this possible "conservative" approach the recipient will also get the CPI increases whereas not a guarantee with equities, etc.
( Not that I've decided). I've gone fron thinking I'd take it early to now seeing some upside in waiting....especially since I can basically live off the pension...(close).
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Old 03-28-2015, 02:11 PM
 
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the flip side is that social security has a hold harmless law when it comes to medicare.

when medicare rates go up if you are collecting ss already , the medicare increase can never be more than your cola adjustment.

if you are delaying then you do not fall under the protected law and your increase is unlimited.

i think if you are collecing , medicare payments for part b come off the top of your check pretax but if you have to pay them on your own they are paid with after tax money.

if your medical is more than 10% of your agi then you can list it as part of your itemized deductions but you still have to clear the standard deduction.

am i correct about part b coming out pretax ? i am not sure .

Last edited by mathjak107; 03-28-2015 at 02:26 PM..
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Old 03-28-2015, 02:47 PM
 
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Quote:
Originally Posted by mathjak107 View Post
the flip side is that social security has a hold harmless law when it comes to medicare.

when medicare rates go up if you are collecting ss already the medicare increase can never be more than your cola adjustment.

if you are delaying then you do not fall under the protected law and your increase is unlimited.
Medicare is not sustainable. The program already spends 2x what it takes in with payroll taxes and premiums. The Federal government is borrowing money to make up the difference and that can't continue much longer. Medicare spending is about 3.5% of GDP today. It projects to be 5.3% of GDP 20 years from now. I'm 8 years 2 months from Medicare eligibility. I expect a massive overhaul to the program sometime in the next decade. Massive cuts in coverage along with massive hikes in Medicare payroll taxes. There cannot possibly be a safe harbor because the entire country is going to feel the pain.

I'm planning to use Social Security as my insurance that I outlive my savings so I'm going to defer taking it until age 70. I'll have 35 years of maxed out contributions when I retire. My spreadsheet says my benefit deferring to age 70 would be $41,412.00 and will adjust for inflation. Even if my 401-K & IRA portfolio completely collapses, I can still cover my cash flow with that.
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Old 03-28-2015, 03:05 PM
 
Location: Colorado Springs
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Originally Posted by GeoffD View Post
Medicare is not sustainable. The program already spends 2x what it takes in with payroll taxes and premiums. The Federal government is borrowing money to make up the difference and that can't continue much longer. Medicare spending is about 3.5% of GDP today. It projects to be 5.3% of GDP 20 years from now. I'm 8 years 2 months from Medicare eligibility. I expect a massive overhaul to the program sometime in the next decade. Massive cuts in coverage along with massive hikes in Medicare payroll taxes. There cannot possibly be a safe harbor because the entire country is going to feel the pain.

I'm planning to use Social Security as my insurance that I outlive my savings so I'm going to defer taking it until age 70. I'll have 35 years of maxed out contributions when I retire. My spreadsheet says my benefit deferring to age 70 would be $41,412.00 and will adjust for inflation. Even if my 401-K & IRA portfolio completely collapses, I can still cover my cash flow with that.
I'm doing the same. The $41K per year SS survivors benefit is adjusted for inflation and is an annuity.

My wife's grandmother lived to 103. If my wife does the same she'll have an income that she cannot outlive and she won't have to figure out how to invest. She'll thank me for that.

I plan to use my own 401K funds to generate income between my planned retirement at 67 and my file and suspend until age 70 SS. By using those taxable funds prior to turning on my own SS, I'll avoid having my SS taxed. At 70, I'll use other savings from my bank accounts that were already taxed for spending above our combined $58K SS income.

Life is sweet!
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Old 03-28-2015, 03:37 PM
 
Location: OH>IL>CO>CT
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Default Part B payments not pre-tax

Quote:
Originally Posted by mathjak107 View Post
the flip side is that social security has a hold harmless law when it comes to medicare.

when medicare rates go up if you are collecting ss already , the medicare increase can never be more than your cola adjustment.

if you are delaying then you do not fall under the protected law and your increase is unlimited.

i think if you are collecing , medicare payments for part b come off the top of your check pretax but if you have to pay them on your own they are paid with after tax money.

if your medical is more than 10% of your agi then you can list it as part of your itemized deductions but you still have to clear the standard deduction.

am i correct about part b coming out pretax ? i am not sure .
Looking at my SSA-1099 form, where I am having Medicare Part B deducted, the deduction is not pre-tax. The IRS reportable income (Box 5) is the full amount of the SS benefit payment.

Part B payments can be an itemized deduction on 1040 Schedule A, subject to the 7.5% "haircut"
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Old 03-28-2015, 03:45 PM
 
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Quote:
Originally Posted by mathjak107 View Post
my situation is different because we do have more resources than we need and a 7 digit ira to deal with and the rmd's are brutal.

if we needed more money i would have delayed but the more i run the numbers and look at those rmd's grow the more i think the lower the ss and longer i get it instead of bigger payments over less time the better.

you may be very different. you may not have the level of rmd's we do.
My husband has significant and growing retirement resources in his DB plan. My IRA went into a Roth several years ago.
We were FRA at 66--and didn't apply because of taxes and because of his earned income.
His CPA suggests he wait until 70.
He is getting his CPA to check some rules/regs about moving income producing resources used to paid himself a salary into a FLP and going from earned income to SS and savings before RMDs and trying to move/convert some 401K money into his Roth more tax efficiently. I have teacher's pension and was able to shelter my spousal pension from the Offset provision when I retired so that peaked at 66--can get 6 mo lump sum though for missed checks when I do apply.
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