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Old 12-24-2015, 01:16 AM
 
Location: Central Massachusetts
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Quote:
Originally Posted by Caltovegas View Post
I say run the numbers at 62 and every year after that. Get free as soon as you can.
run your numbers any time. All of us need to keep in mind that we are in charge of our own retirement. You should be looking at your retirement plan yearly once you reach that proverbial 5 year window. Probably bi-annual before that. I am not saying don't look at your retirement funds annual. Just your plan for retirement if you have one. Talk it over with family (spouse) to see if you both are on the same sheet of music.

Quote:
Originally Posted by mathjak107 View Post
get free ? when you stop working can be a totaly different decision then when you take ss

Absolutely! Our plan is to retire and not take SS for a number of years. Of course we have resources that will provide us with the necessary income but.... for instance. I am 58 and will retire in 3 months 1 day 12 hours 58 minutes (but who is counting). I am planning to file at FRA and decide then if I will suspend (if available still). Wife is 6 months younger and will be doing the same though I think she is planning to continue to work to 62. Again as I said we now openly talk about planned retirement and have for the last 3 years. Prior to that it was bi-annual because I could have been force into retirement based on a number of factors.
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Old 12-24-2015, 03:39 AM
 
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i was going to file by 65 , im am 63 but the new plan for ss we got from fidelity's new tool has me reconsidering delaying the filing .

in our case my wife is collecting since she was 62 and she will suspend at fra in august .

she is 2 years older then me . so when she hits 70 she will resume , i will file for restricted application at 67 and 10 months on her benefit .

then at 70 i file .

it is rather complex but can add quite a bit more dollars and less market dependency . if i do delay i have to think about how i want to invest the short term bridge money while i delay ,.
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Old 12-24-2015, 04:59 AM
 
71,563 posts, read 71,730,589 times
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Quote:
Originally Posted by loves2read View Post
BUT if you elect the lump sum, you reverse your benefit to the earliest monthly amount comprising the lump sum...not the largest/most recent

I thought the lump sum option based on file and suspend would lapse in April--
If you are age-eligible (62 in 2015) then you always carry forward the option to file/suspend and opt for the 6mo lump sum?
i didn't get an answer back from fidelity but i did happen to notice that kitces addressed the issue of getting the lump sum back to fra . the 6 month retro is a different issue then the lump sum back to fra . .

according to kitces's view the lump sum is dead .

" the strategy to file-and-suspend for benefits individually, with the plan/option to reinstate them like (and get prior benefits repaid retroactively back to full retirement age) appears to be ended, as the new Social Security Act 202(z)(1)(A)(ii) limits a resumption of benefits in the next subsequent month or at age 70, but no longer contains the option to resume benefits in a prior month (as previously existed under POMS GN 02409.130)


mike piper also has the same view "

What else is changing?
The second big change deals with suspension of benefits, said Piper. Specifically, it says that, for people who suspend benefits more than 180 days after enactment of the bill, the following things will be true:

There will no longer be the option to retroactively unsuspend benefits (i.e., get a lump sum for benefits that would have been receiving during the period of suspension if you decide to unsuspend).
You will no longer be able to receive benefits on anybody else’s work record while your benefits are suspended.
Nobody else will be able to receive benefits on your work record while your benefits are suspended.



Currently, those with suspended benefits can elect at any time to request payments retroactive back to their filing date.

For example, if a man filed for Social Security at age 66 and then suspended his payments, his benefits would grow at a rate of 8 percent per year. However, if the man came down with a life-threatening illness at age 68, he could retroactively unsuspend his benefits. He would lose the 16 percent bump in pay he should have received from deferring payments, but Social Security will send a lump sum payment for the past two years. Future monthly payments would be made at the same rate the man would have received had he started benefits at age 66.

“This has been a very valuable strategy for someone who had a change in health or financial status .

It allowed people to hedge their bets by establishing a filing date for Social Security. They could defer their monthly benefit amount and let it grow but also rest assured they could receive that money retroactively if needed.

Under the new rules, Social Security beneficiaries can no longer retroactively unsuspend benefits. In the example above, if the man needed to start receiving benefits at age 68, he could still unsuspend his filing. He would not receive a lump sum payout for the previous two years, but he would begin to receive his monthly payments at a higher rate, thanks to the deferral.

Last edited by mathjak107; 12-24-2015 at 05:11 AM..
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Old 12-24-2015, 07:37 AM
 
Location: Central Massachusetts
4,800 posts, read 4,847,776 times
Reputation: 6379
Quote:
Originally Posted by mathjak107 View Post
i didn't get an answer back from fidelity but i did happen to notice that kitces addressed the issue of getting the lump sum back to fra . the 6 month retro is a different issue then the lump sum back to fra . .

according to kitces's view the lump sum is dead .

" the strategy to file-and-suspend for benefits individually, with the plan/option to reinstate them like (and get prior benefits repaid retroactively back to full retirement age) appears to be ended, as the new Social Security Act 202(z)(1)(A)(ii) limits a resumption of benefits in the next subsequent month or at age 70, but no longer contains the option to resume benefits in a prior month (as previously existed under POMS GN 02409.130)


mike piper also has the same view "

What else is changing?
The second big change deals with suspension of benefits, said Piper. Specifically, it says that, for people who suspend benefits more than 180 days after enactment of the bill, the following things will be true:

There will no longer be the option to retroactively unsuspend benefits (i.e., get a lump sum for benefits that would have been receiving during the period of suspension if you decide to unsuspend).
You will no longer be able to receive benefits on anybody else’s work record while your benefits are suspended.
Nobody else will be able to receive benefits on your work record while your benefits are suspended.



Currently, those with suspended benefits can elect at any time to request payments retroactive back to their filing date.

For example, if a man filed for Social Security at age 66 and then suspended his payments, his benefits would grow at a rate of 8 percent per year. However, if the man came down with a life-threatening illness at age 68, he could retroactively unsuspend his benefits. He would lose the 16 percent bump in pay he should have received from deferring payments, but Social Security will send a lump sum payment for the past two years. Future monthly payments would be made at the same rate the man would have received had he started benefits at age 66.

“This has been a very valuable strategy for someone who had a change in health or financial status .

It allowed people to hedge their bets by establishing a filing date for Social Security. They could defer their monthly benefit amount and let it grow but also rest assured they could receive that money retroactively if needed.

Under the new rules, Social Security beneficiaries can no longer retroactively unsuspend benefits. In the example above, if the man needed to start receiving benefits at age 68, he could still unsuspend his filing. He would not receive a lump sum payout for the previous two years, but he would begin to receive his monthly payments at a higher rate, thanks to the deferral.

Knowing that the lump sum change is happening changes things a bit but not much on our end. We both will wait for FRA even though neither of us will be working (we might be working part time for sanity) full time once DW retires. I certainly will not be working a full time position anyway. We will decide if suspending SS payments is the right thing for us then.
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Old 12-24-2015, 07:41 AM
 
71,563 posts, read 71,730,589 times
Reputation: 49168
yeah the lump sum was a nice option if health turned ugly .

i was sad to see the pay back option go , where you could get checks an pay it bck if you lived . that was an amazing deal when you figured in the free roth conversions it would let you do .

one of the reasons it was stopped was that info about using the negative income from the payback was starting to get known .

remember , i divulged that ability years ago on city data . it was a secreat pretty much known only by the most shrewdest .
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Old 12-26-2015, 08:01 AM
 
5,227 posts, read 2,315,293 times
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Quote:
Originally Posted by Perryinva View Post
I've known 2 people that went through similar situations of unusually high income at the wrong time & both appealed the premium amount (both because they also sold property, btw), and both won, and had the premium reduced.

I've mentioned the actual amount vs % issue before. People LOVE to talk about the percentage increase/decrease of things, difference between early and late filing, but the absolute amount is what matters. It makes little difference if your early is $103/mo, and delaying to FRA means it goes up to $147/mo. Percentage it's great, but its ONLY $44/mo or $528/yr. So the difference in SS would be $1236 to $1764. Big whoop. If you have any decent income elsewhere, then, who cares? Its not a deal breaker. But if you are maxed out on SS contributions, and early at 62 is $1980, and FRA is $2800, now we're talking $820/mo or $9840/yr...certainly a substantial amount, that only gets more substantial as COLA and compounding take affect. It means $23760 or wait for $33600, and COLA increases and compounding quickly take that $33600 in to substantial income in 10- 15 years. (All amounts in todays dollars! When looking at future amounts, the difference psychologically "looks" more impressive, $23760 now or $37,100 later, vs $1236 now and $1948 later!!)
Quote:
1. the absolute amount is what matters
2. When looking at future amounts, the difference psychologically "looks" more impressive,
3. that only gets more substantial as COLA and compounding take affect.
Among Friends we've been discussing this and looking at variables, as we will as a group of individuals, turn 62 this year.

Some of us have other income, some don't. I like what the person said in a previous post, about the Medicare premiums cost difference. One of the Sheriff's where I work said, his wife received SS and the Medicare cost was a few dollars more than her benefits. she resulted to have a negative with regards to cash. he said he retired from the Police Dept years ago, he had to return to work, most of the Sheriffs at the job, are retired former police officers, each with a story of how they had limited choice and needed to go back to work, many of these guys are now near age 70, two is older than 70

Last edited by Chance and Change; 12-26-2015 at 08:19 AM..
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Old 12-26-2015, 08:16 AM
 
5,227 posts, read 2,315,293 times
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I made the choice to take pension at 55, which in the middle of the crash seemed like a good and needed idea, as I looked at the difference of what I'd get if I'd waited is substantial. But, it is what it is at this point. It's good info posted about taking money early and taking it later. Currently, I plan to take it later, because I want to keep working, and I make far more than the allowable income if SS is taken at 62. My concern is "health', to keep healthy to get in 5 or 6 more years because this jobs takes 10 yrs to be vested to get 1/2 of income. I was recently offered a higher position which would double or triple my income, I want to take advantage of that, so the pension check looks better. This job does not deduct SS, so there is no more money going into SS, and the amount figure of my SS at age 67 looks goods, but I can't digest the amount of decrease I would get, if I take it at 62, and I can't fathom the limits on earning, both of which would cost me tremendously if I took SS at 62.

I've lived here for 10 yrs, If I'd gotten this job immediately after moving here, I could retire at 62 with two pension checks and take SS at 62.

For me - Nailing it at this point would be right at age 67
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Old 12-26-2015, 08:53 AM
 
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How much fixed income do you need/want can use etc. Especially for those with survivor benefit pensions and nest eggs. The higher the amount the more SS flexibility you have. Also does each spouse have their own SS that other than survivor is greater than anything they could get filing long term on their spouses. That is part of what the new regs are trying to get at.
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Old 12-26-2015, 08:55 AM
 
30,102 posts, read 47,335,107 times
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Quote:
Originally Posted by Chance and Change View Post
I made the choice to take pension at 55, which in the middle of the crash seemed like a good and needed idea, as I looked at the difference of what I'd get if I'd waited is substantial. But, it is what it is at this point. It's good info posted about taking money early and taking it later. Currently, I plan to take it later, because I want to keep working, and I make far more than the allowable income if SS is taken at 62. My concern is "health', to keep healthy to get in 5 or 6 more years because this jobs takes 10 yrs to be vested to get 1/2 of income. I was recently offered a higher position which would double or triple my income, I want to take advantage of that, so the pension check looks better. This job does not deduct SS, so there is no more money going into SS, and the amount figure of my SS at age 67 looks goods, but I can't digest the amount of decrease I would get, if I take it at 62, and I can't fathom the limits on earning, both of which would cost me tremendously if I took SS at 62.

I've lived here for 10 yrs, If I'd gotten this job immediately after moving here, I could retire at 62 with two pension checks and take SS at 62.

For me - Nailing it at this point would be right at age 67
Some of your comments are confusing to me---
You claim to be taking a pension at 55--
But from your comments I assume you have returned to work at different job and are also getting wages/income from that job as well as your pension???

Re your comment about a job that does not deduct for SS wages--

Please be forwarned that unless this is an off-shore/foreign employment which might have special rules I am not familiar with, there ARE/CAN BE penalties against SS benefits when you have a pension or 403b retirement account withdrawals from non-SS wages...
THat pension/403b money can also affect a spousal benefit you might think you are also entitled to claim--
Likely YOUR pension would be higher from what you say than any spousal benefit--
But have you checked about any penalty from your non-SS pension against your SS benefit???

I have that penalty against my own SS benefit because of my teacher retiremen pension...
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Old 12-26-2015, 09:57 AM
 
5,227 posts, read 2,315,293 times
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Quote:
Originally Posted by loves2read View Post
Some of your comments are confusing to me---
You claim to be taking a pension at 55--
But from your comments I assume you have returned to work at different job and are also getting wages/income from that job as well as your pension???

Re your comment about a job that does not deduct for SS wages--

Please be forwarned that unless this is an off-shore/foreign employment which might have special rules I am not familiar with, there ARE/CAN BE penalties against SS benefits when you have a pension or 403b retirement account withdrawals from non-SS wages...
THat pension/403b money can also affect a spousal benefit you might think you are also entitled to claim--
Likely YOUR pension would be higher from what you say than any spousal benefit--
But have you checked about any penalty from your non-SS pension against your SS benefit???

I have that penalty against my own SS benefit because of my teacher retirement pension...
I take the pension from a job I worked for 28 yrs, who outsourced and turned our pension over the Pension Guarantee company.
I have not applied for any SS benefits. (Even if I'd been able to get this job 10 yrs ago, and retired, between the pension check I already get, and the pension this job would provide, It would have caused a negative against my SS at age 62, and I'd suffer a penalty.) currently it will work out, as long as I can stay healthy and work to get the 10 yrs, and reach age 67 about the same time, then I can get all 3 checks without penalty.

I am not sure but IF I were to try to draw SS at age 62, It is likely that the pension amount I currently get would count as part of the 15K earning limit, and therefore; say for example, I got 10k pension from a previous job, I'd only be able to earn 5K a year between the age of 62 and 67, and anything over the total of 15K income would cause a dollar for dollar penalty against my SS pension.

I have to wait until I'm 67, when the limit on earning does not negatively impact SS pension. It does not make sense for me to throw away the years I have recently worked on this job, when I only need to do 5-6 more to get some pension benefit from it. If I stop work before 10 yrs, I will only get a lump sum check of the amount I have contributed to the Pension Program.

Another concern is, "Tax', even at age 67, in this state, Pension income allows the first $6000 to be exempt from tax, but anything above that is added to work or other earned income and is taxed accordingly. SS is not taxed, So, by the time I retire, at 67, between the two pension checks, only $6k will be tax exempt, the rest will be taxable, but the SS won't be taxable, so the amount I will be liable to pay tax on, tells me, that I need to work on having enough deductions to produce as close to "0" tax liability as I can.


I don't know how it works for people who have high value annuities which pay more than 15K a year, and take SS at age 62. I would think they'd suffer the "penalty" against their SS pension amount, simply because its considered additional income. If anyone has info on this, it would be appreciated, or I can research it to get clarity.

It would be great if the state does not tax the first $6k that the SS would also not count it, against the 15K earning limit, but I don't think it works that way. I think SS would automatically just count all received as income against the 15K limit, before they assess their penalty.

People who started in 2015, now have to wait 15 yrs to be vested. Thank goodness I was already in the system and have a few years under my belt, to avoid the extra 5 yrs being added to the period to be vested.

I work with people who have passed the age of 67, they work and earn their full salary, draw their pension, and the system has something called "drop" of which they can work, and have their pension payment go back into their pension fund, so when they "finally retire", they have more money.

I guess the fortunate thing is the issues and challenged suffered over years of what amount to losses, may result to be less burdensome on me, after the age 67. If I can stay healthy, after the age of 67, the only work I want to do, is projects and things that I create and work on. I've over the past 10 yrs been trimming and making sure to manage monthly expense, so I can have UN-obligated funds monthly, both now and when I retire.

Last edited by Chance and Change; 12-26-2015 at 10:44 AM..
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