U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Retirement
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
 
Old 01-18-2016, 12:41 PM
 
30 posts, read 21,013 times
Reputation: 34

Advertisements

I just turned age 64 and would like to wait till FRA at age 66 to collect social security. I would like to retire in about 4 months and and live on IRA and 401k money till age 66. Will this money from the IRA and 401k counts towards social security earnings till my FRA. When I went to social security's retirement estimator and entered estimated earnings of 30,000 a year till age 66 instead of last years earnings of 68000 the benefit was reduced at my FRA by $60 a month. Does this sound about right. Thanks for any insight on this.


Louis
Reply With Quote Quick reply to this message

 
Old 01-18-2016, 01:10 PM
 
Location: Close to an earthquake
890 posts, read 680,260 times
Reputation: 2390
Quote:
Originally Posted by loupow View Post
I just turned age 64 and would like to wait till FRA at age 66 to collect social security. I would like to retire in about 4 months and and live on IRA and 401k money till age 66. Will this money from the IRA and 401k counts towards social security earnings till my FRA. When I went to social security's retirement estimator and entered estimated earnings of 30,000 a year till age 66 instead of last years earnings of 68000 the benefit was reduced at my FRA by $60 a month. Does this sound about right. Thanks for any insight on this.


Louis
No it will not; only "earned income" counts from the sweat of your labors.
Reply With Quote Quick reply to this message
 
Old 01-18-2016, 02:09 PM
 
Location: NC
6,588 posts, read 8,032,390 times
Reputation: 13563
And yet Medicare is happy to count this (distributions from IRA) in estimating how much you need to pay. Nothing is obvious when it comes to taxes.

And most of us sweated to build up that 401K that later became our IRA.
Reply With Quote Quick reply to this message
 
Old 01-18-2016, 03:07 PM
 
Location: Florida
4,382 posts, read 3,724,411 times
Reputation: 4126
Quote:
Originally Posted by loupow View Post
I just turned age 64 and would like to wait till FRA at age 66 to collect social security. I would like to retire in about 4 months and and live on IRA and 401k money till age 66. Will this money from the IRA and 401k counts towards social security earnings till my FRA. When I went to social security's retirement estimator and entered estimated earnings of 30,000 a year till age 66 instead of last years earnings of 68000 the benefit was reduced at my FRA by $60 a month. Does this sound about right. Thanks for any insight on this.


Louis
As mentioned earned income only. But remember that your highest 35 years of earnings are used to calculate your benefit. Thus if you do not have 35 years you will have several years of zero so your benefit will be reduced. Note earlier years earnings are adjusted for inflation so it might take a little bit of work to see how stopping work before FRA will affect your benefits.
Reply With Quote Quick reply to this message
 
Old 01-18-2016, 05:35 PM
 
Location: OH>IL>CO>CT
5,256 posts, read 8,446,434 times
Reputation: 7238
Quote:
Originally Posted by loupow View Post
I just turned age 64 and would like to wait till FRA at age 66 to collect social security. I would like to retire in about 4 months and and live on IRA and 401k money till age 66. Will this money from the IRA and 401k counts towards social security earnings till my FRA. When I went to social security's retirement estimator and entered estimated earnings of 30,000 a year till age 66 instead of last years earnings of 68000 the benefit was reduced at my FRA by $60 a month. Does this sound about right. Thanks for any insight on this.


Louis
Go back and plug in Zeros for those years, and see the effect. Only wages from which FICA taxes were taken count towards your "highest 35 years" of earnings.
Reply With Quote Quick reply to this message
 
Old 01-18-2016, 06:18 PM
 
Location: Ohio
19,992 posts, read 14,280,686 times
Reputation: 16159
Quote:
Originally Posted by rjm1cc View Post
Note earlier years earnings are adjusted for inflation...
Social Security does not adjust for "Inflation."

However, Social Security does index earnings against average wages to reflect an increase in Standard of Living.
Reply With Quote Quick reply to this message
 
Old 01-19-2016, 12:10 AM
 
6,908 posts, read 7,315,105 times
Reputation: 9821
In your case OP you will have more than 35 years of earnings though – if you’ve been working since or before age 29.
Keep in mind also that while many people’s “highest earning” years – are their “last” working years, that’s not always the case.

I also plan to retire at 65 – but not collect until my FRA of 67. So my last two years before filing, I won’t have earned income. (If it turns out that’s what I end up doing)

Many of my co-workers practically kill themselves working OT the last 1 or 2 years they work, THEY SAY -- to bump up their Soc . Sec.
But I’ve read that that OT for only 1-2 years won’t bump up the Soc Sec. that much...so while, yes, you’re earning that much for working the OT -- I wonder how much it’s really worth in Soc. Sec. to do that.
Reply With Quote Quick reply to this message
 
Old 01-19-2016, 06:11 AM
 
30 posts, read 21,013 times
Reputation: 34
Thanks for all the replies, they are of great help and it is what I expected if I don't work in my 65th year than the benefit will take a little bit of a reduction. Oh well maybe a little part time job will make the hit not so bad.
Thanks...
Reply With Quote Quick reply to this message
 
Old 01-19-2016, 08:29 AM
 
Location: Central Massachusetts
4,800 posts, read 4,862,845 times
Reputation: 6379
Quote:
Originally Posted by loupow View Post
Thanks for all the replies, they are of great help and it is what I expected if I don't work in my 65th year than the benefit will take a little bit of a reduction. Oh well maybe a little part time job will make the hit not so bad.
Thanks...

You might be surprised how little of a reduction you will get. Many here have mentioned how surprised they were that even if they had not worked in a year or two prior to collecting how little of a difference from the estimate on SS website to the actual numbers they got once benefits were paid out.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Retirement
Follow City-Data.com founder on our Forum or

All times are GMT -6.

2005-2019, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top