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Will having the money from social security at 62 change how you live your life? If delaying means extra frugality that will cause you to enjoy life less, this is a consideration that should be factored in. In the converse, if your other income is enough at 62 that social security will not make a difference in decisions......taking a trip, funding a hobby, enrolling in a class....then that is a different situation. For many, it is more than just net dollars.
if you read the above posts almost no one not working should delay ss if they cannot take their full retirement draw day 1 . it makes little sense . if you have to wait 8 years to spend more because you cannot lay it out up front , than delaying should not be an option , you cannot afford to delay .
if you read the above posts almost no one not working should delay ss if they cannot take their full retirement draw day 1 . it makes little sense . if you have to wait 8 years to spend more because you cannot lay it out up front , than delaying should not be an option , you cannot afford to delay .
That's not true at all. Posters are making arguments for both sides, and in many cases, delaying makes sense. This is particularly true if 1) you have adequate resources to live as comfortably as you want without SS and 2) have a family history of longevity.
Let's say someone has $700,000 in her IRA, is currently 66, and both parents still alive in their 90s. After accounting for the earnings generated by her IRA, she needs to "dip into principal" by $30,000 a year, meaning she will have drawn down the IRA by $120,000 or so over the "delayed" four years. She will still have $600,000 in retirement savings when starting SS at 70, yet have locked in an SS payment of more than $3,000 - rather than the $2200 she would have gotten at 66 - and can now cover over all basic necessities out of the higher SS payment.
For those with enough savings to live well without SS, delaying is the less risky choice.
How so? He's saying that people who no longer work should NOT delay, and I just showed how there are certainly instances in which delaying makes sense - for those who don't need the early SS money to maintain their lifestyle and who are likely, given their genetics, to live well into their 90s.
Reducing one's IRA balance by 15% in exchange for guaranteed income that will cover all basic expenses for what is likely to be another 20+ years of life is the most risk-adverse choice.
i said no such thing . i said people who don't work should not delay if they cannot safely layout the ss money up front . it makes little sense to delay if you have to wait 8 years to spend a penny more . that makes no sense and they really can't afford to delay . if they have to leave themselves dangerously low on money delaying they should not delay .
delaying is really a choice for those who can take their full draw day 1 . the make up of their income just shifts from mostly their portfolio early on to mostly ss down the road but the draw rate stays consistent.
delaying just shifts them from more market dependent to more longevity dependent .
the only exception would be those NOT LIVING ON THEIR PORTFOLIO'S . THEY HAVE PENSIONS THAT COVER EVERYTHING . WHEN SS KICKS IN IT WILL BE FUN MONEY IF THEY LIVE LONG ENOUGH .
that is quite different from what you think i said .
Last edited by mathjak107; 05-30-2018 at 08:04 AM..
exactly!!!!!!!!!!!!!!!!!! you have to wonder if posts are read before disagreeing
I’m curious where you stand on this:
My age 70 Social Security check will be $43,524 in 2018 dollars. Make me 62. Make my IRA balance $400k. Assume it’s invested in something safe that tracks inflation. I pull out $50k per year. I’m paying taxes on $38k after the $12k standard deduction. 12% bracket money. Say I live somewhere with low or no state income taxes at that income level. I’m spending about $45k per year. At age 70, I start collecting my COLA protected Social Security check and have a trace amount left in my IRA account that rounds it up to that same $45k.
You’ve written a number of times that you wouldn’t spend the IRA to zero. From a worst case analysis point of view, spending it to near zero is the most conservative thing to do since you get the inflation protection for life. My girlfriend has similar career high income with a slightly lower Social Security check coming. Survivor benefits aren’t a consideration. We would be living on what would be a mostly tax free combined $80k+. No RMDs triggering the tax torpedo. I don’t have to sweat a big market correction and sequencing problem.
I have other assets so my numbers are better than that but I don’t see the problem with zeroing out my tax deferred portfolio to bridge myself to age 70.
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