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 06-10-2019, 03:24 PM
 
71,463 posts, read 71,629,249 times
Reputation: 49027

Advertisements

Quote:
Originally Posted by hikernut View Post
Yes, an excellent point. This is part of the so-called "smile-shaped" spending pattern. First phase of retirement is higher spending due to travel and going to events. Second phase is lower spending... mostly staying at home but no serious health problems. Third phase is higher spending due to medical and/or LTC costs.

I've never seen anyone put this spending pattern to the test. It would be interesting to see the outcome.
the smile assumes that the subject has a pretty high ratio of discretionary to non discretionary spending... there is no where to stop spending when everything is pretty much a need
Reply With Quote Quick reply to this message

 
Old 06-10-2019, 03:56 PM
 
Location: OH>IL>CO>CT
5,225 posts, read 8,384,895 times
Reputation: 7180
Quote:
Originally Posted by reneeh63 View Post
I plan on retiring at 62 and collecting SS at 70 but my budget is the same for that whole period. I have a modest pension and will withdraw from my investments at a somewhat higher rate until 70 to make up for not taking SS. I certainly don't plan to get by on less and then live it up ONLY after 70!

If finances change, I can start collecting at any point - it's not an either/or decision except of course once you start collecting you can't stop. Well, maybe you can for a short period (with a payback) but they did change some of those regulations to make it tougher, IIRC.
Yes, you can still "suspend" payments, between FRA and age 70.

"If you have reached full retirement age, but are not yet age 70, you can ask us to suspend retirement benefit payments. "

See https://www.ssa.gov/planners/retire/suspend.html

Also there are some side effects:
- Medicare Part B no longer deducted.
- other's benefits, on your record, stop; ie, spousal
Reply With Quote Quick reply to this message
 
Old 06-10-2019, 04:13 PM
 
Location: Ohio
19,875 posts, read 14,217,545 times
Reputation: 16064
Quote:
Originally Posted by JayCT View Post
I was talking to a friend the other day about Social Security and when to take it. A family member is waiting until 70 to get the maximum benefit but my friend thinks that may not be best. He noted that you are losing 7 1/2 years of income by waiting and it would take a number of years to recoup that money.

His reasoning is this. At 62 1/2 he would get $1,900 a month from SS. At 70 the benefit would be $3,600. If he starts taking it at 62, he would earn a total of $171,000 in those years between retirement and 70 ($1,900 x 12 x 7.5 = $171,000). If he waits to 70, it will take over 8 years to break even and get that $171,000 back ($3,600 - $1,900 = $1,700; $171,000/$1,700 = 100.59 months or 8 years, 4 months).

He feels he should take that money and, assuming he does not need it, invest it to get a better return. Does this make sense? Is he missing something? Jay
No, it doesn't make sense. Your friend probably has some psychological issues.

The decision of when to apply for Social Security is not about screwing the government or screwing Social Security or "getting over on the government" or "getting your money back" or "maximizing your benefit" or "getting the best rate of return" or any other nonsense.

It's about being able to do what you want to do.

The key question is: "What do I want to do in retirement?"

Some people are blessed and have both an employer plan and personal investments, plus Social Security. Others have either an employer plan or their own investments, plus Social Security and some have only Social Security.

But, none of that matters, because at the end of the day, it all comes down to: "What do I want to do in retirement?"

Do you want to sit around and vegetate, or spend time with family, take cruises, and you can fly anywhere in the world for a cruise, or travel, or sell the home, buy an RV and travel, golf or spend time with your hobbies or whatever.

When you decide what you want to do, then you need to figure out how much money you'll need to that, and that's how you make your decision.

You'll probably want to factor in longevity and health status, as well as the health of your spouse.

At age 70, there's a 95% change I'll live another 17-25 years, so retiring at 62 is stupid for me, but that may not be true for others.

Anyway, the question your family member should be asking is, "What do I want to do and will I have enough money to do that?"
Reply With Quote Quick reply to this message
 
Old 06-10-2019, 04:25 PM
 
Location: Kountze, Texas
205 posts, read 31,420 times
Reputation: 201
Our Financial Planner has suggested I take it at 63 and DH 70 - it is to be 1/3 of my retirement - along with Pension and 401K - my estimates at 62 indicate my Pension will pay more more each month that I currently take home (not by much - $562) so I feel waiting until 63 should be fine. I don't want to take from my 401K until I have to. DH is already Retired and now that he is 58 he is under the earnings cap since 2018 when he turned 57 (Federal LE must retire at 57) and he gets a supplement that approximates what he was get from SSA at 62. I'm not sure what he is going to do when he is 62 and that supplement stops. - but we will be talking about it in the near future I'm sure.
Reply With Quote Quick reply to this message
 
Old 06-10-2019, 04:48 PM
 
Location: Gilbert, AZ
3,176 posts, read 1,954,741 times
Reputation: 3315
Quote:
Originally Posted by mathjak107 View Post
the smile assumes that the subject has a pretty high ratio of discretionary to non discretionary spending... there is no where to stop spending when everything is pretty much a need
Yes, of course.

Still begs the question... has anyone run some "smiles" through withdrawal testing? I could code it up myself, but no need to bother if someone's already run those numbers.
Reply With Quote Quick reply to this message
 
Old 06-10-2019, 05:08 PM
 
71,463 posts, read 71,629,249 times
Reputation: 49027
Quote:
Originally Posted by hikernut View Post
Yes, of course.

Still begs the question... has anyone run some "smiles" through withdrawal testing? I could code it up myself, but no need to bother if someone's already run those numbers.
Kitces did
Reply With Quote Quick reply to this message
 
Old 06-10-2019, 05:08 PM
 
Location: Jersey
2,296 posts, read 3,395,026 times
Reputation: 2031
If you have sound financials/good retirement savings, you're better off taking it early imo. I'm going to take it at 62 and use that money to travel and let more of my retirement savings work longer. By the time I'm 78 and maybe even 70, I imagine I won't be able to enjoy whatever additional income I would have by taking the delayed payment and will probably have less in my retirement savings (which I plan on passing down to my hypothetical children/grandchildren) due to having to dip into it more early in my retirement.

If you had to retire later due to not having good retirement savings, then taking it later becomes the better option.
Reply With Quote Quick reply to this message
 
Old 06-10-2019, 05:23 PM
 
507 posts, read 302,965 times
Reputation: 2492
Quote:
Originally Posted by TylerJAX View Post
If you have sound financials/good retirement savings, you're better off taking it early imo. I'm going to take it at 62 and use that money to travel and let more of my retirement savings work longer. By the time I'm 78 and maybe even 70, I imagine I won't be able to enjoy whatever additional income I would have by taking the delayed payment and will probably have less in my retirement savings (which I plan on passing down to my hypothetical children/grandchildren) due to having to dip into it more early in my retirement.

If you had to retire later due to not having good retirement savings, then taking it later becomes the better option.
Just wanna say that this how the numbers seem to work out for me too. I am in the "sound financial footing / significant savings / sufficient income" camp. I keep running the numbers over and over with all the what-if's and "how abouts." Even if I live to 90 yrs old I am only somewhat ahead in total SS payments in every FRA vs -Age 62 and points in between- scenarios. (I didn't bother going to 70) At that age, and really any time after the age-80 break even point, does that fairly modest extra income enhance my life any? It's not enough to get me into a higher class nursing home or make that kind of difference. And that's probably the only difference that would be meaningful at that age

Last edited by fallstaff; 06-10-2019 at 05:41 PM..
Reply With Quote Quick reply to this message
 
Old 06-10-2019, 05:32 PM
 
Location: Central IL
15,201 posts, read 8,504,300 times
Reputation: 35572
Quote:
Originally Posted by reed303 View Post
Yes, you can still "suspend" payments, between FRA and age 70.

"If you have reached full retirement age, but are not yet age 70, you can ask us to suspend retirement benefit payments. "

See https://www.ssa.gov/planners/retire/suspend.html

Also there are some side effects:
- Medicare Part B no longer deducted.
- other's benefits, on your record, stop; ie, spousal

Yes - but you only have 12 months to change your mind if you start and want to stop...and as I said, you have to pay it back:
"You used to be able to collect Social Security benefits at age 62, then suspend benefits and restart them later. Now, if you collect any time before your full retirement age (say, 66), you have only 12 months to change your mind and you have to pay back any monies you received."

I think it's hard for people to delay something they've had coming for so long and it somehow seems counterintuitive to delay...and there is always the suspicion that the government will cheat them. I have several great aunts who all lived into their 90's and I saw what happened to their money - I want a bigger chunk coming in "on the regular" so that's why I'm waiting a few more years. I don't have a problem using some of my own money in the meantime.
Reply With Quote Quick reply to this message
 
Old 06-10-2019, 05:35 PM
 
71,463 posts, read 71,629,249 times
Reputation: 49027
Not true

You can stop anytime from fra up to under 70.......as long as you are fra you can stop your ss and let it grow at anytime.. you pay nothing back when you do a start stop..

Our original plan was my wife was going to stop her ss which she started at 62 at her fra and let it grow up until 70 ... we decided not to do it..

We were beta testers of fidelity’s in-house software optimizing social security .... it came up with my wife stopping her early benefit at her fra .... since she is older then me she would start it at 70 again ..

I would file restricted for half hers ... at 70 I would file for mine and once I filed she would get a spousal adder to her benefit.

Last edited by mathjak107; 06-10-2019 at 05:44 PM..
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

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