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 06-11-2019, 06:59 PM
 
Location: Rust'n in Tustin
2,200 posts, read 2,390,243 times
Reputation: 3941

Advertisements

Quote:
Originally Posted by mathjak107 View Post
It is already means tested ..... the lowest incomes get 6x the benefit per dollar paid in then the highest earners ... plus the ss is double taxed over certain levels of income
That's not what "means testing" means. It means, do you need the money? Do you have other income? Did you have assets?
Reply With Quote Quick reply to this message

 
Old 06-11-2019, 07:28 PM
 
515 posts, read 120,734 times
Reputation: 1111
Quote:
Originally Posted by ysr_racer View Post
That's not what "means testing" means. It means, do you need the money? Do you have other income? Did you have assets?
I know what you meant..."if you have a 401K then you only need 1/2 of your SS at retirement".
Reply With Quote Quick reply to this message
 
Old 06-11-2019, 09:35 PM
 
13,043 posts, read 15,393,961 times
Reputation: 15297
I'm debating this myself. One reason I might delay is that my husband is still working and has a good income. I'm afraid whatever SS I collected would be taxed to death if I did take it because of his income. And if I wait 4-1/2 years I'll get at least $500 more a month.


So I haven't decided whether I will: 1) Keep working till 66-1/2 or somewhere near there. 2) Quit working but not collect social security until 66-1/2. 3) Collect social security at 62 and not worry about reduced benefit/taxes.


Another thing that has made me consider collecting at 62 is that people are keeling over. One of my half brothers died at 38 of cancer. His widow just died at 66. Another half brother died a couple of years ago at 68. His wife died the same year at 63. My half sister died at 49 of cancer. Another half brother died at 47. One half sibling still living in mid 70s.


Full siblings still living. My mom died at 77, dad died at 80. I am guessing I will make it at least to 80, but who really knows? My parents lived on 80 acres and were much more physically active their entire lives than I have ever been, so me they were healthier/more physically fit at my age than I am now. I have been working a desk job since my mid-20s.


Which brings up another consideration: I think when I quit working I will actually be healthier because I won't be sitting at a desk 40+ hours a week and I will finally get enough sleep and I will be more relaxed.


Typing all this out is actually making retiring at 62 make a lot of sense.
Reply With Quote Quick reply to this message
 
Old 06-11-2019, 11:34 PM
 
10,817 posts, read 8,063,256 times
Reputation: 17029
Quote:
Why Wouldn't You Take Social Security at 62?


Because I didn't need it. I retired at 62 but didn't need SS, had more than enough pension income to live the life I wanted. While at the same time converting Roths.
Reply With Quote Quick reply to this message
 
Old 06-11-2019, 11:51 PM
 
2,038 posts, read 1,947,995 times
Reputation: 3449
Quote:
Originally Posted by athena53 View Post
I'm 66 and haven't filed yet on my own record although I'm collecting Survivor benefits on DH's.

The difference in monthly benefit depending on when you file is calculated to be equivalent, on average. Naturally those who start at 62 and die at 68 did better than those who choose to wait till 70 and die at 68. I've chosen to wait because the people in my family tend to live very long lives and because I'm doing fine on Survivor benefits plus my pension and investment income. If, God forbid, I die early, I'll have achieved my 3 primary financial goals- not outliving my savings, helping with the grandkids' educations and leaving a legacy. DS and DDIL will be very wealthy.

Note also that if you file early and are counting on Survivor benefits to support your spouse after you're gone, you're permanently reducing what they'll collect after your death, which is another reason some people wait to file.
Let's say your SS benefit is $2000/month and your spouse's SS benefit is $1000/month. If you pass, does your spouse collect a survivor benefit of $2,000/month and not collect her benefit of $1,000/month?
Reply With Quote Quick reply to this message
 
Old 06-12-2019, 12:36 AM
 
Location: Rust'n in Tustin
2,200 posts, read 2,390,243 times
Reputation: 3941
Quote:
Originally Posted by biscuitmom View Post

Because I didn't need it. I retired at 62 but didn't need SS, had more than enough pension income to live the life I wanted. While at the same time converting Roths.
Me too. That's exactly why I AM taking it at 62. A bird in the hand, and all that. Who knows how long I'll live. I'd rather get 80 percent of something, then 100 percent of nothing.
Reply With Quote Quick reply to this message
 
Old 06-12-2019, 02:00 AM
 
71,584 posts, read 71,730,589 times
Reputation: 49179
Quote:
Originally Posted by ysr_racer View Post
That's not what "means testing" means. It means, do you need the money? Do you have other income? Did you have assets?
it certainly is means testing by any measure ... the more income you have the more they take back by double taxing you or the more your earning were the less benefit per dollar you get ... that my friend is means testing by any measure ...

most people don’t know is that our employment tax dollars don’t all buy the same amount of future benefit. Some of our employment tax dollars buy six times as much in benefits as others.

According to the most recent Trustees Report, for instance, the first $767 of “average indexed monthly earnings” (a complex formula that adjusts earnings over time) is credited at a 90 percent rate, assuring the lowest wage workers of a retirement benefit nearly equal to their earned wage.

Wages of more than $767 a month but less than $4,624 a month are credited at a 32 percent rate. This means retirement benefits increase at a much lower rate. The benefit pinching, however, does not end there.

More means less

For wages of more than $4,624 a month up to the wage base maximum ($113,700 for 2013), the crediting rate is only 15 percent. Thus, all the wages earned — and employment taxes paid — over that $55,488-a-year “bend point” gain benefits at only one-sixth the rate of the lowest wage earners.

In effect, the Social Security benefits formula functions as a sharply graduated means filter ,” reducing the benefits that accrue to higher wages by 85 percent. The higher your means, the lower your benefit.

Last edited by mathjak107; 06-12-2019 at 02:32 AM..
Reply With Quote Quick reply to this message
 
Old 06-12-2019, 02:04 AM
 
71,584 posts, read 71,730,589 times
Reputation: 49179
Quote:
Originally Posted by fumbling View Post
Let's say your SS benefit is $2000/month and your spouse's SS benefit is $1000/month. If you pass, does your spouse collect a survivor benefit of $2,000/month and not collect her benefit of $1,000/month?
you get either your ss or survivor , not both... you could take survivor early at 60 and leave your ss to grow , but you can never get both together
Reply With Quote Quick reply to this message
 
Old 06-12-2019, 02:09 AM
 
71,584 posts, read 71,730,589 times
Reputation: 49179
Quote:
Originally Posted by Ralph_Kirk View Post
When did "almost 50%" get to be "pretty high?"
because most people are mis-informed and think average life expectancy is 78 . life expectancy from birth plays no part when looking at life expectancy from our 60's on . ... in fact odds of one in a couple seeing 85 is 73% and 90% for 80. so yeah , seeing 90 and having a coin toss chance is pretty high
Reply With Quote Quick reply to this message
 
Old 06-12-2019, 02:28 AM
 
Location: RVA
2,165 posts, read 1,266,382 times
Reputation: 4456
Quote:
Originally Posted by ysr_racer View Post
That's not what "means testing" means. It means, do you need the money? Do you have other income? Did you have assets?
Umm, yeah, that is exactly what “means testing” means. It most definitely does not mean “do you need the money”.

In general, and it’s not something people like to read/admit, but the higher your income and portfolio size compared to your required income, and the more cerebral your job, the more likely you are to delay filing. My take is exactly the same as mathjak, beachsportsfan, and newbiehere. We don’t care one whit when anyone takes it. There is no one size fit all answers. Its the faulty REASONS, wacko math or anecdotal stories that we can’t stand! Mainly because we have pointed these same things out for years on various forums.

I’m a proponent of personally delaying filing. But my lower earning spouse (5 years older) filed at 62. I didn’t argue with the decision. I explained the reasons not to file, including increased taxes (bracket rise), no need for the money, “break even” is a useless argument etc. And she listened and understood, but her reasons were just as valid.

She asked if I thought her amount at 62 ($1100/mo) vs 67 ($1600/mo), which translates to an actual difference at 67 of ~$350/mo was going to make a difference at all in our lifestyle?

The answer is not one bit, because as stated, our effective income stays the same regardless. It is WHERE the income comes from, and the risk involved, that changes. $350/mo is just portfolio noise. Our investments rise and fall thousands every day. That amount, whether drawn from portfolio generated income or from SS is negligible.

She worked and contributed to our nest egg our whole marriage. Once she retired from teaching at 57, she didn’t like the feeling of not contributing financially any more. She felt much better once her pensions kicked in at 59, but she would rather have “her own” money to pay for her IRAs, hair appointments, etc, & not feel reliant on “my money” even though all our accounts are joint. Purely a mental comfort.

I respect that & have zero arguments with that. Happy wife, happy life, and all that. She is all for me delaying as long as I want. She has relied on me to get us where we are, financially, and knows I am the math and investments part of the marriage. She understands that if I die at 71, having filed at 70, she will be better off income wise, even though our savings would be reduced during that delayed period. She knows that she does not have the personality to draw income comfortably from a portfolio. She is a “savings for an emergency” mindset person, while I am a portfolio thats works for us, tempered by risk assessment as we age type.

She has no idea of what our taxes are, ( besides too much) what bracket we are in, etc, even though I force her to review our taxes every year. She HATES numbers. She doesn’t like to waste money or pay taxes. Well, duh, no one does.

We would Never say “we want *iss away” any not needed income. We like to live well, but get as much bang for our bucks as possible while living that lifestyle. There are plenty of charities that we contribute to, so part of our estate will likely go where we feel it will do the most good, and not just to leave behind as a windfall for family.

We know we are fortunate in our lives so far, and are grateful for every day. But at the same time, we are realistically setting up our income to maintain our lifestyle as we age, which includes tax mitigation, with risk reduction as age increases. No one can predict the future, but you HAVE to assume some things, and cover as many bets as reasonably as possible. What is different for everyone is what “reasonable” is.

Last edited by Perryinva; 06-12-2019 at 03:21 AM..
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