Why Your Choice: Take Soc Sec. at 62, Full Retirement Age, or 70? (smart, kids)
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.
I've been following the posts here and thought I'd seek input on the question of when to begin social security.
As background, my wife and I plan to retire in 4 years at age 62. At that point I estimate our combined retirement savings will amount to about $1.2M. While our home will not be paid off, we plan to move out of the area (suburban DC region) and purchase a home/condo in a less expensive part of the country with a portion of the equity we've accumulated over the years (about $500K). We intend to spend about half of our equity on a new home then place the remainder in savings for future living expenses. Based upon the estimates we've seen, at age 62 our SS will be a combined $3K per month. At age 66 (our FRA) it is $4.3 per month and at age 70 it becomes $5.6 per month.
If we decide to defer SS until age 66 or 70, I believe we should have sufficient retirement funds to cover our estimated living expenses of between $60K - $75K per year.
The question, should we begin SS at age 62, accept a reduced monthly SS amount and draw down a portion of our accumulated retirement savings or should we rely completely on our retirement savings until age 66 or age 70 as a means to obtain a higher monthly SS payout? I previously thought we'd adopt the first approach, however I've recently read several items which suggest, if one can do so, it may actually be best to rely on one's retirement savings during the early years of retirement and defer SS until later as a means to receive an increased monthly SS payment for the long haul.
I'd very much appreciate any thoughts/experiences/ideas you may have to share.
Thanks!
I would run the numbers for two worst case scenarios, which would be one person passing away a couple years after you both retire, and what the surviving retiree will have for income if they live for ten or twenty more years. If you both get about the same SS income, that will be cut in half for the survivor. If the SS income is based on one of your earnings history, it will remain about the same.
Also consider what each surviving partner would have coming in from other sources and how much more or less will be needed.
I would run the numbers for two worst case scenarios, which would be one person passing away a couple years after you both retire, and what the surviving retiree will have for income if they live for ten or twenty more years. If you both get about the same SS income, that will be cut in half for the survivor. If the SS income is based on one of your earnings history, it will remain about the same.
Also consider what each surviving partner would have coming in from other sources and how much more or less will be needed.
Bada Bing! Not enough time and writing has been dedicated to retirement planning with two incomes and pensions etc and how to manage in conjunction with SS. The small pension of 10K they have is that with survivor benefits or if the pension holder dies is the income lost etc etc?
I appreciate the inquiries concerning survivor's benefits. This is something I need to understand better. The small pension I previously mentioned has a 50% survivors benefit. My limited understanding of SS rules suggests that if either my wife or I pass away at age 62 the survivor would be eligible for 80% of the spouse's SS benefit. If that same event occurs at age 66 (FRA) that benefit would increase to 100%.
In our situation, my wife's SS benefit will be slightly higher than my own. What I'm uncertain about, is the survivor permitted to receive his/her SS payment based upon their own work record in addition to that of the deceased spouse or is it an either/or proposition? If the former, it would seem, when combined with our existing retirement savings and home equity, if either of us was left alone for a 20-30 year time-frame our planned retirement budget would remain essentially intact. If the later, the surviving spouse's annual income would be reduced by the complete loss of the deceased's SS benefit. Is that correct?
I appreciate the inquiries concerning survivor's benefits. This is something I need to understand better. The small pension I previously mentioned has a 50% survivors benefit. My limited understanding of SS rules suggests that if either my wife or I pass away at age 62 the survivor would be eligible for 80% of the spouse's SS benefit. If that same event occurs at age 66 (FRA) that benefit would increase to 100%.
In our situation, my wife's SS benefit will be slightly higher than my own. What I'm uncertain about, is the survivor permitted to receive his/her SS payment based upon their own work record in addition to that of the deceased spouse or is it an either/or proposition? If the former, it would seem, when combined with our existing retirement savings and home equity, if either of us was left alone for a 20-30 year time-frame our planned retirement budget would remain essentially intact. If the later, the surviving spouse's annual income would be reduced by the complete loss of the deceased's SS benefit. Is that correct?
Thanks!
The survivor can not collect both their and the deceased SS benifits , only one
I've been following the posts here and thought I'd seek input on the question of when to begin social security.
As background, my wife and I plan to retire in 4 years at age 62. At that point I estimate our combined retirement savings will amount to about $1.2M. While our home will not be paid off, we plan to move out of the area (suburban DC region) and purchase a home/condo in a less expensive part of the country with a portion of the equity we've accumulated over the years (about $500K). We intend to spend about half of our equity on a new home then place the remainder in savings for future living expenses. Based upon the estimates we've seen, at age 62 our SS will be a combined $3K per month. At age 66 (our FRA) it is $4.3 per month and at age 70 it becomes $5.6 per month.
If we decide to defer SS until age 66 or 70, I believe we should have sufficient retirement funds to cover our estimated living expenses of between $60K - $75K per year.
The question, should we begin SS at age 62, accept a reduced monthly SS amount and draw down a portion of our accumulated retirement savings or should we rely completely on our retirement savings until age 66 or age 70 as a means to obtain a higher monthly SS payout? I previously thought we'd adopt the first approach, however I've recently read several items which suggest, if one can do so, it may actually be best to rely on one's retirement savings during the early years of retirement and defer SS until later as a means to receive an increased monthly SS payment for the long haul.
I'd very much appreciate any thoughts/experiences/ideas you may have to share.
Thanks!
Look at file and suspend. Both have to be at FRA. One files and suspends (to collect at 70) and the other files for spousal benefits. No penalty for doing this . Then when 70 switches back to own account. Don't know if both can do this but try it.
What you have to consider is the money you would of accumulated taking it early, and how many people do you know that have passed and never even got their SS at a later age? I would be happy if I made it to 80!
and i ask you ,did it matter to them if they died? it may to their heirs but waiting for the bigger payment is something they would never live to regret.
Hi Peoples,
I have just turned 66 am still working, own my home in NY, have approx 250k in my 401 and have no outstanding debt. my question and I DO need some input is, should i start taking my ss benifits now and sock the dough in the bank or invest it or just let it sit until hopefully i retire at 67? I do not need the monies to live, my wife and I are comfortable as is. Love to have a little feedback on this
Hi Peoples,
I have just turned 66 am still working, own my home in NY, have approx 250k in my 401 and have no outstanding debt. my question and I DO need some input is, should i start taking my ss benifits now and sock the dough in the bank or invest it or just let it sit until hopefully i retire at 67? I do not need the monies to live, my wife and I are comfortable as is. Love to have a little feedback on this
Tom
Too many variables to make much comment.
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.
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.
60, 62 or 70?
