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You can't seriously call that (or any thing from The Motley Fool) an actual serious article. They are lightly disguised infomercials to hook you to visit their site and "learn about little known strategies", [blah blah blah]
I said:
Quote:
The internet is also full of articles telling us we should take social security early ...
It was presented as an example of an article claiming the opposite thing. I wasn't presenting it as a strategy to be followed by anyone, or claiming that it was a "serious" article. It was an example, and nothing more. I further said:
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... Without reading all the posts in this thread, I say it depends on the variables involved in your decision.
You wrote:
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Delaying is only logical if the math works based on your economic, marital, savings, tax rate, status and desired retirement age.
Maybe I'm getting stupid in my old age. How is that any different than my saying "it depends"?
Just curious. I was on disability at 62. I don't think I ever worked enough to recieve social security. I took my decieased husband's ss at 62. I'll be 65 in about six months.
My question is this, assuming I don't qualify on my own, does anything except being able to get medicare change at 65? The other question concerns property. My son is planning to move and have a space for me. I've already mentioned I want something detached. I don't do well without my own alone place. I'm thinking one of the detached mother in law builds which would actually be slightly larger than my shotgun house.
If/when I move, I want to sell my house. I wouldn't get a lot, maybe 15 to 18 k, but if that goes into my bank account, does SS make me spend it down? I'm perfectly willing to spend it to get the small house I want, and hopefully it be in my name. What would SS do with this?
If anyone can point me to the answers I'd much appreciate it since it plays a big part in how we do this.
ss has nothing to do with spending down assets , that is medicaid not medicare that requires that . by filing for ss early though you can no longer get disability and possibly medicaid from getting disability . that opportunity ends when you file for ss .
had you not filed for ss and stayed on disability at 62 and met the income and asset requirements for medicaid you stood a chance of getting it . but disability is for those unable to work . once you file for social security at 62 you lose that option .
Last edited by mathjak107; 09-18-2016 at 04:01 AM..
@Vasily, actually, as you said, I was agreeing with you. My post was directed at Robyn who normally gives quite astute financial advice, but started her post with quoting yours and in caps said " everyone should read the article you linked"..as if it was of significant serious advice why if you are smart, you should take SS early.
Both her and her husband were/are attorneys that started their own practices, and have, from what I gather from other posts, invested quite successfully, heavily and widely in low tax cost generated passive income that most would call significant. So their income, professions, and retirement levels are well above average. Yet her conclusion as to why they filed at 62 was "a bird in the hand", ie get the most from SS sooner rather than later.
The title of the "article", "Why Smart People take SS benefits early", insinuates, as you also meant in your post, that the smart thing to do is to take it early. (The title insinuates it, not you. It is meant to catch your eye, and draw you in. "I'm a smart oerson, so I Should read this"). In Robyns case, it actually means that BECAUSE she was literally a smart person (an attorney that made excellent income and has a long history of smart investing, specifically geared towards low tax, high income for retirement), she was able to take it early because there was really no gain to be made by delaying. She astutely positioned herself for low tax income, probably because she anticipated having a sizeable income in retirement, and has a way above average understanding of investing and the tax ramifications of high income in retirement.
Most people, if they could just HAVE a high income in retirement, (which more typically comes from a pension and /or saving well in tax deferred accounts) would find they are paying significantly more taxes than they thought they would, because they were led to believe for, well, forever, to "delay paying taxes because you will be in a lower tax bracket In retirement ", would say having to pay more taxes would be a nice problem to have to worry about.
As you and I both said "It depends." I keep repeating myself, but I am not trying to convince anyone that filing at 70 is always the best option. I only keep pointing out, that there are significant pro reasons to delay filing that can lead to real, increased, take home income in from the anywhere from a few hundred to maybe $7-10k a year range, that are being refuted for misleading reasons.
In Robyns case (and I am extrapolating from memory from old posts) : 1: they live in Florida, so there is no state income tax on any retirement income. 2: they draw steady income from munis and bonds and pay either no or low federal taxes on that income as LTCGs, so 15% or less, 3: are not the poster children for healthy living as they smoke, etc. 4: they are both attorneys with the mental capacity to shield assets and gains to their perfectly legal advantage.
None of this is in anyway insulting or judgmental. But given when they retired, a long marriage with dual high incomes, their investment acuity, lack of any tax advantage, and possible reasons to not expect living to 85 or 90, as well as their SS not being required to live the lifestyle they live, there were very good reasons to collect at 62, that don't apply at all to me, or lots of others. But "bird in the hand" or "breaking even" is not one of them. They simply have no real use for buying a SS annuity for guaranteed lower taxed income now that may grow to exceed its invested costs, and provide income for later needs, because they already have lower taxed income to exceed their needs for life.
So while I may be very glad and grateful that I chose my career path, and saved well with tax deferred matched accounts, & will have a decent pension, the fact remains that when I made that decision 35+ years ago, the tax ramifications and inflationary devaluation of a pension coupled with tax deferred income and RMDs was TOTALLY beyond my realm of thought and planning ability. Taxes that I would actually pay in retirement was literally the last thing on my mind. I just wanted to make sure I had "enough money".
Last edited by Perryinva; 09-18-2016 at 05:00 AM..
So while I may be very glad and grateful that I chose my career path, and saved well with tax deferred matched accounts, & will have a decent pension, the fact remains that when I made that decision 35+ years ago, the tax ramifications and inflationary devaluation of a pension coupled with tax deferred income and RMDs was TOTALLY beyond my realm of thought and planning ability. Taxes that I would actually pay in retirement was literally the last thing on my mind. I just wanted to make sure I had "enough money".
Perryinva great post. I am sure Robyn is savvy enough to understand that you were not being judgmental. I think her and her husband are quite smart and did the right thing for them.
To the points you made that I left I have to say this. I too am glad and grateful that I chose my career path which had both tax deferred and pension income for DW and I. I remained in that career path knowing that at some point in the future that some of that income would be subject to tax. I could not afford to move any of that over to Roth nor can I at this point do so. I have ran the numbers and I am stuck with my finances the way they are but I am not complaining. Like you I think we have saved enough and have enough of a portfolio balance that DW and I will gladly pay our taxes owed as we withdraw and we are betting to even leave a legacy to our only child. My thanks for saying it first and so eloquently.
@Vasily, actually, as you said, I was agreeing with you. My post was directed at Robyn who normally gives quite astute financial advice, but started her post with quoting yours and in caps said " everyone should read the article you linked"..as if it was of significant serious advice why if you are smart, you should take SS early. ... The title of the "article", "Why Smart People take SS benefits early", insinuates, as you also meant in your post, that the smart thing to do is to take it early.
I misunderstood - it was puzzling to me. Thanks for clearing it up.
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