I turn 66 on the 7th of December and am healthy and make good jack , so I will go one more year and decide then.
My mom lived to 87 and my dad is still kicking at 90.
I'm in better health than my pops was at my age and we have a family history of living into our late 80s+.
I'll book all the $ I can to get the most, figuring year to year but am calling my investment guru next week to get his feedback.

quote:

As long as your employer deducted SS taxes for the entire time you were employed there, your local government pension will not affect your social security benefit in any way. You will get your benefit WITHOUT any WEP (windfall elimination provision) reduction.

This was a huge point when I retired.

When I started in the early 80s, my department (SO) had a chance to get out of SS. But there were a lot of older guys who's retirement plans hinged on SS and they outnumbered the younger guys. Our sister agency (PD) got out and used to brag about the extra $800/paycheck they were getting.

Flash forward 25+ years and now they are crying because of the WEP. I'm guessing they didn't put their money in their 457 or 401(k) like they were supposed to

quote:

Originally posted by 9mmepiphany:

quote:

As long as your employer deducted SS taxes for the entire time you were employed there, your local government pension will not affect your social security benefit in any way. You will get your benefit WITHOUT any WEP (windfall elimination provision) reduction.

This was a huge point when I retired.

When I started in the early 80s, my department (SO) had a chance to get out of SS. But there were a lot of older guys who's retirement plans hinged on SS and they outnumbered the younger guys. Our sister agency (PD) got out and used to brag about the extra $800/paycheck they were getting.

Flash forward 25+ years and now they are crying because of the WEP. I'm guessing they didn't put their money in their 457 or 401(k) like they were supposed to

Same here. Our old chief retired several years ago during a LEOSA qualification, he
was complaining about how his SS was cut.

After he left we found out that prior to his retirement, he opted out of paying into SS. So, so glad I did not take that option!

That is why I said, in 2023.....when I turn 62, I’m going to add up my SS and pension....and probably punch my retirement ticket.

Affected by both. They cut my SSI in half. My wife collects for 7 months before she passed. She had the much larger portion. I don't get a dime.

I haven’t seen this asked yet but what type of financial professional should you hire to run all you personal numbers to tell you when it makes sense to retire?

Certified Financial planners do this sort of thing. They charge by the hour and do not make commisions. I figured it out myself after years of reading.

Fed161, thanks for your input as well as everyone else! I appreciate hearing your opinions.

6guns,just got this (unsolicited) email today from Vangard for being a "valued Customer" you probably know all this, but someone learn something.

For most Americans, Social Security represents a significant source of their retirement income. In fact, the Social Security Administration (SSA) reports that benefits make up about 33% of seniors' income.*

Many people approach when to start taking Social Security as a straightforward decision—and not surprisingly, a lot of them choose "as soon as possible"—but you can and should be strategic about it to make sure you're getting everything you're due.

As a financial advisor, I help my clients think more strategically about how Social Security fits into their overall retirement plan. Here are the top questions clients ask about Social Security:

When can I collect Social Security?
To collect, you need to be 62 or older and have paid into Social Security through your payroll deductions for a minimum of 10 years.

But as with many things in life, just because you can doesn't mean you should. Your personal strategy to get the most out of Social Security depends on many factors.

57%


Missing out on full benefits

The majority of recipients claim their benefits before full retirement age.*



How much Social Security will I get?
Your benefits are based on the payroll taxes you and your employers pay. Since those taxes come out of your earnings, the higher your earnings, the greater your benefits.

Even for top earners, however, the benefits are relatively moderate. The maximum Social Security benefit as of June 2020 was about $3,000 a month at "full retirement age"*—more about that below.

I recommend my clients get an estimate of what their benefits will be long before they apply for them, so we can start to plan how to maximize them.

When to take Social Security seems like a straightforward decision, but you can and should be strategic about it—make sure you're getting everything you're due.

Factors that can affect your strategy
You should carefully consider the following questions to decide your best Social Security strategy:

Health status: How many years do I think I'll collect benefits?

Marital status: Can and should I claim benefits under my spouse's or former spouse's earnings?

Retirement age: How long do I plan to work and how much will I earn?

Savings: Can I spend from savings while letting my benefit continue to increase?

Other retirement income: What other sources of guaranteed, cost-of-living adjusted income will I have?

Need help with your Social Security strategy?
Our advisors are here for you.

How can I increase my Social Security benefits?
The easiest way to increase your monthly payment is to delay collecting. You won't get 100% of your benefits unless you wait until your "full retirement age" to claim. After your full retirement age, your benefits will keep increasing by 8% a year for each year you wait until you turn 70.

Full retirement age is based on your birth date. If you were born after 1960, for example, your full retirement age is 67.

View our introduction to Social Security Open PDF document in a new window

But there are other potential ways to increase your benefits as well.

If you're married. You and your spouse should coordinate your claims to maximize the benefits. Whether you claim at the same time or use a split strategy to claim at different ages, it usually makes sense for the higher earner to wait longer to collect. Over time, the higher earner's increases will be worth more.

If you're divorced and haven't remarried. You may be eligible to claim benefits on your ex's earnings record if you were married at least 10 years.

If you're a surviving spouse. You can claim survivor benefits as early as age 60, if your spouse's earnings qualified them for Social Security. You also have the option to switch to your own benefits when you reach age 62 or older, if that strategy makes sense for you.

If you've started taking Social Security before full retirement age. Maybe you realized you'd be better off letting the benefit keep growing. Or, perhaps you decided to return to work, or don't need the money for another reason. Here are 2 ways you can undo your decision, to some extent:

Withdraw your application and pay back what you received. You can do this if it's been less than a year since you filed for benefits.
Suspend your benefits once you've reached full retirement age. This is your option if it's been over a year since you filed. Your benefit amount will increase every year until you turn 70 or start to collect again.
Some of these strategies can be complicated and some—like withdrawing your application—can only be done once, so you want to make sure you get them right. We can run different scenarios to help you understand the potential implications.

What else affects my Social Security payment?
While you're strategizing ways to increase your benefits, keep in mind these things that can decrease them:

Taxes: Retirees with moderate or higher incomes will likely end up paying federal taxes on some portion of their benefits. According to the SSA, about 40% of the people who get benefits pay taxes on them.* And some states tax Social Security, too.

Medicare deductions: If you're claiming Social Security and also apply for traditional Medicare, the premiums from Medicare Plan B will be deducted from your Social Security payments.

Certain pensions: If you received a pension from a government entity or another organization that didn't withhold Social Security taxes, your benefits could be reduced. This could also affect any spousal benefits you might claim.

Earnings if you keep working: Depending on your age, if you're working and also collecting Social Security, your benefits can be decreased if you earn over the set limits.

States that tax Social Security income
Map of United States highlighting states that impose state income tax on Social Security benefits. They are: Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, North Dakota, Rhode Island, Utah, Vermont, West Virginia
Read chart description

How much can I earn while on Social Security?
Once you've reached full retirement age, you can earn as much as you want with no penalties.

Before your full retirement age, you can earn up to $18,240 per year (as of 2020) without having your Social Security payments reduced. Bad news: If you earn over the limit, your benefits will be cut. Good news: When you reach full retirement age, any withheld benefits will be returned to you in the form of higher monthly payments.

If you're within the calendar year when you'll achieve full retirement age but haven't reached your birthday month yet, the earnings limit is much higher: $48,600 for 2020.

You can go to our Retirement Planning section to learn more about maximizing your Social Security benefits.

Find out more about Social Security

*Source: Social Security Administration.

I planned on waiting until FRA with my wife retiring at 62. Someone offered to buy my business and I left one month shy of 62. No regrets! we did the math at last 100 times to see if it worked and still didn't believe it but it has. AND chances are you are healthier now than you will be in the future! Hope that helps.

Jim

yucaipa, thanks for that. Lots of good info!

I did eight months before FRA. 48 dollars a month less than if I had waited. Insurance was the determining factor for retirement. Once Medicare was in the picture the decision was made. I was tired and wanted out of that company.

I did wait an additional four months to exit, had to wait for my employment anniversary date to qualify for vacation paid time off. It was based on working the previous year with no prorates. Without going into a bunch of boring details I was not going to walk away from anything that I was entitled to that they had to pay for.

Since Lou started a thread along these lines, I figured I'd bump this and say I'll be taking my SS in December of this year. At that time, I'll be 64 and 2 months.

I took it as soon as possible. Break even is said to be age 82 or so. My thinking was that I could either take the SS or need to start taking money from my IRA to supplement our retirement lifestyle.
By taking the SS I can avoid taking from my IRA. For me it's all about cash flow. Yes I give up a larger SS payment later and IF I live past 82 or so I "lose" money. But in my mind that is offset by allowing my IRA to remain invested and earning $ on that side of the ledger.

quote:

Originally posted by Powers77:
I took it as soon as possible. Break even is said to be age 82 or so. My thinking was that I could either take the SS or need to start taking money from my IRA to supplement our retirement lifestyle.
By taking the SS I can avoid taking from my IRA. For me it's all about cash flow. Yes I give up a larger SS payment later and IF I live past 82 or so I "lose" money. But in my mind that is offset by allowing my IRA to remain invested and earning $ on that side of the ledger.

My thoughts exactly! I retired May first. Turned 62 on May 26. $3000 per month from our S.S. is that much I’m not drawing from our IRA. I wonder if the market does well, and you’re invested right, where is the real break even point. I think stocks will always do better than our “mandatory withdrawn payments for S.S. Run by the U.S. Gov”.

Every situation is different for real. I made a mistake. If you have to take early Social Security to survive financially, then you have no choice. But if you can afford to delay, then every year you delay past full retirement age is similar to investing that year’s social security into an annuity that pays 8%. That’s a pretty good return for zero risk. Based on this, my wife and I decided to delay until age 70.

If I had known more about all the Social Security rules, I could have done better. Her Social Security on her own is coincidentally one half of mine. A better strategy would have been for her to take early Social Security at age 62. With that strategy, she would have started losing money at some point. But that’s just on her own. We would have been getting her money all those years and then when I claim mine at age 70, she could claim spousal benefit and be at one half of mine which is her full amount anyway. That would have been the better way.

Which is why every situation is different.

Another complication is if you have any tax deferred accounts that will be subject to Required Minimum Distributions which I discuss in the post below.

quote:

Originally posted by TBH:

quote:

Originally posted by Powers77:
I took it as soon as possible. Break even is said to be age 82 or so. My thinking was that I could either take the SS or need to start taking money from my IRA to supplement our retirement lifestyle.
By taking the SS I can avoid taking from my IRA. For me it's all about cash flow. Yes I give up a larger SS payment later and IF I live past 82 or so I "lose" money. But in my mind that is offset by allowing my IRA to remain invested and earning $ on that side of the ledger.

My thoughts exactly! I retired May first. Turned 62 on May 26. $3000 per month from our S.S. is that much I’m not drawing from our IRA. I wonder if the market does well, and you’re invested right, where is the real break even point. I think stocks will always do better than our “mandatory withdrawn payments for S.S. Run by the U.S. Gov”.

One thing to factor in is that if you have a sizable IRA, you need to project what your future Required Minimum Distributions will do to your tax bracket. They might put you in a higher tax bracket which means you’ll be paying more in taxes to take out the same amount of money otherwise.

One way to minimize this is to do Roth conversions ahead of the RMDs in amounts that will be tax efficient. Say your income will be $110,000 for the year and the top end of that tax bracket is $170,000. You can take out $60,000 from your IRA, pay taxes on that, and convert the net into a Roth IRA which will be tax free and available in 5 years.

The problem with taking Social Security when doing this is that it reduced the amount you can convert and at the same time, exposes more of your social security to income tax.

When I did the calculations I found that at age 78 is where you break even from taking it early vs the increases.

Twelve plus years ago, my CPA said I'd have to live to at least 80 to break even if I waited to reach 66 and get the full benefits.

I seriously doubted then, and haven't changed my opinion, that there's only two chances that I will live that long-slim and none. So I took the money at 62. No regrets at all.

Bob

My wife and I retired the same day in 2015. I was 65 and she was 66. We both started drawing our SS immediately. While we both enjoyed our jobs, we didn't want to wait to retire and to draw our SS. No regrets after drawing nearly 100 checks each.

quote:

Originally posted by Powers77:
I took it as soon as possible. Break even is said to be age 82 or so. My thinking was that I could either take the SS or need to start taking money from my IRA to supplement our retirement lifestyle.
By taking the SS I can avoid taking from my IRA. For me it's all about cash flow. Yes I give up a larger SS payment later and IF I live past 82 or so I "lose" money. But in my mind that is offset by allowing my IRA to remain invested and earning $ on that side of the ledger.

Exactly ! You and I are looking at it the same .