I'm at full retirement age but delaying until I'm 70. I enjoy working but promised my wife to cut back to 40 hours a week the year I start drawing

Welcome to the “Check of the Month” club!

You are one year behind me.

If you aren’t aware, you won’t get anything for February. The month you turn 62 doesn’t count.

Also, they pay at the end of the month it is for. March will be your first month, but March checks go out in April.

My check is supposed to hit the 2nd Wed of the month, but seems to be hitting the first full week of the the month past few months. This month wasn’t “due” til the 12th, but I got it last week.

When I did the math comparing starting at age 62 or waiting until age 67 (full retirement age for me), the breakeven point for me would have been about age 77- and that’s just simple totals of money received- not putting anything in the calculation for the time value of money.

If you start taking it early you are limited in how much you can earn, and there are severe penalties for going over- like 50%.

But that only counts for earned income- rental income and other investment income is okay.

quote:

Originally posted by 12131:
Those who have applied, how long does it take before you receive your first check?

Instead of applying and then waiting for the check, you can apply 3 months before the date you want to start receiving your check. For example, your birthday is November 20 which means your first check for December will come in January. You can apply as early as August 1. Three months time should give them enough time and and delay won’t be on you.

That’s what we did for my wife and what I plan to do.

ETA: check 911Boss’ post for the timing of the check. My 3 months prior is prior your eligibility date which is your birthday. Okay, I corrected my timing of the first check based on my understanding of his post.

It sucks because i remember my mother dying in late January and I called SS and they said they’ll retrieve the February SS payment which, as I understand now, was for January when she was still living.

I’m way passed 62, so the eligibility/birthdate thing is not a concern. Just a question for my personal situation.

Congrats and enjoy. I hope all you guys draw it for a long, long time.

quote:

Originally posted by 12131:
I’m way passed 62, so the eligibility/birthdate thing is not a concern. Just a question for my personal situation.

But the step ups in how much you get are based on your birthday and it’s a stair step, not an incline. I suppose the extreme outcomes would be you’d get 11 months of lump sum back pay at the smaller amount or just a regular monthly income stream at the higher amount.

ETA: I queried Grok and the 12 month retroactive lump sum will only apply if you’re past Full Retirement Age and here’s the scenario: you can only elect a maximum of 6 months, so if you apply in the 7th month of your birth year, you lose the 1 month and so on. The additional 6 months only come into play if processing your application is delayed by 6 months.

If you’re applying before FRA, you don’t get any retroactive pay for previous months. So if you apply 5 months past age 62, you don’t get paid for those 5 months. Your benefits is reduced by a percentage per month before your FRA.

I waited until 68, mostly out of spite. I was a "public employee" and, as such, would have been penalized by several hundred dollars a month. I worked with several groups pushing to change this law (the Windfall Elimination Provision), and when it passed I applied. Took about 3 months, cause a bunch of us applied at once.

My analysis showed that it would take 180 months of payments to break even with the delayed benefit higher monthly income. 15 years is a long time to break even, so taking it early for me made sense.

My wife just started her SS this fall. It took maybe 2 weeks before she got the approval.

Note that the first check doesn't arrive until 2 months after your birth month. (There are some exceptions). So if you apply in January and your birth month is February, your first check arrives in April. That check is for March.

So the government doesn't pay for your birth month. i.e. your benefits don't start at 62, they start at 62 + 1 month.

When you die, there is again no check for your death month. The government shaves off 2 whole months of your SS.

Congratulations, good choice.
I just turned 63, applied for SS and was approved within 3 weeks. It starts in February for me, looking forward to collecting and enjoying my free time.

I signed up at 66 years age. Full retirement age would be 67. People pushed me for 5 years and I kept saying no, not gonna do it now. I gave in and signed up. I can still work as much as I want. Now I still gotta iron out the prescription drug business.

Congrats! Now Cash out of CA and move to free America

quote:

Originally posted by Rey HRH:
…
It sucks because i remember my mother dying in late January and I called SS and they said they’ll retrieve the February SS payment which, as I understand now, was for January when she was still living.

That’s another loophole, no “pro-rating”. Gotta live the WHOLE month, you (your estate) doesn’t collect partial payment for the month you die.

quote:

Originally posted by 12131:
I’m way passed 62, so the eligibility/birthdate thing is not a concern. Just a question for my personal situation.

.

You look much younger.

I've never seen the inside of a SS office or talked with anybody on the phone . I did everything on my laptop from the comfort of my recliner. The site worked really well for me.

The breakeven point for me he was almost 12 years. Retired at 60 drawing at 62.

I didn’t need the money, but give me that extra pocket change now while I’m still younger and healthy and more likely to enjoy spending it!

quote:

I just turned 63, applied for SS and was approved within 3 weeks. It starts in February for me, looking forward to collecting

Don't forget that at 65, Medicare will be deducted from that payment.

Income taxes get quite complicated with Social Security. So be aware of things like taking capital gains or withdrawals from an Ira/401k. The more other income you have, the more of your SS gets added in and gets taxed. So an addition $1000 in other income can drag another $500 into being taxed, effectively increasing your marginal tax rate by 50% or even much more.

e.g. This year we can position for zero federal income tax. If I take any additional income at all, it will be taxed at least 18.5%, even if it is long term capital gains which would themselves be taxed at 0%, but it drags in SS to be taxed.

There are some software solutions to do the calculations to help plan ahead. Boldin is widely recommended, or use Turbotax to what-if different scenarios.

quote:

Originally posted by cparktd:
The breakeven point for me he was almost 12 years.

If you're looking at just the total payments that is an inaccurate analysis for most of us. You have to take into account the foregone earnings on other investments which will be used to replace the SS income you are deferring.

The assumption is you will plan to live on $X/mo in retirement and pull that money from somewhere. If it's not coming from SS, it's reducing other investments.

The online "breakeven" calculators do NOT take this into account - just raw dollars. Once you run the math properly, the real breakeven point is more like 82+ years old. Statistically unlikely most of us live much beyond that, and you don't get a do-over when you die at 70 instead.

There are instances where this might, maybe, make sense to defer. One earner where you want to maximize survivor benefits for the spouse for example. Even that doesn't make sense to me; she'll still have plenty to run out her life with reduced SS from early election and other assets, and that life just got less expensive without me around.

She wants a boyfriend, he has to pay his own way!!