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Rich Jones
10-13-2012, 09:02 PM
My wife turns 62 in a few months (I'm a couple of years behind her) and is wondering whether to take S.S now or later.
What do you guys think?
The money would come in handy right now, but is not desparately needed.
Without getting into too much politics, she's tempted to take it now before some politian can bump the retirement age up to 70 or something.

So, what have/will you guys be doing?

ccmanuals
10-13-2012, 09:19 PM
I'm in a similiar situation. I plan on working till 66 to draw my full SS but since my wife decided not to work since we moved to Texas we found it to our benefit for her to draw her's at 62.

http://www.bankrate.com/finance/personal-finance/the-right-time-to-draw-social-security-benefits-1.aspx

Todd D
10-13-2012, 09:19 PM
You take a pretty big hit to take it at 62. In our case, my wife started SS at age 64, but I am waiting until a couple of months before my 65th birthday. My feeling is that I prefer to wait to have a bit more money when I am older since we can get by without mine now. To me the biggest factors in deciding when to start SS are financial need and your health. If you need the money now or are in poor health then take it now. If you don't really need the money now and are in good health I would suggest waiting until you are closer to 66 (full entitlement age).

elf
10-13-2012, 09:20 PM
Suggest she go talk to the people at the Social security office. They can help her determine the exact numbers and implications. She needs a clear accounting of the difference between 62 and 67. And what will happen to your taxes if she goes on working 'til 67 but takes her Social Security now.

Gerarddm
10-13-2012, 11:18 PM
I went early,having no faith in the political future of the program. The math worked for me.

Paul Girouard
10-13-2012, 11:19 PM
I'd take it as soon as you can , that's my plan , 62 I'm signing up!

Ironmule
10-14-2012, 12:12 AM
How long do you expect to live, in terms of collecting SS.

I had a plan, based on having the health to contest for age group marathons into my 90's.

Since my diagnosis of pulmonary fibrosis, as a consequence of working in a fiberglass boat factory, I've had to shorten my horizons.

It makes a big difference whether you plan for 5 years or thirty years.

50, 40, 30 years ago, my real life of today was no more real than the fantasy novels I picked up in book stores.

Now, at 67, I am balancing my bucket list on the one hand, and preventing my siblings from being burdened by dealing the collection of tools and stuff I've enjoyed collecting.

The advice given depends on the horizon seen by your respondent, so you have to use your horizon of life expectancy to evaluate the advice you get.

Lew Barrett
10-14-2012, 02:20 AM
I wouldn't take personal financial advice here on the forum in this matter, especially as we have no idea of your objectives or circumstances and if we did, you'd be unwise to tell us here in the open. Talk to a professional, or suss it out for yourself. As iron mule says, your horizon matters.
Consider these items:
1. Your return will be halved if you continue to work and draw SS at the same time (unfavorable tax treatment for early enrollment).
2. Big hit in payout.

But really, it might be worth a buck or two to you to speak to somebody, or as Em has suggested, just talk to your local SS office and see what advice they have. Then you will be armed with some information that you can turn to your advantage and make the best decision for yourself. It's my understanding that most working people don't benefit from early enrollment.

MiddleAgesMan
10-14-2012, 06:09 AM
I heard a discussion a few months ago where some financial guru bucked the common wisdom that says to wait for the biggest payout. He pointed to the extra four years of benefits as worth the smaller monthly benefit. IIRC you have to have a life expectancy well beyond 80 or so to come out ahead by waiting.

John Smith
10-14-2012, 08:05 AM
Suggest she go talk to the people at the Social security office. They can help her determine the exact numbers and implications. She needs a clear accounting of the difference between 62 and 67. And what will happen to your taxes if she goes on working 'til 67 but takes her Social Security now.

That was goingn to be my suggestion.

I'm not comfortable advising people on this, as other factors come into play, including health. Eventually health issures impact all of our lives and if collecting a bit less at 62 helps you do things you'd like to do while your health permits it, that may be a wiser decision that opting to wait for a larger income but health problems that prevent the activity.

Todd D
10-14-2012, 09:49 AM
If you want to see the impact of starting Social Security at different ages go to the web page below and download ANY PIA. You will need your social security statement for the data to enter, but once you type the numbers in you can evaluate the impact of starting social security at different ages. It is a very useful and easy to use tool. http://www.ssa.gov/oact/anypia/anypia.html

Bert Langley
10-14-2012, 09:56 AM
One thing most people do not consider is that if you start at 62, do not really need the income and just bank it you can pay it all back interest free at 66 and begin to draw the full amount. It can provide a little cushion that if you do not need it then fine, but is there for unforeseen emergencies. Just another thing to consider.

ccmanuals
10-14-2012, 10:39 AM
It's ok to listen to other peoples situations and what their decisions were but each individual has unique circumstances. Your decision needs to be based upon your needs and goals.

ccmanuals
10-14-2012, 10:41 AM
Do your own research. I.E. a lot of folks are not aware of this little goody:

You can work while you receive Social Security retirement (or survivors) benefits. When you do, it could mean a higher benefit for you in the future (http://www.ssa.gov/pubs/10069.html#increase). Higher benefits can be important to you later in life and increase the future benefit amounts your family and your survivors could receive.
Note: If you are outside the United States (http://www.ssa.gov/pubs/10137.html#a0=6), the rules for receiving benefits while you are working are different.

While you are working, your earnings will reduce your benefit amount only until you reach your full retirement age (http://www.ssa.gov/pubs/ageincrease.htm). After you reach full retirement age we recalculate your benefit amount (http://www.ssa.gov/retire2/whileworking3.htm) to leave out the months when we reduced or withheld benefits due to your excess earnings.
We use a formula to determine how much your benefit must be reduced:


If you are under full retirement age (http://www.ssa.gov/pubs/ageincrease.htm) for the entire year, we deduct $1 from your benefit payments for every $2 you earn above the annual limit.
For 2012, that limit is $14,640.

In the year you reach full retirement age (http://www.ssa.gov/pubs/ageincrease.htm), we deduct $1 in benefits for every $3 you earn above a different limit, but we only count earnings before the month you reach your full retirement age.
If you will reach full retirement age in 2012, the limit on your earnings for the months before full retirement age is $38,880. (If you were born in 1946 or 1947, your full retirement age is 66 years.)

Starting with the month you reach full retirement age, you can get your benefits with no limit on your earnings.
Caution: If you apply for benefits more than 6 months after you reach full retirement age, we can only pay the benefits for the previous 6 months.


Note: If your earnings will be over the limit but you will be retired for part of the year, we have a special rule that applies to earnings for one year (http://www.ssa.gov/retire2/rule.htm). The special rule means we cannot deduct excess earnings from any whole month we consider you retired, regardless of your yearly earnings.

Paul Pless
10-14-2012, 10:42 AM
Suggest she go talk to the people at the Social security office. They can help her determine the exact numbers and implications. She needs a clear accounting of the difference between 62 and 67. And what will happen to your taxes if she goes on working 'til 67 but takes her Social Security now.

I understand that the SSA will provide accurate advice on benefits, but can they really give you the best tax advice?

Lew Barrett
10-14-2012, 11:54 AM
One thing most people do not consider is that if you start at 62, do not really need the income and just bank it you can pay it all back interest free at 66 and begin to draw the full amount. It can provide a little cushion that if you do not need it then fine, but is there for unforeseen emergencies. Just another thing to consider.

Nope. that rule is gone, out the window and no longer possible.

Lew Barrett
10-14-2012, 11:56 AM
I understand that the SSA will provide accurate advice on benefits, but can they really give you the best tax advice?
If you know the rules and the playing ground you are in a position to make your own mind up, always the best option. Income from SS is taxed at 50%....earn two, they take one above the set limit for most working people who don't plan to retire until 66....stuff you need to know, if you are still working and opt to enroll before you are there (66).
The rules have changed in the last two or three years and continue to so that your decisions are more proscribed than they were a decade ago.
SS has become a rolling doughnut, and your flexibility is somewhat reduced.

Talk to them and your tax adviser.