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Between 62 and 67
Old 10-13-2005, 02:42 PM   #1
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Between 62 and 67

I am planning on retiring at 55 and starting social security payments at 62. My question is concerning the limits on (earnings) between 62 and 67. From what I have read you can only have $12,000 in earnings (dividends, interest etc.) before they begin to reduce your benifits $1 for every $2 in earnings. That would limit me to $24,000 yr (12,000 SS + $12.000 dividends etc.) to live on. I would like to have at least 40K. Does anyone out there have a good statagy to deal with this situation? Thanks
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Re: Between 62 and 67
Old 10-13-2005, 02:46 PM   #2
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Re: Between 62 and 67

If you have, say, $100k in a taxable account that you can access without incurring tax consequences (stock sold at cost basis, or money market funds for example), you can withdraw $20k/yr from this account for 5 years and you'll be set. These withdrawals won't count as income (assuming you have no tax consequences from the sale of the assets to generate cash).
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Re: Between 62 and 67
Old 10-13-2005, 02:46 PM   #3
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Re: Between 62 and 67

Jim,

Since you want an additional 16K to live on it seems that you would need about 400K in savings.
at 4% safe withdrawl rates that would earn you the 16K you would need.

Hope this helps,
JOE
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Re: Between 62 and 67
Old 10-13-2005, 03:06 PM   #4
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Re: Between 62 and 67

Quote:
From what I have read you can only have $12,000 in earnings (dividends, interest etc.) before they begin to reduce your benifits $1 for every $2 in earnings
I think you are referring to earnings from wages, if you work while you are receiving SS.* To the best of my knowledge, receiving dividends and interest (eg from an IRA) should have no effect on your SS.
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Re: Between 62 and 67
Old 10-13-2005, 03:19 PM   #5
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Re: Between 62 and 67

From http://www.ssa.gov/

"Non-work income such as pensions, annuities, investment income, interest, capital gains and other government benefits are not counted and will not affect your Social Security benefits. For more information, we suggest that you read the following publications which are available online: Retirement Benefits (Publication No. 05-10035) and How Work Affects Your Benefits (Publication No.05-10069)."

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Re: Between 62 and 67
Old 10-13-2005, 05:12 PM   #6
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Re: Between 62 and 67

Quote:
Originally Posted by DFW_M5
I think you are referring to earnings from wages, if you work while you are receiving SS.* To the best of my knowledge, receiving dividends and interest (eg from an IRA) should have no effect on your SS.
That's right! It's WAGES! There is no means test for SS, .........yet!

JG
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Re: Between 62 and 67
Old 10-13-2005, 05:19 PM   #7
 
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Re: Between 62 and 67

Quote:
Originally Posted by MRGALT2U
That's right!* It's WAGES!* There is no means test for SS, .........yet!

JG
There is an implicit means test -- the percentage of SS income that is taxed depends on the total amount of your income. Of course, if you're a dumpster diver and don't have much other income, you're free of this consideration.

HH
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