File SS Late for 4%?

[Red Badger]

So, I'm counting on the combined sagacity of forum members here to counsel me on filing for SS. Apologies if this has been discussed - I didn't see it.

I'll turn 62 in May 2019. DW will hit FRA in August 2019. DW was a SAHM, so has no SS of her own. Also, under the 2016 "reforms" any File and Suspend is long gone.

My inclination is for both to file at her FRA. Her spousal benefit caps at her FRA (50% of my PIA). We can cover all the basics with SS and pensions. Once one of us assumes room temperature, the other can cover all the basics with same (SS, pensions) minus one SS check. And yup, if I file early and die first, DW gets my check, not FRA but .75ish of FRA

The nest egg provides for travel and infrequent big ticket stuff (car, major repair, intl travel, etc). ie, if the recent bear hangs around for a while, we'll limit draws to any big repairs, and maybe (or not) some travel.

I'd be okay with delaying to my FRA and burning a portion of our egg. Delaying to 70 doesn't fit our goals as that would leave little, if anything.

Open SS Calculator suggests filing at DW FRA.

I'm aware of the potential SS haircut in ~15 years, but suspect it won't happen. If it does, I think it might be half or so of the ~25%, in a share the pain situation (cowards in DC rightfully fear the geezer community. We're the ones that show up for every election).

DW and my parents all headed north in their 80's or earlier. Longevity risk is minimal.

So, if we delay, mine goes up ~8%, hers, 0%. So combined ~4%.

Nothing promised, but I think our pensions are fairly secure. The larger is COLA'd.

Thanks for any feedback!

 

[dtbach]

There is really no right or wrong decision. You can look at it this way, that way, my way, your way and every decision might be a little or a lot different. In your situation, I think you have a good plan.

 

[joeea]

DW and my parents all headed north in their 80's or earlier. Longevity risk is minimal.

Unless you happen to know something about your own health and that of your wife, your parents' longevity doesn't mean that your own longevity risk is minimal.

So, if we delay, mine goes up ~8%, hers, 0%. So combined ~4%.

So what happens to her survivor benefit? Have you considered that at all? You should.

 

[pb4uski]

We are in similar situation.... both 63 in our case and DW was a SAHM and her PIA is less than 50% of mine.

I used opensocialsecurity.com and looked at now (62 in your case), FRA for both and FRA for her/70 for me as well as their optimal solution and the EPVs are all pretty similar.. perhaps 5% different at most.

Bottom line.. anything is an ok decision. We'll probably take at 65 or FRA or FRA/70 depending on investment results, Part A premium increases or health changes.

 

[homestead]

Your situation is almost the same as ours. We actually would have gotten less by waiting.
We filed 3 yrs ago. One thing to consider is if one of you dies early on then you should have
a large portfolio to cover that event.
I filed at 62 the same year she got 50% of my FRA amount. Her ss was very minimal
without the spousal benefit.

 

[VanWinkle]

I am inclined to agree with your thinking on this one. I am in a similar situation with my wife being mostly a SAHM with a minimal FRA of 450.00. I was unable to claim early due to income control for the ACA, but would have claimed at my wife's FRA for sure to start the spousal benefits. Having a portfolio large enough to tide DW through in case of my demise would be the basis of my decision. Otherwise joeea is correct about protecting her longevity with your claiming.

 

[Red Badger]

Unless you happen to know something about your own health and that of your wife, your parents' longevity doesn't mean that your own longevity risk is minimal.


So what happens to her survivor benefit? Have you considered that at all? You should.

Yes, we both have health issues that won't likely improve with age.


Her survivor benefit is my SS. As mentioned, if I draw early; 75% of PIA

 

[Sunset]

Yes, we both have health issues that won't likely improve with age.

Her survivor benefit is my SS. As mentioned, if I draw early; 75% of PIA

So your thinking: "So, if we delay, mine goes up ~8%, hers, 0%. So combined ~4%. " is wrong.

It really is: So, if we delay, mine goes up ~8%, hers, 0%, her survivor benefit 8%

Now, understand I don't know the rules on survivor benefit, but I'm betting that [-]delaying[/-], meaning NOT collecting early but instead at FRA would be passed on to survivor.

 

[Red Badger]

So your thinking: "So, if we delay, mine goes up ~8%, hers, 0%. So combined ~4%. " is wrong.

It really is: So, if we delay, mine goes up ~8%, hers, 0%, her survivor benefit 8%

Now, understand I don't know the rules on survivor benefit, but I'm betting that [-]delaying[/-], meaning NOT collecting early but instead at FRA would be passed on to survivor.

And in that last sentence, lies the conundrum.

But thanks to all.

 

[sengsational]

You could plug your case into i-orp and do some "what-if" runs.... changing when to start SS and also "expiration dates". In many cases, the differences between plans is small, and so comes down more to how you feel about it vs the dollars and cents. I noticed that higher expected returns on investments pushed toward taking SS sooner. That increased available spending while concurrently increasing lifetime federal taxes to pay. That was a bit of a surprise. But everyone's situation is different, and planning assumptions different, which is why this topic is a constant on this board.