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Old 09-06-2016, 10:09 AM   #141
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My plan has always been to take SS at 62, simply because I don't fully trust the government. I figure the sooner I get on board, the sooner I get grandfathered in, and they won't screw with me as badly as they will the younger generations.
I have never felt that it was likely that people of the same age who had taken benefits would be treated differently in the event of program changes than people who had not taken benefits.

I never felt that I would "grandfathered in" by doing that.

I do, however, take the possibility of future benefit reductions into consideration. That is, I would hate to spend down my portfolio until age 70 based upon a projection of what benefits I think I would get at age 70 (based upon current law) and then, well into it, have the law changed so that at age 70 I was going to get less money than I had planned for.

So, I do think there is something to be said for getting the money while it is here recognizing that there could be reductions in the future.

I once felt that they wouldn't make significant changes for those over 55 but I'm not so sure now. For example, I turned 62 this year and had been seriously considering taking spousal while allowing my own benefit to grow. But, when I was 61 the law was changed to make it available only for those who were 62 that year (I missed the cutoff by a few months).
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Old 09-06-2016, 10:13 AM   #142
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Regarding the post below: I see today's stock market and economy (economic indicators) no different than January 2013. Back then the Internet was full of articles promising that the future stock market returns would be terrible and to sell now after 4 year BULL MARKET. In early 2013 the stock market was at record highs and CD rates were low and bond yields at record lows.

What did the stock market do since January 2013 regardless of the experts? It went UP, UP AND UP!

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Originally Posted by samclem View Post
What are CDs yielding today?
What are bond yields today?
What is the history of the US stock market when stock prices are at present levels relative to earnings? (For more info, Google "Schiller PE10" and scan some articles).
Here are two good ones to start with:
Kitces: CAPE's predictive value,long and short term.
ER-ORG thread: Future Returns

The consensus of those who have nothing to gain by selling people something is rather gloomy right now.

Would you expect stocks to do better for the 10 years after a large run up in prices (as we've seen since the 2009 crash), or would you expect them to do worse after such a run up?

Nobody has a crystal ball that gives precise answers about the future. But still there are useful indicators that can indicate the likely range of future returns.
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Old 09-06-2016, 10:20 AM   #143
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But, aren't you trusting the government to grandfather you in?

IMHO, you are placing a lot of trust in the government and your fellow citizens to allow early claimers to go on collecting their enriched booty, while the rest of us who waited get less. Personally, I would not place my trust there.

For example: The recent changes in filing a restricted application had an exception for people already above a certain age, whether you had already filed a restricted application or not.

Still, we each do what we think is best for us in our individual circumstances, and I won't try to tell anybody what they must do.
Well, naturally I'll fine tune, and continue to re-run my calculations, as I get closer to retirement, and take whatever the gov't does into account. FWIW, I've also run another set of calculations, assuming I'll get nothing for SS (a bit harsh, I know, but I figured I'd go for the extreme). In that case, having no SS at all only puts off my retirement by 1-2 years. For example, if I wanted to retire at age 50, living off of $60K per year, and with a 95+% chance of success, without SS I'd have to put it off to 52.

I'm not going to worry too much about when to take SS, at least not until I get closer to making that decision.
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Old 09-06-2016, 10:24 AM   #144
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Originally Posted by Forced to Retire View Post
Regarding the post below: I see today's stock market and economy (economic indicators) no different than January 2013. Back then the Internet was full of articles promising that the future stock market returns would be terrible and to sell now after 4 year BULL MARKET. In early 2013 the stock market was at record highs and CD rates were low and bond yields at record lows.

What did the stock market do since January 2013 regardless of the experts? It went UP, UP AND UP!
Your point is well taken. However, the principle (stocks are less likely to continue going up after a long run-up) is indisputable. The "sneezes" we have seen in the stock market when the FED even HINTS of a rate increase indicates to ME how vulnerable the stock market is. Whether that turns out to be the case, we will only know in hind sight. Supposedly, everything is always baked in to the prices - but then why do bubbles burst and "surprise" everyone??

I guess if you have a long-term view of the stock market and you have a good AA already set, it doesn't really matter about relatively short term (a few years or less) of down turns. Still, each slump seems like "this time it's really different." As always, YMMV.
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Old 09-06-2016, 10:48 AM   #145
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Also if you are still working p.t. and making above 15k then they start taking $ back so it does not make sense to take it until FRA.
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Old 09-06-2016, 11:54 AM   #146
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Well, naturally I'll fine tune, and continue to re-run my calculations, as I get closer to retirement, and take whatever the gov't does into account.

+1 Bingo!

And, I will add, you can continue to do that after age 62 if you don't take SS at 62. It's not a 62 or 70 decision even though one might think so while reading discussions on the topic. One can decide to take SS at 64 and 5 months or 68 and 3 months, etc. Or, here's a radical thought, take it at your full retirement age!!

I believe there are several people on this forum who took SS earlier than planned when the crash of 2008 hit them hard.
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Old 09-06-2016, 11:57 AM   #147
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Originally Posted by Forced to Retire View Post
Regarding the post below: I see today's stock market and economy (economic indicators) no different than January 2013. Back then the Internet was full of articles promising that the future stock market returns would be terrible and to sell now after 4 year BULL MARKET. In early 2013 the stock market was at record highs and CD rates were low and bond yields at record lows.

What did the stock market do since January 2013 regardless of the experts? It went UP, UP AND UP!
True. In the short term (3 years or so) maybe the bubble well-supported increase in stock prices will continue and a speculator an investor may be able to get historic rates of return (annual 5% real or more) over that short period. For a person that intends to get all out within the next few years and can afford to lose a lot of their money if they are wrong, then playing that game may make sense.

You made fast work of those links I passed! So you saw that the CAPE is not especially useful as a predictor of "now through a few years" but is a very good predictor of stock market returns for the window of "today through 8-15 years out", and that prediction today is for very low returns. I figured that time window might apply to your situation, but maybe not.
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Old 09-06-2016, 12:15 PM   #148
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Originally Posted by Forced to Retire View Post
Regarding the post below: I see today's stock market and economy (economic indicators) no different than January 2013. Back then the Internet was full of articles promising that the future stock market returns would be terrible and to sell now after 4 year BULL MARKET. In early 2013 the stock market was at record highs and CD rates were low and bond yields at record lows.

What did the stock market do since January 2013 regardless of the experts? It went UP, UP AND UP!
Go for it man! With your excellent track record and obvious interest, you'll soon be a multimillionaire!! You be sure to come back and clue us in.

Ha
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Old 09-06-2016, 01:07 PM   #149
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The older I get, the lower the chances I can even remember 62.
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Old 09-06-2016, 03:47 PM   #150
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....The cost of pulling the money out of the savings and 401K, IRA during the years they are 62-70 if there is a bear stock market during that period. If you are collecting social security during that period you would not need to be taking as much money out during those bear market years and will have more money in your retirement accounts at age 70 going forward.
That is the beauty of deferring though... if my investment returns are good then no need to start drawing... if things go sideways to the extent that things get uncomfortable then any day that I want I can start SS benefits and slow withdrawals.... best of both worlds.
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Old 09-07-2016, 12:41 PM   #151
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We filed a restricted application in March of this year before the rules changed on May 1st. We had planned on using "file and suspend" strategy. Spouse took her SS early and I filed for spousal benefits. I will wait until 70 to collect my SS (or as long as we can afford). We are currently "living off the hump" using pension and SS while not withdrawing from LT savings.
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Old 09-07-2016, 02:04 PM   #152
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1) First, I don't trust the government. They may decide to cut benefits for future retired folks who start collecting sometime in the future. Are you absolutely sure that your benefits will be 8% a year higher per year when you finally collect? Maybe they will change the rules. (I think it would be easier for them to cut benefits of people who have not started collecting.)
I don't trust the government either. I will begin collecting as soon as possible.
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Old 09-07-2016, 03:02 PM   #153
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It would be great if some people who started collecting Social Security at age 62 but did not need the money all that much, could help me defend the concept of collecting benefits at that age. There are tons of posts and articles talking about the glories of waiting until you are seventy. We have already heard those arguments.

Help me out, why would someone collect benefits at age 62 if you did not need the money right then?
I took it at 62, because I have 2 sons 1 and 10 who also receive (combined) what I receive so it effectively doubles my ss check until I am 79. I will stop taking my own at 66 (kids still receive theirs ) and let mine grow 8% per year until age 70. The advantage in this is my wife who is 30 years younger and a non citizen will be able to collect my full benefit after I kick off and she is 67.

That's the plan, unless I live to be 100 (Dad is going on 99) then she will have to wait to age 70 to collect!
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Old 09-07-2016, 03:28 PM   #154
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If it was just me I'd take it at 62 and allow my other assets to continue to (hopefully) grow to be left to my daughter and grandkids. But since there are two of us and my SS is significantly larger than DW's, I'll defer until 70 to leave her a larger survivor benefit. As far as starting hers, we'll probably hold off until FRA to give us a few more years of larger Roth conversion space, which is a nice strategy for helping our heirs minimize taxes. That's what will probably work best for us.

I wouldn't defer for the Roth conversion strategy if it was just me. For a single filer the 15% bracket just isn't that big.
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Old 09-07-2016, 05:16 PM   #155
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I took it at 62, because I have 2 sons 1 and 10 who also receive (combined) what I receive so it effectively doubles my ss check until I am 79. I will stop taking my own at 66 (kids still receive theirs ) and let mine grow 8% per year until age 70. The advantage in this is my wife who is 30 years younger and a non citizen will be able to collect my full benefit after I kick off and she is 67.

That's the plan, unless I live to be 100 (Dad is going on 99) then she will have to wait to age 70 to collect!
Can anyone start it , and then stop it to allow it to grow , or is this something very specific because you have young children (for an old guy). ??
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Old 09-07-2016, 05:41 PM   #156
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Can anyone start it , and then stop it to allow it to grow , or is this something very specific because you have young children (for an old guy). ??
Here is an article explaining this complicated scenario--the dependent loophole has been closed for people younger than 66, I believe (toward the end of the article)--although one could still file at 62, suspend at FRA, and restart at 70, it looks like the dependents' benefits also are suspended now:https://www.kitces.com/blog/navigati...ication-rules/
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Old 09-07-2016, 05:48 PM   #157
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Here's a link to someone that's calling it what some (I think) wise people have been calling it...longevity insurance.

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The goal isn’t just to maximize money received. The goal is to maximize the chances of success in retirement. In many aspects of financial planning a little insurance increases your odds of success even while lowering your overall wealth.
Most People Take Social Security At The Worst Possible Age | Marotta On Money
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Old 09-07-2016, 05:48 PM   #158
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I'm taking it at 70 to leave DW the most money I can (I'm older than her and have had a heart attack). I do get a pension, but it goes to 50% when I die. One of the ways I'm covering that gap is to take SS at 70.
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Old 09-07-2016, 06:24 PM   #159
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Here's a link to someone that's calling it what some (I think) wise people have been calling it...longevity insurance.


Most People Take Social Security At The Worst Possible Age | Marotta On Money
Over the years I have written several times similarly to this article. There are all kinds of special situations which are very important to the individuals who could be affected by these other than ordinary conditions. But the idea that the general case does not present a dominant strategy seems strange to me. It is insurance, at a cheap rate, and with the worlds most secure insurance company. Nevertheless, I am sure that these threads will continue to show up, and that many people who have no immediate need for the money, are not in a special category, and who are not deathly ill, will continue ti take SS at 62. One thing that is very often given inadequate weight is the prevailing level of interest rates on long term TIPS.

It is just something about how the human brain weighs outcomes and information. If there is a general idea to be gathered from this, I think it is that we tend to overweight dramatic or available but far from determinative factors. As Bayesians emphasize, the base case should carry a heavy weight.

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Old 09-07-2016, 07:41 PM   #160
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Here's a link to someone that's calling it what some (I think) wise people have been calling it...longevity insurance.


Most People Take Social Security At The Worst Possible Age | Marotta On Money
And this quote from that article is another pertinent one:

Quote:
If you die young, you nearly always have enough money. Therefore there is no need to gamble hoping for the case where you die young. The danger you are seeking to guard against is running out of money before you die. And living a long life always exceeds whatever break even points you compute.
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