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Old 04-06-2013, 01:58 PM   #21
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We plan to make the decisions regarding when we file (& suspend) and collect Soc Sec independent of other calculators. For us the optimal approach with our assumptions appears to be 4 easy steps, but we have years to finalize. AARP and T Rowe Price have good Soc Sec for couples calculators, I am sure there are others. YMMV
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Old 04-06-2013, 02:59 PM   #22
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Originally Posted by foxfirev5 View Post
I am not counting on doing much after 85 or so. I used to think that about age 55 but now that I'm past that age I've moved the bar.
Seriously though, I still plan on age 62 for SS since I'm a control freak who wants to keep my investments in my hands as long as possible. Can I do better than the built in increase in SS benefits by delaying? Maybe, maybe not, but I'll take my chances. The answer for each of us is not as easy as some would make it out to be.
+1. I don't like seeing the net worth column in the retirement planning spreadsheet dip too low. We are taking the pensions early as well to help fund early semi-ER.

If we took SS at 70 we'd have more money at age 90 but I'm not sure what we would do with it at that age except leave it to the kids or watch it dwindle to pay nursing home bills as we spend down to Medicaid asset levels.
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Old 04-06-2013, 04:19 PM   #23
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The reason for one half of a couple to delay to FRA or 70 is for the benefit of the survivor who will then have only one SS income. dH took SS at 62 1/2 but I may take it at FRA or later. I am not quite 59 though so figure I don't have to decide now,
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Old 04-06-2013, 04:27 PM   #24
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I think all these calculator trips just put some stuff of unknowable reliability between you and reality.

Do you want some fixed income? Do you want some indexed fixed income? Do you want some longevity insurance? Do you want some insurance against errors, either your own or errors in the investing algorithms that you have accepted? Do you expect SS to be continued more or less intact?

Are you mortally ill?

If you can answer yes to all the first group, and no to the last, let your benefit ride. It is probably better than anything else you could do.

Ha
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Old 04-06-2013, 05:47 PM   #25
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So maybe we can rephrase this to say that the 'conventional wisdom' is to delay SS as long as possible - where 'as long as possible' means not having to dip into your portfolio too much w/o that SS income.
-ERD50
Don't forget that 'conventional wisdom' assumes people who [had to] work as long as possible, and then retired with small-ish assets. In that scenario, the extra money from delaying might be significant.

But for people who are F.I.R.E.'d the additional SS probably has little or no effect on their lifestyle.

The maximum possible age 66 benefit is $2513.
That's $1885 at 62 or $3317 at 70.
The incremental amount is $17,000/yr. After enduring 8 years of $0 SS benefit. Which implies that you have enough other income (pension, 401k, and investments) that you can easily get by with no SS.

So, maybe you've got "other" income of $50K - $60K or so. Remember in order to get the max benefit you had to earn enough to hit the SS cap every year - so this is not poor people we're talking about, and presumably they have built up a hefty portfolio.

An incremental $17,000 is not going to make a huge difference in their lifestyle -- certainly not a "life-changing" difference.

OTOH, if they have a $1,000,000 portfolio, a 5% return is $50,000. Compared to that number, $17,000 is almost a roundoff.
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Old 04-06-2013, 06:36 PM   #26
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OTOH, if they have a $1,000,000 portfolio, a 5% return is $50,000. Compared to that number, $17,000 is almost a roundoff.
34% is some round-off!
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Old 04-06-2013, 07:04 PM   #27
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Originally Posted by haha View Post
I think all these calculator trips just put some stuff of unknowable reliability between you and reality.

Do you want some fixed income? Do you want some indexed fixed income? Do you want some longevity insurance? Do you want some insurance against errors, either your own or errors in the investing algorithms that you have accepted? Do you expect SS to be continued more or less intact?

Are you mortally ill?

If you can answer yes to all the first group, and no to the last, let your benefit ride. It is probably better than anything else you could do.

Ha
I agree that when you get to 62 and have to make a decision, a completely different question arises. My concern is using FIRECalc to determine what you can safely plan to spend during ER years prior to 62.

In my case I'm contemplating ER at age 49. FIRECalc indicates I can spend 5.5K more per year if I take SS at 62 as opposed to waiting till 70 for max payment.

Now if I get to 62 and the portfolio has performed better than anticipated, or my expenses are lower than planned, I will delay SS. In the meantime, I'll plan to split the difference.
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Old 04-07-2013, 09:13 AM   #28
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<snip>If we took SS at 70 we'd have more money at age 90 but I'm not sure what we would do with it at that age except leave it to the kids or watch it dwindle to pay nursing home bills as we spend down to Medicaid asset levels.
Part of my fear is that I end up in some really horrible nursing home because I have zero dollars left. I actually want that buffer so that I have a choice of nursing homes. I worry too much.
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Old 04-07-2013, 09:16 AM   #29
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Don't forget that 'conventional wisdom' assumes people who [had to] work as long as possible, and then retired with small-ish assets. In that scenario, the extra money from delaying might be significant.

But for people who are F.I.R.E.'d the additional SS probably has little or no effect on their lifestyle.
Actually I am planning to delay my SS until age 70 because all the calculators say there is a 10 - 15% chance of my portfolio only lasting to age 85. Therefore, I am using the extra SS (at age 70 vs 62) as longevity insurance just in case I really do end up broke at 85.
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Old 04-07-2013, 09:23 AM   #30
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Actually I am planning to delay my SS until age 70 because all the calculators say there is a 10 - 15% chance of my portfolio only lasting to age 85. Therefore, I am using the extra SS (at age 70 vs 62) as longevity insurance just in case I really do end up broke at 85.


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Old 04-07-2013, 09:24 AM   #31
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Part of my fear is that I end up in some really horrible nursing home because I have zero dollars left. I actually want that buffer so that I have a choice of nursing homes. I worry too much.

buy ltc insurance
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Old 04-08-2013, 04:34 PM   #32
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A long time ago I considered LTC insurance but never pulled the trigger. Now after seeing several of my older acquaintances pass - none of them made it to a nursing home prior to their passing.
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Old 04-08-2013, 04:44 PM   #33
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Another factor to consider on when to draw SS is can you afford to reduce that amount by 25% starting in 2033 if the cuts happen.
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Old 04-08-2013, 04:50 PM   #34
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A long time ago I considered LTC insurance but never pulled the trigger. Now after seeing several of my older acquaintances pass - none of them made it to a nursing home prior to their passing.
This is exactly why we have it. The way our luck runs, if we didn't have it, we'd both end up in a nursing home. Since we do, I hope we don't. I'd rather pay the premiums for years and never use it than actually need it. Pretzel logic, I know.
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