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Old 08-31-2008, 07:26 PM   #61
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The other key if you delay is hoping the govt doesnt start doing means testing, cuts the payout, drops the inflation adjustment, increases the taxation or some other method of pumping the bilge before the ship sinks.

If you take the money and invest it rationally, you'll be in your early to mid 80's before the delay strategy starts getting the upper hand. Having that bird in the hand may let you be a little freer with your spending between 62 and 85.

I'm guessing that the money is going to be more fun to spend at 62 than 85.
This is my plan for my measley SS payout of $400/month at 62. If I don't need it then I will invest it for later use or to leave as part of my inheritance for my oldest son who will likely need it when SS goes bankrupt.
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Old 09-01-2008, 09:46 AM   #62
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I can see where people are using SS for different things so will have different strategies. I'm thinking of it as longevity insurance. At some point I will retire and live off savings - and likely show pretty low income for some years. I plan to use that time to convert IRA money to Roth using the lower tax brackets. Delaying SS at least until I'm done with those conversions seems like a good idea. After that, I like the COLA of SS as longevity insurance in case I miss estimated savings or live longer than expected. In between I see terrible political risk and don't see any way to know what is the best thing to do. Taking SS before 70, then paying back to get the higher payout seems like a good idea but vulnerable to having that "feature" eliminated - not so much because of usage (only a few actually do that) but because it's getting all kinds of press and might be seen as a 'loophole" for the rich. Alternatively, waiting to take the higher payout might mean missing any grandfather provision if general SS means testing is passed, which seems to be gaining political momentum and I expect to happen sometime in my lifetime.

It's hard to optimize a strategy in a game where someone else gets to change the rules whenever they like.
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Old 09-01-2008, 09:56 AM   #63
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Alternatively, waiting to take the higher payout might mean missing any grandfather provision if general SS means testing is passed, which seems to be gaining political momentum and I expect to happen sometime in my lifetime.

It's hard to optimize a strategy in a game where someone else gets to change the rules whenever they like.
I see little if any risk of being impacted by this once you are actually at an age to be able to make a decision to delay taking SS to get a higher payout.

Until age 62 the delay strategy is a theory, not an actual decision. And once you reach 62 you will have plenty of time to take action if you see a means testing law is about to be passed.
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Old 09-01-2008, 09:59 AM   #64
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It's hard to optimize a strategy in a game where someone else gets to change the rules whenever they like.
Thats why I worry less about spot on optimized strategies with so many variables that the 'optimization' will most likely fail, and just go with the strategy that has almost no variables.
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Old 09-01-2008, 10:05 AM   #65
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I see little if any risk of being impacted by this once you are actually at an age to be able to make a decision to delay taking SS to get a higher payout.

Until age 62 the delay strategy is a theory, not an actual decision. And once you reach 62 you will have plenty of time to take action if you see a means testing law is about to be passed.
Unless you're in your mid to late 50's and almost certain to receive 100% of the benefits as stated, largely without modification. Incorporating the availability of an income stream starting at 62 may allow you to spend more money NOW in your 50's.

Pretty appealing to someone who would like to spend a little more while they're young.

Its kinda funny to hear people say "I just hunkered over a bunch of spreadsheets and calculators and came to the conclusion that I should defer income until I'm old and deny myself whatever pleasures I may have gotten from it, just to make sure to mitigate the 2% chance I'll outlive my money."

Is that what we've traded our working lives for?

I'd rather work another year or two, or come up with an alternative plan for the slim chance that I live too long.
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Old 09-01-2008, 10:19 AM   #66
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Unless you're in your mid to late 50's and almost certain to receive 100% of the benefits as stated, largely without modification. Incorporating the availability of an income stream starting at 62 may allow you to spend more money NOW in your 50's.

Pretty appealing to someone who would like to spend a little more while they're young.

Its kinda funny to hear people say "I just hunkered over a bunch of spreadsheets and calculators and came to the conclusion that I should defer income until I'm old and deny myself whatever pleasures I may have gotten from it, just to make sure to mitigate the 2% chance I'll outlive my money."

Is that what we've traded our working lives for?

I'd rather work another year or two, or come up with an alternative plan for the slim chance that I live too long.
Everyone should gaze at their own belly button and contemplate a personal 'when to take SS' decision.

The point of my post was once you get to SS age there should be ample warning of changes that will impact you - such as means testing. With the possible exception of doing away with the payback and restart option, there should be no "gotchas" once you reach your 60's.
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Old 09-01-2008, 10:49 AM   #67
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But havent there been a a number of changes throughout the years? Changes to the COLA adjustments and changes to the taxation rules? Wouldnt you expect there to be many more as the balance of workers to retirees changes drastically over the next 15 years?

Heck, over the last ten years havent rising medicare costs eaten up the COLA entirely, and then some?
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Old 09-01-2008, 11:03 AM   #68
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But havent there been a a number of changes throughout the years? Changes to the COLA adjustments and changes to the taxation rules? Wouldnt you expect there to be many more as the balance of workers to retirees changes drastically over the next 15 years?

Heck, over the last ten years havent rising medicare costs eaten up the COLA entirely, and then some?
Yes to all the above. Things will definitely change with regard to SS.

Growing_older expressed concern about missing out on a grandfather provision regarding means testing. My response was that it was unlikely those of us who were at or near SS age would be deprived of such an opportunity since we should know in advance of pending legislation.
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Old 09-01-2008, 02:30 PM   #69
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For what it's worth, I mentioned the idea of a grandfather provision in means testing simply as a hypothetical example. Likewise the possibility that the return of SS taken and refiling might be withdrawn in the future. But the issue isn't limited to these specific examples. My thought was that SS will be tinkered with, perhaps in these ways, but certainly in other ways too. Impossible to know what rule changes might be coming or when.
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Old 09-01-2008, 02:34 PM   #70
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OK. Never mind....
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