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Social Security Scenarios - Need insight
Old 02-15-2014, 10:33 PM   #1
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Social Security Scenarios - Need insight

I'm trying to get my head around Social Security and all of the different options. I'm hoping if I can put some basic information, someone who has a better grasp on it, can provide some insight.

Me - 57
DH - 51

There is hope that we can retire in the next year or two. No pensions. Very conservative investor.

It seems pretty obvious that you are better off holding off until Age 70 to take social security, as long as you can fund your retirement until then.

But what confuses me is all of the file and suspend, take half of the spouses social security, etc.

My social security at age 70 will be approximately $3340 in todays dollars and DH will be about $2286 when he is age 70. Remember, he is six years younger than me.

Can anyone give thoughts on what you would do? I know that somehow, him taking 1/2 of my social security would be great to grow his - but with him being six years younger, does that mean I have to delay taking mine?

Thanks!
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Old 02-15-2014, 10:39 PM   #2
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Try this:

Social Security Benefits Evaluator - T. Rowe Price

Just plug in dummy names, your expected SS benefit (you can run it at different ages/expected benefit $$$) and it will give you alternate scenerios to consider.
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Old 02-15-2014, 11:12 PM   #3
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Ok, I will check it out. Thanks. Will it automatically tell me if one of us should take 1/2 of spouse or file and suspend? Those are the things I dont understand.

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Old 02-16-2014, 06:58 AM   #4
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Originally Posted by Debinnov a View Post
Will it automatically tell me if one of us should take 1/2 of spouse or file and suspend?
Yes...
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Old 02-16-2014, 07:28 AM   #5
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Quote:
Originally Posted by rescueme View Post
Try this:

Social Security Benefits Evaluator - T. Rowe Price

Just plug in dummy names, your expected SS benefit (you can run it at different ages/expected benefit $$$) and it will give you alternate scenerios to consider.
+1 One of the more useful tools out there IMHO
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Old 02-16-2014, 09:51 AM   #6
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Not sure if this has been vetted, but I found the scenarios to be explained very well.

Social Security Timing
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Old 02-16-2014, 11:20 AM   #7
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For the maximum, here is a thought. Of course verify and validate...

You take it at 70. At his FRA, he takes a spouse benefit. At 70, he can take his benefit, and get delayed retirement credits.

If he starts collecting earlier than FRA, even if it is spouse benefits, his retirement is reduced by the early withdrawal.

If you die after you start collecting at 70, he gets your full benefit which should be greater.

That's the way I understand it.
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Old 02-16-2014, 11:31 AM   #8
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Great information. Thanks everyone!

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Old 02-16-2014, 11:48 AM   #9
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Quote:
Originally Posted by Debinnov a View Post
It seems pretty obvious that you are better off holding off until Age 70 to take social security, as long as you can fund your retirement until then.
I think that delaying SS until 70 is an excellent low risk strategy for having COLA'd income for as long as you live (longevity insurance).

But, it isn't guaranteed that delaying until 70 would make you "better off." That would depend on your personal situation regarding dependents and taxes, investment outcomes from investing early SS, how long you live, inflation, sequence of events and a long list of other variables.

I'm not saying delaying until 70 isn't a good strategy with longevity insurance as the targeted outcome. It is a good strategy. But it's not guaranteed to be the "better off" strategy depending on how things work out in your life.

I'm married to a gal who gets no SS and can't collect a spousal benefit from mine due to GPO, so in the interest of protecting her, I started my SS at 62. I've been trying to keep a few rough records so I can estimate how this works out vs delaying. That is, how much bigger is my FIRE portfolio at 70, with the eight yrs of invested SS income, vs the larger SS income I would have received had I delayed SS until 70.
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