Taking Social Security early vs. not

[W2R]

Quote:

Originally Posted by rayvt You realize that an annuity payout is more for an older person and less for a younger person, right? For example, I just pulled up a SPIA quote from BRK, based on a $100K premium, with different birth dates. This is the EXACT SAME annuity. Payout per month depending on age: Age 65: $530 Age 70: $614 These are the same value. The person who waited until 70 isn't getting a better deal, even though a simplistic look at $530 vs. $614 might seem that he is. You can't ignore the $31,800 (5*12*$530) that you could collect while waiting. Just doing simplistic math and ignoring interest, $31800 / (614 - 530) is 378 months until break-even. That's 31 years. You have to live to 96 in order to get a net benefit of waiting until 70. Granted, the SS numbers are slightly different -- but you can do the same math.

Interestingly (given what you are saying), the vast preponderance of advice columns and books (of the hundreds that I have read, anyway) do not agree with you at all in the case of a single woman like me, from a family with great longevity. You are completely correct that your mathematics is simplistic, and as you hint, perhaps too much so. Having done the math many times myself, I vehemently disagree from that standpoint although I do respect and appreciate your opinion and will take it into consideration.

Something for all to think about might be whether or not the only factor to be considered is total money received throughout one's lifetime (even though the probabilities are that that does come to more for me if I claim at age 70). I don't think that should be the most important factor in my decision, so much as when in my lifetime I am receiving that money and how much I need more reliable vs less reliable sources of money at different ages, and how reliable SS will be for me. Some might say that is an argument for claiming early, but that is not my perception right now.

Another factor is greed! And yes, I do experience that as much as anybody. I very nearly applied for SS a couple of months ago just because I would like to have that money now, and sometimes I could care less about practicalities such as probable longevity and planning for my 90's or 100's in case I get there. I guess there is a Scrooge McDuck inside many of us, including me.

[gerrym51]

as i've posted if there are no issues with taxes paid because money has to be pulled from retirement accounts after 70-taking social security later is probably a better deal if you live long enough.


the key words are if you live long enough

[W2R]

Quote:

Originally Posted by gerrym51 as i've posted if there are no issues with taxes paid because money has to be pulled from retirement accounts after 70-taking social security later is probably a better deal if you live long enough. the key words are if you live long enough

Exactly.

If someone is planning to take SS at 70, it is a good idea to consider the tax implications of RMDs and perhaps start pulling more out of retirement accounts before 70 than one otherwise might.

[youbet]

Quote:

Originally Posted by gerrym51 as i've posted if there are no issues with taxes paid because money has to be pulled from retirement accounts after 70-taking social security later is probably a better deal if you live long enough. the key words are if you live long enough

The key words are "probably" and "if you live long enough." But, yes, like most or all annuities, delaying the start of SS and getting the higher payout looks better and better the longer you live, all else being equal. Whether it's the "best" thing to do depends on both your personal circumstances and the utility of the dollars received due to taking the early SS option.

My summary would be a bit different than yours. Most likely, given that you handle the early money prudently and have no extreme investment or tax situations, it will make little difference whether you take SS early or late. If you die young, taking it early wins. If you live to be extremely old, taking it late wins. Issues such as marital status and GPO add complications calling for individual interpretations and calculations.

You won't know if you did the "right" thing unless you're able (and interested) in doing all the calculations and giving consideration to all the subjective factors on the day you die.

[Independent]

Quote:

Originally Posted by rayvt You realize that an annuity payout is more for an older person and less for a younger person, right? For example, I just pulled up a SPIA quote from BRK, based on a $100K premium, with different birth dates. This is the EXACT SAME annuity. Payout per month depending on age: Age 65: $530 Age 70: $614 These are the same value. The person who waited until 70 isn't getting a better deal, even though a simplistic look at $530 vs. $614 might seem that he is. You can't ignore the $31,800 (5*12*$530) that you could collect while waiting. Just doing simplistic math and ignoring interest, $31800 / (614 - 530) is 378 months until break-even. That's 31 years. You have to live to 96 in order to get a net benefit of waiting until 70. Granted, the SS numbers are slightly different -- but you can do the same math.

Yes, the SS numbers are different.

Suppose my SS normal retirement age is 66, and I have a $1,000/month if I start then. If I start at 65, the benefit is $933/month. If I start at 70, the benefit is $1,320.

Using your math (60 x 933) / (1320-933) = 145. So the break-even age is 77. That's well within a normal life expectancy.


(Of course, this simplistic calculation ignores investment earnings, investment risks, and longevity risks. Those are all important.)

[rayvt]

Quote:

Using your math (60 x 933) / (1320-933) = 145. So the break-even age is 77. That's well within a normal life expectancy

Correct. Happily, your figures exactly match what I came up with, so that's verified.

In fact, at 0% the break-even age is 77.8. At 3% it's 79.5%.
FWIW, the SS mortality table gives a 66 y.o. male a life expectancy of age 82.

'course, one of the other things I ponder upon is not break-evens or percentage improvements, but the absolute dollar amounts.
If you can afford to eschew getting $933/mo for 5 years, then you have a pretty comfortable income without SS.
If you have a pretty comfortable income, then you don't have an urgent need for that extra $387/mo in 5 years time.

If all you have is SS, then your annual income would be either $11,200 or $15,800. And with either of those, you are so far under the poverty line that it doesn't matter.

But suppose you have a comfortable pension of $24,000 ($2k/mo). Now your total income will be $35,200 or $39,800. Your lifestyle at either of these figures is going to be essentially the same.

Eh...when you get down to it, it's just a matter of personal preference. Whether you take SS at 62 or at 70, there will be little difference in your overall financial situation.
$387/mo is not going to lift you from poverty to opulence. If you are poor, it will relieve some of the burden -- but in that case, you can't afford to skip 5 years of income. If you are rich, it's just another shrimp on the barbie.

Which, oddly enough, is what the SSA implicitly says, when they say that they are actuarially the same.

The people who need the money can't afford to wait 5 years.
The people who don't need the money, it doesn't matter whether or not they wait 5 years.

[M Paquette]

Quote:

Originally Posted by W2R Exactly. If someone is planning to take SS at 70, it is a good idea to consider the tax implications of RMDs and perhaps start pulling more out of retirement accounts before 70 than one otherwise might.

Yup. My particular optimal plan has me running down the IRA account from 59 1/2 to 70, and then starting Social Security at 70, as a higher payout form of longevity insurance for DW and I.

[Khufu]

Quote:

Originally Posted by rayvt Correct. Happily, your figures exactly match what I came up with, so that's verified. In fact, at 0% the break-even age is 77.8. At 3% it's 79.5%. FWIW, the SS mortality table gives a 66 y.o. male a life expectancy of age 82. 'course, one of the other things I ponder upon is not break-evens or percentage improvements, but the absolute dollar amounts. If you can afford to eschew getting $933/mo for 5 years, then you have a pretty comfortable income without SS. If you have a pretty comfortable income, then you don't have an urgent need for that extra $387/mo in 5 years time. If all you have is SS, then your annual income would be either $11,200 or $15,800. And with either of those, you are so far under the poverty line that it doesn't matter. But suppose you have a comfortable pension of $24,000 ($2k/mo). Now your total income will be $35,200 or $39,800. Your lifestyle at either of these figures is going to be essentially the same. Eh...when you get down to it, it's just a matter of personal preference. Whether you take SS at 62 or at 70, there will be little difference in your overall financial situation. $387/mo is not going to lift you from poverty to opulence. If you are poor, it will relieve some of the burden -- but in that case, you can't afford to skip 5 years of income. If you are rich, it's just another shrimp on the barbie. Which, oddly enough, is what the SSA implicitly says, when they say that they are actuarially the same. The people who need the money can't afford to wait 5 years. The people who don't need the money, it doesn't matter whether or not they wait 5 years.

You are severely missing the point in several of your posts. First of all, SS is only actuarially fair for a single taxpayer. If the taxpayer is married and especially if the spouse has a longer life expectancy at this point, then the Delayed Retirement Credits represent a free lunch.

Second, it is true that many people cannot afford to delay SS and for some others SS benefits are not important for funding retirement. However, that leaves many, many people for whom optimizing the benefit from SS can contribute significantly to their well-being during retirement. Probably most of the people on this board fall into that category. For many of these people optimizing SS benefits is likely to have a bigger effect than many investment decisions. An increase of 10% in COLA'ed income is not small; it's huge.

Even for a single person the decision to delay SS is not unimportant. The decision to delay is actuarially neutral only for the entire pool of participants, i.e. the SSA. For an individual, it is not neutral. The individual has risks of inflation and longevity that he cannot afford to bear. He can pay the SSA to assume more of that risk for him. Although if we use the median life expectancy only, his expected lifetime income may not have changed, but that ignores the 50% likelihood that he will live longer than the median life expectancy. It is a serious mistake in analyzing SS optimizing decisions to ignore risk, since risk is the big problem facing the retiree. Break-even analyses are beside the point.

Let me explain this point by analogy. A homeowner without fire insurance is bearing the risk of possibly ruinous loss himself. The cash value of that risk can be determined and is approximately equal to the premium that an insurance company would charge for fire insurance. (It isn't actuarially neutral because the insurance company intends to make a profit, unlike the SSA, but it's close enough.) So, when the homeowner recognizes the risk of financial ruin and decides to buy the fire insurance he merely transfers to the carrier the amount of the premium, which is about equal to the expected value of fire loss. So, the effect on his net worth is probably negligible. Nevertheless, you can't say the choice is unimportant, because now he does not live under the threat of financial ruin from fire.

Another way of saying this, with respect to SS, is that it is a huge mistake to treat the median life expectancy as certain or even very likely. Most participants will not live the median life expectancy even though it is the best estimate of how long they will live. It's like flipping a coin eight times. We know that the best estimate is that four heads and four tails will result, but it's unlikely that that is what will actually happen. Accordingly, if we consider how to provide for ourselves in the even that we live to 100, the buying more annuity from the SSA would be the best solution that is widely available.

[Khufu]

Quote:

Originally Posted by W2R Exactly. If someone is planning to take SS at 70, it is a good idea to consider the tax implications of RMDs and perhaps start pulling more out of retirement accounts before 70 than one otherwise might.

For many people, myself included, the optimal strategy is to do Roth conversions between the ages of retirement and 70, keeping conversion amounts within the current bracket, and delaying SS until 70. The result is to reduce both the RMDs themselves and the tax on both the RMDs and SS beginning at 70. Whether the effect of the Roth conversions is beneficial or not depends on such factors as: life expectancy of the Roth tax-exemption, i.e. of the wife or kids, expected rate of return of the investments in the Roth, difference between current and expected future tax rates.

[gerrym51]

irs calculation for taxable SS include

dividends
taxable interest
TAX-FREE interest
pension benefits
Ira distributions
ROTH IRA distributions
other taxable income
wages
1/2 social security received

the tax free interest and roth ira are NOT TAXABLE but are part of ss calculation for taxes.

the calculation and the 25,000,32000,and 44 thousand limits for single and married 50 percent and 85 percent are NOT inflation adjusted.

just like the AMT kept hitting more and more people as time passed unless the congress fixes this it will keep getting worse.

if you have substantial deferred accounts and have to pull money out after 70
the only adjustment to this is either pulling out more money out of accounts before it hits or take ss earlier to lessen the impact. 1/2 of whatever ss you are getting will be included in the calculation

[Independent]

Quote:

Originally Posted by rayvt Correct. Happily, your figures exactly match what I came up with, so that's verified. In fact, at 0% the break-even age is 77.8. At 3% it's 79.5%. FWIW, the SS mortality table gives a 66 y.o. male a life expectancy of age 82. 'course, one of the other things I ponder upon is not break-evens or percentage improvements, but the absolute dollar amounts. If you can afford to eschew getting $933/mo for 5 years, then you have a pretty comfortable income without SS. If you have a pretty comfortable income, then you don't have an urgent need for that extra $387/mo in 5 years time. If all you have is SS, then your annual income would be either $11,200 or $15,800. And with either of those, you are so far under the poverty line that it doesn't matter. But suppose you have a comfortable pension of $24,000 ($2k/mo). Now your total income will be $35,200 or $39,800. Your lifestyle at either of these figures is going to be essentially the same. Eh...when you get down to it, it's just a matter of personal preference. Whether you take SS at 62 or at 70, there will be little difference in your overall financial situation. $387/mo is not going to lift you from poverty to opulence. If you are poor, it will relieve some of the burden -- but in that case, you can't afford to skip 5 years of income. If you are rich, it's just another shrimp on the barbie. Which, oddly enough, is what the SSA implicitly says, when they say that they are actuarially the same. The people who need the money can't afford to wait 5 years. The people who don't need the money, it doesn't matter whether or not they wait 5 years.

I think the important part of my post was that if I'm going to do the math, it's important that I use real SS numbers. Right now, deferring SS is a far more efficient way of buying lifetime income than buying a private annuity, so I shouldn't use private annuity numbers and assume that SS is about the same.

The unimportant part was my choice of $1,000, which was just a handy round number. However, note that the Federal Poverty Level for a single person is $11,490. I'd disagree that I'd be so far under the poverty line with either $11,200 or $15,800 that I wouldn't notice the difference. For people I know in that income range, I expect that $387/mo is a big deal. (however, the actual lifetime income difference isn't that big)

I'm currently deferring SS. The analysis that makes sense for my situation is that deferring reduces the uncertainty of my future income. It takes away some of the potential upside in return for limiting the downside.

[GolfingDuo]

Quote:

Originally Posted by Khufu You are severely missing the point in several of your posts. First of all, SS is only actuarially fair for a single taxpayer. If the taxpayer is married and especially if the spouse has a longer life expectancy at this point, then the Delayed Retirement Credits represent a free lunch. Second, it is true that many people cannot afford to delay SS and for some others SS benefits are not important for funding retirement. However, that leaves many, many people for whom optimizing the benefit from SS can contribute significantly to their well-being during retirement. Probably most of the people on this board fall into that category. For many of these people optimizing SS benefits is likely to have a bigger effect than many investment decisions. An increase of 10% in COLA'ed income is not small; it's huge. Even for a single person the decision to delay SS is not unimportant. The decision to delay is actuarially neutral only for the entire pool of participants, i.e. the SSA. For an individual, it is not neutral. The individual has risks of inflation and longevity that he cannot afford to bear. He can pay the SSA to assume more of that risk for him. Although if we use the median life expectancy only, his expected lifetime income may not have changed, but that ignores the 50% likelihood that he will live longer than the median life expectancy. It is a serious mistake in analyzing SS optimizing decisions to ignore risk, since risk is the big problem facing the retiree. Break-even analyses are beside the point. Let me explain this point by analogy. A homeowner without fire insurance is bearing the risk of possibly ruinous loss himself. The cash value of that risk can be determined and is approximately equal to the premium that an insurance company would charge for fire insurance. (It isn't actuarially neutral because the insurance company intends to make a profit, unlike the SSA, but it's close enough.) So, when the homeowner recognizes the risk of financial ruin and decides to buy the fire insurance he merely transfers to the carrier the amount of the premium, which is about equal to the expected value of fire loss. So, the effect on his net worth is probably negligible. Nevertheless, you can't say the choice is unimportant, because now he does not live under the threat of financial ruin from fire. Another way of saying this, with respect to SS, is that it is a huge mistake to treat the median life expectancy as certain or even very likely. Most participants will not live the median life expectancy even though it is the best estimate of how long they will live. It's like flipping a coin eight times. We know that the best estimate is that four heads and four tails will result, but it's unlikely that that is what will actually happen. Accordingly, if we consider how to provide for ourselves in the even that we live to 100, the buying more annuity from the SSA would be the best solution that is widely available.

Quote:

Originally Posted by gerrym51 irs calculation for taxable SS include dividends taxable interest TAX-FREE interest pension benefits Ira distributions ROTH IRA distributions other taxable income wages 1/2 social security received the tax free interest and roth ira are NOT TAXABLE but are part of ss calculation for taxes. the calculation and the 25,000,32000,and 44 thousand limits for single and married 50 percent and 85 percent are NOT inflation adjusted. just like the AMT kept hitting more and more people as time passed unless the congress fixes this it will keep getting worse. if you have substantial deferred accounts and have to pull money out after 70 the only adjustment to this is either pulling out more money out of accounts before it hits or take ss earlier to lessen the impact. 1/2 of whatever ss you are getting will be included in the calculation

Quote:

Originally Posted by Independent I think the important part of my post was that if I'm going to do the math, it's important that I use real SS numbers. Right now, deferring SS is a far more efficient way of buying lifetime income than buying a private annuity, so I shouldn't use private annuity numbers and assume that SS is about the same. The unimportant part was my choice of $1,000, which was just a handy round number. However, note that the Federal Poverty Level for a single person is $11,490. I'd disagree that I'd be so far under the poverty line with either $11,200 or $15,800 that I wouldn't notice the difference. For people I know in that income range, I expect that $387/mo is a big deal. (however, the actual lifetime income difference isn't that big) I'm currently deferring SS. The analysis that makes sense for my situation is that deferring reduces the uncertainty of my future income. It takes away some of the potential upside in return for limiting the downside.

So as I read these three posts and apply them to my situation I should defer and convert in the meantime. Let me explain this out.

I will have two retirements. One military and one FERS both will gross 2k plus each per month. I get a FERS supliment of right now an unknown quantity until age 62. I have 400k plus right now in a 401k pretax contribution. I might have 10k in Roth. My wife is saving at a nice rate and I expect her savings to reach 100k by she reaches 62. We are both 55 now. My SS will be 2100 per month at 62 and if I wait I will get 2800 per. I will leave out other capital gains of sales of two homes and a business.

So based on what I have read I should take as soon as I can 2k or more per month to convert into Roth and use as needed in the meantime. Maybe I should take 4k so that I can draw down enough to mitigate the income tax bite later when I start drawing SS? Does that sound like something I should do? I anticipate not having any mortgage and probably only car payments on the wife's new car when we move to retirement community.

[GolfingDuo]

So as I read these three posts and apply them to my situation I should defer and convert in the meantime. Let me explain this out.

I will have two retirement pensions. One military and one FERS both will gross 2k plus each per month. I get a FERS supliment of right now an unknown quantity until age 62. I have 400k plus right now in a 401k pretax contribution. I might have 10k in Roth. My wife is saving at a nice rate and I expect her savings to reach 100k by she reaches 62. We are both 55 now. My SS will be 2100 per month at 62 and if I wait I will get 2800 per. I will leave out other capital gains of sales of two homes and a business.

So based on what I have read I should take as soon as I can 2k or more per month to convert into Roth and use as needed in the meantime. Maybe I should take 4k so that I can draw down enough to mitigate the income tax bite later when I start drawing SS? Does that sound like something I should do? I anticipate not having any mortgage and probably only car payments on the wife's new car when we move to retirement community.

I am not retiring yet. I will only if one they send me packing, which they could. Two I reach my maximum age of 60 and I am forced to retire. That is still 4 years away.

[gerrym51]

Quote:

Originally Posted by GolfingDuo So as I read these three posts and apply them to my situation I should defer and convert in the meantime. Let me explain this out. I will have two retirement pensions. One military and one FERS both will gross 2k plus each per month. I get a FERS supliment of right now an unknown quantity until age 62. I have 400k plus right now in a 401k pretax contribution. I might have 10k in Roth. My wife is saving at a nice rate and I expect her savings to reach 100k by she reaches 62. We are both 55 now. My SS will be 2100 per month at 62 and if I wait I will get 2800 per. I will leave out other capital gains of sales of two homes and a business. So based on what I have read I should take as soon as I can 2k or more per month to convert into Roth and use as needed in the meantime. Maybe I should take 4k so that I can draw down enough to mitigate the income tax bite later when I start drawing SS? Does that sound like something I should do? I anticipate not having any mortgage and probably only car payments on the wife's new car when we move to retirement community. I am not retiring yet. I will only if one they send me packing, which they could. Two I reach my maximum age of 60 and I am forced to retire. That is still 4 years away.

i made my taxable ss post not to convince anybody to take ss early but that you cannot take the early/late taking ss decision in a vacuum. there are other considerations to be accounted for.

although this is a transition year for me since i will start taking ss in may and will pay taxes at the end of this year i have figured it out how not to pay any taxes starting next year until i turn 70 in 8 years. this is also part of my total return calculation

[GolfingDuo]

Quote:

Originally Posted by gerrym51 i made my taxable ss post not to convince anybody to take ss early but that you cannot take the early/late taking ss decision in a vacuum. there are other considerations to be accounted for. although this is a transition year for me since i will start taking ss in may and will pay taxes at the end of this year i have figured it out how not to pay any taxes starting next year until i turn 70 in 8 years. this is also part of my total return calculation

Okay but I guess that my post is a twofold question. I kind of think I will not need my SS. I anticipate with my wife's frugalness and my propensity to follow her wishes for the most part that we will be able to live on my two pensions once I am retired. She will be working a couple of years longer so for the first two years initially we will be able to live comfortably on income already in place. If I get a part time job that could add to it but I don't know how much I will make. Then there is the planned move so during that time we will need to put away moving expenses which I know will be a few thousand easily. We will have to sell our rental property during that time and our comb factory as well.

So putting off taking SS to roll over 401k money into Roth IRA and even start a Roth for my daughter in a trust is the question. Is that a good idea? I even think we can wait until 70 for both though I might have her start hers maybe so long as it don't raise our income too much.

[gerrym51]

Quote:

Originally Posted by GolfingDuo Okay but I guess that my post is a twofold question. I kind of think I will not need my SS. I anticipate with my wife's frugalness and my propensity to follow her wishes for the most part that we will be able to live on my two pensions once I am retired. She will be working a couple of years longer so for the first two years initially we will be able to live comfortably on income already in place. If I get a part time job that could add to it but I don't know how much I will make. Then there is the planned move so during that time we will need to put away moving expenses which I know will be a few thousand easily. We will have to sell our rental property during that time and our comb factory as well. So putting off taking SS to roll over 401k money into Roth IRA and even start a Roth for my daughter in a trust is the question. Is that a good idea? I even think we can wait until 70 for both though I might have her start hers maybe so long as it don't raise our income too much.

i love my 2 daughers and my granchildren. however i am divorced from their mother and remarried. my currrent wife has 2 children but no grandchildren
from them and will not have any.

i have to straddle a fine line in this regard. neither my wife's parents nor my parents left us anything(just an observation not a criticism). my wife and i are joint coholders or chief beneficiaries of everything . after the last spouse dies anything left gets divided among our 4 children evenly. thats the only way to maintain peace.

[GolfingDuo]

Quote:

Originally Posted by gerrym51 i love my 2 daughers and my granchildren. however i am divorced from their mother and remarried. my currrent wife has 2 children but no grandchildren from them and will not have any. i have to straddle a fine line in this regard. neither my wife's parents nor my parents left us anything(just an observation not a criticism). my wife and i are joint coholders or chief beneficiaries of everything . after the last spouse dies anything left gets divided among our 4 children evenly. thats the only way to maintain peace.

In our case we only have the one daughter. Neither of us has wed another. The Roth for the daughter is not even the question either. The real question comes down to if my two pensions of 48k is low enough to take portions of my 401k and roll it to Roth so that later it can off set other gains? We have other IRA's and the wife is still putting in money to her 401k. I know that is quite a complicated mess but at what point would I be income wise to be at to safely withdraw my 401k and pay the least amount of tax? Would I be wise to wait until I move to an income tax free state which is in the cards?

[gerrym51]

Quote:

Originally Posted by GolfingDuo In our case we only have the one daughter. Neither of us has wed another. The Roth for the daughter is not even the question either. The real question comes down to if my two pensions of 48k is low enough to take portions of my 401k and roll it to Roth so that later it can off set other gains? We have other IRA's and the wife is still putting in money to her 401k. I know that is quite a complicated mess but at what point would I be income wise to be at to safely withdraw my 401k and pay the least amount of tax? Would I be wise to wait until I move to an income tax free state which is in the cards?

i do not link well. i suggest you use a ss calculator. i use at moneyover55.about.com

plug in the numbers using various amounts and combinations to find taxable ss.
make sure you click married filing jointly.

this gives you amounts you can fiddle with.

then go to irs longevity tables. usually at 70 it's divide by 27.1

then go to irs.gov and print the 1040 tax form(not book) just form

using these 3 items you can extrapolate various scenarios.

i just basically use standard deduction and 2 exemptions about 20,000 to subtract from adjusted gross-then work from there. impossible to do exact because future tax forms don't obviously exist but it does give you good idea.

[GolfingDuo]

Quote:

Originally Posted by gerrym51 i do not link well. i suggest you use a ss calculator. i use at moneyover55.about.com plug in the numbers using various amounts and combinations to find taxable ss. make sure you click married filing jointly. this gives you amounts you can fiddle with. then go to irs longevity tables. usually at 70 it's divide by 27.1 then go to irs.gov and print the 1040 tax form(not book) just form using these 3 items you can extrapolate various scenarios. i just basically use standard deduction and 2 exemptions about 20,000 to subtract from adjusted gross-then work from there. impossible to do exact because future tax forms don't obviously exist but it does give you good idea.

Thank you that SS calculator makes sense to me. It tells me that at 67 and 2 months apply for my SS benies and suspend them. Then a few year later have my wife take spousal benies. Then at age 70 take mine. and the same for her when she reaches 70. At this I will probably be doing pretty well with my golf game I suspect.

Then that begs to the question of paying some of the taxes at the time I can begin withdrawing my 401k. Is it wise to take more than the 4% rule from my funds then put them into Roth? Will it even make much of a difference? I know that MA will take its piece of my pie as long as I claim it as home.

[gerrym51]

Quote:

Originally Posted by GolfingDuo Thank you that SS calculator makes sense to me. It tells me that at 67 and 2 months apply for my SS benies and suspend them. Then a few year later have my wife take spousal benies. Then at age 70 take mine. and the same for her when she reaches 70. At this I will probably be doing pretty well with my golf game I suspect. Then that begs to the question of paying some of the taxes at the time I can begin withdrawing my 401k. Is it wise to take more than the 4% rule from my funds then put them into Roth? Will it even make much of a difference? I know that MA will take its piece of my pie as long as I claim it as home.

i wish i was a seer but i'm not. every couples case is different.-but one thing to pay close attention to.

the irs info again is NOT inflation adjusted. i would not look at just the first years but subsequent years. although i have ss at 62 and you at 70 both of our ss(and wives) with get cola adjustment. the government in general WANTS higher income earners and savers(namely us) to pay more. the irs provisions for ss will never be inflation indexed in our lifetimes