Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 07-29-2011, 03:49 PM   #21
Thinks s/he gets paid by the post
MasterBlaster's Avatar
 
Join Date: Jun 2005
Posts: 4,359
Quote:
Originally Posted by TN_INVEST View Post
One of the main issues I see with most folks and their break even analysis is they forget you can pass away before taking social security (let's say age 64). Had they started ss @ 62, they would have probably already pocketed $40K.
You could make the same cooments about your nestegg.

What if you die before spending that extra $40k out of your nestegg.

Not only does it really suck to be dead, but what's worse you didn't spend enough !
__________________

__________________
MasterBlaster is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 07-29-2011, 05:32 PM   #22
Thinks s/he gets paid by the post
 
Join Date: Oct 2006
Posts: 3,817
Quote:
Originally Posted by TN_INVEST View Post
One of the main issues I see with most folks and their break even analysis is they forget you can pass away before taking social security (let's say age 64). Had they started ss @ 62, they would have probably already pocketed $40K.
My observation is that most people who forget they can pass away before taking SS aren't posting here.

According to the SS actuaries, a man born in 1950 and reaching age 62 will have almost a 3% chance of dying in the next 2 years (most of those people probably know they have unusually bad health on their 62nd birthday). They have about the same chance of living to 99 and dying sometime after that. Equivalent numbers for a woman are 2% and age 103.

Good planning requires thinking about both possibilities.
Life table Tbl_7_1950
__________________

__________________
Independent is offline   Reply With Quote
Old 07-29-2011, 05:52 PM   #23
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
mickeyd's Avatar
 
Join Date: Apr 2004
Location: South Texas~29N/98W
Posts: 5,881
When to begin taking SS depends on two main things IMHO ~(1) Your health. (2) Your financial need for the income stream that SS provides.

If you are in excellent health and have a family history of longevity and have enough current income from other sources (pensions, royalties, work etc) to pay all of you current expenses, delaying SSA income stream looks very good to me.
__________________
Part-Owner of Texas

Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx

In dire need of: faster horses, younger woman, older whiskey, more money.
mickeyd is offline   Reply With Quote
Old 07-29-2011, 06:27 PM   #24
Thinks s/he gets paid by the post
GregLee's Avatar
 
Join Date: Oct 2010
Location: Waimanalo, HI
Posts: 1,881
Quote:
Originally Posted by Independent View Post
According to the SS actuaries, a man born in 1950 and reaching age 62 will have almost a 3% chance of dying in the next 2 years (most of those people probably know they have unusually bad health on their 62nd birthday).
So if you're 62 and you don't know you have unusually bad health, your chance of dying in the next 2 years is less than that 3%, so you will probably live longer than the SS actuaries anticipate.
__________________
Greg (retired in 2010 at age 68, state pension)
GregLee is offline   Reply With Quote
Old 07-29-2011, 06:33 PM   #25
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
REWahoo's Avatar
 
Join Date: Jun 2002
Location: Texas Hill Country
Posts: 42,093
I took SS at age 62 and sincerely hope to live long enough to make it a bad decision.
__________________
Numbers is hard

When I hit 70, it hit back

Retired in 2005 at age 58, no pension
REWahoo is offline   Reply With Quote
Old 07-29-2011, 06:48 PM   #26
Recycles dryer sheets
Retch The Grate's Avatar
 
Join Date: Jul 2010
Location: Mountain View
Posts: 252
Quote:
Originally Posted by REWahoo View Post
I took SS at age 62 and sincerely hope to live long enough to make it a bad decision.
I keep wishing there was a like button on here.

My dad is waiting for 70 because he's looking at it as longevity protection for my mom.
__________________
Retch The Grate is offline   Reply With Quote
Old 07-29-2011, 07:19 PM   #27
Thinks s/he gets paid by the post
 
Join Date: Mar 2009
Posts: 1,433
I'm inclined toward the take it 62 camp. I think the numbers crunch pretty evenly when investment returns, life expectancy, and age related lifestyle are all considered. A nice supplement to my ER income that would allow my other investments to grow along with added flexibility of having control over my distributions. That's the idea now, but I've got 7 years to see what happens.
__________________
Retired in 2016. Living off dividends / interest and a mini pension. Freedom.
foxfirev5 is offline   Reply With Quote
Old 07-29-2011, 07:33 PM   #28
Recycles dryer sheets
 
Join Date: Jul 2008
Posts: 136
Quote:
Originally Posted by MasterBlaster View Post
You could make the same cooments about your nestegg.

What if you die before spending that extra $40k out of your nestegg.

Not only does it really suck to be dead, but what's worse you didn't spend enough !
Except if the money is in my nest egg, I get to pass it on. Yes, I know SS has spousal provisions, but something tells me the actuaries have already run the numbers and accounted for that.

Quote:
Originally Posted by Retch The Grate View Post
I keep wishing there was a like button on here.

My dad is waiting for 70 because he's looking at it as longevity protection for my mom.
Does your mom work? What about dad?

Have they considered filing and suspending his benefits? Or filing a restricted benefit?

In their case, their tightening of their budget is going to be the real "magic" that helps them financially (i could be wrong, but something tells me they are being fairly careful with their expenses if dad is that worried about mom's future).

I know SSA limits the reset/do-over to 12 months, but that too is an option that often sides with taking benefits early.

Me...I simply prefer to get "my" money as soon as I can.
__________________
TN_INVEST is offline   Reply With Quote
Old 07-29-2011, 08:16 PM   #29
Recycles dryer sheets
Retch The Grate's Avatar
 
Join Date: Jul 2010
Location: Mountain View
Posts: 252
Quote:
Originally Posted by TN_INVEST View Post
Does your mom work? What about dad?

Have they considered filing and suspending his benefits? Or filing a restricted benefit?

In their case, their tightening of their budget is going to be the real "magic" that helps them financially (i could be wrong, but something tells me they are being fairly careful with their expenses if dad is that worried about mom's future).
My mom doesn't/didn't work in an income producing job after I was born, I'm not sure she ever earned any income in the US actually, her work may all have been in Ireland.

The SS is cheap longevity insurance for them, no belt tightening going on. My dad is happily working as a professor and isn't considering retiring before 70, and even then he may just dial it back to only teaching a few classes so he still gets to have the fun with a somewhat lower workload.
__________________
Retch The Grate is offline   Reply With Quote
Old 07-30-2011, 12:42 AM   #30
Thinks s/he gets paid by the post
 
Join Date: Jan 2006
Posts: 1,012
Quote:
Originally Posted by TheWizard View Post
I'll read the JFP article later this evening, thanks.

In my case, I'm not too worried about running out of funds in later years. I think my goal is to have a comfortable excess of discretionary income to permit more elaborate SCUBA diving island travel than has been feasible to this point.

The major $$ uncertainty isn't so much on the SS side, but on the side of my personal nest egg investments. So, as someone else said, it's becoming clear that this will be a steer-it-as-you-go kind of plan, not something that can be cast in cement ahead of time...
if you want to spend more between the ages of 62 - 70 while spending the same after age 70 then take SS at age 70. for a few examples with numbers i include the following links.

here are 2 hypothetical examples that used another posters SS numbers Social Security at 62, 66 or 70?

and here is a 3rd that was an analysis of another poster's numbers: When to take Social Security with this correction and further comment When to take Social Security

BTW if using the 4% rule is too risky for you the argument i make for taking SS at age 70 improves with lower initial WRs.
__________________
jdw_fire is offline   Reply With Quote
Old 07-30-2011, 05:54 AM   #31
gone traveling
 
Join Date: Apr 2009
Location: Eastern PA
Posts: 3,851
Quote:
Originally Posted by TN_INVEST View Post
Me...I simply prefer to get "my" money as soon as I can.
You and over 70% of the rest of the folks that claim at age 62.

I've run the numbers for us (as a married couple, which changes the rules a bit). DW will claim at FRA age of 66, I'll claim 50% spousal against her at that time (for my age 66-69 - we're the same age), and then claim mine at age 70 - both for the total financial benefit, but more importantly to have my wife take my benefit amount (which is much higher than her FRA amount) for the rest of her life, assuming I die first.

FYI, I used FIDO's RIP (Retirement Income Planner) program to run the different scenerio's of taking SS at different points, to come up with a plan that made sense for us, and our situation.

We're not concerned about getting "our" money back; rather we're planning for a consistent source of income as we age. Cash flow in retirement is everything. Anyway (as I've said often), money is for the living - not the dead. If we ensure a maximum revenue stream while we're alive - especially as we age, it works for us.

Everybody is different, in SS discussions; married vs. single, healthy vs. not, able to fund ER through other means vs. just getting by, and feelings of "I want mine" vs. looking at the total picture - of "possibilities". Few people will make the same decision, but everyone making that decision "knows" what the correct answer is...
__________________
rescueme is offline   Reply With Quote
Old 07-30-2011, 06:23 AM   #32
Dryer sheet aficionado
 
Join Date: Jul 2011
Location: Reading, MA
Posts: 37
Quote:
Originally Posted by jdw_fire View Post
if you want to spend more between the ages of 62 - 70 while spending the same after age 70 then take SS at age 70. for a few examples with numbers i include the following links......
I'll check those links shortly, thanks.
I don't presume to know what my future holds that far down the road, of course. The usual train of thought is that discretionary "fun" expenditures tend to decline after age 70 or 75, only to be replaced with increasing medical expenses.
__________________
TheWizard is offline   Reply With Quote
Old 07-30-2011, 06:40 AM   #33
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jun 2005
Posts: 8,616
A thread on bogleheads pertinent to this thread has links to a NYTimes article on "when to collect SS" which in turn has links to some newish on-line calculators to help one make the this decision: Bogleheads :: View topic - Web/Online calculators: When to Collect Social Security?
__________________
LOL! is offline   Reply With Quote
Old 07-30-2011, 08:50 AM   #34
Dryer sheet aficionado
 
Join Date: Jun 2011
Location: Saint Joseph
Posts: 41
When I was younger, I didn't think it would be this confusing trying to decide when to retire, when to take SS, etc. The trouble with all the calculators and recomendations is they rely on statistics based on a large population. I (we) have to make a decision based on a population of 1 or 2 (or in my case 3). So the odds of you making the wrong choice go way up. My wife and I are both 58, but I do have a disabled daughter who is getting SS payments (though only $220/month) so I haven't figured out yet how it will effect her when I retire.
__________________
jeffmete is offline   Reply With Quote
Old 07-30-2011, 09:29 AM   #35
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
TromboneAl's Avatar
 
Join Date: Jun 2006
Posts: 11,197
Quote:
Originally Posted by HFWR
My current thinking is to take it at 62 - for both "bird-in-the-hand" and to enable retirement earlier issues. Subject to change...

One reason not often mentioned when discussing waiting as long as possible is to draw down retirement accounts, thereby reducing RMDs.
I'm also flip flopping on this, but my current thinking is to wait till 70. Why? Because with the rate we get at 70, we could survive without any other income, even if we live to be 110.

It's likely that we'll get more if we start at 62, but the above means no worries.

Re RMDs, I don't think those matter unless you want to leave an inheritance. Right?
__________________
Al
TromboneAl is offline   Reply With Quote
Old 07-30-2011, 09:39 AM   #36
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
TromboneAl's Avatar
 
Join Date: Jun 2006
Posts: 11,197
Remember that, unless you are sick, it's a lot harder to spend money after age 85 or so. You may just want to hang out around home.
__________________
Al
TromboneAl is offline   Reply With Quote
Old 07-30-2011, 10:50 AM   #37
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
HFWR's Avatar
 
Join Date: May 2005
Location: Lawn chair in Texas
Posts: 12,964
Quote:
Originally Posted by TromboneAl View Post
I'm also flip flopping on this, but my current thinking is to wait till 70. Why? Because with the rate we get at 70, we could survive without any other income, even if we live to be 110.

It's likely that we'll get more if we start at 62, but the above means no worries.

Re RMDs, I don't think those matter unless you want to leave an inheritance. Right?
In my case, unless my 401k grows a lot more over the next few years than I expect, I'd likely be living mostly on SS if I waited until 70 to collect.

As for RMDs, if your nest egg happens to still be sizable when you hit 90, you may be required to take some fairly large withdrawals, throwing you into a higher-than-necessary tax bracket. Of course, you could determine this enough ahead to take larger, earlier withdrawals, then leave the unused portion in non-RMD susceptible accounts.
__________________
Have Funds, Will Retire

...not doing anything of true substance...
HFWR is offline   Reply With Quote
Old 07-30-2011, 11:30 AM   #38
Thinks s/he gets paid by the post
 
Join Date: Oct 2006
Posts: 3,817
Quote:
Originally Posted by GregLee View Post
So if you're 62 and you don't know you have unusually bad health, your chance of dying in the next 2 years is less than that 3%, so you will probably live longer than the SS actuaries anticipate.
Yes. Life insurers think that at those ages they can avoid more than half the deaths in the first year after issue just by avoiding people with known health issues. However, the impact of selection wears off over time.

So if healthy people have only a 1.5% chance of dying in the first two years instead of 3.0%, that doesn't mean they have a 4.5% chance (instead of 3%) of making it to 99.
__________________
Independent is offline   Reply With Quote
Old 07-30-2011, 11:55 AM   #39
Dryer sheet aficionado
 
Join Date: Jul 2011
Location: Reading, MA
Posts: 37
Quote:
Originally Posted by HFWR View Post
As for RMDs, if your nest egg happens to still be sizable when you hit 90, you may be required to take some fairly large withdrawals, throwing you into a higher-than-necessary tax bracket......
RMDs start at age 70-1/2, not 90...
__________________
TheWizard is offline   Reply With Quote
Old 07-30-2011, 12:01 PM   #40
Recycles dryer sheets
 
Join Date: Jul 2008
Posts: 136
Quote:
Originally Posted by TheWizard View Post
RMDs start at age 70-1/2, not 90...
Yes, they do. However, they can be quite severe at age 90
__________________

__________________
TN_INVEST is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Delay taking pension? ER Fireball FIRE and Money 23 07-12-2011 09:38 AM
I'm ready to start stocking up on guns and canned goods here in Minnesota Hamlet FIRE Related Public Policy 12 07-11-2011 07:54 PM

 

 
All times are GMT -6. The time now is 06:46 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.