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why you should ALWAYS take SS as soon as you can
Old 05-31-2010, 12:30 AM   #1
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why you should ALWAYS take SS as soon as you can

i'm sure it's been brought up....but i havent seen it.

it's my position that one should always take ss as soon as possible.

reason? you can give the early money back (without interest!) and begin receiving the larger check if you choose to.

it's a free lunch.
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Old 05-31-2010, 12:53 AM   #2
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It's been talked about here before. If you do a search you will find the threads.

I agree to take ss as soon as possible. I wish they had it available at any age, even 40 or 50. I know it would be at a severe discount, but I would take it anyway. Like you said, if I took it at age 50 and made it to 65 with plenty of money, I would consider repaying everything I got in exchange for a higher monthly benefit.
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Old 05-31-2010, 12:59 AM   #3
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Originally Posted by retire@40 View Post
It's been talked about here before. If you do a search you will find the threads.

I agree to take ss as soon as possible. I wish they had it available at any age, even 40 or 50. I know it would be at a severe discount, but I would take it anyway. Like you said, if I took it at age 50 and made it to 65 with plenty of money, I would consider repaying everything I got in exchange for a higher monthly benefit.
thanks for the info. i posted this because i saw some threads that had people waiting to get the bigger check. i hope this thread helps them.

me too - i want to take it in a year or two. sadly i'm only in my early forties. so i'm wrestling with megacorp annuity from now until 62....versus lump sum. i dunno

also working on 72t issues....but the interest rate is ridiculously low right now
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Old 05-31-2010, 01:15 AM   #4
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Originally Posted by endthefed View Post

you can give the early money back (without interest!) and begin receiving the larger check if you choose to.

it's a free lunch.
Not if you die in the first 10 years after paying it back.
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Old 05-31-2010, 01:22 AM   #5
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Not if you die in the first 10 years after paying it back.
you have the choice to pay it back (or not) and receive the bigger check. that's the beauty of it.

if i live that long, that will be a hard decision. i see many hours of crunching numbers and flipping coins
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Old 05-31-2010, 02:20 AM   #6
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Originally Posted by endthefed View Post
i'm sure it's been brought up....but i havent seen it.

it's my position that one should always take ss as soon as possible.

reason? you can give the early money back (without interest!) and begin receiving the larger check if you choose to.

it's a free lunch.
Like your gold thread.... you state that this is the only position to take... and I disagree... everybody's situation is different and there can be some good reasons not to do what you say...

What if you are married and your wife does not have any work history... if you take it early and die... what happens to her benefits? What if she is younger and will likely live 20 more years than you What if you pay it back and have a heart attack the next day because you stress out at writing that check...

Sure, there are some who probably would benefit from what you say... but not all... no blanket statements....
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Old 05-31-2010, 05:43 AM   #7
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Right now I am not going to take SS early. I've seen nothing that says that if I die a day after I get my first SS check, my husband can pay it back. It appears to me that if I take the reduced benefit at 62 my husband's survivor benefit is based on the reduced benefit. If I don't take the reduced benefit, his survivor benefit will be based on the full benefit. If I am wrong, please tell me and explain how it works.
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Old 05-31-2010, 05:53 AM   #8
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With the caveat that no one can predict the future...

It depends on your specific goals and your specific situation.

One size does not fit all!

The free lunch part is debatable... we paid into the system.

The do over option provides people (that have the money to pay back) the ability to adjust and perhaps correct a mistake.... life's uncertainties.

Unlike an insurance company (which has a profit motive)... the Gummit is more concerned with maintaining a system to provide the elderly with the means to meet their basic needs.
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Old 05-31-2010, 06:43 AM   #9
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Like your gold thread.... you state that this is the only position to take... and I disagree... everybody's situation is different and there can be some good reasons not to do what you say...
I fully agree. It depends on your personal situation.

If you are single, or disabled (e.g. your life expectancy is less than normal), or if you just need the $$$ to survive/live, than take it early.

If you are married, there are other considerations not only for yourself, but also possibly for the benefit of your spouse, along with survivorship income issues. Also the situation of working past age 62 must be considered.

As for my DW/me, both 62 and not taking SS till later, it took a bit of planning. BTW, I'm retired; my wife still wo*ks, but may retire at any time (her personal decision - not a financial one).

In our case, my DW will take her SS at her FRA age of 66. At that time, I will claim a 50% spousal benefit against her, while I let my own benefit accrue additional longevity credits.

At age 70, I'll claim SS. Facing the reality that I will pass before my DW, she will get my full benefit (which is forecast to be 2x her age 66 benefit).

So I "get" SS (by claiming against her) while I delay my SS for a much greater benefit for her in the future.

How did I determine the "best way" for us? Simple, I ran the age 62/66/70 scenarios through FIDO's Retirement Income Plan software, which gives terminal plan values, along with year by year withdrawal rates, forecast taxes, and computation of excess RMD's (RMD in excess of normal withdrawals to support our retirement income requirements). Our plan shows the largest terminal plan value, which also means that we've planned a buffer if the market does not turn out as expected, in the long term.

Again, there is no "automatic answer". You have to run the various scenarios on your situation and make your personal decision, based upon your retirement plan - not others...
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Old 05-31-2010, 06:53 AM   #10
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It's been talked about here before. If you do a search you will find the threads.
And here are some of them.

Social Security: Re-starting SS at 70 y.o.?

Social Security - When to start benefits..

As Texas Proud says, it's not a black and white issue; there are many shades of grey.
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Old 05-31-2010, 07:40 AM   #11
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I'm sure I will take it early, being single and no worries about what a dependent would get. But a little over 6 more years to think about it.
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Old 05-31-2010, 07:57 AM   #12
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Not if you die in the first 10 years after paying it back.
Wouldn't this also be true if you delayed it and died in the first 10 years after starting your SS? At least for a single person.

With regard to the spousal issue, I seem to recall that OAG (who did a repay and restart) suggested in an earlier thread that a surviving spouse might be able to repay and restart her husband's SS as an "interested party". Does anyone know for sure whether or not this is the case?
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Old 05-31-2010, 08:09 AM   #13
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Old 05-31-2010, 08:26 AM   #14
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I guess our thinking is not what pays us the most overall in total, but what suits us best.

We're still 9 years out from even an early social secuity at 62, and the rules are likley to change by then.

That said, at this time, we plan to do one of two things.
1. DH will claim at 62 or so, and then I will claim half of his when I get to FR age. I will then claim at 70 since my benefit will be higher than DH whenever we apply. We would do this because if I pass, he will need the extra money, and if he passes, I live cheaper than he does.
2. We will both wait until age 70. Thinking here is that we can spend down some of the assets, and reduce taxes against SS, and then SS will (hopefully) be tied yet to cost of living.

Not sure what the future holds, but feel confident we will still have SS- even if bebefit is reduced.
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Old 05-31-2010, 08:43 AM   #15
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Old 05-31-2010, 09:31 AM   #16
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Another thing to consider........this giveback doesn't always go as planned since apparently it isn't done often enough to keep those who administer it in training. Unless you understand exactly how it is supposed to happen, it may not , and even if you do understand, you may have to battle to get it done correctly. Some horror stories from bogleheads.com:
Bogleheads :: View topic - Bob's Saga of SSA-521 Concluded (I think!)
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Old 05-31-2010, 10:27 AM   #17
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I think there are risks (including unknown risks) in either taking SS early or later. I like the idea that if I take it early and then change my mind, I can payback and restart, but I fear that is a potential political hot potato. While the number of people who actually do this is so small that there is a good chance this will never get enough attention to change it, there is also a risk that it sounds too good and politicians will want to "reduce waste" by sticking it to fat cats who manipulate the SS system to get larger benefits. The sound bites may be irresistible. I don't want to put myself in a position where I could be locked in to a smaller benefit that I don't want, merely because I expected the system to allow a (rarely used) restart of my application. As I see it, I can use SS as income source whenever I choose, but if I delay, I am using it as a form of longevity insurance. I'd rather have the longevity insurance, so I'm waiting. Maybe I'll change my mind if circumstances change, but I am cautious about rule changes. It seems like the rules get tinkered with every few years, and I don't want to get caught on the wrong side of future changes.
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Old 05-31-2010, 10:42 AM   #18
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My plans are to collect SS survivor benefits at 60 in a little over 4 years. I don't know what the amount will be as I have never checked. I suppose at 66 I could then switch over to SS on my own record if it is higher although I doubt this will be the case. I had given some thought to not collecting the survivor benefits until later as I won't need the money to live, but thought it wise to get grandfathered in asap in case any changes are afoot.
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Old 05-31-2010, 10:55 AM   #19
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1. Folks with spouses impacted by the GPO provision need to keep in mind that their SS situation is different than either the single or the married case. You have a spouse and the related considerations regarding that spouse's well being after you pass, but the spouse cannot collect SS on your earnings record.

2. I started SS at 62. This substantially reduced withdrawals from my FIRE portfilio during the recession which I liked. Because my spouse cannot collect SS on my earnings record (GPO), having a larger FIRE portfolio is all I can do for her security if I pass first.

3. The biggest unknown factor for me is what will the investment returns be on the SS money I'm collecting between 62 and FRA. I don't invest the actual SS dollars received, but those SS dollars keep me from withdrawing invested dollars from my FIRE portfolio, which amounts to the same thing.
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Old 05-31-2010, 11:53 AM   #20
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The payback method seems like a huge PITA in so many ways, including having to amend my tax forms for the intervening years. Avoiding that is worth a lot to me personally so that is one option that I do not intend to pursue.
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