Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 05-19-2015, 06:39 PM   #221
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Chuckanut's Avatar
 
Join Date: Aug 2011
Location: West of the Mississippi
Posts: 6,328
Quote:
Originally Posted by Independent View Post



The second post (by mathjak) said that's not true. You can prudently spend more in your 60's if you defer SS -- i.e. the guy in the video was simply wrong.

We've come full circle back to the fact that money is fungible.
__________________

__________________
The worst decisions are usually made in times of anger and impatience.
Chuckanut 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 05-19-2015, 07:39 PM   #222
Recycles dryer sheets
 
Join Date: May 2011
Location: Maple Valley
Posts: 465
DH and myself have decided to take social security at 62 because who even knows for sure that social security will be around our whole lifespan? Better to get some now while the getting is there. :-) I am currently 55 and my DH is 57.
__________________

__________________
kimcdougc is online now   Reply With Quote
You should take SS at 62
Old 05-19-2015, 09:24 PM   #223
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Chuckanut's Avatar
 
Join Date: Aug 2011
Location: West of the Mississippi
Posts: 6,328
You should take SS at 62

Quote:
Originally Posted by kimcdougc View Post
DH and myself have decided to take social security at 62 because who even knows for sure that social security will be around our whole lifespan? Better to get some now while the getting is there. :-) I am currently 55 and my DH is 57.
Q
__________________
The worst decisions are usually made in times of anger and impatience.
Chuckanut is offline   Reply With Quote
Old 05-19-2015, 09:26 PM   #224
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: 42,094
Quote:
Originally Posted by Chuckanut View Post
I have no problem with people taking SS at 62 as long as they don't start squawking a few years down the road about how poor they are, and how the government should take some $$ from those who get the larger checks in order to help those who cashed in at 62.
Is that something you've seen a lot?
__________________
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 05-20-2015, 12:07 PM   #225
Full time employment: Posting here.
 
Join Date: Sep 2007
Posts: 716
Quote:
Originally Posted by Texas Proud View Post
You have a couple of long posts showing what most people has said repeatedly.... the for a single person SS is agnostic on when to take it... IOW, they take into account everything you put down and it is basically a wash for the average person...
You fail to put in your post that most people that take SS are married and the calculations do NOT follow what you have... I am in that boat... there is ZERO calculation you can come up with that would make taking SS early or even on time beneficial to 'my family'...
I would be surprised if it came out significantly different for a married couple. Just in overall terms, you have to forego 100% of the benefit *now* in order to get a 7%-8% higher benefit *later*. However you look at it, it's going to take many years before the accumulated total of the 7%-8% payments add up to 100%. That's the same general fact for each person and for the couple as a whole.

So many of the articles you read tend to focus on the higher benefit you get by deferring and give short shrift to the money that you forego by waiting. If you focus on benefits but wave away the costs, you get a very distorted picture.

But, it sounds like it might be fun to play with and add another section to my SS spreadsheet. The calculations for spousal benefits seem rather complicated, so it'll take some serious studying. I bet that the break-even period is still around 10-15 years.

======
Purely from first principles, I strongly doubt that deferring for a couple has a completely different go/no-go answer than for a single. The SSA is just not in the business of giving away magnanamous amount of money for loopholes. Look at how quickly they got rid of the "Withdrawal of Application" scheme when it became widely advertised-- and that was something where the monetary benefit was negligible.
__________________
rayvt is offline   Reply With Quote
Old 05-20-2015, 12:35 PM   #226
Full time employment: Posting here.
 
Join Date: Sep 2007
Posts: 716
I did some more work in my spreadsheet to compute a whole montage of break-even periods, of deferring SS benefits.

To summarize,
* the breakeven period for most combinations of starting age and # of years of deferral is between 12 and 15 years.

* The famous "defer one year past FRA to get 8% more" takes 12.5 years to break-even.

* The shortest break-even is deferring from 62 to 70 -- 10.5 years.

* The time to break-even for a 67 FRA is not much different than for a 66 FRA. Where the 67'ers get hurt is in the size of the benefit, not the number of years it takes to break-even. At all ages, the person with 67 FRA gets less money than the person with the 66 FRA.

=========

I think that the problem with all these discussions and articles is that the usually are focussing on the wrong things.
* You get a higher monthly benefit if you defer --- indisputable, simple a matter of math.

The thing that matters here is how many years it takes until you come out ahead by deferring. And the unknown is whether you'll still be alive at that time.
The other thing that matters is the shape of the cash flow. No money now but more later, vs. some money now but less later. It does you no good to have more money later if you are in bad health and can't enjoy it.

* Deferring SS as longevity insurance is cheaper than buying a commercial annuity. Again, no dispute -- this is absolutely true.

The thing that matters here is not which is cheaper, what matters is if you want that annuity in the first place. If you do, then SS is the place to get it. If you don't want it, it doesn't matter which is cheaper since you aren't going to buy it anyway. It makes no sense to buy something you don't want, just because it is cheap.
__________________
rayvt is offline   Reply With Quote
Old 05-20-2015, 12:49 PM   #227
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,384
Quote:
Originally Posted by rayvt View Post
Deferring SS as longevity insurance is cheaper than buying a commercial annuity. Again, no dispute -- this is absolutely true.

The thing that matters here is not which is cheaper, what matters is if you want that annuity in the first place. If you do, then SS is the place to get it. If you don't want it, it doesn't matter which is cheaper since you aren't going to buy it anyway. It makes no sense to buy something you don't want, just because it is cheap.
Good summary. I do think also that a conservative move is to have that insurance, whether one thinks he needs it or not.

When I as making this decision I framed it as : Some benefit that is independent of my investment results is a good idea. It is good that this benefit has US Govt backing, and that it is inflation indexed. It is also good that this benefit can be very cheaply had, given current very low interest rates relative to the benefit.

Ha
__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is offline   Reply With Quote
Old 05-20-2015, 12:57 PM   #228
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: May 2005
Posts: 13,271
Quote:
Originally Posted by rayvt View Post
I would be surprised if it came out significantly different for a married couple. Just in overall terms, you have to forego 100% of the benefit *now* in order to get a 7%-8% higher benefit *later*. However you look at it, it's going to take many years before the accumulated total of the 7%-8% payments add up to 100%. That's the same general fact for each person and for the couple as a whole.

So many of the articles you read tend to focus on the higher benefit you get by deferring and give short shrift to the money that you forego by waiting. If you focus on benefits but wave away the costs, you get a very distorted picture.

But, it sounds like it might be fun to play with and add another section to my SS spreadsheet. The calculations for spousal benefits seem rather complicated, so it'll take some serious studying. I bet that the break-even period is still around 10-15 years.

======
Purely from first principles, I strongly doubt that deferring for a couple has a completely different go/no-go answer than for a single. The SSA is just not in the business of giving away magnanamous amount of money for loopholes. Look at how quickly they got rid of the "Withdrawal of Application" scheme when it became widely advertised-- and that was something where the monetary benefit was negligible.

The break even point is still out like you say.... but that is not the only thing you have to look at... DW is 10 years younger.... has no SS of her own... the calculation shows I get just under $1 mill in payments to my expected passing, but DW gets $1.9 mill total from spousal and survivor...

It is not even CLOSE on which way I should go as long as we are together and have normal life expectancy....

BTW, she should start taking spousal at 62 because there is no benefit in delaying as breakeven is long after I am gone....
__________________
Texas Proud is offline   Reply With Quote
Old 05-20-2015, 01:06 PM   #229
Thinks s/he gets paid by the post
 
Join Date: Jun 2014
Posts: 1,035
Simple question, is the 7-8 percent increase per year above and beyond the cola? Or is it really only a 5-6 percent increase?


Sent from my iPhone using Early Retirement Forum
__________________
dallas27 is offline   Reply With Quote
Old 05-20-2015, 01:52 PM   #230
Recycles dryer sheets
 
Join Date: Mar 2014
Posts: 152
Quote:
Originally Posted by dallas27 View Post
Simple question, is the 7-8 percent increase per year above and beyond the cola? Or is it really only a 5-6 percent increase?
If you delay taking SS, your benefit is increased 8% for every year between FRA and age 70, above and beyond the cola.
__________________
user5027 is offline   Reply With Quote
Old 05-20-2015, 02:41 PM   #231
Dryer sheet aficionado
 
Join Date: Feb 2014
Posts: 43
What you stated is true and a fact. What we all don't know is how long we will live. That is why this thread has over 200 responses. Which Is fine. We all learn from each other. Please all continue to provide your thoughts.


Sent from my iPhone using Early Retirement Forum
__________________
43WorkYears is offline   Reply With Quote
Old 05-20-2015, 04:44 PM   #232
Full time employment: Posting here.
NYEXPAT's Avatar
 
Join Date: Jul 2009
Location: Miraflores,Peru
Posts: 874
Quote:
Originally Posted by Texas Proud View Post
The break even point is still out like you say.... but that is not the only thing you have to look at... DW is 10 years younger.... has no SS of her own... the calculation shows I get just under $1 mill in payments to my expected passing, but DW gets $1.9 mill total from spousal and survivor...

It is not even CLOSE on which way I should go as long as we are together and have normal life expectancy....

BTW, she should start taking spousal at 62 because there is no benefit in delaying as breakeven is long after I am gone....
I am in a similar situation, but with a 10 y/o and 7 week old to boot.
I plan to take SS in 6 mos. at age 62 (suspend at 66 and restart at 70) My number is similar to yours but my Wife's is wildly different (She will only collect survivor benefits (28 years younger) starting at 67. She will also participate in the family benefit, once the oldest hits 18.

My benefit 951,808 dead at 94 (location to be determined)

Family benefit 96,886 child 1
261,145 child 2
125,775 Spouse portion of family benefit

Spouse Survivor bene 3,008,415 till age 100 (all numbers Cola'd at 2.5%)


Total 4,444,031

I find these #'s crazy as according to SS, I had only put in a little over 100k

Just goes to prove my theory," that sometimes it's better to think with the little brain"!
__________________
NYEXPAT is offline   Reply With Quote
Old 05-20-2015, 04:52 PM   #233
Thinks s/he gets paid by the post
Bikerdude's Avatar
 
Join Date: Jul 2006
Posts: 1,901
Quote:
Originally Posted by NYEXPAT View Post

Total 4,444,031

I find these #'s crazy as according to SS, I had only put in a little over 100k
Sort of makes you wonder about the sustainability of the program.
__________________
“I guess I should warn you, if I turn out to be particularly clear, you've probably misunderstood what I've said” Alan Greenspan
Bikerdude is offline   Reply With Quote
Old 05-20-2015, 05:12 PM   #234
Thinks s/he gets paid by the post
Big_Hitter's Avatar
 
Join Date: May 2013
Location: In the fairway
Posts: 4,094
Quote:
Originally Posted by Bikerdude View Post
Sort of makes you wonder about the sustainability of the program.
there is a significant lack of accumulating and discounting in his example, plus he went way past assumed life expectancy in both calculations AND didn't factor in any employer contributions...other than that it was a solid analysis
__________________
Swing hard, look up
Big_Hitter is offline   Reply With Quote
Old 05-20-2015, 05:28 PM   #235
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
clifp's Avatar
 
Join Date: Oct 2006
Posts: 7,450
Quote:
Originally Posted by rayvt View Post
=========

I think that the problem with all these discussions and articles is that the usually are focussing on the wrong things.
* You get a higher monthly benefit if you defer --- indisputable, simple a matter of math.

The thing that matters here is how many years it takes until you come out ahead by deferring. And the unknown is whether you'll still be alive at that time.
The other thing that matters is the shape of the cash flow. No money now but more later, vs. some money now but less later. It does you no good to have more money later if you are in bad health and can't enjoy it.

* Deferring SS as longevity insurance is cheaper than buying a commercial annuity. Again, no dispute -- this is absolutely true.

The thing that matters here is not which is cheaper, what matters is if you want that annuity in the first place. If you do, then SS is the place to get it. If you don't want it, it doesn't matter which is cheaper since you aren't going to buy it anyway. It makes no sense to buy something you don't want, just because it is cheap.
I think I'll just cut and paste this in the future, pretty much the perfect summary for a single person.

For a married couple it is more complicated. But in general I think you are significantly better off have the higher earner wait until 70 and the lower earner taking it early. This is especially true if the higher earner is older and male.
__________________
clifp is offline   Reply With Quote
Old 05-20-2015, 05:48 PM   #236
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
youbet's Avatar
 
Join Date: Mar 2005
Location: Chicago
Posts: 9,965
Quote:
Originally Posted by Texas Proud View Post
Since we are far away from the original post.... let me remind you that the premise was that you would spend the money when taking it at 62 in addition to whatever you had planed to spend anyhow.... so no time value of money involved since it is going out the door immediately....
As you say, we are far away from the original post. Clearly I was commenting on the Schwab analysis that was posted, not on the OP.
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
youbet is offline   Reply With Quote
Old 05-20-2015, 05:52 PM   #237
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2005
Posts: 5,408
here are the numbers as worked up by michael kitces.

22 years to break even if spending down a 50/50 portfolio to delay.

https://www.kitces.com/blog/how-dela...money-can-buy/
__________________
mathjak107 is offline   Reply With Quote
Old 05-20-2015, 05:58 PM   #238
Dryer sheet aficionado
 
Join Date: Feb 2014
Posts: 43
I am 2 1/2 years older approaching 62 within 3 months and can file now if I want at 62. No longer working, put in the 35+ years that SS determines your benefits. As I am here, my situation is my wife can live very well, wether I get 1850.00 a month now or 2650 a month at 66, if I go. I know there are so many situations, but my wife's income if I'm gone is not a concern. Would you say I make my decisions as a single person. We also own five homes besides stocks/ 401K's which would be her's if I'm gone. We have two sons in their 20's, working. My point is to get opinions and not to feel guilty on what I decide with SS. Pensions I have as well. She gets 50% if I go. Please provide your thoughts. Everyone on this site has provided a great amount of info for me and others on this sight. Best to all.


Sent from my iPhone using Early Retirement Forum
__________________
43WorkYears is offline   Reply With Quote
Old 05-20-2015, 06:05 PM   #239
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
youbet's Avatar
 
Join Date: Mar 2005
Location: Chicago
Posts: 9,965
Quote:
Originally Posted by mathjak107 View Post
here are the numbers as worked up by michael kitces.

22 years to break even if spending down a 50/50 portfolio to delay.

https://www.kitces.com/blog/how-dela...money-can-buy/
The 22 years, of course, is given his assumptions about returns and inflation and without consideration to the sequence of returns issue. A nice analysis for sure, but we should be careful to understand that it's 22 years plus or minus a bunch depending on returns, inflation and their sequence. Any particular individual may have a result less than or greater than the 22 years.
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
youbet is offline   Reply With Quote
Old 05-20-2015, 06:06 PM   #240
Thinks s/he gets paid by the post
 
Join Date: May 2008
Posts: 3,422
Quote:
Originally Posted by 43WorkYears View Post
I am 2 1/2 years older approaching 62 within 3 months and can file now if I want at 62. No longer working, put in the 35+ years that SS determines your benefits. As I am here, my situation is my wife can live very well, wether I get 1850.00 a month now or 2650 a month at 66, if I go. I know there are so many situations, but my wife's income if I'm gone is not a concern. Would you say I make my decisions as a single person. We also own five homes besides stocks/ 401K's which would be her's if I'm gone. We have two sons in their 20's, working. My point is to get opinions and not to feel guilty on what I decide with SS. Pensions I have as well. She gets 50% if I go. Please provide your thoughts. Everyone on this site has provided a great amount of info for me and others on this sight. Best to all.


Sent from my iPhone using Early Retirement Forum
You don't need SS, don't take it.

Just kidding.

If you have long life expectancy -- are healthy, have good family history -- and want to maximize the money you leave to the wife and sons, it would seem you'd want to wait.

If on the other hand you could use the extra money now and spend it while you're more active, then take it early?
__________________

__________________
explanade 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
When Should You Take Social Security? wanaberetiree FIRE and Money 20 09-02-2014 02:56 PM
when should you take social security article veremchuka FIRE and Money 117 02-21-2011 06:04 PM
why you should ALWAYS take SS as soon as you can endthefed FIRE and Money 69 06-05-2010 09:38 AM
Iraq and the Kansas Tornado. You should be angry. We all should. newguy88 Other topics 16 05-08-2007 08:20 AM

 

 
All times are GMT -6. The time now is 12:24 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.