Social Security income at 64

[Rob]

Hi all,
I'm 63 1/2 and currently working overseas and not contributing to Social Security, and will most likely be overseas for a long time. I like to do things right and conservative with my money and actions. However, for me to retire at 64, I'd like to supplement my pension with Social Security. The vast majority of opinions here and elsewhere say hold off until full retirement, and I probably could.

Nevertheless, here are the facts. I've contributed a lot less to Social Security over the years than most. If I received my social security at the age of 64 in 2011, I'd get $616/month. If I waited until my 66th birthday, I'd get $711/month. Is it worth waiting? I can understand if you are getting $1000+/month waiting, but to wait for two more years for an increase in a bit more than 1200 per year increase in my opinion does not seem worth it.

Concerning my finances, I have a retirement income of about $2,700/month, but that is the interest on 80% of my investments with TIAA-CREF. I'm keeping the principal intact. It's enough to live on, but the Social Security would help.

I'd be particularly interested in those of you that are advocates of waiting until full retirement age. As mentioned, I like to do things right, and getting Social security before 66 actually does not seem reckless. Moreover, that extra income allows me a bit more freedom that I did not have before and makes up for the loss in the US dollar that I'm feeling being overseas. The important thing is I am qualified for Medicare.

What do you think? Thank you very much.

Rob

 

[73ss454]

Hi Rob, you don't provide enough info about your finances to give any help.

 

[Bikerdude]

Hi all,
I'm 63 1/2 and currently working overseas and not contributing to Social Security, and will most likely be overseas for a long time. I like to do things right and conservative with my money and actions. However, for me to retire at 64, I'd like to supplement my pension with Social Security. The vast majority of opinions here and elsewhere say hold off until full retirement, and I probably could.

Nevertheless, here are the facts. I've contributed a lot less to Social Security over the years than most. If I received my social security at the age of 64 in 2011, I'd get $616/month. If I waited until my 66th birthday, I'd get $711/month. Is it worth waiting? I can understand if you are getting $1000+/month waiting, but to wait for two more years for an increase in a bit more than 1200 per year increase in my opinion does not seem worth it.

I'd be particularly interested in those of you that are advocates of waiting until full retirement age. As mentioned, I like to do things right, and getting Social security before 66 actually does not seem reckless. Moreover, that extra income allows me a bit more freedom that I did not have before and makes up for the loss in the US dollar that I'm feeling being overseas. The important thing is I am qualified for Medicare.

What do you think? Thank you very much.

Rob

Basically its an individual thing. You run your numbers and consider your own personal situation. Most who delay are married and want to maximize a benefit for a spouse upon their demise or have longevity in their genes. Some spend down their IRA to minimize RMD's. Others just think they are going to live forever.

 

[haha]

Basically its an individual thing. You run your numbers and consider your own personal situation. Most who delay are married and want to maximize a benefit for a spouse upon their demise or have longevity in their genes. Some spend down their IRA to minimize RMD's. Others just think they are going to live forever.

And still others know a cheap COLA annuity when they see it. Essentially you would be paying $616/mo over 24 months to recieve an extra $95/mo COLA for life. Taking a very rough 3% PV discount, you are paying $14350 for a COLA annuity underwritten by the US Treasury beginning at $1140. Go to the Vanguard website and see what that would cost you from an insurance company. While you are at it, see how much you would get and how much it would cost if you delay until 70.

In spite of what the previous poster said, it has nothing to do with delusions that you will live forever. This move requires only that you think inexpensive, high quality annuities are worth having in your retirement income plan.

Ha

 

[Alan]

You may like to look at this thread from earlier this year.

http://www.early-retirement.org/forums/f28/social-security-when-to-start-benefits-49142.html

 

[Rob]

You're missing the point. Looking at previous threads might be good for someone getting $1500/month at 66. I'd be getting $711 at 66 and $616 at 64. I thinking looking at postings for when to take SS is relevant only when the income you are getting from SS is more than what I'm getting. I just don't think it's a big deal to sacrifice $94/month to get my SS now rather than at 66. It seems ridiculous to fret over that amount, especially when we will most likely see benefits cut or re-adjusted in the future.

Rob

 

[haha]

You're missing the point. Looking at previous threads might be good for someone getting $1500/month at 66. I'd be getting $711 at 66 and $616 at 64. I thinking looking at postings for when to take SS is relevant only when the income you are getting from SS is more than what I'm getting. I just don't think it's a big deal to sacrifice $94/month to get my SS now rather than at 66. It seems ridiculous to fret over that amount, especially when we will most likely see benefits cut or re-adjusted in the future.

Rob

Your call Rob. What did the McDonalds ad say? Have it your way, have it your way...

We may be missing the point or you may be missing the point, or maybe there is no point.

But I am curious, why did you ask the question if you were sure of the answer? No one here is fretting except perhaps you who asked the question. We were only trying to give a serious response to what we mistakenly believed to be a serious inquiry.

Ha

 

[Rob]

I guess I'm just trying to put things in perspective. I've been struggling with Social Security and when to take it. It's just that delaying until 66 is very valid if you have a significant income from Social Security. Apparently that does not make any difference for some, and I wanted to see what others felt. Whether your Social Security is $300/month or $1000/month, some people just seem to feel that delaying it is proper.

In my own case, I feel that the extra $95 dollars per month I would get from Social Security by holding off from 64 to 66 years of age is not worth it. I wanted to hear from others, but I needed to emphasize that my SS is meager to begin with. To have an increase by delaying for two years on an already meager SS does not seem logical regarless of how good SS is thought of as an annuity.

Thanks again. I genuinely appreciate the responses.

Rob

 

[FANOFJESUS]

This might help Rob

Social Security Benefits Calculator

 

[Rob]

Thanks, but I've used the SS Claculator many times. That how I get the $616 now at the age of 64 and the $711 at 66.

Rob

 

[Nords]

I guess I'm just trying to put things in perspective. I've been struggling with Social Security and when to take it. It's just that delaying until 66 is very valid if you have a significant income from Social Security. Apparently that does not make any difference for some, and I wanted to see what others felt.

Actually many ERs have reduced earnings records (I only have 24 years of earnings myself) and quite a few of us are in your situation.

One of those factors isn't the dollar difference, it's the percentage difference. It doesn't seem like a lot of money when expressed in dollars, but 8%/year in deferred benefits can compound pretty significantly if you can somehow stretch that out to 66 or 68 or 70.

Another perspective is that if your entire retirement financial plan rests on this small difference in SS payments, then perhaps your ER plan is insufficiently capitalized.

So Alan is tactfully suggesting that your act of reading the other threads will pique something in your thinking or help you with factors you haven't thought of. I think dismissing his suggestion with phrases like "you're missing the point" is likely to leave this thread hanging with few, if any, responses.

 

[jdw_fire]

You're missing the point. Looking at previous threads might be good for someone getting $1500/month at 66. I'd be getting $711 at 66 and $616 at 64. I thinking looking at postings for when to take SS is relevant only when the income you are getting from SS is more than what I'm getting. I just don't think it's a big deal to sacrifice $94/month to get my SS now rather than at 66. It seems ridiculous to fret over that amount, especially when we will most likely see benefits cut or re-adjusted in the future.

Rob

actually i think you are missing ha's point. the decision to delay SS for a single person depends on how you feel about a cola'd annuity (backed by the US government) as a part of your retirement income package. if you want as much of that kind of annuity as you can get (at a price that beats similar annuities offered by insurance companies) then delay receiving SS until 70 (or use the payback option at that time). the amount of SS you are to receive has nothing to do with it as the analysis is scalable to any amount.

 

[Rob]

Thank you. I'm trying to live off just the interest. My full pension is about $55,000/year plus social security. I'm doing my best to delay the pension. Without explaining the situation, it is a pension I either can take fully or live off the interest from the accumulation. I'm living off the interest (about $2,700/month) at the moment.

Given the choice between SS and my pension, getting social security early and sacrificing the SS I would get at 66 rather than 64 is the dilemma.

I'm sorry if I came across wrongly. My apologies. Take care.

Rob

 

[Koolau]

I too would suggest rereading some of the older posts on the subject. However, here is what I have concluded from all of my reading on the subject of SS timing (both here and elsewhere): Assuming you have no information about your own longevity (e.g., good/bad family history, current good/bad health) then 1) Take the SS NOW if you need the income 2) Wait until 70 or else when you DO need the income to take SS. The bulk of my reading suggests that waiting for SS is one of the few good deals left in this world (on a percentage basis) so, since I don't need the income right now, I'm waiting. At any time, I can change my mind. If, suddenly, I decide I need the income, I'll change my strategy and take the money. If not, I'll wait until 70. The actual amount (whether $700/mo or $3000/mo) doesn't change the argument on a percentage basis.

Still, if your amount feels like "chump change" and you don't care to maximize it, by all means take it now and cross one more decision off your retirement "TO DO" list. As always, YOUR MILEAGE MAY VARY.

Good luck.

 

[rothlev]

it is your decision based on your own life issues. I did have my husband take his early for the same reasons you posted. He is retired civil service. The social security income is very small , and it hardly seemed worthwhile to wait for a small increase. Also, we took it early for quality of life reasons. We are going to use the money more now than when we are 80 or so. I am going to take mine early too.

 

[FANOFJESUS]

Thanks, but I've used the SS Claculator many times. That how I get the $616 now at the age of 64 and the $711 at 66.

Rob

Well I would try to guess my date of death the best I could to make the wisest choice. If you can make it untill 81 it pays to wait if not take it early. God knows our date of death we can only guess.

 

[Bikerdude]

Well I would try to guess my date of death the best I could to make the wisest choice. If you can make it until 81 it pays to wait if not take it early. God knows our date of death we can only guess.

Not that the OP cares, as his only concern was if we valued an extra $94 a month. Wrong forum to ask that question. My break-even age is 84. Everyone needs to run their own numbers and then make a choice. Its not a one size fits all.

 

[jdw_fire]

it is your decision based on your own life issues. I did have my husband take his early for the same reasons you posted. He is retired civil service. The social security income is very small , and it hardly seemed worthwhile to wait for a small increase. Also, we took it early for quality of life reasons. We are going to use the money more now than when we are 80 or so. I am going to take mine early too.

that depends on what you mean by "quality of life". as an example, lets say you are single and you havent started taking SS (as the OP) and you plan to have your retirement income produced from two sources, your portfolio and SS. if you plan on retiring and taking SS before age 70 then you would get $X from SS and $Y from your portfolio (making a real/inflation adjusted retirement income of $X+$Y for life). but if you would like to spend more money between the age you retire and the age of 70 (while maintaining the real/inflation adjusted $X+$Y income after age 70) then by delaying SS to age 70 you can accomplish that. i gave a couple of examples in an earlier thread.

http://www.early-retirement.org/forums/f28/when-to-delay-pension-or-ss-27925-6.html#post471145

and

http://www.early-retirement.org/forums/f28/when-to-delay-pension-or-ss-27925-7.html#post471597

 

[Alan]

Rob,

FWIW, I only have 23 years in contributions into the SS system and one of the reasons I plan to delay receiving payments until 67 or even 70 is not just the 8% / annum increase but it also means leaving a higher legacy for my DW should she outlive me.