Like you, I believe that going by overall population averages when looking at breakeven points is foolish. Your lifespan is an individual measurement and although we can't predict with certainty, there are reasonable estimates that can be made. I've done a couple of online calculations where you input family history as well as your own health and lifestyle circumstances and get a longevity estimate. Mine turns out to be 93 (not unreasonable since my mother is still going at 97.). That's different enough from a breakeven point based on the total population statistics that I've decided to wait beyond FRA before taking SS. I may not wait until I'm 70 due to other financial considerations but I'm already nearly two years beyond my FRA.Our family history suggests we’ll both live to 90 if not we’ll past, so we’re delaying SS until we’re 70. That math is simple...for most situations.
Steel, yes the amount on your statement is before WEP. The most they are taking now is 463.
What I find irritating about the Motley Fool is that on one day they will post an article listing the reasons why you should wait until 70 and the very next day they will post an article telling you why waiting until 70 is a big mistake.
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Once again, the Motley Fool is just posting "click bait".
Here is chart at 5% interest. Shows about the same amount at 87-89 yrs.
Nice calculation. The conventional wisdom of taking SS at 70 is the best is questionable unless you could live beyond 90 years. Why not take it earlier than 70 since longevity is uncertain?
Nice calculation. The conventional wisdom of taking SS at 70 is the best is questionable unless you could live beyond 90 years. Why not take it earlier than 70 since longevity is uncertain?
IMO, the biggest flaw in the article is that it assumes that one's goal is to maximize (expected) lifetime benefits. It does not even consider that one's goal may be instead to minimize the probability of running out of money.
Edit: The best spousal benefit is DH at 70. Not going to happen.
I'm curious as to why that would be, since spousal benefit doesn't grow beyond FRA (right?).
I'm curious as to why that would be, since spousal benefit doesn't grow beyond FRA (right?).
While it is important to include the time value of money, is it also important to consider mortality (the probability of living to receive the benefit).
opensocialsecurity.com is a useful tool that includes mortality and the time value of money.
Below are the expected present values of 4 scenarios for a single male born on 4/15/1957 (currently 62 yo) with a PIA of $1,457/month (like in the Motly Fool article) using 2017 Preferred mortality (reasonably healthy) and a 3% real discount rate (the 5% interest above less 2% Fed target for inflation):
Age 62.............................. $201,310
FRA (66/6 months)................204,463
Optimal (67/4 months)...........205,291
Age 70.................................199,726
Note that Age 70 is only 2.7%/$5,565 lower than the optimal solution... so as much as we vigorously debate this topic at the end of the day arguably any decision is fine (in this case of a single person... for a couple with a lower earning spouse the difference can be more).