Poll: Taking SS - when?

[6miths]

I voted in the <62 and taking it at 62 category, but maybe should have been other? I voted for us as a family. DH is 54 and we have young kids. After looking into it on the advice I received here, it’s a no brainer for us as a family to start collecting when he turns 62, as long as there are no changes to SS in the interim.

Why do you say it is a 'no brainer'? Do you desperately need the money or does he have a health condition that will limit life expectancy?

 

[jimandthom]

Suggest you ignore the following unless you are interested in WEP and GPO

I voted "under 62 and starting SS at 70", though I include the "can change my mind at any time" rider. DW, now 62, will start whenever she retires. Her school system pension makes her SS subject to WEP, so her SS will be less than $500/month.

Waiting until 70 is longevity insurance, but more importantly, it is spousal survivor benefits. The survivor benefits would be almost negated by GPO (due to her pension) if I take an age 62 benefit. However, my SS benefits will grow more between age 62 and 70 than 2/3rds (part of the GPO calculation) of her pension growth. Thus, there will be much more for her to claim from my benefits if I wait until 70 (and die before her).

Good point on the calculation at 70 not just FRA etc. Just did some math.

For us------ 2/3 of spouses CSRS present value subtracted from my SS future value estimate at 70 still puts us in the negative. I didn't add in colas as they are usually the same.

The final three years in calculating the CSRS pension were by far the largest earning.

It was a time when many auxiliary mail routes were being combined with other permanent routes and some of the sorting automation was starting to take major inroads.

So-- he went to 6 days every other week on a somewhat high volume high mileage route( but not so high as to cause any red flags) for 2 of the final three years.

Plus most of my last 15 years of worklife was being able to work in a job that allowed me to continue with my parental care arrangements. Pay was ok, had health benefits, great employee discount, 401k and I could walk to work. It was actually the perfect job in light of the care needs.

Guess I'll stick with collecting next year or 2020 for FRA.

 

[tb001]

Why do you say it is a 'no brainer'? Do you desperately need the money or does he have a health condition that will limit life expectancy?

As I understand it, at 62, we will receive benefits for him as well as benefits for our two children, up to 18, and for me if I’m the sole caregiver, up to a family max. The article one of the forum members sent me to is here:

https://www.kitces.com/blog/why-soc...-it-a-good-deal-to-start-early-and-not-delay/

 

[6miths]

Why do you say it is a 'no brainer'? Do you desperately need the money or does he have a health condition that will limit life expectancy?

As I understand it, at 62, we will receive benefits for him as well as benefits for our two children, up to 18, and for me if I’m the sole caregiver, up to a family max. The article one of the forum members sent me to is here:

https://www.kitces.com/blog/why-soc...-it-a-good-deal-to-start-early-and-not-delay/

That is interesting and it sounds like you are correct in your situation. I don't know if we have those rules north of the border. Never an issue for us as children are grown.

 

[MarieIG]

Under 62 - and all over the map. In theory, if in good health, and depending upon status of conversions, would like to postpone mine to a minimum of 65, and DH (with the better earning history) to 70.

 

[NW-Bound]

Yes on being Canadian and yes the Canada Pension Plan is very similar to Social Security. Taking it later means a greater monthly cheque. AFAIK the main differences are that the maximum payout for SS is higher than CPP for high income earners although the governments have been talking about increasing the amounts for the last few years for all incomes (with increased contributions of course) and the second difference is that the Plan is in good shape financially and never discussion about it not existing or reductions in payouts. The age range to start is 60 with full benefits at 65 increasing to a maximum at 70. There have been discussions about increasing the range by 2 years due to longer lifespans but hasn't happened yet. As well there are two other pension plans which are not contribution based - Old Age Security which starts at 65 and the Guaranteed Income Supplement which also starts at 65 for those with low incomes. The effect of the three plans is that poverty in old age is quite low with many low income individuals having a greater income in old age than they did in their working years.

I recall having an exchange with Meadbh (who has left the forum) about Canadian CPP. As I recall, the payout is lower than USA's SS, but then the contribution is also lower.

 

[6miths]

I recall having an exchange with Meadbh (who has left the forum) about Canadian CPP. As I recall, the payout is lower than USA's SS, but then the contribution is also lower.

Yes that's right. At the lower end I think the numbers are very similar but the maximum pensionable earnings is lower so if one is much above average income then there is no further increase in benefits (or contributions while working as you point out). Old Age Security (which is residence based and funded out of general tax revenues) is clawed back entirely by the time one has an annual income of about 107k for an individual. At that income it is hard to argue that one needs a subsidy from tax payers.

 

[ShokWaveRider]

I wish people would stop referring to SS and other state pensions as Tax Payer funding. They are an insurance annuity that has been fully or partially paid for by the recipient, a Contract if you like with a maturity date (multiple maturities in the case of SS). If it is Partial then payouts are reduced accordingly.

 

[pb4uski]

Not sure what you are all exercised about... the word entitle only shows up once on this page prior to your post and in that case not in the context that you object to.

 

[harley]

Also, if SS isn't funded by tax payers, where do you think the money came/comes from?

 

[ShokWaveRider]

Also, if SS isn't funded by tax payers, where do you think the money came/comes from?

The money we all pay (Paid) into it for 30 odd years. If not why did we have to pay SS Taxes on our income all our lives.

 

[ncbill]

Voted "Younger than 62 - SS @ FRA"

My SS will be 1/2 of spouse's SS @ FRA (makes most sense for her to take SS @70)

I don't have enough retirement credits to be eligible for SS on my own record.

Since I spent...let's just say "well over a decade" taking care of an ill parent, which started not long after graduate school.

 

[candrew]

not sure what you are all exercised about

 

[harley]

I wish people would stop referring to SS and other state pensions as Tax Payer funding. They are an insurance annuity that has been fully or partially paid for by the recipient, a Contract if you like with a maturity date (multiple maturities in the case of SS). If it is Partial then payouts are reduced accordingly.

The money we all pay (Paid) into it for 30 odd years. If not why did we have to pay SS Taxes on our income all our lives.

That just doesn't make any sense. Oh well, I'll refer to it any way I like, and you can do the same.

 

[dtbach]

Age 65, DW 61. She will take at 62, me at 70. Her family has short longevity, me just the opposite.

 

[pb4uski]

That just doesn't make any sense. Oh well, I'll refer to it any way I like, and you can do the same.

No, it does make sense. His point is that SS benefits are something that you have paid for, therefore dissimilar from food stamps, welfare, medicaid, etc which are traditional entitlement programs where eligible citizens receive benefits without necessarily having ever contributed.

 

[ShokWaveRider]

No, it does make sense. His point is that SS benefits are something that you have paid for, therefore dissimilar from food stamps, welfare, medicaid, etc which are traditional entitlement programs where eligible citizens receive benefits without necessarily having ever contributed.

Thank you!

 

[6miths]

No, it does make sense. His point is that SS benefits are something that you have paid for, therefore dissimilar from food stamps, welfare, medicaid, etc which are traditional entitlement programs where eligible citizens receive benefits without necessarily having ever contributed.

Yes I think it makes sense too. Was my point about CPP in Canada versus Old Age Security (and Guaranteed Income Supplement - GIS). Like SS, CPP is paid into as you work by employee and employer deductions (payroll taxes) and thus due to workers based on these contributions (of course you could say that these workers are taxpayers). While OAS and GIS are paid for out of current general tax revenues and are not dependent on direct worker/employer contributions.

 

[MI-Roger]

Under 62, Retiring at 63-1/2, Claiming immediately

In my mind it is not a question of whether we can or cannot support ourselves without SS. Rather it is a question of which investment will provide the greater future income and wealth increase.

The $2200 per month that I will likely receive from SS at age 63-1/2 is $2200 that I do not need to liquidate from other investments. Investments that provide greater than 8% growth or income each year.

Therefore I will leave my high return portfolio dollars invested and spend the lower return, early filing, SS dollars on life's essentials.

 

[Cessna152]

No, it does make sense. His point is that SS benefits are something that you have paid for, therefore dissimilar from food stamps, welfare, medicaid, etc which are traditional entitlement programs where eligible citizens receive benefits without necessarily having ever contributed.

In the 1937 Helvering v. Davis case, the U.S. Supreme Court stated that for Social Security "The proceeds of both the employee and employer taxes are to be paid into the Treasury like any other internal revenue generally, and are not earmarked in any way."

In the 1960 Fleming v. Nestor case, the court stated "To engraft upon the Social Security system a concept of ‘accrued property rights’ would deprive it of the flexibility and boldness in adjustment to ever changing conditions which it demands." And further stated "It is apparent that the non-contractual interest of an employee covered by the [Social Security] Act cannot be soundly analogized to that of the holder of an annuity, whose right to benefits is bottomed on his contractual premium payments."

These are the legal rulings of the highest court in the country. Hopefully simply stated facts are not verboten on this forum.

 

[MI-Roger]

Except....... SS benefits are highly formulaic based upon payments made each year and years of contribution. Thus making benefits received directly linked to the value of contributions made, and therefore not an entitlement.

 

[pb4uski]

In the 1937 Helvering v. Davis case, the U.S. Supreme Court stated that for Social Security "The proceeds of both the employee and employer taxes are to be paid into the Treasury like any other internal revenue generally, and are not earmarked in any way."

In the 1960 Fleming v. Nestor case, the court stated "To engraft upon the Social Security system a concept of ‘accrued property rights’ would deprive it of the flexibility and boldness in adjustment to ever changing conditions which it demands." And further stated "It is apparent that the non-contractual interest of an employee covered by the [Social Security] Act cannot be soundly analogized to that of the holder of an annuity, whose right to benefits is bottomed on his contractual premium payments."

These are the legal rulings of the highest court in the country. Hopefully simply stated facts are not verboten on this forum.

I suspect that there is a point that you are trying to make somewhere in that drivel.... why don't you make it?

 

[cooch96]

Other--younger than 62 so I'll wait and decide then, based on my current health, whether I think the stock market is high (defer SS and sell stock) or low (take SS, sell less stock), and any indications of change, especially if there might not be fair grandfathering.

+1

 

[Cessna152]

I suspect that there is a point that you are trying to make somewhere in that drivel.... why don't you make it?

That contrary to ShokWaveRider's claim, no contract was created by the formula linking an individual's SS benefits to their SS tax payments.

 

[pb4uski]

Now that wasn't all that difficult, was it?

Perceptive glimpse of the obvious that there is no contractual claim or legal right to SS.

SWR didn't say that it was a contract.... "a contract if you like"... suggesting that it is similar to a contract.