Collecting Social Security benefits at age 62

[kimcdougc]

Thanks for posting all these insightful comments regarding SS again. I need to remember it is an individual decision.

We are leaning on starting SS at 62, but will evaluate again in 1 1/2 years when DH will be eligible to start SS at 62.

 

[jimandthom]

I have always greatly appreciated the threads on when to take SS.

I will probably take SS no later than FRA @ 66 (tad over 2 years) but may pull the trigger at 65.

In Michigan SS is not taxed.

The most important reason I will not wait till 70 is that my spouse cannot collect a spousal benefit due to the WEP on Civil Service pensions.

If I die first, he cannot get a survivor benefit. If he dies first, my SS and survivor $$ from Civil Service, will be more than what he gets with just Civil Service and not being able to get a survivor benefit on my SS.

Don't really know if my choice is best, but it seems reasonable.

 

[harllee]

DH whose health is not as good as mine (and does not come from a long lived family like mine) filed at 62. I am planning to wait until age 70 to claim my own SS if my health continues to be good (I am at age 66 now). That seemed the best deal for us. I don't worry about it too much.

 

[Perryinva]

Thanks for the compliment. Too many spelling mistakes from answering on an iphone! Lots of good solid reasons given here. Much more thought out than many responses on other retirement sites. A few other points are going from married to single, and vice versa. Are there heirs worth the inheritance (take care of you in old age vs hoping you die soon for the $$$). If you unfortunately go from married to single, and have large RMDs, the tax increase is brutal. If all your retirement investments are in Roths, tax is not a consideration. Those two extremes alone can easily change what the “ best” answer is. There is tremendous emotional pressure to “get whats yours” as soon as possible, especially if you’ve paid in the maximum for 35- 40 years. I fully understand that alone as being a valid reason. It is just as valid as the people that simply can’t spend what their portfolio clearly shows as available and have no heirs to leave it to, because they don’t want to. Or working when there is absolutely no financial need. Emotional reasons ARE valid. If the resources are available then it is not just a financial reason to consider. I KNOW me enough that I doubt I could make it delaying until 70 regardless of the math. 69 may be my limit. How can I not claim a monthly benefit of $3333/mo for a year in order to see a $240/mo increase after that year? How can a $2880/yr annuity be worth a $40k cost at age 70?? The emotional pressure would cripple me....LOL.

 

[txtig]

DW is taking her SS at 62. First direct deposit is due to arrive in a few days. She worked for the local school district and has a teacher pension that will start at 65. But, once she starts receiving her teacher pension, SS will be significantly reduced due to WEP. Taking at 62 allows her to receive an unreduced benefit for three years.

 

[kaneohe]

I took it at 62 because I was not aware that the sophisticated answer is to delay until 70.
The usual uninformed reasons..........break even at 83 or so; if I lost the bet and lived longer, at least I got the longer life. If I "won" the bet and lived shorter, at least I got some bucks back. If I had bet the other way and lost.......I could have been a double loser.....no bucks and no life.

No regrets tho...........one unexpected benefit. Since we have very meager pensions, when the 2008 recession hit, it was of great comfort to have SS coming in every month to cover almost all the costs...........and not having to worry about how long or how deep the recession would be. Priceless! As others have mentioned you often don't really know about longevity. You can be fine and then in one day you can be diagnosed w/ some very serious medical condition. Your decision, make yourself happy .......don't worry about others.

 

[rodi]

For us it was a no-brainer for DH to take at 62. We had/have minor age children, and as dependents of a SSer, they get a small benefit themselves till 18. This made it NOT actuarially neutral for us. (I learned about this benefit on er.org. Thanks!).

I will hopefully wait till 70, spending down some of my IRA money in the meantime. But this is not set in stone... Like other aspects of our retirement plan (WR, etc) I plan to re-evaluate periodically. If we have an extended downturn I might take it earlier. If my health goes south, I might take it earlier. If the hold harmless provision for medicare part B goes away - I might take it at 65.... No need to decide now, when I'm only 56.

 

[youbet]

The most important reason I will not wait till 70 is that my spouse cannot collect a spousal benefit due to the WEP on Civil Service pensions.

I think you mean GPO, not WEP.

 

[pb4uski]

85% of our SS would mean no low tax-cost Roth conversions and much higher RMDs later so we're waiting until FRA or 70. Also, since DW was a SAHM we have joint mortality to consider.

 

[Sunset]

I used to think as a couple we would both wait until 70 to maximize the return.
However, running a calculator shows that since our lifetime earnings for SS are wide apart, it is better to have the high income earner wait until 70, but have the low earner take it much earlier, and then switch to 1/2 of spousal amount (as it's higher) later on.

We will definitely be buying at least 2 of those software that figure out all the possibilities, once we get to 62.

 

[cme4oil]

The reason that I am taking social security at the age of 62, It is due to the government pension offset. Because my wife has a government's pension, any survivor benefit she might get would be eliminated to the GPO.

 

[daylatedollarshort]

We took pensions at 55 and plan to take SS at 62 and together those will cover the bulk of our baseline expenses. Our factors are: no need / concerns for longevity insurance; long pay back period to wait; income stream diversification; Medicare hold harmless provision; prefer to maximize the portfolio, not SS, since the portfolio is money we have more control over; more money for the estate when are kids are younger and less established if we pass away early; and concerns over possible future cuts / asset testing / taxes on SS.

If we do decide for some reason we need longevity insurance, another option for us is to buy a private policy at age 80 or so as the prices are not too expensive at that age.

 

[joeea]

DW is taking her SS at 62. First direct deposit is due to arrive in a few days. She worked for the local school district and has a teacher pension that will start at 65. But, once she starts receiving her teacher pension, SS will be significantly reduced due to WEP. Taking at 62 allows her to receive an unreduced benefit for three years.

You mean "unreduced due to WEP". Certainly claiming at 62 means her benefit is reduced by 25% or so from her full benefit and much more from her benefit at 70.

Hopefully, those 3 years of WEP-free make up for the permanent reduction.

 

[jimandthom]

I think you mean GPO, not WEP.[/QUOTE

Thanks----- always get them confused.

Whether it was a good or bad idea, in the late 80;s we elected for him to stay with CSRS. At that time and a guess for the future, we would not have been allowed to be married. Where is the crystal ball when you need one?

 

[Sunset]

We took pensions at 55 and plan to take SS at 62 and together those will cover the bulk of our baseline expenses. Our factors are: no need / concerns for longevity insurance; long pay back period to wait; income stream diversification; Medicare hold harmless provision; prefer to maximize the portfolio, not SS, since the portfolio is money we have more control over; more money for the estate when are kids are younger and less established if we pass away early; and concerns over possible future cuts / asset testing / taxes on SS.

If we do decide for some reason we need longevity insurance, another option for us is to buy a private policy at age 80 or so as the prices are not too expensive at that age.

That only has effect at age 65, so not a reason to take SS at 62.

 

[youbet]

The reason that I am taking social security at the age of 62, It is due to the government pension offset. Because my wife has a government's pension, any survivor benefit she might get would be eliminated to the GPO.

That's our situation and the path we took.

We've already finished the 8 year process and it worked out well. The incremental sum in our FIRE portfolio due to receiving and investing early SS payments for 8 years easily supports an increased annual withdrawal equal to the 62 SS vs 70 SS delta. (Thanks bull market!!) And DW gets some added protection because the money is there whereas 70 SS would evaporate if I die first.

Every situation seems to have its own unique strategy. The GPO/WEP crowd included.

 

[daylatedollarshort]

That only has effect at age 65, so not a reason to take SS at 62.

Ages 65 and below, but not above, would kick in the hold harmless.

 

[SumDay]

Research. A lot of people talk about and believe that if 2 earners are going to get SS, the lower earner can take early, while the higher earner waits to 70. That gives the best survivor outcome as I understand it. That is what I am thinking of ding when the time comes so far. Will likely depend on other resources situation as that time gets here.

Luckily, when they changed the rules a couple of years back, the cut-off birthdate for doing this was 1/1/54. Luckily DH was born in 1953 and is 4 years older than I. So, I'll draw at 62, and he'll take 1/2 mine when he reaches FRA a couple of months later. His will sit on the back burner until he turns 70 and then his will kick in.

 

[pb4uski]

Ages 65 and below, but not above, would kick in the hold harmless.

I think the point was that the hold harmless might be a reason to take at 65 rather than later, but isn't a reason to take at 62.

 

[daylatedollarshort]

I think the point was that the hold harmless might be a reason to take at 65 rather than later, but isn't a reason to take at 62.

If you look at my original post, I made a made a one sentence list with our reasons for taking at 62, of which hold harmless was one of many reasons, not the only reason.

 

[pb4uski]

If you look at my original post, I made a made a one sentence list with our reasons for taking at 62, of which hold harmless was one of many reasons, not the only reason.

Right, and the other reasons are sensible reasons for taking at 62 for those inclined to do so, but hold harmless is not a valid reason to take at 62 since you get the full advantage even if you wait until 65.... it might be a valid reason for taking at 65... but not 62.

 

[daylatedollarshort]

Right, and the other reasons are sensible reasons for taking at 62 for those inclined to do so, but hold harmless is not a valid reason to take at 62 since you get the full advantage even if you wait until 65.... it might be a valid reason for taking at 65... but not 62.

I am not really interested in getting into a semantics argument over a one sentence list. The hold harmless provision will kick in for us by taking at 62.

 

[pb4uski]

Given it's a weak argument that is perfectly understandable.

 

[Sunset]

Right, and the other reasons are sensible reasons for taking at 62 for those inclined to do so, but hold harmless is not a valid reason to take at 62 since you get the full advantage even if you wait until 65.... it might be a valid reason for taking at 65... but not 62.

Exactly why I stated it.
The reason I mentioned it, was because some folks reading this listing might not realize the hold harmless does not even start until age 65, and they would actually think they need to do it earlier.

 

[daylatedollarshort]

Exactly why I stated it.
The reason I mentioned it, was because some folks reading this listing might not realize the hold harmless does not even start until age 65, and they would actually think they need to do it earlier.

I assumed most people here know they can't qualify for Medicare at 62.