Poll for those 62 or older: At what age did you begin taking SS?

[Khufu]

That's an interesting viewpoint. Assuming that the money received from SS represents an equal amount of money that was left invested in Vanguards index 500 fund, the growth of that money from 3 years ago is compounded at close to 15% per year. A mite higher than the growth in SS payment.

But that's an obviously false comparison. You are comparing a retrospective investment return (cherry-picked both to exclude a balanced portfolio by way and to skip over the crash!) to an insurance product that protects you with an income that you can't outlive. It is always the case with insurance products that there is a near-term disadvantage, particularly against cherry-picked stock market return. The benefit of insurance appears when the risk that you cannot afford to bear actually appears, i.e. unexpectedly long life,

If your comparison period included the past five years, compared to a balanced portfolio, reflected the ~8% increase due to Delayed Retirement Credits PLUS the COLAs for the five year period (since you are using nominal returns for the S&P, and you live 5 years more than you expect, what do you think the comparison would look like?

 

[mathjak107]

ill be 60 tomorrow and my wife is 62 .

we have debated this over and over and the fact is the best deal is she just filed and ill wait until 66 or maybe even 70.

there is no annuity on the planet i could buy with an inflation adjustment that even comes close to ss.

so i may just end up taking 1/2 my wifes at 66 and god willing my own at 70.

having said that ,the reason is we can spend a whole lot more out of savings now while we are young and healthy .

we can spend so much more now because we will have the security of a whopper of a payment coming in later to refill.

its not only about the payment but full fra lets you maximize payments if your married.

marilyn takes hers early, at 66 i may file and take 1/2 hers letting mine grow until 70.

with 2 horses in the race im not worried about breaking even. odds are one of us will go on but the fact is we can spend more right now by not taking it and thats key .
she switches

 

[Walt34]

Undecided so far. The pension option I took calls for the pension to drop by the amount of SS I would have been eligible for at 62 (which was last spring) thus maintaining a level income. But if I keep working I'll get more later and DW, who will presumably outlive me, will too.

And I don't mind the job I have now, which pays much more than the SS benefit. Easy commute, nice hours, low stress, the extra income is nice, etc. so for now I'll stay the course.

And we're banking most of the unplanned-for income to spend later which I think is optimistic because it relies on the assumption that there will be a "later". That's where the crap shoot comes in.

 

[golfersailor]

Don't, you'll be severely disappointed.

Why look back?? Can't change anything so just enjoy what you have now. I like having my a pile of cash that I can touch and feel. Pension and SS pays all of our major bills without taking money out of IRA's. Would we have been better off waiting maybe or maybe not just depends on health and when we die.

 

[gerntz]

I'm 64.5. We're trying to keep income down in order to take more LT cap gains at 0% rate. Have a chunk of employer stock with big gains. Who knows what the future tax rates will be. May change then.

 

[Lsbcal]

Didn't realize I was voting in a poll that is now 3.5 years old.

Actually some of the folk's reasoning in this forum convinced me to take SS earlier then FRA. Shows an open mind. No regrets.

 

[ejman]

But that's an obviously false comparison. You are comparing a retrospective investment return (cherry-picked both to exclude a balanced portfolio by way and to skip over the crash!) to an insurance product that protects you with an income that you can't outlive. It is always the case with insurance products that there is a near-term disadvantage, particularly against cherry-picked stock market return. The benefit of insurance appears when the risk that you cannot afford to bear actually appears, i.e. unexpectedly long life,

If your comparison period included the past five years, compared to a balanced portfolio, reflected the ~8% increase due to Delayed Retirement Credits PLUS the COLAs for the five year period (since you are using nominal returns for the S&P, and you live 5 years more than you expect, what do you think the comparison would look like?

I'm not so sure it's obviously false. I did not cherry pick the period or the investment. The poster I was responding to made a comment regarding another poster that had taken SS 3 years earlier at 62 and made it sound as if that poster had made a mistake. I simply looked at the return on a very standard run of the mill investment for the same time period since that poster took SS and clearly the investment comes out ahead.

For the future - who knows - investments could do well or not SS payments could be sharply reduced or means tested - who knows. Considering options and deciding whats best is very seldom a black and white question for the simple reason that we do not know what the future holds.

I am biased though - I just applied for my SS ( at 62) after duly considering the arguments for delaying to my FRA or to age 70. Let's do another poll in 30 years and see how things turned out shall we?

 

[tightasadrum]

"I found this frightfully old 2009 thread by doing a search. I think the results are fascinating, because it is not related to plans and reasons, but to what people actually DID - - and so far not one single person out of the 44 participants indicated that they actually took SS at full retirement age or later." W2R

Well, W2R, I'm at least one who is eligible for full SS benefits who has not elected to start yet. This "when to start SS" argument seems to go on forever. At least for now I'm of the mind that I will start it when I need it, or at 70, whichever comes first. I'm also seven years older than DW, so later would provide more COLA'd income for her if I go out first.

 

[imoldernu]

We took SS @ 62, back in 1998... but there were some differences then, in interest rates.
We were ultra conservative at our retirement in 1989/90. Cd's up to and through 2003 were substantially higher than today... As I recall there were times when we had jumbo CD's that were paying about 9% and even more.

In some earlier posts, I had questions about accumulation of capital, without actively investing in the market. Some of it came from beginning IRA's in 1974...
While interest rates have been up and down since then. There were times when plain old CD's paid 16% -17%... Between the late 1970's and mid 1980's it looked like easy street for everyone who could set a bit of money aside.

Certificate of Deposit Index (CODI), Historical Data

Not from being smart.. just being around at the right time.

Off topic, I'm sure, but looking ahead and considering the national debt @ 16T, I have an uneasy feeling about the possibility of double digit inflation, so as far as SS is concerned, wonder if the political structure would COLA SS with an actual inflation adjustment, or adjust in the manner of today,by excluding things like food and energy... possibly adding healthcare and education to the non-applicable cost of living adjustments.

SS at 62? A tough decision.

 

[mathjak107]

Stupid me.... I forgot about the 15% per year.

as we say hindsite is 20/20.

i can say this much for myself. if i had that kind of returns from my equities i would more then likely not take anymore of a withdrawal not knowing what tomorrows markets would be like.

the biggest bear market may be lurking just around the corner.

but i can tell you by delaying ss and having it pretty much a lock like i bought an annuity i would have no reservations about spending more.

big difference in the way i would handle the two events.

 

[growing_older]

I'm not yet old enough to make this decision, but I can say that my parents opted for SS as soon as possible (age 62) despite having a very large portfolio which could have supported them many times over. A few bad investment results (and maybe a few bad investment decisions) later, their portfolio is no longer enough to sustain them and is being rapidly drawn down as they rely heavily on their SS checks. Based on this experience I plan to delay my own SS as long as possible to get the maximum COLA annuity out of it. Since I have no other sources of income in retirement except my own savings, I want the "second leg" of my support to be as strong as possible.

 

[bizlady]

We too are a ways out. We are just 8 months apart in age, and each of our benefits will actually be very close in total dollars. We are thinking we would like to both apply and suspend at FRA and then each take the 50% of the spousal benefit, then take our full benefits at 70. But this seems too good to be true. Can this be done?

Plan 2 is he will take his at FRA (I will take 50% if I can at my FRA 8 months later) and then, I would take my full benefit at age 70, since mine is higher than his at any age.

We are not so concerned about getting what we paid, but rather want to maximize what we can get, and set up for the max in the event of early death for one of us.

 

[mathjak107]

husband and wife cannot both claim spousal benefits.only one can file and suspend.

 

[bizlady]

drats-I figured that might be too good to be true! Thanks for the bad news!

 

[FreeAtLast]

I just started taking survivor's benefits in July at age 60. I will switch to my own benefits at age 66 or 70.

 

[Bikerdude]

One thing to keep in mind (especially if you are single and your savings are primarily in a 401K or IRA) is that SS benefits are taxed at a max of 85% (and usually much lower) depending on the amount of other income. In addition, many states do not tax SS payments. Withdrawals for tax advantaged plans are taxed at 100%. So the potential break-even age is extended by both tax savings and potential return on assets not spent.

 

[RonBoyd]

we have debated this over and over and the fact is the best deal is she just filed and ill wait until 66 or maybe even 70.

See, for instance: Ten of the Worst Social Security Gotchas.

"Social Security's website gives the impression that your spousal benefit is half of your partner's Primary Insurance Amount (PIA), also called the full retirement benefit. Your spouse is eligible for $2,000 a month? Then you would get $1000 a month. But this is true only if a) you don't qualify for a retirement benefit on your own, or b) you reach full retirement age but never filed for Social Security and, at that point, you apply only for your spousal benefit, not for your own."

 

[MikeTN]

COLA for SS

We took SS @ 62, back in 1998... but there were some differences then, in interest rates.
We were ultra conservative at our retirement in 1989/90. Cd's up to and through 2003 were substantially higher than today... As I recall there were times when we had jumbo CD's that were paying about 9% and even more.

In some earlier posts, I had questions about accumulation of capital, without actively investing in the market. Some of it came from beginning IRA's in 1974...
While interest rates have been up and down since then. There were times when plain old CD's paid 16% -17%... Between the late 1970's and mid 1980's it looked like easy street for everyone who could set a bit of money aside.

Certificate of Deposit Index (CODI), Historical Data

Not from being smart.. just being around at the right time.

Off topic, I'm sure, but looking ahead and considering the national debt @ 16T, I have an uneasy feeling about the possibility of double digit inflation, so as far as SS is concerned, wonder if the political structure would COLA SS with an actual inflation adjustment, or adjust in the manner of today,by excluding things like food and energy... possibly adding healthcare and education to the non-applicable cost of living adjustments.

SS at 62? A tough decision.

You seem to be repeating a common misconception about the COLA for SS. While BLS does calculate a CPI that excluudes food and energy which economists often prefer to measure "core inflation", the COLA for SS is based on the "CPI for all urban consumers" and does not exclude food or energy

 

[molly]

I am beginning to think that with the various pushes to up revenue......anybody with a large 401K/IRA who waits until 70 to draw SS is going to get hit hard in the tax department. I question whether it might be more prudent to just start collecting at FRA and banking the money. If you have a pension - it limits what you can do as far as Roth conversions prior to age 70.

I believe that any special tax treatment for SS and extra Senior considerations are going to disappear within the next 5 years.

It's going to be a whole new game.

 

[BLS53]

I filed for my SS at my FRA 66 years. DW was also 66. Her projected SS earnings based on her earning record would have been 1/4 of mine.

The original plan was that I would file and suspend and DW would receive the Maximum spousal benefit at 1/2 of my FRA amount and I would wait until 70. Bear in mind that if I filed for my spousal benefit on her record, then our combined benefits would still be less than 1/2 of my benefit.

Even so, we filed online. The online SS application is strictly customized to the individual applicant. DW's and my aplications were quite different. For example DW's application asked about her military service (she has none). My application said nothing about military service (I have some). I paid SS while in the military which shows on my SS earnings record.

Anyhow per the online application I thought I had filed and suspended. Per the online application SS is supposed to call by phone. This did not happen for either me or DW. Imagine my surprise when a direct deposit for me from SS appeared in our checking account. Also, DW received a direct deposit from SS, however, it was based on her own record which was about 1/2 of her spousal benefit on my record. By phone we did straighten things but by that time I did not want to give back my direct deposit so I said to heck with it. Let it come!

Also about that time DW recieived a letter from SS. They were going to do a "random" audit on her SS application. She absolutely panicked. Among other things the auditor who was several states away wanted our IRS returns (we have always filed jointly) from 1992 and 2005. I don't know if he could legally ask for our return from 1992 (he already had a copy). But I was so proud of myself that I was able to find the 1992 return that I had it at the audit which was by phone. He also wanted a certified copy of our marriage license. So, we had to take our marriage license to the local SS office to have it certified and a copy sent to the auditor. I think we passed the audit, we've never heard another word. This was our first and, hopefully, last visit to the local SS office.

In hindsight, I'm glad we have all that behind us and DW and my direct deposits should arrive every month until one or both of us die or the USA goes bust.

DW and my SS earnings cover about 2/3 of our monthly budget and causes our SWR to go way down.

What was unusual about 1992 and 2005 that piqued their interest?