You should take SS at 62

[audreyh1]

FRA for me is 66 years 10 months. So by then I'm only 3 years away from 70.

Lots to consider, but I've been leaning towards the "later" camp.

I don't get 8% returns on average in my retirement portfolio now. More like 5%.

Maybe we will start doing Roth conversions someday.

 

[Chuckanut]

The best decision on when to take SS is the one that lets you sleep at night.

 

[LinCella]

Chuckanut - perfect answer!

I will also say longevity depends upon your health - I have diabetes - I'm taking whatever SS I get at 62.

 

[mathjak107]

me too , diabetic as well but so far under control with just a a lot of exercise ( i run 3-1/2 miles non stop every other day ) and strict diet i am on no meds.

the math and longevity just don't work in my favor delaying .

giving up those early checks . giving up my wife's spousal kicker and spending down investments possibly in to a down market my first year all say waiting is a poor choice.

 

[LinCella]

Mathjak! Good for you! I was a Type 2, turned into a Type 1. Now on a pump and CGM and getting better results than ever.

 

[haha]

me too , diabetic as well but so far under control with just a a lot of exercise ( i run 3-1/2 miles non stop every other day ) and strict diet i am on no meds.

the math and longevity just don't work in my favor delaying .

The when to take SS choice is some kind of personality test. People decide what is most appealing emotionally, then marshal arguments to support the choice. But did you notice that BB King just died at age 89, good and fat, and a longtime diabetic? His shows over recent years have him sitting quietly on a stool. He surely was not running non-stop any 3.5 miles ever, let alone every other day. So if he lasted until age 89, only god knows how long you might last.




Ha

 

[mathjak107]

and your point ? he was living on insulin and meds and could barely walk for years . i was taken off everything and need no meds at all and in the best shape of my life . .

he was also way over weight ,i am not .

not sure of your entire comparison or point .

 

[haha]

and your point ? he was living on insulin and meds and could barely walk for years . i was taken off everything and need no meds at all and in the best shape of my life . .

he was also way over weight ,i am not .

not sure of your entire comparison or point .

You don't realize it, but you have just summarized my point. You said "the math and longevity just don't work in my favor delaying ." From what you have said, you could easily have average or greater life-span.

BB King had diabetes, was not well controlled, yet he lived to age 89. You are concerned that you should take SS early, because you have diabetes that doesn't even require meds, and you run over 10 miles a week, yet you seem to think that your medical condition favors taking SS early. But who knows what you think. Anyway, as the McDonald's ad says, have it your way.

 

[hnzw_rui]

and your point ? he was living on insulin and meds and could barely walk for years . i was taken off everything and need no meds at all and in the best shape of my life . .

he was also way over weight ,i am not .

not sure of your entire comparison or point .

Maybe his point is your longevity risk might be higher?

I think Chuckanut's answer is the really the right one.

We can all run spreadsheets of various scenarios comparing a bunch of different variables but in the end, this really boils down to an emotional response.

 

[mathjak107]

You don't realize it, but you have just summarized my point. "the math and longevity just don't work in my favor delaying ."

BB King had diabetes, was not well controlled, yet he lived to age 89. You are concerned that you should take SS early, because you have diabetes that doesn't even require meds, and you run over 10 miles a week, yet you seem to think that your medical condition favors taking SS early. But who knows what you think. Anyway, as the McDonald's ad days, have it your way.

on the other hand eventual complications and diabetes did my mother in at age 55 and my dad at 66 from stroke . .

it is as unpredictable condition as can be. today i have it under control tomorrow it can destroy my internal organs. no one knows with diabetes what is next.

but that isn't why i am taking it early , it just makes better sense as i need to make it to around 84- 85 to just break even and longevity isn't one of my family's strong points . my first cousin died last year.

i have neuropthy in my toes and fingers from it which make them burn. but other than that so far so good but i am a gym rat and have been so for more than 15 years now.

starting to run last year made the biggest difference and since then i am off lipitor , blood pressure a meds nd no diabetes meds . got my fingers crossed things stay this way

 

[LinCella]

89 and not well controlled is not a happy place.

 

[RunningBum]

89 and not well controlled is not a happy place.

Still need money, right?

 

[LinCella]

Of curse you still need money, RunningBum. And with Diabetes you need a lot more of it!

 

[steelyman]

Kinda rude, don'tcha think?

Never mind "rude". It's just not true, and not worth a minute of thought.

 

[Dash man]

Kinda rude, don'tcha think?

I think it depends a lot on the government agency. I worked both private and supervised DoD employees while I the military, and worked as a government civilian for a while. Most civilian government employees I saw worked hard, though rarely over 40 hours. There were a few slackers, but I saw that in private industry too. The true bureaucrats I've known were, however, not that dedicated in their work.
Federal benefits are often exaggerated, and state and local government benefits vary quite a bit. I think my private sector benefits were comparable to the federal benefits I remember having.

 

[LinCella]

I worked both private and public and you have your slackers in both. As for "producing goods" - a city government produces the police, the fire department, the rec center, the library, the parks, your water...common good that your taxes help pay for. As a librarian I produced all kinds of community programs, events, put the right book in the right person's hand. I'm happy I worked to "produce" a good community. Now I'M DONE!

 

[RunningBum]

Of curse you still need money, RunningBum. And with Diabetes you need a lot more of it!

Yep. That's why when people say they'll do more and spend more in their 60s than their 80s, I wonder if the spending part is true. You might need more money (and thus perhaps want to delay SS for a larger payment) just to live comfortably with whatever condition you have in old age.

 

[audreyh1]

Yep. That's why when people say they'll do more and spend more in their 60s than their 80s, I wonder if the spending part is true. You might need more money (and thus perhaps want to delay SS for a larger payment) just to live comfortably with whatever condition you have in old age.

That's what I keep coming back to. Especially since we are funding long term care. And I'd like to be able to pay for nice quality long term care if we need it.

 

[retiredunder50]

Some additional thoughts on when to take Social Security:

1. Much analysis indicates taking it at 62 versus 70 will keep you ahead financially until around 80 years of age (more or less depending on your investment assumptions AND factoring income tax implications and tax brackets). So, for the first 18 Years or so, you are ahead financially --> Do you think you really have another 18 years to offset the number of years you were ahead OR are you weighing those later years as much more in importance? Statistically, more than half of us will expire around our mid eighties.

2. Recent studies indicate that our spend rate actually goes down as we approach the later years of retirement - no more mortgage, no kids, no college costs, not as many 'toys' desired to purchase, not as much travelling, live in downsized homes, less utilities,... yes, large medical bills are looming for some of us.

3. Longevity tables may start showing, in a few years, that our predicted lifetimes will be decreasing somewhat. They have yet to fully factor in the current and next generation folks who have significantly jacked up the obesity percentages, lived sedentary lifestyles (many sitting 8 hours a day at work and spent hours sitting in front of a TV or PC), exercised minimally, ate processed foods with lots of 'chemical additives' with some that have been later removed, exposed to much more toxins in our water, air and food supplies than the people from earlier generations, continual exposure to low levels of RF radiation, possible effects from a lifetime of dental/fracture X-rays, airport scans and various other imaging technologies... Yes, the medical industry has made great strides in addressing many ills to help extend our lives, I'm just not convinced yet that it can undo everything that recent generations have been exposed to.

4. Waiting until 70 will give you the max payout, but will often also result in the max tax hit. Combine it with RMDs at that time, in addition to pension, dividends,... and the percent of taxable social security income could be significant versus taking it earlier.

5. Many are looking at the strategy of waiting until 70 as a guarantee 8% or so a year gain on their retirement assets. Is it an asset? If you have children, grandchildren, great grandchildren, a charity organization, church, cancer research, university... that you would like to leave a legacy to, your social security paycheck won't be going to either upon your death (OTOH, your surviving spouse who is dependent on your SS will benefit). The money you used while delaying your social security check could have been left to your beneficiaries. That money could have grown during the years you took early social security and you could have left the beneficiaries with a larger chunk of funds. Social security is more like an insurance based income stream that ends when you end.

There are tons of arguments for taking social security earlier and tons for taking it later. As been stated before, the best time is when it is right for your personal situation. Obviuosly, there are different considerations for the single individual versus the married.

 

[rayvt]

What if the person who claimed at 62 didn't spend the money but instead put the money into their asset allocation to save? Wouldn't that make the break even point much later? Of course this assumes positive market returns but it just seems like this would argue for taking it earlier in many cases.
Maybe that analysis has already been done but I don't recall seeing it.

It has indeed been done. I posted my somewhat comprehensive spreadsheet here: https://www.dropbox.com/s/gebanzrbr3g33qf/My SS breakeven calc.xls?dl=0

If you earn 0%, the (62 vs. 70) breakeven is about age 80. If you earn 3% above inflation, age 85. If you earn 6% above inflation, age 98.

Spending the social security money and allowing you to take less out of your portfolio is the same as saving the social security right?

Yes. As someone pointed out elsewhere in this thread, money is fungible.

 

[rayvt]

I will delay it to at minimum age 65 unless doctor tells me I have 2-3 years left to live.

Now all you need is getting him to tell you 2-3 years before a drunk driver runs you over.

Why? Because there is no guaranteed investment which astronomical returns that delaying SS provides so why would I miss this return....... It is all about discipline and plan

Taking SS at 62 tells me lack of planning which results in missing high returns.

I don't mean to be snarky here, but this topic has been studied quite intensively, and if you think that you have discovered something -- like "astronomical returns that delaying SS provides" -- that everybody else has overlooked .... well, it's more likely that you are missing or misunderstanding something.

The so-called 8% return appears to be the case only because people forget to account for the 8 years of $0 benefits.

 

[crispus]

Now all you need is getting him to tell you 2-3 years before a drunk driver runs you over.




I don't mean to be snarky here, but this topic has been studied quite intensively, and if you think that you have discovered something -- like "astronomical returns that delaying SS provides" -- that everybody else has overlooked .... well, it's more likely that you are missing or misunderstanding something.

The so-called 8% return appears to be the case only because people forget to account for the 8 years of $0 benefits.

We are taking it early at 62, because you can never get more time. Time lost in this case equals money.

As an aside how much money would I have if I would have invested my SS payments along with the employer match in index equities by now? I would say well over a couple of million bucks. I looked at our combined contributions to SS and its in excess of 500k. And that money could be handed down to future generations.

 

[Mulligan]

From reading and following this thread it still proves,to me anyways, there are many right options to take on age of withdrawal. Or at least worst, collectively as a group, a loss of pennies on the dollar. The only wrong decision is the choice many take in the real world. That being taking it at 62 with little saving and retirement money and doing it just because they do not want to work anymore.


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[eta2020]

I don't mean to be snarky here, but this topic has been studied quite intensively, and if you think that you have discovered something -- like "astronomical returns that delaying SS provides" -- that everybody else has overlooked .... well, it's more likely that you are missing or misunderstanding something.

The so-called 8% return appears to be the case only because people forget to account for the 8 years of $0 benefits.

It is somewhere around 7-8% more by delaying it 12 months not 8 years.....

That looks to me like superb increase. If New Your Life was selling COLA Fixed Immediate Annuity and offered 7-8% higher monthly payment if I wait for 12 months that would look to me like investment of lifetime that I should not miss.

I know I did not discover anything new. Same as there is nothing new that if you buy S&P 500 and just hold indefinitely you will historically get about 9% return yet.....people don't seem to be able to do it.

Now the fact that I will not take SS at 62 does not mean I will not retire at age 55. I just want to maximize my income after I retire and delaying SS is one of the things that will do it for me.

 

[almost there]

Everyone should put it off as long as possible.
So it will still be there in 8 years when I turn 62.