Question?

[Prale]

I'm new to these forums, I first posted earlier this month in the Hi I am part. I have been trolling quite a bit, trying to pick up advise here and there I have read alot of the FAQ. Alot of people here seem very smart, I am NOT financially savy at all, I would be a very wealthy man if I had acted differently for the past 20 years, but alas thats water under the bridge. Going forward I am trying to learn as much as I can, I am pretty smart and I learn quickly. These boards are nice because I can get advise and pick very smart brains.

I may ask very basic questions, or maybe not in the right topic, I apoligize in advance. I have Many many questions that i want to ask here, but I figure i will only ask 1 or 2 at a time lol.

My question today specifically is this: I'm retiring on Aug 1st this year, i will be 41, "If" I do not work another day for the next 20 years, will i still be able to draw my SSI that I have built up to this date when i turn 62?
Or will i lose the points i have earned since I will not have woked for 20 years? This is an important question for me because I have a decision to make when i retire. My retirement includes an option if I want to take it that will add an addtional 150 dollars or so to my pention check. It works like this: Right now my SSI check when i turn 62 is estimated to be roughly 1000 dollars a month. If i decide to take the SSI option on my pention NOW I get the additional income that I can invest or save. BUT when I turn 62 my Pension check will drop by the amount that I give them now. In other words If I take this option now and say I will draw 1000 a month, at age 62 My pension will drop 1000 a month and supposedly SSI takes up the slack. I hope this makes sence.

Please dont worry that I will listen only to the advise given here, I intend to meet with Social Security people in a month or 2. I would just like to do that as informed as possible.

[ProspectiveBum]

I believe (and I'm certainly no expert on this subject) that you will receive credit for what you've paid into the system, with your last working salary driving your final payment. There are calculators here that may give you a better idea of what to expect: Choose a Benefit Calculator

[RunningBum]

Yeah, you have to watch those estimate reports SS gives you, because they assume you'll keep working until you draw the benefits. But the online calculators should give you a way to show what happens when you cut off your contributions. You will get less.

btw, it would be more helpful if you put in a specific thread title, rather than a generic "Question?" title. You'll get more people who know about the topic reading the post, and it also helps later if someone is browsing for a topic that has been answered. Thanks.

[Prale]

Thank you that calculator is exactly what I needed to see.

[Prale]

Runningbum thanks for the input, I really new at this. I appreciate the advise i will be more specific in the future, and you were also correct about the calculator showing a lower amout than my statement. My statement showed i would get 980 dollars while the calculator showed I will only get about 700 dollars. It still leaves me with a decision but I am already more informed.

Just so you guys know i have asked many people about this and this is the first time i actually got a good answer thanks alot.

[clifp]

In general the statement from Social Security will assume that you continue working until retirement age. After 5 years or so of not working I noticed the Social Security changed there assumptions. AFAIK the advanced SSN calculator where you fill in your lifetime history of earnings as well as future earning is very accurate.

The pension option is an interesting question. It would probably be worth posting the details to get some forum feedback on how could a deal this is.

[REWahoo]

Quote:

Originally Posted by Prale My question today specifically is this: I'm retiring on Aug 1st this year, i will be 41, "If" I do not work another day for the next 20 years, will i still be able to draw my SSI that I have built up to this date when i turn 62?

Welcome to the forum, Prale.

The answer to your question above is yes, you will be able to draw SS when you reach the age of SS eligibility. Once you earn enough quarters to be eligible for SS you don't lose them by not working. However, since you are 21 years away from being 62, I'm not prepared to make a prediction 62 will be the minimum age you can begin drawing SS or that the amount will still be roughly $1k/month today's estimate shows. I expect some changes between now and then.

You can find answers to this question and many others here: SS Retirement Planner: Frequently asked retirement questions

Quote:

Originally Posted by Prale I have been trolling quite a bit...

I think the word you were intending to use here is "lurking"...

[Goonie]

Quote:

Originally Posted by Prale My retirement includes an option if I want to take it that will add an addtional 150 dollars or so to my pention check.......In other words If I take this option now and say I will draw 1000 a month, at age 62 My pension will drop 1000 a month and supposedly SSI takes up the slack.

My pension offered the same option. I could take the regular pension, or I could opt for a 'enhanced' pension that would drop at age 62 to a lower amount. It is/was assumed that at age 62 the retiree would begin collecting SS which, along with the lowered pension payment, would be reasonably equal to the original 'enhanced' payment.

I didn't take the 'enhanced' offer, instead I opted to take the standard amount for life. I can easily live on my current standard (cola'd) pension, so when I start drawing SS it will be like a nice monthly pay raise.....extra hot fudge on my sundae! Besides my ability to live well on my standard pension, the other reason I didn't go for the 'enhanced' was because of all of the unknowns about the future health of SS. I'd rather not count on SS and get it, than to count on SS and not get it....or at least not get the amount I had been counting on! (BTW, I'm VERY optimistic about SS!)

One of my former fellow employees took the 'enhanced' option due to his relatively lousy health, and a family history of dying before age 62. At age 51, except for an aunt & uncle, he is currently the oldest living person in his family. Both of his parents, as well as grandparents, died before they hit 60. He figured he'd get it while the getting was good!

[Prale]

Thanks for the responces, I am leaning away from taking the option as well, but here was my thinking, I too am concerned about weather Social Security will be there or not when I turn 62 or if they raise the age or what not. I was wondering though if I took the 150dollars, and invested it, 20 years is 36000 would it be close to what I will get anyways.

Anyways I'm thinking out loud, and more than likely I will leave this option alone and just hope for the pay raise at 62.

We will be comfortable on my regular retirement anyways. As I stated on my Who i am post my wife is going to get the same retirement package as me, albeit in 8 years. Her retirement should be several hundred dollars more than mine because she will be making more money than me.