Another SS Staff Story

[Independent]

About three years ago I filed and suspended so my wife could start spousal benefits. At the time, the SS staffer said "When you want to start benefits, just give us a call. Since you've already filed and provided your birth certificate, we can handle everything over the phone."

I'm turning 70 this year and called the SS national help line so I can start my benefits. The person on the phone says I have to do that in person, sets up an appt at my local office, and tells me I'll need my birth certificate and marriage certificate. I say "But I already filed and suspended ...". Nope, need to go in person.

Today, about 90 minutes before my appt, I get a call from the local office. The staffer says "I've been reviewing your file for our appointment later today. It seems to me that you don't need to come in at all. I can mail you a one page form, you sign it and send it back, and we're good to go." I say, "But the national service center said ....". He says, "Well, somebody was wrong".

I'm believing the local guy and not the person on the national number.

(And, barring a sudden change in health, I'll be one of those rare people who actually waits to 70.)

 

[Blue Collar Guy]

Hind sight is 20/20. Seems to me it will take about 12 years to break out even. That money you didnt take and thus lost opportunity to invest, i think it will take long past your lifespan to break out even. why did you wait? Im a collect at 62 type person(if i live to 62). Im trying to understand the wait to 70 crowd. Im glad you got a good answer from the local office.

 

[2017ish]

... Im trying to understand the wait to 70 crowd. Im glad you got a good answer from the local office.

And I'm still trying to understand why the primary PIA in a married couple would ever take before 70, barring some particular health/longevity risk to the female in the couple.

 

[Blue Collar Guy]

And I'm still trying to understand why the primary PIA in a married couple would ever take before 70, barring some particular health/longevity risk to the female in the couple.

ok, im listening. Whats the reasoning?

 

[2017ish]

Longevity risk.

 

[CRLLS]

And I'm still trying to understand why the primary PIA in a married couple would ever take before 70, barring some particular health/longevity risk to the female in the couple.

That could be taken as somewhat of a sexist question. I assume that you are talking about major breadwinner and
minor breadwinner and a health issue with the minor breadwinner.

The major reason I think would be that both have a family history of health issues and no children to leave anything to. Or perhaps life happened and they HAD to claim earlier to make ends meet. or..... or...... The reasons to delay are as numerous as reasons to take early. IMO.

FYI, I am the major breadwinner and will delay as long as I can so that whichever of us is left, has the highest SS benefit possible. There are other "best" answers. This one is mine.

 

[Texas Proud]

Hind sight is 20/20. Seems to me it will take about 12 years to break out even. That money you didnt take and thus lost opportunity to invest, i think it will take long past your lifespan to break out even. why did you wait? Im a collect at 62 type person(if i live to 62). Im trying to understand the wait to 70 crowd. Im glad you got a good answer from the local office.

You must not be married...

Most women live longer than men... and most men marry a younger woman... so that means the woman will more than likely live past those 12 years you seem to be worried about...

I know the estimate is that my DW will get more money from my SS than I will....

 

[Blue Collar Guy]

You must not be married...

Most women live longer than men... and most men marry a younger woman... so that means the woman will more than likely live past those 12 years you seem to be worried about...

I know the estimate is that my DW will get more money from my SS than I will....

AHHH, now this is a concept i must look into, and yes you are correct, married younger wife, and much healthier. Thanks, i need to study up on this stuff.

 

[haha]

I know the estimate is that my DW will get more money from my SS than I will....

Charge her up front for this.

Ha

 

[braumeister]

Today, about 90 minutes before my appt, I get a call from the local office. The staffer says "I've been reviewing your file for our appointment later today. It seems to me that you don't need to come in at all. I can mail you a one page form, you sign it and send it back, and we're good to go." I say, "But the national service center said ....". He says, "Well, somebody was wrong".

Seems to be a lot of local variation here.

Like you, I did the file and suspend thing so DW could start collecting spousal when she reached FRA. Then when I hit 70 I just went in to the local SS office to tell them to start sending me the money. The main reason I went in is because I wanted to have them withhold taxes from my benefit.

I didn't have to sign anything to start collecting. I did have to sign a form authorizing the withholding.

This has been a great deal, since we were old enough to get in before they changed the rules. When DW hits 70 she'll start collecting on her own record.

 

[audreyh1]

About three years ago I filed and suspended so my wife could start spousal benefits. At the time, the SS staffer said "When you want to start benefits, just give us a call. Since you've already filed and provided your birth certificate, we can handle everything over the phone."

I'm turning 70 this year and called the SS national help line so I can start my benefits. The person on the phone says I have to do that in person, sets up an appt at my local office, and tells me I'll need my birth certificate and marriage certificate. I say "But I already filed and suspended ...". Nope, need to go in person.

Today, about 90 minutes before my appt, I get a call from the local office. The staffer says "I've been reviewing your file for our appointment later today. It seems to me that you don't need to come in at all. I can mail you a one page form, you sign it and send it back, and we're good to go." I say, "But the national service center said ....". He says, "Well, somebody was wrong".

I'm believing the local guy and not the person on the national number.

(And, barring a sudden change in health, I'll be one of those rare people who actually waits to 70.)

Is the moral of the story to always call your local office?

 

[racy]

... I'm trying to understand the wait to 70 crowd. ...

BCG,
There are 4 scenarios, to wit:

Take SS at 62 and die sooner than average. -- I paid more into SS than I collected, but I'm dead and don't care.
Take SS at 70 and die sooner than average. -- I paid more into SS than I collected, but I'm dead and don't care.
Take SS at 62 and die much later than average. -- Taking lower SS could hurt me if my retirement portfolio is not enough for my unexpected long life. Potentially a large cost.
Take SS at 70 and die much later than average. -- I'm getting the maximum, inflation adjusted SS benefit at the same time I'm spending more than expected from my retirement portfolio. Potentially a large advantage.
The absolute amount of dollars received is outweighed by the utility of those dollars in each scenario.

For me, it's the last scenario, longevity risk insurance, not a break-even point.

 

[Curmudgeon]

Hind sight is 20/20. Seems to me it will take about 12 years to break out even. That money you didnt take and thus lost opportunity to invest, i think it will take long past your lifespan to break out even. why did you wait? Im a collect at 62 type person(if i live to 62). Im trying to understand the wait to 70 crowd. .

Show me an investment that is guaranteed to earn 8% return, over and above inflation, with no risk of principal loss or dips and I'll consider collecting at 62.

 

[Blue Collar Guy]

BCG,
There are 4 scenarios, to wit:

Take SS at 62 and die sooner than average. -- I paid more into SS than I collected, but I'm dead and don't care.
Take SS at 70 and die sooner than average. -- I paid more into SS than I collected, but I'm dead and don't care.
Take SS at 62 and die much later than average. -- Taking lower SS could hurt me if my retirement portfolio is not enough for my unexpected long life. Potentially a large cost.
Take SS at 70 and die much later than average. -- I'm getting the maximum, inflation adjusted SS benefit at the same time I'm spending more than expected from my retirement portfolio. Potentially a large advantage.
The absolute amount of dollars received is outweighed by the utility of those dollars in each scenario.

For me, it's the last scenario, longevity risk insurance, not a break-even point.

Thanks, i need to study up on this stuff.

 

[Blue Collar Guy]

Show me an investment that is guaranteed to earn 8% return, over and above inflation, with no risk of principal loss or dips and I'll consider collecting at 62.

That part i understand,the guarantee. Its the dying part thats getting me.

 

[Hermit]

BCG,

Search the threads on "SS at 62 or 70" or something like that. You will get tons of info.

 

[Koolau]

Two reasons I chose to wait until 70. 1) Waiting gives DW the highest SS survivor benefit. This was all a part of the plan back when DW (and I) decided to take the lower survivor benefit for my pension (in exchange for a higher monthly benefit until I die.) 2) It gave me a longer period of time to "get rid of" more of my tax-deferred funds which are now subject to RMDs. There are (or more appropriately, were) alternate ways to handle these issues, but it seemed to make sense to me to wait until 70. So far, I'm glad I did. YMMV

 

[Bestwifeever]

Seems to be a lot of local variation here.

Like you, I did the file and suspend thing so DW could start collecting spousal when she reached FRA. Then when I hit 70 I just went in to the local SS office to tell them to start sending me the money. The main reason I went in is because I wanted to have them withhold taxes from my benefit.

I didn't have to sign anything to start collecting. I did have to sign a form authorizing the withholding.

This has been a great deal, since we were old enough to get in before they changed the rules. When DW hits 70 she'll start collecting on her own record.

DH filed at FRA and actually started collecting, and I started collecting on his record at my FRA (I am also in that loophole age range that won't exist much longer) so that mine can grow til I'm 70, by which time my own benefit will be a couple thousand a year more that half of his at that time). I'll definitely go to the local office if it's still there in three plus years.

Re the threadjack: plenty of searchable threads debating the "best" time to collect--obviously not a one-size-fits-all so do whatever you think will make you happiest and some people will agree with you and some people won't. No changes in SS policies lately. This thread will deteriorate into that endless back and forth shortly. Sigh.

 

[brucethebroker]

BCG,
There are 4 scenarios, to wit:

Take SS at 62 and die sooner than average. -- I paid more into SS than I collected, but I'm dead and don't care.
Take SS at 70 and die sooner than average. -- I paid more into SS than I collected, but I'm dead and don't care.
Take SS at 62 and die much later than average. -- Taking lower SS could hurt me if my retirement portfolio is not enough for my unexpected long life. Potentially a large cost.
Take SS at 70 and die much later than average. -- I'm getting the maximum, inflation adjusted SS benefit at the same time I'm spending more than expected from my retirement portfolio. Potentially a large advantage.
The absolute amount of dollars received is outweighed by the utility of those dollars in each scenario.

For me, it's the last scenario, longevity risk insurance, not a break-even point.

How about "was planning on taking SS at age 70, but died at 69, and with my dying breath said "could have used the extra cash those last 7 years..."

 

[ShokWaveRider]

Show me an investment that is guaranteed to earn 8% return, over and above inflation, with no risk of principal loss or dips and I'll consider collecting at 62.

Isn't this true ONLY if you do not use the money. If you take the SS then yes you do not get he 8% uplift over time but you are using the money. To get 8% you still have to use your OTHER resources to live in the meantime.

I am a FRA guy (65 actually when medicare kicks in)

 

[stepford]

It's also an assertion allocation issue. SS is a COLA"d income stream. Those that already have a large COLA'd pension already have longevity insurance and may see less of an advantage in delaying SS than the rest of us.

 

[Texas Proud]

How about "was planning on taking SS at age 70, but died at 69, and with my dying breath said "could have used the extra cash those last 7 years..."

AGAIN, it is not just about YOU... if you are married you have to think about your spouse... so, if I die at 69 I can say 'honey, at least I am leaving you with more coming in from SS and not leaving you with a small pension'....


And as of today I do not need the extra cash... but then again I am not yet 60....

 

[CRLLS]

RE:Longevity,

According to longevityillustrator.org, if 2 people are the same age, non-smokers, and in average health reach 65 yrs old, there is a 50% chance of the male reaching age 86 and the female reaching 88 yrs. But here is the kicker, there is also a 50% chance of one of them reaching age 92! In addition there is a 25% chance of one reaching age 97 and a 10% chance of one reaching 101.

Their calculator is based on actual SS raw data. Unfortunately, the calculator starts at no lower than age 65.

The need for longevity planning is not trivial. This illustrates the reason I'm letting my SS benefit delay as much as possible, for the survivor. I'm also fortunate that I can start claiming spousal benefits on my DW's at age 66, helping to fill the 4-1/2 year delayed filing gap; and setting my Medicare base premium. YPMV (Your plan may vary)

 

[Clone]

How about "was planning on taking SS at age 70, but died at 69, and with my dying breath said "could have used the extra cash those last 7 years..."

In this case, the surviving spouse will have a larger benefit for the balance of their life. If it was snug before, it could have been really tough for the surviving spouse when they move from 2 SS checks to just one (assuming both drew earlier).

A larger benefit for the surviving spouse is one of the reasons to delay drawing. But if you need the SS income, draw when you need it! Actuarialy neutral!

One of the reasons that we have so much debate on this forum is that we have a large population of folks that financially have the option to delay. Next, we have a diverse population with different goals for the end game. (Leave a pile for heirs vs spend it all)

In hindsight, we can run the numbers and show what would have been the optimum choice. Going forward, it is more like a game of market timing. We may have some indicators of what the expiration date is on the tag, but we certainly are dealing with imperfect knowledge.

I have our plan for when we begin to draw, but it is subject to change. We have income that is treated as earned income until the recipient begins to draw SS. Post SS the income is not subject to self employment tax. So the timing of SS is more complicated there. In essence, once the recipient begins drawing SS, you no longer pay self employment tax (15%), and the income goes up.

We are fortunate to be in a position where we need to make decisions.

 

[Pilot2013]

I may be mistaken, but I think the "Survivor Benefit" is capped at FRA for the surviving spouse? So waiting past FRA (67 for me) is about the additional payout for us while I am alive, not what she would get if I get hit by the beer truck....

Based on that, I was planning FRA for taking SS....