Social Security at 70

[ShokWaveRider]

Re: WR2's post ^^^^^ ....... and if you Kark it earlier than you thought, it will not bother you! That is the thing that some folks forget. One worries about not getting as much as one "thinks" one should get only while alive, again, after you have Karked it, you really do not care and it will never bother you again.

 

[harllee]

I agree with W2R. I also did all the calculations, etc and started my SS at age 70. Now every month between DH and I we get over $5000 per month from SS. It is a good feeling to see that money coming in every month like clockwork.

 

[oldtimer]

I am not Mike Piper (!), but it could be that OpenSS is reporting the amount you get FOR that year, rather than IN that year.

Why does that not make sense?

The tool is stating that year's benefits that you qualify for is equal to Sept benefit + Oct benefit + Nov benefit + Dec benefit. Not the amount you actually receive into your bank account that year (Sept benefit + Oct benefit + Nov benefit). One has to be careful when speaking with SSA. Your Oct benefit is not the benefit that is deposited in your bank account in Oct, but the benefit deposited in Nov.
An interesting side note is that one must be alive for the full month to qualify for that month's benefit. If one dies the last day of a month, even though SSA may deposit the benefit the following month, you must return it because you did not qualify for that benefit.

Glad this is so simple

 

[Chuckanut]

I agree with W2R. I also did all the calculations, etc and started my SS at age 70. Now every month between DH and I we get over $5000 per month from SS. It is a good feeling to see that money coming in every month like clockwork.

It sure helps to keep one from panicking when the market drops 20% or more. Being able to pay the mortgage and put food on the table despite a poor stock market is a good feeling.

 

[harllee]

It sure helps to keep one from panicking when the market drops 20% or more. Being able to pay the mortgage and put food on the table despite a poor stock market is a good feeling.

So true. I don't pay any attention to the stock market any more. Of course I do have a bunch of cash in CDs.

 

[TheWizard]

The tool is stating that year's benefits that you qualify for is equal to Sept benefit + Oct benefit + Nov benefit + Dec benefit. Not the amount you actually receive into your bank account that year (Sept benefit + Oct benefit + Nov benefit). One has to be careful when speaking with SSA. Your Oct benefit is not the benefit that is deposited in your bank account in Oct, but the benefit deposited in Nov.
An interesting side note is that one must be alive for the full month to qualify for that month's benefit. If one dies the last day of a month, even though SSA may deposit the benefit the following month, you must return it because you did not qualify for that benefit.

Glad this is so simple

Can you say POUND SAND

 

[pb4uski]

^^^ I guess that you could but I'm pretty sure that they'll find a way to claw it back anyway... and as a taxpayer you should be glad that they clawback any benefits paid that the recipient isn't entitled to.

 

[Out-to-Lunch]

Why does that not make sense?

Did oldtimer's explanation clear up the intent of my post?

 

[Sunset]

.....
An interesting side note is that one must be alive for the full month to qualify for that month's benefit. If one dies the last day of a month, even though SSA may deposit the benefit the following month, you must return it because you did not qualify for that benefit.
...

Always plan to die on the 1st of the month if you want to optimize it.

 

[Rianne]

Did oldtimer's explanation clear up the intent of my post?

What's the point of claiming in a specific month? I specifically intended to claim Sept. 1 to achieve what opensocialsecurity stated and the amount I should receive for the year. If you claim in or on a specific month, that is the amount you should receive for that month and that year, arrears or not. Why didn't I claim in August? This changes the calculation of what you actually receive.

Medicare is taking what they're owed for the year, including Sept. Medicare is taking 4 months of payment. How is it SS only has to pay 3 months when I applied for 4 months in the year 2022.

This is a difference of $1000+ for my benefit. We argue about much less, in terms of $$ of benefit. Claiming in Sept. should be 4 months of benefit, period.

 

[Sunset]

We are paying for Medicare directly while delaying collecting SS. Good news for us, is that it is cheaper than our old health insurance.

Now that SS and Medicare are on different timetables (both used to use 65) , I can see how people are mentally encouraged to get SS at 65.

Too bad SS doesn't offer an option to collect enough SS to pay Medicare at 65, while delaying the remaining bulk of SS until a person wants to collect it.

 

[mathjak107]

Actually after fra , the month you file does matter .

Ss works differently after fra . Except for the month you will be 70 .

Say you retired at 68 -1/2 in July ……you would get the previous january amount ….you would be missing 6 months of credit .

Comes the new year you would be recalculated in January and going forward get paid for the delayed credits you earned from last January to July .


But the dirty lil secret from ss is they will never pay you retro for the 6 months you didn’t get from last January to July …you only get the proper amount going forward .

At 70 though they pay you to the moment if you wait just like pre fra ….it is the exception to the January calculation rule

The only way to get everything due you is to file for a January check since all after fra calculations are done in January

 

[Koolau]

This is what happened when I started SS last year. My birth date is in October. I did not get a SS deposit for October. I got one SS deposit in November and one SS deposit in December. When I asked SS about it they said the SS payments are in arrears so the payments are always one month behind.

I don't know if this is the (or a) reason, but it is "handy" when one passes away, that the family has a chance to stop further payments without needing to return anything to SS. This happened with both parents. YMMV

 

[explanade]

If you have a big retirement account balance, like IRA and 401k, wouldn't the RMDs also be a consideration?

I don't know exactly how RMDs are calculated yet but my mother's RMD is about 10% of the balance in a year it seems.

So what happens to the calculus of when to take SS if you're expecting to have to do RMDs of $30-35k or more at age 70 or 71?

 

[pb4uski]

^^^ Since RMDs are the same in both cases, why would it make a difference?

 

[Sunset]

If you have a big retirement account balance, like IRA and 401k, wouldn't the RMDs also be a consideration?

I don't know exactly how RMDs are calculated yet but my mother's RMD is about 10% of the balance in a year it seems.

....

RMD's start out at ~3.5% of your total IRA/401K assets and the percentage slowly goes up each year on the remaining balance. The IRS publishes a table of the precise percentage for each age.

 

[CRLLS]

Essentially, one's annual RMD = 1/(number of years left above ground) and is recalculated each year. It uses gross statistical data, ignoring any personal data such as health, gender, race etc.

 

[volfan]

I've also mentioned the Roth conversion issue in these threads.

But realistically, this is mainly an issue for higher income, wealthier retirees.

I'm guessing that at least half of people in their 60s do not have large enough tax-deferred accounts to make eventual RMDs a problem...

But in reality while it may not be a problem for a married couple, when one enters the single bracket after losing a loved one, the RMDs can have a huge impact on taxes and IRMMA to name a few. And you don’t have to be “wealthy” for that to happen. A pension plus SS with RMDs and suddenly you are at the IRMMA threshold!

 

[RunningBum]

If you have a big retirement account balance, like IRA and 401k, wouldn't the RMDs also be a consideration?

I don't know exactly how RMDs are calculated yet but my mother's RMD is about 10% of the balance in a year it seems.

So what happens to the calculus of when to take SS if you're expecting to have to do RMDs of $30-35k or more at age 70 or 71?

One consideration is that delaying SS to age 70 gives you more years to do Roth conversions at a lower tax level, and not affecting SS taxability. Any conversions will reduce your IRA balance, which reduces RMDs.

 

[mathjak107]

But it could get you whacked with iirma surcharges on your Medicare.

In order to convert enough to matter we would have hit surcharges

 

[jazz4cash]

Actually after fra , the month you file does matter .



Ss works differently after fra . Except for the month you will be 70 .



Say you retired at 68 -1/2 in July ……you would get the previous january amount ….you would be missing 6 months of credit .



Comes the new year you would be recalculated in January and going forward get paid for the delayed credits you earned from last January to July .





But the dirty lil secret from ss is they will never pay you retro for the 6 months you didn’t get from last January to July …you only get the proper amount going forward .



At 70 though they pay you to the moment if you wait just like pre fra ….it is the exception to the January calculation rule



The only way to get everything due you is to file for a January check since all after fra calculations are done in January

So I’m planning to start SS at FRA in Sept of this year. With this info, I’ll wait til Jan (or is it Feb) unless I choose OMY.
I’m always surprised these discussions seem to focus on 62, FRA, and 70 as if those are the only choices. My goal is FRA, but it’s really a month by month decision.

 

[TheWizard]

But it could get you whacked with iirma surcharges on your Medicare.

In order to convert enough to matter we would have hit surcharges

With proper Roth conversion planning, it's possible to stay in the same IRMAA tier both before and after starting SS and then RMDs.
That's what I'm doing...

 

[Dash man]

With proper Roth conversion planning, it's possible to stay in the same IRMAA tier both before and after starting SS and then RMDs.

That's what I'm doing...

Or you can bite the bullet with large conversions, pay IRMAA and taxes for a few years and be done with it before RMDs kick in. That’s what we’re doing. I want everything simplified before we’re in our 70s.

 

[TheWizard]

Or you can bite the bullet with large conversions, pay IRMAA and taxes for a few years and be done with it before RMDs kick in. That’s what we’re doing. I want everything simplified before we’re in our 70s.

Yes, you could.
But that would have required me to go from the 24% bracket up to the 32% bracket (or higher) back in my pre-72 years. And I didn't like that idea.

So I'm comfortable with just keeping the same AGI each year before and after age 72, adjusted for inflation, of course...

 

[Helen]

With proper Roth conversion planning, it's possible to stay in the same IRMAA tier both before and after starting SS and then RMDs.
That's what I'm doing...

That really depends on income in retirement; pensions, dividends, rental income, capital gains, etc.