Social Security~ Pays to delay says Scott Burns

[Gail]

This site has a free SS-delay calculator:

http://www.analyzenow.com/

Our plan has always been to take SS at age 62. I finally took the time to use this calculator, and I was a little surprised, but definitely pleased, that our best alternative was taking it early.

 

[OAG]

Just a update on the SS "do-over" process. I submitted a letter and form SSA-521 to withdraw my 2002 application for SS benefits. I had taken SS at age 62 and now see that I have sufficient funds to just repay SS and stop current benefits. Then I will wait until I need the funds or age 70 whichever happens first.

After submitting the application in Sep 07 I got a call from SS in Chicago asking if I knew what I was doing. After a long discussion the SS representative said she thought I knew what I was doing however, she suggested I go into a local office (Ohio) and discuss it with a SS representative. I made the appointment, waited about a month and went in today. Sat down with the local Rep who had no idea why I was there. We talked about it, she call her Chicago SS office, and said the application was being "worked" and I should anticipate a response along about January. She said the response letter will give me a dollar amount to send them and provide a provision for sending in my monthly Medicare premiums. At that point all I have to do is send in the dollars and my application will be basically like I had never submitted it. I anticipate the payback will be approximately $80K plus past Medicare Premiums.

So I guess you can take the benefit at 62, change your mind, pay the money back (interest free), take the tax deduction for the repaid money, and submit a new application for SS when your ready to do so.

 

[REWahoo]

So I guess you can take the benefit at 62, change your mind, pay the money back (interest free), take the tax deduction for the repaid money, and submit a new application for SS when your ready to do so.

After all the discussion of the ability to request and be granted a SS "do over', it's really nice to get a first hand account of the real thing. I had doubts that it was possible to do this unless you had extenuating circumstances, but that doesn't look to be the case.

Thanks R Wood for posting your experience. Please let us know when you get the January letter so we can close the loop on this.

 

[Nords]

After all the discussion of the ability to request and be granted a SS "do over', it's really nice to get a first hand account of the real thing. I had doubts that it was possible to do this unless you had extenuating circumstances, but that doesn't look to be the case.

I find it hard to believe that this "do-over benefit" will still be around in 2022...

 

[MJ]

J
So I guess you can take the benefit at 62, change your mind, pay the money back (interest free), take the tax deduction for the repaid money, and submit a new application for SS when your ready to do so.

Can I assume that if your income is less than the returned money that you will be able to use the leftover credit the following year. Does your state have a form line to use the credit as well?

MJ

 

[clifp]

After all the discussion of the ability to request and be granted a SS "do over', it's really nice to get a first hand account of the real thing. I had doubts that it was possible to do this unless you had extenuating circumstances, but that doesn't look to be the case.

Thanks R Wood for posting your experience. Please let us know when you get the January letter so we can close the loop on this.

A big Mahalo for posting your experiences. I am personally in Nords camp earliest SS for me is 2022 and wouldn't even hazard a guess what rules exist then. However my BIL just retired (for the 3rd time LOL) at 66, My sister is 9 years younger and in great health. Financially they are probably in a position to repay the SS at age 70 and I've discussed it with him.

Knowing that it is actually possible to do what the financial gurus says you should do is very helpful. Judging by your experience with the folks at SS office, I am guessing this isn't an everyday affair!

 

[ziggy29]

As mentioned, if you do not need the money at 62, you can still collect it at that age, set it aside in an interest-bearing account, and give it all back at a later date in exchange for larger monthly checks. At least as long as this loophole exists, anyway.

There's something to be said for waiting for larger checks when you don't need it, but there's also something to be said for the bird in the hand. Taking it at 62 and setting it aside would seem to leave both options open. If you're healthy a few years later, it might be worth giving it back and starting over with a higher payout. I don't expect this option to be available in 20 years when I'm faced with it, though, as is typical for my generation and those after me.

 

[Alan]

As mentioned, if you do not need the money at 62, you can still collect it at that age, set it aside in an interest-bearing account, and give it all back at a later date in exchange for larger monthly checks. At least as long as this loophole exists, anyway.

There's something to be said for waiting for larger checks when you don't need it, but there's also something to be said for the bird in the hand. Taking it at 62 and setting it aside would seem to leave both options open. If you're healthy a few years later, it might be worth giving it back and starting over with a higher payout. I don't expect this option to be available in 20 years when I'm faced with it, though, as is typical for my generation and those after me.

Have to agree - a very attractive loophole indeed. I hope I can remember to look for this in 9 years when the time comes for me to make the decision

 

[cute fuzzy bunny]

I guess the only downside would be to have a bunch of people do this, start squirreling the money away in cd's, then at the 11th hour have the SSA decide they arent accepting these recision applications anymore.

 

[Zipper]

...............and pay it all back and die the next year.

 

[OAG]

If you die you will not care unless your DW or DH left behind could benefit from the higher level of payout.

Latest statistic I saw regarding this is the SSA does these about 100,000 times a year.

Have yet to look at the numbers but a tax deductible HE or HELOC may also be a pretty good solution to the payback - which would leave the invested benefit to continue to grow.

 

[New Thinking]

Rwood

I had taken SS at age 62 and now see that I have sufficient funds to just repay SS and stop current benefits. Then I will wait until I need the funds or age 70 whichever happens first.

RWood - If you are married, you should consider the strategy mentioned in last weekend's big WSJ article on Social Security. Once you hit your Full Retirement Age, file only for spousal benefits based on your wife's work record. You could receive these assuming she has filed for her worker benefits..These would cease at age 70, once you file based on your work record..Great strategy that I was previously unaware of. I did confirm it this week with the SSA. Don't leave money on the table.

 

[OAG]

NT-I will try to find the article.

 

[OAG]

NT-Thanks I located the article and will take a look.

 

[pfpelican]

Would you please post the link? thanks...

 

[Robert the Red]

Probably this?
The Baby Boomer's Guide To Social Security - WSJ.com