Taking social security at 62?

[Anonymous]

Anonymous wrote:I turn 62 in August and have not worked in 20 years (but big law before that) and DH (big law) will likely work until he falls over dead. My thought about taking SS at age 62 is that it will be eaten up by DH's top tax bracket? I don't know how to "run the numbers" on this.

It’s probably impossible to avoid significant taxes if he’s high income. But if you figure it out it would be interesting to know.

[Anonymous]

A couple of posters have called the 8% increase in annual payments for each year you wait an “investment return.” It is not.

The 8% is an adjustment factor for not receiving your benefits earlier. Put differently, if you start SS at 62 and live to 85, you’ll get 23 years of payments, but if you begin payments at 70, you’ll get 15 years of payments. The incremental 8% adjustment just increases the latter’s payments so that they receive the same lifetime benefit as the former. That’s not an investment return. It’s largely shifting the same amount of dollars to a shorter timespan from a longer one.

If you don’t believe me, run SS’s breakeven calculator. These payments are setup to be equal for the average lifetime + a bit. You have to live to 85+ to make more money with the delayed benefit. The System offsets this with the early death of many other seniors.

If it was a true “investment return,” people who wait until 70 would receive MORE than the additional dollars to compensate them for giving up benefits for an additional 8 years during an average lifespan.

[Anonymous]

Anonymous wrote:A couple of posters have called the 8% increase in annual payments for each year you wait an “investment return.” It is not.

The 8% is an adjustment factor for not receiving your benefits earlier. Put differently, if you start SS at 62 and live to 85, you’ll get 23 years of payments, but if you begin payments at 70, you’ll get 15 years of payments. The incremental 8% adjustment just increases the latter’s payments so that they receive the same lifetime benefit as the former. That’s not an investment return. It’s largely shifting the same amount of dollars to a shorter timespan from a longer one.

If you don’t believe me, run SS’s breakeven calculator. These payments are setup to be equal for the average lifetime + a bit. You have to live to 85+ to make more money with the delayed benefit. The System offsets this with the early death of many other seniors.

If it was a true “investment return,” people who wait until 70 would receive MORE than the additional dollars to compensate them for giving up benefits for an additional 8 years during an average lifespan.

Thank you.

[Anonymous]

Anonymous wrote:A couple of posters have called the 8% increase in annual payments for each year you wait an “investment return.” It is not.

The 8% is an adjustment factor for not receiving your benefits earlier. Put differently, if you start SS at 62 and live to 85, you’ll get 23 years of payments, but if you begin payments at 70, you’ll get 15 years of payments. The incremental 8% adjustment just increases the latter’s payments so that they receive the same lifetime benefit as the former. That’s not an investment return. It’s largely shifting the same amount of dollars to a shorter timespan from a longer one.

If you don’t believe me, run SS’s breakeven calculator. These payments are setup to be equal for the average lifetime + a bit. You have to live to 85+ to make more money with the delayed benefit. The System offsets this with the early death of many other seniors.

If it was a true “investment return,” people who wait until 70 would receive MORE than the additional dollars to compensate them for giving up benefits for an additional 8 years during an average lifespan.

Same poster. Thought of another way to say this.

An investment return implies the creation of new or added economic value. However, assuming one lives an actuarial average life, the 8% per annum increase only ensures that people who start their annuity at 70 receive the same amount of real dollars as those who did so at 62.

A true investment or economic return would accrue only to those who waited AND outlived an average life, which if your currently 62, SS assumes is 83 for men and 86 for women.

It seems to me that the greater risk is that you don’t live that long. And even if you do, the extra return for living a few extra years is peanuts, especially if you have more than enough money to see you to death.

[Anonymous]

Longevity in my family, I’m in good health, and I don’t need the cash. Waiting until 70 to maximize benefits (unless I die early)

[Anonymous]

Anonymous wrote:A couple of posters have called the 8% increase in annual payments for each year you wait an “investment return.” It is not.

The 8% is an adjustment factor for not receiving your benefits earlier. Put differently, if you start SS at 62 and live to 85, you’ll get 23 years of payments, but if you begin payments at 70, you’ll get 15 years of payments. The incremental 8% adjustment just increases the latter’s payments so that they receive the same lifetime benefit as the former. That’s not an investment return. It’s largely shifting the same amount of dollars to a shorter timespan from a longer one.

If you don’t believe me, run SS’s breakeven calculator. These payments are setup to be equal for the average lifetime + a bit. You have to live to 85+ to make more money with the delayed benefit. The System offsets this with the early death of many other seniors.

If it was a true “investment return,” people who wait until 70 would receive MORE than the additional dollars to compensate them for giving up benefits for an additional 8 years during an average lifespan.

^ Way too smart for dcum

[Anonymous]

Anonymous wrote:

Anonymous wrote:A couple of posters have called the 8% increase in annual payments for each year you wait an “investment return.” It is not.

The 8% is an adjustment factor for not receiving your benefits earlier. Put differently, if you start SS at 62 and live to 85, you’ll get 23 years of payments, but if you begin payments at 70, you’ll get 15 years of payments. The incremental 8% adjustment just increases the latter’s payments so that they receive the same lifetime benefit as the former. That’s not an investment return. It’s largely shifting the same amount of dollars to a shorter timespan from a longer one.

If you don’t believe me, run SS’s breakeven calculator. These payments are setup to be equal for the average lifetime + a bit. You have to live to 85+ to make more money with the delayed benefit. The System offsets this with the early death of many other seniors.

If it was a true “investment return,” people who wait until 70 would receive MORE than the additional dollars to compensate them for giving up benefits for an additional 8 years during an average lifespan.

Same poster. Thought of another way to say this.

An investment return implies the creation of new or added economic value. However, assuming one lives an actuarial average life, the 8% per annum increase only ensures that people who start their annuity at 70 receive the same amount of real dollars as those who did so at 62.

A true investment or economic return would accrue only to those who waited AND outlived an average life, which if your currently 62, SS assumes is 83 for men and 86 for women.

It seems to me that the greater risk is that you don’t live that long. And even if you do, the extra return for living a few extra years is peanuts, especially if you have more than enough money to see you to death.

So, take the money at 62?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:A couple of posters have called the 8% increase in annual payments for each year you wait an “investment return.” It is not.

The 8% is an adjustment factor for not receiving your benefits earlier. Put differently, if you start SS at 62 and live to 85, you’ll get 23 years of payments, but if you begin payments at 70, you’ll get 15 years of payments. The incremental 8% adjustment just increases the latter’s payments so that they receive the same lifetime benefit as the former. That’s not an investment return. It’s largely shifting the same amount of dollars to a shorter timespan from a longer one.

If you don’t believe me, run SS’s breakeven calculator. These payments are setup to be equal for the average lifetime + a bit. You have to live to 85+ to make more money with the delayed benefit. The System offsets this with the early death of many other seniors.

If it was a true “investment return,” people who wait until 70 would receive MORE than the additional dollars to compensate them for giving up benefits for an additional 8 years during an average lifespan.

Same poster. Thought of another way to say this.

An investment return implies the creation of new or added economic value. However, assuming one lives an actuarial average life, the 8% per annum increase only ensures that people who start their annuity at 70 receive the same amount of real dollars as those who did so at 62.

A true investment or economic return would accrue only to those who waited AND outlived an average life, which if your currently 62, SS assumes is 83 for men and 86 for women.

It seems to me that the greater risk is that you don’t live that long. And even if you do, the extra return for living a few extra years is peanuts, especially if you have more than enough money to see you to death.

So, take the money at 62?

Yes, unless you’re still working or you have little to no other retirement savings or income.

If the latter, taking SS later will ensure that you have more retirement income for your oldest years or if you’re the high earner in the couple, your spouse could take your higher benefit when you die.

BUT, if you have a good nest egg, it’s better to use SS as your early retirement income and let your nest egg continue to grow. The spousal benefit doesn’t really matter much if you have other funds.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:A couple of posters have called the 8% increase in annual payments for each year you wait an “investment return.” It is not.

The 8% is an adjustment factor for not receiving your benefits earlier. Put differently, if you start SS at 62 and live to 85, you’ll get 23 years of payments, but if you begin payments at 70, you’ll get 15 years of payments. The incremental 8% adjustment just increases the latter’s payments so that they receive the same lifetime benefit as the former. That’s not an investment return. It’s largely shifting the same amount of dollars to a shorter timespan from a longer one.

If you don’t believe me, run SS’s breakeven calculator. These payments are setup to be equal for the average lifetime + a bit. You have to live to 85+ to make more money with the delayed benefit. The System offsets this with the early death of many other seniors.

If it was a true “investment return,” people who wait until 70 would receive MORE than the additional dollars to compensate them for giving up benefits for an additional 8 years during an average lifespan.

Same poster. Thought of another way to say this.

An investment return implies the creation of new or added economic value. However, assuming one lives an actuarial average life, the 8% per annum increase only ensures that people who start their annuity at 70 receive the same amount of real dollars as those who did so at 62.

A true investment or economic return would accrue only to those who waited AND outlived an average life, which if your currently 62, SS assumes is 83 for men and 86 for women.

It seems to me that the greater risk is that you don’t live that long. And even if you do, the extra return for living a few extra years is peanuts, especially if you have more than enough money to see you to death.

So, take the money at 62?

Yes, unless you’re still working or you have little to no other retirement savings or income.

If the latter, taking SS later will ensure that you have more retirement income for your oldest years or if you’re the high earner in the couple, your spouse could take your higher benefit when you die.

BUT, if you have a good nest egg, it’s better to use SS as your early retirement income and let your nest egg continue to grow. The spousal benefit doesn’t really matter much if you have other funds.

Is the answer the same (take the money at 62) if you're not working and don't really the money now?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:A couple of posters have called the 8% increase in annual payments for each year you wait an “investment return.” It is not.

The 8% is an adjustment factor for not receiving your benefits earlier. Put differently, if you start SS at 62 and live to 85, you’ll get 23 years of payments, but if you begin payments at 70, you’ll get 15 years of payments. The incremental 8% adjustment just increases the latter’s payments so that they receive the same lifetime benefit as the former. That’s not an investment return. It’s largely shifting the same amount of dollars to a shorter timespan from a longer one.

If you don’t believe me, run SS’s breakeven calculator. These payments are setup to be equal for the average lifetime + a bit. You have to live to 85+ to make more money with the delayed benefit. The System offsets this with the early death of many other seniors.

If it was a true “investment return,” people who wait until 70 would receive MORE than the additional dollars to compensate them for giving up benefits for an additional 8 years during an average lifespan.

Same poster. Thought of another way to say this.

An investment return implies the creation of new or added economic value. However, assuming one lives an actuarial average life, the 8% per annum increase only ensures that people who start their annuity at 70 receive the same amount of real dollars as those who did so at 62.

A true investment or economic return would accrue only to those who waited AND outlived an average life, which if your currently 62, SS assumes is 83 for men and 86 for women.

It seems to me that the greater risk is that you don’t live that long. And even if you do, the extra return for living a few extra years is peanuts, especially if you have more than enough money to see you to death.

So, take the money at 62?

Yes, unless you’re still working or you have little to no other retirement savings or income.

If the latter, taking SS later will ensure that you have more retirement income for your oldest years or if you’re the high earner in the couple, your spouse could take your higher benefit when you die.

BUT, if you have a good nest egg, it’s better to use SS as your early retirement income and let your nest egg continue to grow. The spousal benefit doesn’t really matter much if you have other funds.

Is the answer the same (take the money at 62) if you're not working and don't really the money now?

DP. That’s our plan. We won’t be working and won’t need the money. Take it at 62.