Social Security, when to apply?

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Sep 1, 2015
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I am coming up on that time rather quickly.
I am in the fortunate position of not being reliant on it.
There doesn't seem to be a definitive way to decide when to apply.

The best advice I have seen say's
" If you need it to live on, hold off as long as possible.
If you don't need it to live on, get it ASAP and use the money to enjoy life when you're younger."

How did you decide and at what age?
 
There are many factors involved. Basically involves how long you think you will live and when you need the money. You get the most by waiting til 70 to collect. The system is designed to be neutral but it actually favors waiting til later because people are living longer. You can collect as soon as 62 but get 8% more per year the longer you wait. In theory it's neutral if you live to 82 but on average people live to 84. So you'd get the most out of it by waiting til you're 70 if you don't need the money. If you think you'll die sooner and are below average then you should take it sooner. Most people seem to think they're going to die sooner though and end up getting less.
 
This is a really personal decision that asking on the internet is of limited value. Wolf359 laid it out very well. My health isn't great so I decided on 62. Time will tell whether my decision was a good one.
 
In general....wait as long as you can. I did not and regret it. Its guaranteed savings if you can afford not to draw it.
 
If you are working your regular full time job at 62, check with SS to see if you will be penilised a % of your SS while still working. That may reduce your payments. As stated, the longer you work the more you will receive up to 70 years old. It will pay off if you can wait. But if your struggling now, taking it early might work better for you.,,
 
There are many factors involved. Basically involves how long you think you will live and when you need the money. You get the most by waiting til 70 to collect. The system is designed to be neutral but it actually favors waiting til later because people are living longer. You can collect as soon as 62 but get 8% more per year the longer you wait. In theory it's neutral if you live to 82 but on average people live to 84. So you'd get the most out of it by waiting til you're 70 if you don't need the money. If you think you'll die sooner and are below average then you should take it sooner. Most people seem to think they're going to die sooner though and end up getting less.
I understand all the above and it's all good info.
It's also my understanding that when people make it to 80, they pretty much quit spending money (except necessary things).
So does it make sense to wait and have more after your not spending it?

This is all assuming good health......

The other side of it is if I do elect to start SS, I will back off the draw on my investments and keep the money there.
 
I understand all the above and it's all good info.
It's also my understanding that when people make it to 80, they pretty much quit spending money (except necessary things).
So does it make sense to wait and have more after your not spending it?

This is all assuming good health......

The other side of it is if I do elect to start SS, I will back off the draw on my investments and keep the money there.
I have known many who waited and died shortly after. In my situation I will take it earlier. I don't like gambling.
 
Impossible to say, too many variables. It may not change in the long run, your total payments might be very similar no matter which way you go.

One thing most annuitants don't consider, 'what if I wait and SS goes insolvent' or worse 'what if they start to means test your payments?' Most don't know this either, your benefits are NOT guaranteed.


https://supreme.justia.com/cases/federal/us/363/603/

The great unknown is how long you live. Remember SS is NOT your personal property which you can will to your survivor(s).

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I started mine at 67 and retired at 70. Had the extra income for 3 years. Got a pension from where I worked and wife has a pension too. Travel, help the kids and enjoy life.
 
I understand all the above and it's all good info.
It's also my understanding that when people make it to 80, they pretty much quit spending money (except necessary things).
So does it make sense to wait and have more after your not spending it?

This is all assuming good health......

The other side of it is if I do elect to start SS, I will back off the draw on my investments and keep the money there.
It basically boils down to how healthy you are. Dr Fauci is now 81 and he's still doing those task force briefings and he's still pretty sharp. He used to run marathons though and did a 3:37 once. Then there's also Charlie Munger, Warren Buffet's right hand man still going strong and mentally sharp at 98.

Impossible to say, too many variables. It may not change in the long run, your total payments might be very similar no matter which way you go.

One thing most annuitants don't consider, 'what if I wait and SS goes insolvent' or worse 'what if they start to means test your payments?'
It's estimated that it will be insolvent by 2034, but you won't get 0, it will just have to reduce benefits by 22% so you'd still get 78%. That's if Congress does nothing. It's the 3rd rail so they'll probably do something before then, but probably at the last minute so it will probably be several more years before that date gets pushed back again.
 
Since you said your in a position to not need it you should start taking it and let it offset withdraws from your savings. Or take a look at what your tax liability will be at the same income level with and without SS.
 
Since you said your in a position to not need it you should start taking it and let it offset withdraws from your savings. Or take a look at what your tax liability will be at the same income level with and without SS.
Are you sure this even makes sense? You get an 8% increase if you don't take it so if you don't need it, you can defer it and get a higher return. I think you also get taxed on it if you take it before full retirement age and you're still working, but not afterwards so at least wait til full retirement age to take it. It also goes by the last 35 years of work with the highest incomes so if you're still making good money, continuing to work will raise your social security benefits. You basically almost need a book to decide how to utilize social security as there are lots of rules and rule changes from year to year.

 
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The retirement part is happening.... Monday. 3 yrs after my wife to the day.
Been on vacation since mid-January.

I have no immediate plan to apply.
Really appreciate everyone's thoughts.
Lots of good ideas and things to consider.
 
Are you sure this even makes sense? You get an 8% increase if you don't take it so if you don't need it, you can defer it and get a higher return. I think you also get taxed on it if you take it before full retirement age and you're still working, but not afterwards so at least wait til full retirement age to take it. It also goes by the last 35 years of work with the highest incomes so if you're still making good money, continuing to work will raise your social security benefits. You basically almost need a book to decide how to utilize social security as there are lots of rules and rule changes from year to year.

Well I would not take it as long as I was working. I retired at 62 but I waited until 65 to start SS because I was required to start Medicare at 65 and it was easier to just let them take the part B out of my SS check. But after I worked out the taxes and the fact that only 50% of my SS was taxable and the fact that the market was going up 25%/year vs 8% SS increase I thought it best to leave my retirement money invested and only supplement my SS.
 
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