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It Might Be Better to Take Social Security at 66 Instead of 70. Here's Why

VacationForever

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About the Author (Mike Piper)
I am a CPA in St. Louis, Missouri. I'm the author of nine financial books, as well as the popular blog "Oblivious Investor." I am an occasional public speaker (usually about Social Security or tax planning), and I have been quoted as a Social Security expert in numerous publications (e.g., Wall Street Journal, AARP, Kiplinger, and several others).

http://opensocialsecurity.com/

I just ran our ages and PIA through and it confirmed what I already knew. It said I should collect when I turn 62. :)
 

TravelTime

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I don’t understand, I got nothing when I took maternity leave. What are they getting? I suppose they can use sick days, but those are limited. Why do they get SS?

In California, pregnancy counts as short term disability. The state pays for 12 weeks, I believe. There is an even more liberal maternity leave that just went into effect this year.
 

easyrider

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Can anyone confirm that my plan for ss will work. Here it is.

My wife is a year older than me and could receive a ss check at 62. Her benefit at almost 67 is less than mine.

My benefit at full retirement is substantially higher than my wife's benefit.

My question is will my wife be able to take half of my benefit as her benefit when I take ss ? Would she be able to collect her benefit at 62 and then switch to the higher amount that is half of my benefit ?

Bill
 

WinniWoman

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Can anyone confirm that my plan for ss will work. Here it is.

My wife is a year older than me and could receive a ss check at 62. Her benefit at almost 67 is less than mine.

My benefit at full retirement is substantially higher than my wife's benefit.

My question is will my wife be able to take half of my benefit as her benefit when I take ss ? Would she be able to collect her benefit at 62 and then switch to the higher amount that is half of my benefit ?

Bill

I found this on line. I really wasn't sure about it.

https://www.forbes.com/sites/kotlik...e-switch-to-her-spousal-benefit/#7b3726eb4142
 
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ThatGuyOverThere

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Can anyone confirm that my plan for ss will work. Here it is.

My wife is a year older than me and could receive a ss check at 62. Her benefit at almost 67 is less than mine.

My benefit at full retirement is substantially higher than my wife's benefit.

My question is will my wife be able to take half of my benefit as her benefit when I take ss ? Would she be able to collect her benefit at 62 and then switch to the higher amount that is half of my benefit ?

Bill

If I am understanding you correctly I can answer this.

No she would not. If you draw a benefit at under FRA and her PIA is less than half of yours (i.e Husband PIA 2200 Wife PIA 800) she is automatically deemed to file for BOTH benefits under the age of FRA. She has to take both benefits due.

Does this answer it?
 

bluehende

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If I am understanding you correctly I can answer this.

No she would not. If you draw a benefit at under FRA and her PIA is less than half of yours (i.e Husband PIA 2200 Wife PIA 800) she is automatically deemed to file for BOTH benefits under the age of FRA. She has to take both benefits due.

Does this answer it?

We actually are doing this. We are in the same position as the questioner. We were told when I file at FRA my wife's social security will then be based on half of mine. There is a reduction due to her collecting early but with us the break even was like 85. They actually ran the numbers for us. Also with mandatory retirement withdrawals and the increase in our income due to SS if you include tax benefits it pushes it to 90+ with a few tax assumptions. Do not forget to include the tax implications. Another issue is how much you can earn on what you collect. For us it is allowing our assets to grow. If you spend it then ignore this.

Your example is close to us

mine is 2200 at fra and hers was 700 when she collected at 62. They calculated that hers would be 950 instead of 1100 when I file.
 

VacationForever

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Can anyone confirm that my plan for ss will work. Here it is.

My wife is a year older than me and could receive a ss check at 62. Her benefit at almost 67 is less than mine.

My benefit at full retirement is substantially higher than my wife's benefit.

My question is will my wife be able to take half of my benefit as her benefit when I take ss ? Would she be able to collect her benefit at 62 and then switch to the higher amount that is half of my benefit ?

Bill
You have to check PIA amount for both. If her PIA is higher than 50% of yours, then she won't benefit from it. BTW, spousal claim it is 50% of your PIA which is at full retirement age and not 50% of what you collect at 70.
 

easyrider

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We actually are doing this. We are in the same position as the questioner. We were told when I file at FRA my wife's social security will then be based on half of mine. There is a reduction due to her collecting early but with us the break even was like 85. They actually ran the numbers for us. Also with mandatory retirement withdrawals and the increase in our income due to SS if you include tax benefits it pushes it to 90+ with a few tax assumptions. Do not forget to include the tax implications. Another issue is how much you can earn on what you collect. For us it is allowing our assets to grow. If you spend it then ignore this.

Your example is close to us

mine is 2200 at fra and hers was 700 when she collected at 62. They calculated that hers would be 950 instead of 1100 when I file.

We are very close to your numbers. I want to wait until 70 so the spousal benefit would be higher. I am pretty sure she will outlive me.

Bill
 

SmithOp

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See VactionForever's post. The spousal benefit does not increase after your full retirement age.

I think Bill mistyped, he meant the spouse Survivor benefit will be higher if he waits until 70, she will get his higher amount.


Sent from my iPad using Tapatalk Pro
 

VacationForever

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I think Bill mistyped, he meant the spouse Survivor benefit will be higher if he waits until 70, she will get his higher amount.


Sent from my iPad using Tapatalk Pro
Spousal benefit = when both are still alive. Spouse can claim 50% of the other's SS amount based on PIA which is at Full Retirement Age, not at 70. Spousal benefit does not change between FRA and 70.

Survivor benefit = Deceased SS benefit at Survivor Full Retirement Age.
 
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easyrider

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Spousal benefit = when both are still alive. Spouse can claim 50% of the other's SS amount based PIA which is at Full Retirement Age, not at 70. Spousal benefit does not change between FRA and 70.

Survivor benefit = Deceased SS benefit at Survivor Full Retirement Age.

Thanks. I didn't consider this.

Bill
 

capjak

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see my earlier post regarding
http://opensocialsecurity.com/, It allows you to play around with different strategies, it will give you what the calculator believes is optimum based on what the coder assumed when developing the tool. I can not verify it is the best I am not an accountant or etc... but it is another data point.
 

Kozman

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Or, 62 depending on your current financial status, health and family history. There is no guarantee that you will make it until tomorrow.
 

WinniWoman

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Everyone's situation is different so you just can't rely on calculators, but they are good tools to give you an idea of what might work.

The big risk is not that you might not live long enough to get social security.You will be dead anyway in that case, so you won't miss anything.

The bigger risk is that you just might live a long life so it is best to optimize your benefits in a way that works best for you.
 

am1

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Seems like a standard starting time would be preferred. Say 65 and every ten years increase it a year. Take the decisions out of it and save people a lot of headache and money in paying someone decide. Government pensions were only ever met to be part of a retirement plan.
 

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If you take your SS at 66 your wife can get spousal SS without impeding her increase when can can take hers at 70. Gender can be exchange in previous sentence.
 

Talent312

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There is no guarantee that you will make it until tomorrow.

Indeed. I was unwilling to forego 5 years of SS payments by waiting until FRA.
I figured my break-even age was something like 82 and, even if I lived longer...
I'd rather have it while I was still ambulatory.
.
 

Patri

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Indeed. I was unwilling to forego 5 years of SS payments by waiting until FRA.
I figured my break-even age was something like 82 and, even if I lived longer...
I'd rather have it while I was still ambulatory.
.
That really is a key point.
 

WinniWoman

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Indeed. I was unwilling to forego 5 years of SS payments by waiting until FRA.
I figured my break-even age was something like 82 and, even if I lived longer...
I'd rather have it while I was still ambulatory.
.


Sure. But one thing is that for married couples, it is usually a good idea for at least (but not always) the higher earning spouse to wait until age 70 (if they can afford it), so that after death, the surviving spouse will have a higher benefit when down to just one SS check..

Of course, if you are rolling in dough- have big pensions or whatever- and don't need it- you could also just take it early and play with it or invest it or gift it.

But if you will be relying on it somewhat or mostly, it is a good idea to have a strategy. If you really need it for income early on- take it early.

If you don't really need it ever- well- take it whenever you want.

But- if it is part of an income plan going forward into your 80's and 90's, seriously give other options a look.

Social Security is just like an annuity. That is what it is.
 

easyrider

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see my earlier post regarding
http://opensocialsecurity.com/, It allows you to play around with different strategies, it will give you what the calculator believes is optimum based on what the coder assumed when developing the tool. I can not verify it is the best I am not an accountant or etc... but it is another data point.

This calculator confirms the notion of waiting until 70 for me and 66 and 10 months for my spouse to max out the benefits. Our scenario seems to be waiting until 65 at the earliest. Unless the ACA goes away, I wouldn't want the extra income to deal with until we are on Medicare at 65.

Bill
 

VacationForever

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This calculator confirms the notion of waiting until 70 for me and 66 and 10 months for my spouse to max out the benefits. Our scenario seems to be waiting until 65 at the earliest. Unless the ACA goes away, I wouldn't want the extra income to deal with until we are on Medicare at 65.

Bill
What has ACA got to do with when you start SS?
 
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