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(CNBC)   I'll be so rich when I'm old. Seriously look at your own financial situation. I'm probably taking it a 65...wife 67 or higher   (cnbc.com) divider line
43
    More: Asinine, Retirement, Research, Social security, Stock market, Employment, Inflation, Widow, Wealth  
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1128 clicks; posted to Business » on 08 Feb 2023 at 1:00 PM (5 weeks ago)   |   Favorite    |   share:  Share on Twitter share via Email Share on Facebook



43 Comments     (+0 »)
View Voting Results: Smartest and Funniest
 
SpectroBoy [TotalFark] [OhFark]
2023-02-08 10:54:41 AM  
The article is light on details.

If I wait until I'm 70 versus 65 what about the NPV of the money I collected from age 65-70?
 
Badmoodman [TotalFark]
2023-02-08 10:59:31 AM  
The maximum Social Security benefit for someone retiring at full retirement age is $3,627 per month.


This amount is not correct. I waited until age 70 last year and I was getting the maximum amount but there was an @8% increase this year. So, I get more than the amount above.
 
Cewley [TotalFark]
2023-02-08 11:39:16 AM  
The SSA used to have a table showing when the delay pay amount and the take early amount were the same. After that, the delay pay would be a better deal. Depends upon your circumstances. My parents both died in their 70s - I took mine at 62. No regrets.
 
fragMasterFlash [TotalFark] [OhFark]
2023-02-08 11:39:39 AM  
When I first entered the workforce it seemed I would have to work to the age of 72 to get full SS benefits. That has been dialed back 70 many moons ago, but I seriously doubt I will see a penny of the money I have paid in over the years. SS has been saddled with paying benefits to those who never contributed themselves, and while I'm not opposed to giving those people some sort of benefits it should really be called something else and funded differently, IMHO. De-incentivizing US workers does not help boost the GDP, and considering how big the national debt is we need strong GDP to make servicing that debt less of a struggle and avoid budgetary issues being a perennial brinksmanship play for showboating politicians.
 
SpectroBoy [TotalFark] [OhFark]
2023-02-08 11:47:03 AM  

fragMasterFlash: When I first entered the workforce it seemed I would have to work to the age of 72 to get full SS benefits. That has been dialed back 70 many moons ago, but I seriously doubt I will see a penny of the money I have paid in over the years. SS has been saddled with paying benefits to those who never contributed themselves, and while I'm not opposed to giving those people some sort of benefits it should really be called something else and funded differently, IMHO. De-incentivizing US workers does not help boost the GDP, and considering how big the national debt is we need strong GDP to make servicing that debt less of a struggle and avoid budgetary issues being a perennial brinksmanship play for showboating politicians.


The only people who can legally collect benefits without paying into Social Security are family members of workers who have done so. Nonworking spouses, ex-spouses, offspring or parents may be eligible for spousal, survivor or children's benefits based on the qualifying worker's earnings record.

https://www.aarp.org/retirement/social-security/questions-answers/collecting-benefits-without-paying-into-social-security.html#:~:text=The%20only%20people%20who%20can,the%20qualifying%20worker's%20earnings%20record.
 
oa330_man [TotalFark] [OhFark]
2023-02-08 12:19:17 PM  

SpectroBoy: The article is light on details.

If I wait until I'm 70 versus 65 what about the NPV of the money I collected from age 65-70?


If wait until you're 70 and then die one day after your 70th birthday it'll be less than if you had taken the money from age 65-70.

/math is hard
//let's go shopping!
 
cherryl taggart [TotalFark] [OhFark]
2023-02-08 12:50:57 PM  

SpectroBoy: fragMasterFlash: When I first entered the workforce it seemed I would have to work to the age of 72 to get full SS benefits. That has been dialed back 70 many moons ago, but I seriously doubt I will see a penny of the money I have paid in over the years. SS has been saddled with paying benefits to those who never contributed themselves, and while I'm not opposed to giving those people some sort of benefits it should really be called something else and funded differently, IMHO. De-incentivizing US workers does not help boost the GDP, and considering how big the national debt is we need strong GDP to make servicing that debt less of a struggle and avoid budgetary issues being a perennial brinksmanship play for showboating politicians.

The only people who can legally collect benefits without paying into Social Security are family members of workers who have done so. Nonworking spouses, ex-spouses, offspring or parents may be eligible for spousal, survivor or children's benefits based on the qualifying worker's earnings record.

https://www.aarp.org/retirement/social-security/questions-answers/collecting-benefits-without-paying-into-social-security.html#:~:text=The%20only%20people%20who%20can,the%20qualifying%20worker's%20earnings%20record.


Pretty sure they are referring to the folks that get SSI and/or SSDI versus the Social Security payments.  They are all handled through the Social Security Administration but have very different criteria and funding sources.  SSI is funded through general revenues, while SSDI and Social Security retirement plans are FICA funded.  A child born with severe disabilities can never pay a penny in, and still qualify to receive funds through the Social Security Administration.  They are the check writers.  So fragMasterFlashis correct in that, if it's not funded by FICA, it should probably be moved elsewhere.  But the SSA is very efficient for the purpose of getting funds out fast.  It's the getting approved that takes forever.
 
Nick Nostril
2023-02-08 1:11:04 PM  
Die at 71. Smart
 
Rapmaster2000 [TotalFark]
2023-02-08 1:13:16 PM  
You'll get social security.  There's an entire political party who is receiving lobbying funds from the financial services industry who wants you to think it won't so they can provide their alternative and skim fees off of it.
 
hammettman
2023-02-08 1:27:49 PM  
So the math only works out if you live past age 77.  Yeah, I personally don't see that happening and not sure I'd even want to get past that age.

I'm going in early, with bets that the world or myself will end before it turns financially positive to wait.
 
OccamsWhiskers
2023-02-08 1:31:52 PM  
There are a bunch of tools that will show you how all of your filing options compare over time, including factoring in potential spousal benefits. My take from those is the stakes are pretty low unless your lifespan is on either end of the bell curve. I plan to wait if possible, as a kind of longevity insurance.

But one factor that makes it really complicated is considering tax on the SS income. The rates, brackets, and SS-specific rules may very well change but even if you assume they won't, there's likely a tax benefit to spreading the income over more years. So the breakeven for filing at 62 vs 67 or 70 is probably even later than most simple comparisons indicate.
 
krebshack
2023-02-08 1:50:40 PM  
I had a coworker who did this. Really nice guy.

His wife died visiting their grandchildren in Nebraska while he was at work.
 
Anenu
2023-02-08 1:53:58 PM  
No thanks, I'd rather retired early and have some time to enjoy it rather than work an extra half decade plus and retired at an age when all I do is take trips to the doctor and back.
 
quo vadimus
2023-02-08 2:00:55 PM  
Nope.

static.scientificamerican.comView Full Size
 
eKonk
2023-02-08 2:04:36 PM  
I'm not planning my retirement around receiving anything from Social Security, so in theory I should be able to retire younger but wait until 70 to start collecting. My grandfathers both were pretty healthy through their 80s so it could work out to my advantage.

Of course, if it goes the way all my other plans seem to go, I'll die at age 69.

/Nice
 
Johnson [BareFark]
2023-02-08 2:08:07 PM  

hammettman: So the math only works out if you live past age 77.


Yep.  I started taking it at 62 because
A:  Don't know if I will live past 77
B:  My wife is a decade older than I am, if she pre-deceases me, I get her SS as Spousal Survival Benefit instead of my own SS because she is already claiming the max amount which is considerably more than I currently receive.

/ checks FB HS Class page
//  oh, another classmate died this week before he could claim his SS benefits.
/// repeat until my number comes up.
 
tobcc
2023-02-08 2:11:47 PM  
im planning on retiring as soon as I can.  Yea you get more money if you wait, but the reason they do that is you will draw for less time.  I'd rather get a few hundred less a month and have a great 5-7 year run before issues with age and heath prevent it.

Once again no one on their death bed says "Hey I wish I worked a little longer or a litte harder".

Got a few retirement accounts, wife will have a state teachers pension, but our big thing, having the house paid off.  Yea taxes and insurance, but a $500 payment is still way less than rent.
 
Another Government Employee
2023-02-08 2:20:47 PM  
The deciding function is the recipient's health. If you think you will die prior to 80, take it early. If you think you  will longer, then wait.

I'm at the age where this is important. I can draw now, but I'm relatively healthy so I'm holding out until at least 66 and 8 months (my full benefit date) and will review things then. I have a friend who started drawing at 62 because he wrecked his health by drinking and it will be surprising if he makes it past 70.
 
jake3988 [OhFark]
2023-02-08 3:02:30 PM  

Cewley: The SSA used to have a table showing when the delay pay amount and the take early amount were the same. After that, the delay pay would be a better deal. Depends upon your circumstances. My parents both died in their 70s - I took mine at 62. No regrets.


It's around age 77, which is basically the life expectancy for a normal man.

My uncle was the longest lived male (that we know of) on his side of the family... and he died just shy of 74.

My dad (his brother) felt it was a very easy decision to take SS at 62.  He already suffered a minor stroke and had a life threatening battle with pneumonia prior to that.  And with family history saying he definitely won't maximize it... absolutely take it.

It all depends on the situation, but for most people I say... retire early.  Unless you REALLY like what you do (or are a doctor or something.  They get such a late start, they always retire late)
 
keldaria
2023-02-08 3:04:24 PM  

Cewley: The SSA used to have a table showing when the delay pay amount and the take early amount were the same. After that, the delay pay would be a better deal. Depends upon your circumstances. My parents both died in their 70s - I took mine at 62. No regrets.


They still provide the data you need to extrapolate that. It's a fairly simple exercise.

For me, if I live to be 76 or less then it's better for me to take it at 62. If I live to between 77 and 78 it's better for me to take it at 65. If I live to between 79 and 81 then I should take it at 67 and if I live to 82 and beyond then I should wait until 70 to take it.

The hard part is knowing when you'll die. My family has a mixed history. Several 90 year olds and several low 70's. My brother died a year and a half ago at 42. That said, I may leave a bit of money on the table if I live to be 90 but I'm going to probably plan for taking it at 62... assuming it still exists. Otherwise my normal retirement account is healthy and my vested pension from my old job is a decent chunk that should offset it.
 
Telephone Sanitizer Second Class
2023-02-08 3:22:37 PM  

OccamsWhiskers: There are a bunch of tools that will show you how all of your filing options compare over time


That's not a nice way to refer to accountants.
 
Mikey1969 [TotalFark] [OhFark]
2023-02-08 3:22:40 PM  
Well, considering that 11 years of layoffs and contract work has assured that I have no retirement whatsoever, I plan to work until I drop dead at the ripe old age of immortal. For some reason, life likes to fark me, so I'm never going to die, because that would just end the joke life is playing on me. So I'm gonna work until the end of time, every time I get settled in and organized, I'll get laid off for one reason or another, and I'll scramble for another job that will fark me over.
 
Doc Daneeka
2023-02-08 3:42:58 PM  

quo vadimus: Nope.

[static.scientificamerican.com image 590x408]


That's average life expectancy at birth.  Meaning it's an an average including all the people who died in childhood or at an early age.

The average life expectancy of a person who survives to middle-age and is approaching retirement age, will be significantly higher.

I'm currently in my early 40s.  According to one life expectancy calculator I found, a person my age can be expected to live to age 82 on average.  But if I make it to age 62, then from that point I would be expected to live to age 85 on average.  And so on - as you age, your remaining life expectancy continues to rise, but at a slower rate.

When people talk about the antiquity or the middle ages, and the fact that average life expectancy was around age 30 or something, some people seem to think that means that most people died in early adulthood.  But no, that's an average.  The reason it was so low was because LOTS of people used to die in infancy or early childhood.  Those who actually reached adulthood actually stood a pretty good shot of making it to their 70s.
 
JohnBigBootay
2023-02-08 3:59:18 PM  

quo vadimus: Nope.

[static.scientificamerican.com image 590x408]


Life expectancy at birth is not a very useful number for adult humans ( though it's great for babies...). Individual health traits aside you need to look at your life expectancy for your age group. If you are in your mid 50's it's likely around 82. If you are 70 it's about 85. If you are 80, it's about 88.

https://www.ssa.gov/oact/STATS/table4c6.html
 
natazha [BareFark]
2023-02-08 4:08:54 PM  
I tried to convince a friend to take SS against her ex's account at 62, then switch at 70 to her own. Could not get her to understand the math. Her real estate taxes eat up most of her income.

I took SS at 62, because at that time the money was needed and the maximum age for starting IRA withdrawals was 70. Once I start tapping that (I think it's 72 now), it will be more than SS by quite a margin.
 
Wine Sipping Elitist [TotalFark]
2023-02-08 4:20:31 PM  
I'm glad to see so many old farts on fark.

Like someone else said, I'm not planning my retirement around SS checks or a 401k. I'm going to need passive income, like renting out my home or another house and moving to some place with a low cost of living. I don't want stairs in my retirement home and I won't need a bunch of empty rooms, so I probably won't stay in my current home.

That said, I check the SSA page every year and the only real decision for me is collecting at 62 or 65. Retiring at 65 gives me $700 more than at 62, and retiring at 67 is $1000 or so more than 62, but only 370 or so more than at 65. Collecting at 70 is almost 2000/month more than 62 for completeness, but that is some BS to wait that long for YOUR money. Fark that noise.

The question I asked myself: Is $1000/month worth 5 years of my later life, or would I rather party and travel for those years? If the body and health changes I've experienced from 40 to 45 are any indication of how 60 to 65 will be, the answer is hell no. My 90 year old granddaddy said he lived too long. He said it's better to die young and I believed him.

You can't take it with you, so give me back what I put in asap if you're going to give it to me at all. Let me spend it.
 
JohnBigBootay
2023-02-08 4:22:21 PM  

Doc Daneeka: quo vadimus: Nope.

[static.scientificamerican.com image 590x408]

That's average life expectancy at birth.  Meaning it's an an average including all the people who died in childhood or at an early age.

The average life expectancy of a person who survives to middle-age and is approaching retirement age, will be significantly higher.

I'm currently in my early 40s.  According to one life expectancy calculator I found, a person my age can be expected to live to age 82 on average.  But if I make it to age 62, then from that point I would be expected to live to age 85 on average.  And so on - as you age, your remaining life expectancy continues to rise, but at a slower rate.

When people talk about the antiquity or the middle ages, and the fact that average life expectancy was around age 30 or something, some people seem to think that means that most people died in early adulthood.  But no, that's an average.  The reason it was so low was because LOTS of people used to die in infancy or early childhood.  Those who actually reached adulthood actually stood a pretty good shot of making it to their 70s.


I se you covered this. Good - it's important stuff and obviously a lot of people just aren't looking at the right numbers. There's little value to including folks who are already dead in 'life' expectancy calculations and it skews the numbers a lot.

In the same vein a lot of people actually overestimate the effect of, say, their dad dying at X from cancer then assuming, fark it, I may as well plan on dying young. there's a whole new ballgame these days for life expectancy for many kinds of cancer. Not to say family health history is not an important factor. Of course it is for many reasons. I just find that a lot of folks choose to only pay attention to data that confirms the choice they prefer to make while ignoring data that does not.
 
SpectroBoy [TotalFark] [OhFark]
2023-02-08 4:28:31 PM  

Anenu: No thanks, I'd rather retired early and have some time to enjoy it rather than work an extra half decade plus and retired at an age when all I do is take trips to the doctor and back.



You can retire and still delay your SS enrolment.
 
Red Shirt Blues
2023-02-08 4:39:44 PM  

Wine Sipping Elitist: moving to some place with a low cost of living.


Keep us posted when you find one of those. Especially in the US.
 
JohnBigBootay
2023-02-08 4:42:03 PM  

SpectroBoy: Anenu: No thanks, I'd rather retired early and have some time to enjoy it rather than work an extra half decade plus and retired at an age when all I do is take trips to the doctor and back.


You can retire and still delay your SS enrolment.


Right. Of course the main issue for so many is they don't have an acceptable financial alternative. They're broke now.
 
Blackstone [TotalFark] [OhFark]
2023-02-08 4:42:10 PM  
Start at 62 --you draw for a MUCH longer time. Even when accounting for a higher payment if you wait, the breakeven point works out to around age 75 and few months

So, yeah, if you wait your monthly check is bigger, but unless you think you'll live past 76, you'll accumulate more money by starting at 62
 
mcreadyblue
2023-02-08 5:08:02 PM  

Red Shirt Blues: Wine Sipping Elitist: moving to some place with a low cost of living.

Keep us posted when you find one of those. Especially in the US.


Saipan has a low cost of living and you don't have to pay the IRS anything. Plus the beaches are nice.
 
warrenn
2023-02-08 6:03:17 PM  
One thing to keep in mind is a portion of your SS benefits count as taxable income if you have more than a certain amount of income ($34k single, $44k married).  Income would generally be money that is taxed, such as money from a job, 401k, IRA, etc.  Money from things like savings and Roth accounts do not count as income.  If you take SS at 62 and are still working or drawing from your IRA, your effective SS benefit could be less if you end up having to pay taxes on it.
 
CCNP
2023-02-08 7:25:57 PM  
Thankfully, Biden is going to stop share buybacks, to keep stock prices from going up too high.

Or else all those greedy firefighters, teachers, government employees, pensioners, and 401K holders would wind up getting more retirement than the rest of us.
 
dustman81
2023-02-08 7:49:38 PM  

quo vadimus: Nope.

[static.scientificamerican.com image 590x408]


Huh, it's like there was some major health event around 2019-2020 that affected older people more than younger people.
 
TedCruz'sCrazyDad
2023-02-08 8:08:52 PM  

warrenn: One thing to keep in mind is a portion of your SS benefits count as taxable income if you have more than a certain amount of income ($34k single, $44k married).  Income would generally be money that is taxed, such as money from a job, 401k, IRA, etc.  Money from things like savings and Roth accounts do not count as income.  If you take SS at 62 and are still working or drawing from your IRA, your effective SS benefit could be less if you end up having to pay taxes on it.


If you take SS at 62, they will hold back money if you earn over $19,560 (2022).  For every $2 you exceed they will withhold $1.
 
hlehmann
2023-02-08 8:17:21 PM  

Badmoodman: The maximum Social Security benefit for someone retiring at full retirement age is $3,627 per month.


This amount is not correct. I waited until age 70 last year and I was getting the maximum amount but there was an @8% increase this year. So, I get more than the amount above.


According to ssa.gov:
"If you retire at age 70 in 2023, your maximum benefit would be $4,555"
 
proteus_b
2023-02-08 11:31:09 PM  

Blackstone: Start at 62 --you draw for a MUCH longer time. Even when accounting for a higher payment if you wait, the breakeven point works out to around age 75 and few months


Right, and as people have pointed out, the life expectancy for someone who lives to 62 is 85. Which is more than 75. So you expect to collect more if you wait until 70. It's true though that you'll have that extra money when you are older and presumably less likely to enjoy it.
 
HempHead
2023-02-09 1:19:37 AM  

proteus_b: Blackstone: Start at 62 --you draw for a MUCH longer time. Even when accounting for a higher payment if you wait, the breakeven point works out to around age 75 and few months

Right, and as people have pointed out, the life expectancy for someone who lives to 62 is 85. Which is more than 75. So you expect to collect more if you wait until 70. It's true though that you'll have that extra money when you are older and presumably less likely to enjoy it.


But being destitute at 75 and forced to get a job doesn't sound like fun either.
 
Red Shirt Blues
2023-02-09 4:22:06 AM  

HempHead: proteus_b: Blackstone: Start at 62 --you draw for a MUCH longer time. Even when accounting for a higher payment if you wait, the breakeven point works out to around age 75 and few months

Right, and as people have pointed out, the life expectancy for someone who lives to 62 is 85. Which is more than 75. So you expect to collect more if you wait until 70. It's true though that you'll have that extra money when you are older and presumably less likely to enjoy it.

But being destitute at 75 and forced to get a job doesn't sound like fun either.


I'd rather live in my car.
 
DrKillPatient [TotalFark]
2023-02-09 11:02:39 AM  

hammettman: So the math only works out if you live past age 77.  Yeah, I personally don't see that happening and not sure I'd even want to get past that age.

I'm going in early, with bets that the world or myself will end before it turns financially positive to wait.


I'm going be 64. Looking at 65, or 67 at the latest, same reason.
 
OccamsWhiskers
2023-02-09 11:56:03 AM  

hlehmann: Badmoodman: The maximum Social Security benefit for someone retiring at full retirement age is $3,627 per month.


This amount is not correct. I waited until age 70 last year and I was getting the maximum amount but there was an @8% increase this year. So, I get more than the amount above.

According to ssa.gov:
"If you retire at age 70 in 2023, your maximum benefit would be $4,555"


TFA's number says it's for Full Retirement Age. If Badmoodman is 71, his was at age 66. Delaying benefits for 4 years beyond that will increase the monthly benefit quite a lot. That's probably most of the difference in his report, and your number for the maximum delayed benefit as of 2023.
 
SoundOfOneHandWanking [TotalFark] [OhFark]
2023-02-09 8:37:18 PM  
I did the math, if you're going to die before age 76, you should take the money early.
 
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