When to file social security benefits 62 or 67?

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anonforthis
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When to file social security benefits 62 or 67?

Post by anonforthis »

Sorry I have so many questions since I joined this board. I just read my husband social security benefits online and here is what it says:

Retirement
You have earned enough credits to qualify for retirement benefits. At your current earnings rate, your estimated payment would be:
At full retirement age (67):
$2,294 a month
At age 70:
$2,864 a month
At early retirement age (62):
$1,575 a month

He will retire at 62 and our children will be 9 and 10. I will still be working. Should we wait to file or should we file at 62? I believe he will get more than $1575 a month because we have 2 minor children. He is 53 now. Thank you.
ajcp
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Re: When to file social security benefits 62 or 67?

Post by ajcp »

This doesn't directly answer your question, but it's an important thing to consider, especially with two young kids. Do you have enough saved for him to retire at 62?
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cheese_breath
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Re: When to file social security benefits 62 or 67?

Post by cheese_breath »

From my perspective an important thing to consider is your health and longevity outlook. I don't know the exact number now, but when my wife and I both took ours at age 62 the break even point was somewhere around 82 years plus or minus. That means if we pass before age 82 we are ahead of the game by taking it early. If we live longer we should have waited.
The surest way to know the future is when it becomes the past.
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anonforthis
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Re: When to file social security benefits 62 or 67?

Post by anonforthis »

ajcp wrote:This doesn't directly answer your question, but it's an important thing to consider, especially with two young kids. Do you have enough saved for him to retire at 62?

We should be okay. I will be working and no mortgage by then. Our plan is not to touch any retirement accts because I will be 43 when he retires.
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anonforthis
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Re: When to file social security benefits 62 or 67?

Post by anonforthis »

cheese_breath wrote:From my perspective an important thing to consider is your health and longevity outlook. I don't know the exact number now, but when my wife and I both took ours at age 62 the break even point was somewhere around 82 years plus or minus. That means if we pass before age 82 we are ahead of the game by taking it early. If we live longer we should have waited.

His mom passed at 60 and his dad is now 85.
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Phineas J. Whoopee
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Re: When to file social security benefits 62 or 67?

Post by Phineas J. Whoopee »

anonforthis wrote:...
He will retire at 62 and our children will be 9 and 10. I will still be working. Should we wait to file or should we file at 62? I believe he will get more than $1575 a month because we have 2 minor children. He is 53 now. Thank you.
I believe that to be incorrect. Social Security payments are not increased for retirees just because they have dependents. It can affect total taxes paid, but benefits are not adjusted upward.

See goblue100's correction in the next post.

PJW
Last edited by Phineas J. Whoopee on Thu Mar 13, 2014 11:15 am, edited 1 time in total.
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Re: When to file social security benefits 62 or 67?

Post by goblue100 »

Phineas J. Whoopee wrote:
anonforthis wrote:...
He will retire at 62 and our children will be 9 and 10. I will still be working. Should we wait to file or should we file at 62? I believe he will get more than $1575 a month because we have 2 minor children. He is 53 now. Thank you.
I believe that to be incorrect. Social Security payments are not increased for retirees just because they have dependents. It can affect total taxes paid, but benefits are not adjusted upward.
PJW
Actually, I believe they are.
http://www.ssa.gov/retire2/yourchildren.htm

When you qualify for Social Security retirement benefits, your children may also qualify to receive benefits on your record. Your eligible child can be your biological child, adopted child or stepchild. A dependent grandchild may also qualify.

To receive benefits, the child must:

•be unmarried; and
•be under age 18; or
•be 18-19 years old and a full-time student (no higher than grade 12); or
•be 18 or older and disabled from a disability that started before age 22.
Financial planners are savers. They want us to be 95 percent confident we can finance a 30-year retirement even though there is an 82 percent probability of being dead by then. - Scott Burns
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Phineas J. Whoopee
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Re: When to file social security benefits 62 or 67?

Post by Phineas J. Whoopee »

Thanks for the correction goblue100. I've struck through the text in my previous post and pointed readers to yours instead.
PJW
sscritic
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Re: When to file social security benefits 62 or 67?

Post by sscritic »

Note that those benefits belong to your children, not you. It's time for another UTMA fight.
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Re: When to file social security benefits 62 or 67?

Post by cheese_breath »

Another important consideration is whether he desires to leave an inheritance, first to you and then to the children. Delaying social security will mean drawing down his retirement investments faster to replace the income he would have received from SS if he had claimed earlier.

The bottom line is there is not one answer that's right for everyone. You and he will have to consider many different options and choose the one that seems best for your circumstances.
The surest way to know the future is when it becomes the past.
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Re: When to file social security benefits 62 or 67?

Post by dbr »

cheese_breath wrote:
The bottom line is there is not one answer that's right for everyone. You and he will have to consider many different options and choose the one that seems best for your circumstances.
That is exactly right. The reason to postpone benefits, even to age 70, is maximum insurance against living too long and running out of money. What sort of issue that is depends on each investor's point of view.
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Re: When to file social security benefits 62 or 67?

Post by JW-Retired »

There is a lot to the decision when to take SS benefits so it's good you are starting to think about this when it is still years off. Which earner will have the highest benefit? Will you have other income so you are not forced to take it early? You should analyze this as couple instead of just as a single person like the usual "breakeven analysis" does.

Is husbands SS going to be bigger than yours? That is often the case. Mine is much larger than my wife's so I delayed to age 70 to maximize the amount she would get as a survivor when I die, which is more probable actuarially. The survivor gets the amount of SS benefit the deceased was getting at death. Or, if they were not drawing it yet, the amount they would have received if they filed on the day they died. Since your Husband is 19 years older you obviously need to consider the survivor benefit aspects of this.

Another thing is state taxation. Many states (like my state CA) don't tax SS but they do tax other retirement income like IRA/401k RMDs. I pay a high state income tax rate (9.3%) on most everything except SS. You get to a marginal brackets of 8% and 9.3% at pretty modest incomes here in CA. :( This means it is best to try to make your SS income as large as possible, if need be at the expense of some of your other retirement income.
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Re: When to file social security benefits 62 or 67?

Post by dhodson »

Unless you are making more than your husband , I'd think heavily about the spousal benefits given the age differences.
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anonforthis
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Re: When to file social security benefits 62 or 67?

Post by anonforthis »

Thanks everyone. I don't think I will ever need my husband ss benefits because:

If he retires at 70 the maximum benefits for him will be around $2800. I can only get half of it as a spouse so $1400. I have been making at least 50K since I was 30 year old and I worked full time since I was 18. I am now 34. Therefore I think I will be better off getting my own benefits. I don't plan to retire at all unless of course I"m disabled or my health doesn't allow for me to work. Even then, I have private long term disability insurance on me until I"m 65. Thanks again.
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Re: When to file social security benefits 62 or 67?

Post by sscritic »

He can file and suspend kiddie style. File at 62, suspend at 67. Kids can keep collecting while he earns delayed credits.
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Re: When to file social security benefits 62 or 67?

Post by gerntz »

I have no idea how you can decide that nine years from now you WILL retire at 62 when you'll have minor kids. Without more explanation, feels irresponsible. What's wrong with working another 2,3,5 years?
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Re: When to file social security benefits 62 or 67?

Post by sscritic »

anonforthis wrote: If he retires at 70 the maximum benefits for him will be around $2800. I can only get half of it as a spouse so $1400.
Sometimes I don't know why I bother. This statement is wrong on three levels, explicit and implicit. Someone else will have to step in, because I need to go watch 断奶 starring 佟丽娅, who has been one of my favorites since 北京爱情故事 where she played 沈冰. This is in spite of the fact that she has a crowded out canine (a nod to my daughter - neither of us can watch a movie or tv show without commenting on the teeth). Actually, that canine is part of her charm.
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Re: When to file social security benefits 62 or 67?

Post by anonforthis »

sscritic wrote:
anonforthis wrote: If he retires at 70 the maximum benefits for him will be around $2800. I can only get half of it as a spouse so $1400.
Sometimes I don't know why I bother. This statement is wrong on three levels, explicit and implicit. Someone else will have to step in, because I need to go watch 断奶 starring 佟丽娅, who has been one of my favorites since 北京爱情故事 where she played 沈冰. This is in spite of the fact that she has a crowded out canine (a nod to my daughter - neither of us can watch a movie or tv show without commenting on the teeth). Actually, that canine is part of her charm.

If I said something wrong. Iam sorry. I don't understand what you meant by all this. Thank you.
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Re: When to file social security benefits 62 or 67?

Post by cheese_breath »

anonforthis wrote:
sscritic wrote:
anonforthis wrote: If he retires at 70 the maximum benefits for him will be around $2800. I can only get half of it as a spouse so $1400.
Sometimes I don't know why I bother. This statement is wrong on three levels, explicit and implicit. Someone else will have to step in, because I need to go watch 断奶 starring 佟丽娅, who has been one of my favorites since 北京爱情故事 where she played 沈冰. This is in spite of the fact that she has a crowded out canine (a nod to my daughter - neither of us can watch a movie or tv show without commenting on the teeth). Actually, that canine is part of her charm.

If I said something wrong. Iam sorry. I don't understand what you meant by all this. Thank you.
Don't worry about him. He just gets a little crotchety sometimes. :wink: He's actually a pretty good guy.
The surest way to know the future is when it becomes the past.
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Re: When to file social security benefits 62 or 67?

Post by sscritic »

anonforthis wrote:
sscritic wrote:
anonforthis wrote: If he retires at 70 the maximum benefits for him will be around $2800. I can only get half of it as a spouse so $1400.
This statement is wrong on three levels, explicit and implicit.
If I said something wrong. Iam sorry. I don't understand what you meant by all this. Thank you.
You were lied to, is my guess. The fault is not yours, except to the extent that you believed the lies.
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Re: When to file social security benefits 62 or 67?

Post by nickfrank »

You will get $2800 when your husband dies as a widow. This amount will be reduced depending on when He starts collecting. You will get $1400 while he is alive and He will collect $2800 @ 70.
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Re: When to file social security benefits 62 or 67?

Post by pshonore »

nickfrank wrote:You will get $2800 when your husband dies as a widow. This amount will be reduced depending on when He starts collecting. You will get $1400 while he is alive and He will collect $2800 @ 70.
Not quite. Spousal benefits do not include DRCs; how old will she be when he is 70?
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Re: When to file social security benefits 62 or 67?

Post by JW-Retired »

anonforthis wrote:
sscritic wrote:
anonforthis wrote: If he retires at 70 the maximum benefits for him will be around $2800. I can only get half of it as a spouse so $1400.
Sometimes I don't know why I bother. This statement is wrong on three levels, explicit and implicit. Someone else will have to step in, because I need to go watch 断奶 starring 佟丽娅, who has been one of my favorites since 北京爱情故事 where she played 沈冰. This is in spite of the fact that she has a crowded out canine (a nod to my daughter - neither of us can watch a movie or tv show without commenting on the teeth). Actually, that canine is part of her charm.

If I said something wrong. I am sorry. I don't understand what you meant by all this. Thank you.
I'll try.... wrong on 3 levels he said (1) you don't get half of 2800 benefit if you file as a spouse, once you are FRA(age 67) you can get half of his PIA (primary insurance amount) which you said would be 2294. (2) If you file earlier than your FRA you automatically claim your own benefit as well and you will get that amount if it is larger than half his PIA, either will be reduced for claiming early. (3) once you are FRA you can file as a spouse without claiming your own benefit if you wish, i.e. you might want delay your own to make it bigger and then switch to it later at age 70. You implied spousal was your only choice. (4) Seems to me the key thing is the widow/survivor benefit. Should husband die while you are in the 60-something to 70 age range, you have the option to take widow/survivor benefits in the amount of his current benefit amount (possibly reduced depending on your age). Even if your own benefit is larger than his you might choose to do that in order to delay your own claim for SS until age 70 to make it as large as possible.

There are just a heck of a lot of possibilities. It's not a good idea to grab at one (e.g. he will claim at 62) until you have a reasonable understanding of them all.
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Raymond
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Re: When to file social security benefits 62 or 67?

Post by Raymond »

anonforthis wrote:...If I said something wrong. Iam sorry. I don't understand what you meant by all this. Thank you.
sscritic is *the* go-to person on Social Security on this forum - as I understand it, he worked at the SSA for years.

He is also a huge fan of Chinese (or is it Korean?) soap operas.

He is not happy when people (you, in this case) are given incorrect information - however, he will then often give homework assignments.

Someone please correct me if I'm wrong :happy
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Re: When to file social security benefits 62 or 67?

Post by Random Musings »

cheese_breath wrote:From my perspective an important thing to consider is your health and longevity outlook. I don't know the exact number now, but when my wife and I both took ours at age 62 the break even point was somewhere around 82 years plus or minus. That means if we pass before age 82 we are ahead of the game by taking it early. If we live longer we should have waited.
I ran some Monte Carlo analysis for my parents and came out B/E was around 83 or so. For a women aged 62, that's about their average life expectancy.

RM
I figure the odds be fifty-fifty I just might have something to say. FZ
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Re: When to file social security benefits 62 or 67?

Post by sscritic »

JW Nearly Retired wrote: I'll try.... wrong on 3 levels he said (1) you don't get half of 2800 benefit if you file as a spouse, once you are FRA(age 67) you can get half of his PIA (primary insurance amount) which you said would be 2294. (2) If you file earlier than your FRA you automatically claim your own benefit as well and you will get that amount if it is larger than half his PIA, either will be reduced for claiming early. (3) once you are FRA you can file as a spouse without claiming your own benefit if you wish, i.e. you might want delay your own to make it bigger and then switch to it later at age 70. You implied spousal was your only choice. (4) Seems to me the key thing is the widow/survivor benefit. Should husband die while you are in the 60-something to 70 age range, you have the option to take widow/survivor benefits in the amount of his current benefit amount (possibly reduced depending on your age). Even if your own benefit is larger than his you might choose to do that in order to delay your own claim for SS until age 70 to make it as large as possible.

There are just a heck of a lot of possibilities. It's not a good idea to grab at one (e.g. he will claim at 62) until you have a reasonable understanding of them all.
JW
Thanks JW. I misspoke as the third error was tied to an earlier statement about not needing her husband's wife's benefits (or are those her wife's benefits?). Ignoring need for the moment, free money is always good. And you got it. She can file a restricted application at her FRA to be his wife and collect while letting her own old-age benefits grow by delayed retirement credits until she is 70.

We really have no idea what her benefits will be like when she reaches FRA, but it could easily be that her own at 70 will be more than his at 62 so waiting until 70 might make the most sense for her at the point that he dies (assuming she is still alive). And if he dies before she reaches 70, she can collect as a widow while waiting for 70 (subject to age restrictions) to max her own benefit.

The key here is the extra money the children can collect by his filing at 62 rather than 67 (that sounds like 5 years times 2 children). You have to look at the family max which should be on the SS statement she has and know how that interacts with his taking early. While often taking late is better than early, that is in a situation without this extra free money (separate from the previous free money I mentioned). The existence of kids who can collect tilt the field toward taking early.

And, as I mentioned before, he can suspend at 67 and the children can keep collecting while he waits until 70 to pick up 3 years of delayed credits. This is the "file and suspend later" strategy that is rarely discussed. When you suspend, it affects you as the worker and not those also collecting on your record, which is why the usual file and suspend allows your spouse to collect as your spouse after you suspend.
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Re: When to file social security benefits 62 or 67?

Post by sscritic »

Raymond wrote: sscritic is *the* go-to person on Social Security on this forum - as I understand it, he worked at the SSA for years.

He is also a huge fan of Chinese (or is it Korean?) soap operas.

He is not happy when people (you, in this case) are given incorrect information - however, he will then often give homework assignments.

Someone please correct me if I'm wrong :happy
1) never worked there, just had an occasion to start reading, and then I read some more.

2) Chinese.

3) wrong answers to questions annoy me, and not just about social security, especially if they hang around on this forum where people can read them and be mislead.

4) homework is good for learning.
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Re: When to file social security benefits 62 or 67?

Post by JW-Retired »

What age can the kids collect to? I read it as the 10 year old will be 19 when husband is 62. Or maybe OP meant he/she will be 10 when husband is 62?
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Re: When to file social security benefits 62 or 67?

Post by sscritic »

Speaking of homework, who googled images of 佟丽娅 to check out her teeth? :)
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anonforthis
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Re: When to file social security benefits 62 or 67?

Post by anonforthis »

I want to say thank you to everyone very much for your inputs especially to Mr. sscritic. I’m so glad I found this board where all the smart people hang out. Thanks again.
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Re: When to file social security benefits 62 or 67?

Post by sscritic »

JW Nearly Retired wrote:What age can the kids collect to? I read it as the 10 year old will be 19 when husband is 62. Or maybe OP meant he/she will be 10 when husband is 62?
JW
He will retire at 62 and our children will be 9 and 10
Future. Although it could be she was talking about their birthdays later this month, but I don't think that's what was meant. I took will be to mean will be when he is 62. "When" rather than "and" would have been clearer.
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anonforthis
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Re: When to file social security benefits 62 or 67?

Post by anonforthis »

JW Nearly Retired wrote:What age can the kids collect to? I read it as the 10 year old will be 19 when husband is 62. Or maybe OP meant he/she will be 10 when husband is 62?
JW

The kids are 1 and 2 and my husband is 53. They will be 9 and 10 when my husband turns 62. Thank you.
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Re: When to file social security benefits 62 or 67?

Post by cheese_breath »

sscritic wrote:
JW Nearly Retired wrote:What age can the kids collect to? I read it as the 10 year old will be 19 when husband is 62. Or maybe OP meant he/she will be 10 when husband is 62?
JW
He will retire at 62 and our children will be 9 and 10
Future. Although it could be she was talking about their birthdays later this month, but I don't think that's what was meant. I took will be to mean will be when he is 62. "When" rather than "and" would have been clearer.
In her previous thread she said the children are under 3.

http://www.bogleheads.org/forum/viewtop ... 2&t=134235
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Re: When to file social security benefits 62 or 67?

Post by peppers »

sscritic wrote:Speaking of homework, who googled images of 佟丽娅 to check out her teeth? :)
Tong Liya, am I close?
"..the cavalry ain't comin' kid, you're on your own..."
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Re: When to file social security benefits 62 or 67?

Post by sscritic »

peppers wrote:
sscritic wrote:Speaking of homework, who googled images of 佟丽娅 to check out her teeth? :)
Tong Liya, am I close?
Isn't that what I wrote? :)

Did you get it because you knew her famous canine?

Tong Liya is in Weaning. Previously, she was in Beijing Love Story where she played Shen Bing. She is married to Chen Si Cheng, who wrote, starred in, and directed Beijing Love Story. Yang Mi, who is known to shop at South Coast Plaza, was also in Beijing Love Story and starred in Gong, in which Tong Liya also played (as her best friend who betrayed her).

http://wiki.d-addicts.com/Tong_Li_Ya
http://wiki.d-addicts.com/Beijing_Love_Story

P.S. dramawiki is good, but it is incomplete for many things. baike.baidu is better. Google translate helps.
http://baike.baidu.com/view/1614105.htm
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Re: When to file social security benefits 62 or 67?

Post by peppers »

Also called Ya ya I believe. :)
"..the cavalry ain't comin' kid, you're on your own..."
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Re: When to file social security benefits 62 or 67?

Post by nfs »

anonforthis wrote: The kids are 1 and 2 and my husband is 53. They will be 9 and 10 when my husband turns 62. Thank you.
In a very similar situation...though no kids yet, just 1 planned and I plan to stop working while kiddo is young at least (I'm 31 now). We have been talking about this recently, mainly about how our 20 year age difference impacts decisions.

I'm having trouble wrapping my mind around how to determine if it will be better to draw early to pick up the child portion and not disturb other investments as much so that they continue to grow, or waiting so that the spouse benefit and eventual widow benefit I would get would be larger (though then we will use more existing retirement benefits).

Does anyone have a spreadsheet for this? ;)
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Re: When to file social security benefits 62 or 67?

Post by TomatoTomahto »

^^^ no spreadsheet as such! but I just had 3 sets of columns, for 62, 66, and 70. I assumed constant dollars, and ignored tax questions. I just ran a cumulative total, and found the point at which 62+kids was no longer more that 66 and 70.

Even though my kids were 15 and 17 at the time (HS sophomore and senior) so they'll have fewer months of earnings, I don't remember the break-even point, but if I live past that age, I will be happy to be alive and my financial "mistake" will actually be a pleasant one. Don't regard it as advice, but ages 9 and 10 when parent is 62 must be close to a slam dunk for early filing. There are other threads that discuss what you can and should do with the kids' money.
Okay, I get it; I won't be political or controversial. The Earth is flat.
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Re: When to file social security benefits 62 or 67?

Post by nfs »

TomatoTomahto wrote:Don't regard it as advice, but ages 9 and 10 when parent is 62 must be close to a slam dunk for early filing.
So does the child's SS benefit count as income so they can start contributing to an IRA? (Now off to hunting down other threads discussing these things...)
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Re: When to file social security benefits 62 or 67?

Post by sscritic »

No. You need taxable compensation, not income of any kind, for an IRA. Interest, dividends, capital gains, withdrawals from 401(k)s, IRAs and 403(b)s are not compensation, nor are social security payments.

Speaking of getting annoyed at incorrect statements, whoever told you that you could open an IRA if you had "income"?

P.S. I am not annoyed at you, but at the person who told you that you needed "income."
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Re: When to file social security benefits 62 or 67?

Post by nfs »

sscritic wrote: Speaking of getting annoyed at incorrect statements, whoever told you that you could open an IRA if you had "income"?
Chalk it up to someone who has only ever experienced any sizable inflow of cash as taxable compensation for work. Having not had the experience of getting money in another way, it's never particularly crossed my mind. Was just thinking that if it made kiddos eligible to fund IRAs that would be a pretty sweet deal and a great use of the $$.

Also, I think it's largely a semantic issue.
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Re: When to file social security benefits 62 or 67?

Post by sscritic »

nfs wrote: Also, I think it's largely a semantic issue.
The IRS doesn't think so, which is why they explain what is taxable compensation and what is not in the publication on IRAs, pub 590.
For 2013, the most that can be contributed to your traditional IRA generally is the smaller of the following amounts:
  • $5,500 ($6,500 if you are age 50 or older), or
    Your taxable compensation (defined earlier) for the year.
Social security and tax regulations (all regulations for that matter) depend on the correct use of terms. You have to use their definitions, not your own.
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Re: When to file social security benefits 62 or 67?

Post by sscritic »

P.S. Don't you think that if the word compensation rather than the word income had been in your mind, that you might not have asked your question, thinking that social security benefits were not compensation? You still might have, but doesn't it bother you a little that you were taught something that is not correct?
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Re: When to file social security benefits 62 or 67?

Post by TomatoTomahto »

nfs wrote:Was just thinking that if it made kiddos eligible to fund IRAs that would be a pretty sweet deal and a great use of the $$.
When I signed my kids up, I made the offhand remark to the agent that this money would find a good home in the kids' college fund. She immediately said: "no, this is intended to provide for their current expenses, not to be saved." Money is fungible, so who is to say which money went into savings and which to buy groceries. But, be prepared to show that the money was used for their current expenses.
Okay, I get it; I won't be political or controversial. The Earth is flat.
sscritic
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Re: When to file social security benefits 62 or 67?

Post by sscritic »

TomatoTomahto wrote: When I signed my kids up, I made the offhand remark to the agent that this money would find a good home in the kids' college fund. She immediately said: "no, this is intended to provide for their current expenses, not to be saved." Money is fungible, so who is to say which money went into savings and which to buy groceries. But, be prepared to show that the money was used for their current expenses.
Not according to the guide they give you as a parent. Actually, you are the representative payee who receives the noney on behalf of the actual beneficiary. I will cover the situation I was in and then include some notes for children on SSI or are disabled. Saving the regular SS money of a child on SSI could make the child ineligible for SSI, but saving the SSI money paid in a lump sum will not.
First, you must make sure the beneficiary’s day- to-day needs for food and shelter are met. Then, the money can be used for any of the beneficiary’s medical and dental care that is not covered by health insurance, and for personal needs, such as clothing and recreation. If there is money left after you pay for the beneficiary’s needs, it must be saved, preferably in an interest- bearing account or U.S. Savings Bonds.
...
To protect the beneficiary’s funds, the checking or savings accounts title must reflect the beneficiary’s ownership of the funds and your relationship as a fiduciary (financial agent).
...
A common checking account for all family members living in the same household who receive benefits may show a parent as the owner of the account. Children’s savings, however, must be held in a separate savings account for each child, with the child’s name shown as the owner of the account.
and
If you are a payee for a child receiving SSI payments, you will be required to obtain treatment for the child’s medical condition when treatment is determined to be medically necessary.
...
[under major purchases]
To continue receiving SSI, a beneficiary must not have resources worth more than $2,000 ($3,000 for couples). Although not all resources are counted, some of the items you may buy with the money could be worth so much that the beneficiary would be ineligible for SSI benefits. Any money you do not spend could also count as a resource. You should check with your local Social Security office before making a major purchase for an SSI beneficiary.
...
Sometimes, blind or disabled children will receive large, past-due SSI payments covering more than six months of benefits. Usually, these payments must go directly into a separate banking account. We call this a “dedicated account” because funds in this account may be used only for certain expenses, primarily those related to the child’s disability. The dedicated account must be kept separate from any other savings or checking account set up for the beneficiary. Except for certain subsequent past-due payments, no other funds may be commingled into the account, and money in the dedicated account is not countable as a resource. Interest earned on the money also is not counted as income or as a resource. Money in a dedicated account must be used only for the following expenses: [a list]
...
If Medicaid is paying more than half the cost of an SSI beneficiary’s care, or private health insurance is paying for the care, the SSI payment is usually limited to $30 per month, plus any additional money paid by the state. This entire payment must be used for the beneficiary’s personal needs or saved on his or her behalf if personal needs have been met.
http://www.ssa.gov/pubs/EN-05-10076.pdf

I saved my son's survivor's benefits in a UGMA account. I had a good job and met all his personal needs without using any of his SS payments. When he turned 18, I handed the money over. Then I didn't give him a penny for college, but he still had money from SS left after he graduated. As TT says, money is fungible. And, as he also says, you do provide an accounting every year of where the money went, and savings is perfectly good place for the money to go.
As a representative payee, you are responsible for keeping records and reporting on how you spend the benefits by completing a Representative Payee Report (Form SSA-623, SSA-6230 or SSA-6233). The appropriate form will be mailed to you about once a year. You also can file the report online at http://www.socialsecurity.gov/payee.
Faith20879
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Re: When to file social security benefits 62 or 67?

Post by Faith20879 »

nfs wrote: (I'm 31 now). We have been talking about this recently, mainly about how our 20 year age difference impacts decisions.
You have a bride of 11 yoa? That sounds illegal. :D
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wander
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Re: When to file social security benefits 62 or 67?

Post by wander »

Your kids are too young. Your husband should delay until 70 to file for social security.
sscritic
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Re: When to file social security benefits 62 or 67?

Post by sscritic »

wander wrote:Your kids are too young. Your husband should delay until 70 to file for social security.
Too young for what? My son started collecting at 14. The whole point of child's benefits is that the child can collect benefits while the child is still a child.
nfs
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Re: When to file social security benefits 62 or 67?

Post by nfs »

sscritic wrote:P.S. Don't you think that if the word compensation rather than the word income had been in your mind, that you might not have asked your question, thinking that social security benefits were not compensation? You still might have, but doesn't it bother you a little that you were taught something that is not correct?
I wouldn't claim it's that I was taught something that's incorrect. I would say that based on my experience of the world my question seemed reasonable. Thank you for the correction. Since it has to be on taxable compensation, does that mean I can still contribute when I withdraw from my deferred comp ? Or is it really based on what years you receive a w2?

Sscritic, I understand your frustration, just keep in mind that many of us asking question are not nearly as well versed in these things as you are. Because of that the precision of our language is not always as good.
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Peter Foley
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Re: When to file social security benefits 62 or 67?

Post by Peter Foley »

One thing to keep in mind when deciding when to file for benefits is how much spendable income will you receive. SS is very highly taxed (at a marginal rate) for some couples. Also, having a couple years in retirement w/o SS also may provide an opportunity to make other financial adjustments (Roth conversions) that may have long term benefits.
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