Maximize our Social Security Benefits

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Lupine
Posts: 15
Joined: Wed May 09, 2012 9:05 am

Maximize our Social Security Benefits

Post by Lupine » Tue Feb 20, 2018 3:19 pm

I’ll turn 70 in August and can receive $3333/mo now and $3455 then when benefits need to start. My spouse turns 62 in May and will be eligible for $1011 / mo at that time. She could collect $1707/mo at FRA IF income stays the same.

We have income from a business in a boom ‘n bust industry . Maximum taxed social security earnings in ’08-’12, little between ’13-’16, and back to maximum in ’17. Suspect ’18 will be like ’17, and hopefully future years too, as we continue to invest in the business.

I’m particularly asking when should my spouse begin taking benefits as my decision has little leeway. Elucidating pros & con aspects of each decision is also appreciated.

Lupine
Posts: 15
Joined: Wed May 09, 2012 9:05 am

Re: Maximize our Social Security Benefits

Post by Lupine » Tue Feb 20, 2018 3:25 pm

Add’l information – My spouse has a 49% ownership in the business. So, she contributes to Social Security mightily in the good years. Too, there are no plans to sell the business presently.

Can benefits change once they’ve started recognizing additional social security payments occur by the taxpayer?

Thanks.

soccerrules
Posts: 803
Joined: Mon Nov 14, 2016 4:01 pm

Re: Maximize our Social Security Benefits

Post by soccerrules » Tue Feb 20, 2018 5:04 pm

General comments
1) If you NEED the money on top of the $3300-$3400 from your benefit -- then MAYBE. It seems as if you don't need the money because you are both working and you delayed your SS benefit to 70 But don't know full story.
2) Consider Tax issues with working incomes, SS income(s), RMD's at 70.5 (hints to at least delay wives benefit as long as possible) - Might be worth a conversation with your tax guy/gal
3) Looks like her individual benefit will be about what a spousal benefit on your SS at her FRA.
4) How is your/your spouses health ? if good - then delay; if poor then maybe take it.
5) Hard to really know without knowing current and retirement expenses, other assets, debt, net worth, business plan (keep , sell or pass on) - plans for inheritance.

Generally the wisdom is if you are in good health and have longevity in your family- delay taking SS for the higher benefit and longevity insurance.

I plan to take at 69 and wife will be 67 (spousal).
Don't let your outflow exceed your income or your upkeep will be your downfall.

Lupine
Posts: 15
Joined: Wed May 09, 2012 9:05 am

Re: Maximize our Social Security Benefits

Post by Lupine » Tue Feb 20, 2018 7:30 pm

Thanks, “Soccerrules.”

We’ve no need for the money and there is no debt. Kids’ have wonderful “legacy” Schwab accounts that are gifted maximally annually. Likewise, the grandkids 529’s are funded maximally yearly.

Like I suspect many Bogleheads are, we’re far better savers than spenders. Hard to change a lifetime of saving exacerbated by Scottish roots and coming from an industry where no matter your job performance, you were always looking for the ax to fall. And fall it did repeatedly, though thankfully each time w/ a handsome severance pkg.

Taxes are likely to be high regardless of SS decisions, if commodity prices hold.

We’re both blessed w/ excellent health and dutifully strive to maintain such. Her Mom’s still alive at 90+ and living independently! My heredity isn’t nearly so stellar, but so far, so good.

harmony
Posts: 504
Joined: Sun Nov 24, 2013 1:35 am

Re: Maximize our Social Security Benefits

Post by harmony » Tue Feb 20, 2018 10:25 pm

When there is an eight years age spread between spouses, then it is perhaps more likely that the older spouse will be resting in Green Acres for a few extra years while the younger spouse will be taking the larger of the two benefits. Since your wife will receive much higher SS benefits on your record than her own, I think she should get the maximum time from her own benefits starting at age 62. Sure her benefits will be reduced for a few years if she works, but the total number of years that this is reduced is likely to be less than average because of your age differences. If she does indeed live to a very ripe old age, the higher benefit will be paying a lot longer so any reductions to her own benefit could have been long neutralized.

Maybe your wife could earn less in the business during ages 62-66 to lessen effects of the SS benefit reduction. You said you were investing in the business, so maybe her compensation can be reduced to be able to afford new business investment. If you earn more, it won’t increase your SS benefit though so don’t increase your salary either, just invest more into the business like you said.

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