Social Security

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Tea
Posts: 4
Joined: Tue Sep 26, 2017 9:47 pm

Social Security

Post by Tea »

I understand that if I defer taking social security payments after my retirement age the payments will increase by 8% for each year that I wait. I also understand that those taking social security payments will receive cost of living increases, which was 2.8% in 2018. If I defer taking payments, is the increase 8% plus the cost of living increase each year or just the 8% without the cost of living increase?
Beefriendly
Posts: 9
Joined: Thu Sep 19, 2019 2:09 pm

Re: Social Security

Post by Beefriendly »

Yes, the increase will also include compounded cost of living adjustments (COLA's). Kiplinger has an easy to understand article on this.
Jazzysoon
Posts: 126
Joined: Tue Jan 09, 2018 3:05 pm

Re: Social Security

Post by Jazzysoon »

To clarify it's not 8% from age 62 > FRA. Varies each year and not always 8%, ranges from6.x to 8.x

http://www.socialsecuritychoices.com/blog/?p=563
rkhusky
Posts: 10179
Joined: Thu Aug 18, 2011 8:09 pm

Re: Social Security

Post by rkhusky »

From the wiki (https://www.bogleheads.org/wiki/Social_Security)
If you take, or are deemed to take, your own benefit before your FRA, your benefit is reduced by 5/9% per month for each of the first 36 months and 5/12% per month for each month beyond 36 months that you choose to receive your benefit before FRA.

If you take, or are deemed to take, your own benefit after your FRA, your benefit is increased by 2/3% per month for each month after FRA that you choose to receive your benefit, up to, but not including, age 70.
After FRA, you get additional benefit of 8%/yr up to age 70.
FRA's range from age 65 - 67, depending on year of birth.
Topic Author
Tea
Posts: 4
Joined: Tue Sep 26, 2017 9:47 pm

Re: Social Security

Post by Tea »

Thanks to all for your help, which is excellent as usual.
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JoeRetire
Posts: 5756
Joined: Tue Jan 16, 2018 2:44 pm

Re: Social Security

Post by JoeRetire »

Consider investigating your numbers using https://opensocialsecurity.com/ before you decide when to start.

It's a terrific tool.
It's the end of the world as we know it. | It's the end of the world as we know it. | It's the end of the world as we know it. | And I feel fine.
retiredflyboy
Posts: 230
Joined: Sun Dec 02, 2018 10:02 pm

Re: Social Security

Post by retiredflyboy »

Hard to find an investment where you get a 6 to 8% increase on top of inflation for each year you delay. :sharebeer
Facts are stubborn things. Everything works until it doesn’t.
neilpilot
Posts: 3396
Joined: Fri Dec 04, 2015 1:46 pm
Location: Memphis area

Re: Social Security

Post by neilpilot »

retiredflyboy wrote: Mon Oct 07, 2019 10:20 pm Hard to find an investment where you get a 6 to 8% increase on top of inflation for each year you delay. :sharebeer
Apples & oranges. I personally will wait until 70 to collect my benefit, but an annual 8% increase in FUTURE benefits does not equate to a 6-8% inflation corrected return on an investment.
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