My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

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McDougal
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by McDougal »

tim1999 wrote: Mon Sep 13, 2021 4:19 pm Looking back in my family history, every single male in the past 40 years would have better off taking SS at 62 instead of FRA or beyond. None of them made it to the break even points, though one was close. And to my knowledge, none of them took it at 62.
I think you need to define "better off" in your family's situation. I am pretty sure there are several definitions, and they are all correct! :beer
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JoeRetire
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by JoeRetire »

tim1999 wrote: Mon Sep 13, 2021 4:19 pm Looking back in my family history, every single male in the past 40 years would have better off taking SS at 62 instead of FRA or beyond. None of them made it to the break even points, though one was close. And to my knowledge, none of them took it at 62.
Yikes - scary.
At what ages did they die?
Were any of them married?
Do you actually know when they started their benefits?
Just remember: it's not a lie if you believe it.
Retired Bill
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by Retired Bill »

Believe should be able to start a social security benefit, but need to consider survivor's benefit or drawing on own account it appears. Not enough information however to make an informed decision.
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by Dottie57 »

GoneCamping wrote: Thu Jun 03, 2021 2:50 pm The whole idea of actuarial tables for SS is to get the same amount paid out by one's expected death regardless of when collected. So naturally the what-if scenarios will favor one over the other. What-if I die young, then taking SS early is the better choice, what-if I live to 100, then taking it layer is the better choice. The view of SS as longevity insurance focuses on the latter, of course.

However, longevity insurance when talking about SS is about more than just outliving one's portfolio because they live longer, which is how I think most people tend to think of it. It's also about having one's portfolio depleted early. That's not technically longevity insurance but it's insurance nonetheless and it's why I will defer to 70 if at all possible. Should my SS ever become my sole, or even main source of income, I'd like for it to be the highest amount possible.
+1
GoneOnTilt
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by GoneOnTilt »

As a Buddhist,

I will likely take

the Middle Path

And collect

At 65.

It will be enough for me.
bradpevans
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by bradpevans »

CnC wrote: Mon Sep 13, 2021 11:37 am
bradpevans wrote: Wed Aug 25, 2021 10:02 pm
CnC wrote: Wed Aug 25, 2021 7:02 pm
KlangFool wrote: Wed Jun 02, 2021 7:37 am
CnC wrote: Fri May 19, 2017 1:07 pm C
If he listened to convention wisdom he would still be working and not got to spend any time in retirement with his wife. So there was not much that was going to change his mind. We talked and agreed money buys a 60 year old a lot more enjoyment than it does an 80 year old
CnC,

Whether to withdraw social security at 62 years old has nothing to do with whether to retire at 62 years old. A person could retire at 62 years old and live on his portfolio and then withdraw social security at 67/70 year sold.

If someone could not retire without withdrawing the social security at 62 years old, then, no discussion is needed. However, if someone could live on their portfolio and withdraw social security at 67/70 years old, it could be advantageous.

If your plan is to support your father and fill the gap, you may have to think about this too.

KlangFool
Klang
I disagree with the statement that the decision to withdraw social security at 62 has nothing to do with retirement at 62.

I'm a few years older and wiser than I was when I made this post. And I am doubling down on my belief that his situation was better by taking social security at 62 regardless of how long he lives.

He is 67 now and money he has gotten to enjoy thus far is much more important than money he will get in 5 years.

I feel too many people here are looking at numbers and missing the forest for the trees.

Imo there are only 2 types of people who benefit from delaying social security. The rich that don't really need it and the poor who are relying on social security as a primary source of income in retirement.

Those middle class people who can live a better life because they took social security are absolutely better off taking it and enjoying life. Because as I watch my father get older I 100% understand that he won't get as much joy out of his money in the future as he does now. If he ends up living a long time and misses out on ±200k as a 90 year old he absolutely won't miss the money.
So many in the “Take Social Security early camp” set up a false dichotomy that ONLY by taking Social Security early they can spend all sorts of money.

Unless SS Is your only source of income, (and if it is maybe retirement at 62 is not a good idea)
You simply spend money from other sources until the Social Security comes in and then you back off on those sources

I plan to delay to 70.
I won’t be upset if I don’t maximize my SS. I’ll be upset because that means I died younger than I wanted to

It is not "false dichotomy" it's human nature. Regardless of the fact that they could theoretically take out the same amount of money the vast majority of people will not. It is much easier to enjoy yourself and spend the money when the check is going to be coming in regardless versus withdrawing money out of your life savings that are supposed to last you the rest of your life.

The people who are in the pro delaying social security camp completely miss out on this basic human truth. If you can look at it and with a clear conscience say okay great I'll withdraw an extra $40,000 a year above the 4% planned withdrawal rate because I know that I will be taking social security at 70 and will make up for that money then go ahead. My father couldn't I don't think I will be able to in the vast majority of retirement eligible people I know are not able to do that.
CFM300 wrote: Wed Aug 25, 2021 10:14 pm
CnC wrote: Wed Aug 25, 2021 7:02 pm He is 67 now and money he has gotten to enjoy thus far is much more important than money he will get in 5 years.
Delay Social Security to age 70 and Spend more money at 62
I'm talking reality and not theory. Reality is, for the vast majority of people they will not juice their withdrawals over their comfort zone because they are delaying social security.

They will just end up living on less. And once they hit 70 they will have more money than they need and nothing to spend it on.
Its not an "extra 40K" and its not every year - its at most 8 years (62 v 70)
For the "start at 62" SS will be ~ 20-25K, not 40K, so delaying that but replacing from traditional means an extra 20-25K /year strain .. till 70
and then then is 40K less per year ... for the rest of your life

If the goal is to "spend more every month until you pass" then starting early is sub optimal
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by goblue100 »

GoneOnTilt wrote: Mon Sep 13, 2021 8:17 pm As a Buddhist,

I will likely take

the Middle Path

And collect

At 65.

It will be enough for me.
We are also taking the middle path. My wife will claim at 62. I will claim at 70, health willing. So an average of 66. It should be enough for us.
According to Mike Piper's calculator we are leaving $2,000 on the table by my wife not waiting until 65, but I'm ok with that.
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
millervt
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by millervt »

I have the same situation, where the difference between my wife collecting at 62 or 65 is miniscule. For various reasons she can't hold a regular job, and she wants to feel like she is contributing to family finances, so she will start next year at 62. The psychological benefit far outweighs the fact that I will "only" be 99.99% optimized.
vested1
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by vested1 »

CnC wrote: Mon Sep 13, 2021 11:37 am It is not "false dichotomy" it's human nature. Regardless of the fact that they could theoretically take out the same amount of money the vast majority of people will not. It is much easier to enjoy yourself and spend the money when the check is going to be coming in regardless versus withdrawing money out of your life savings that are supposed to last you the rest of your life.

The people who are in the pro delaying social security camp completely miss out on this basic human truth. If you can look at it and with a clear conscience say okay great I'll withdraw an extra $40,000 a year above the 4% planned withdrawal rate because I know that I will be taking social security at 70 and will make up for that money then go ahead. My father couldn't I don't think I will be able to in the vast majority of retirement eligible people I know are not able to do that.


I'm talking reality and not theory. Reality is, for the vast majority of people they will not juice their withdrawals over their comfort zone because they are delaying social security.

They will just end up living on less. And once they hit 70 they will have more money than they need and nothing to spend it on.
The fact that this issue is constantly discussed on this forum tends to refute your notion that those who delay are missing out on a basic human truth. I would say it's more likely that those who have decided to delay have put a lot of thought into their decision, looking at all angles and then opting to join the vast minority of those who can appreciate the benefits of doing so. Not saying that those who decide to take SS at 62 haven't thought long and hard about it as well, just stating the obvious.

While it's true that most retirees don't have the option of delaying their SS benefits, some do. Failing to research all the options with an open mind seems to be self-defeating at the very least.


My reality is having an open mind and allowing the aforementioned thread by Cut-Throat to influence my decision. I have delayed filing for SS and have been able to spend more during the 5.5 years since my wife and I retired (over 6 for her). We looked at the numbers and discovered that we could make it either by delaying or not. Our circumstances are different than your father's, but that doesn't make him wrong or us right. Our portfolio has continued to grow since we retired, regardless of the fact that we withdrew more than conventionally suggested during that time. That was because of the raging bull, not the pitiful bear. Seize the day and all that.

Perhaps it's your age, relative to mine, but I turn 70 in 10 months and will happily file for my SS at that time. My wife will happily accept the greatly increased benefit as a survivor, as will I should she die first. Somehow we still manage to find things to spend money on. I doubt that will change abruptly in 10 months when we will simultaneously reach the ages of 69 (her) and 70 (me). News flash: Life doesn't end at age 70. For our parents it didn't even end at age 90. There's that pesky individual circumstance thing again!
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by RadAudit »

why on Earth do ... a pretty healthy portion of the boggel heads here recommend delaying SS benifits even after you retire. Am I missing something?
You're missing the fact that a number of BHs plan on living forever.
FI is the best revenge. LBYM. Invest the rest. Stay the course. Die anyway. - PS: The cavalry isn't coming, kids. You are on your own.
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Wiggums
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by Wiggums »

RadAudit wrote: Wed Sep 15, 2021 7:24 am You're missing the fact that a number of BHs plan on living forever.
This made me smile…
Investors need to be better informed about the costs they pay. “High fund fees can be hazardous to your wealth in the same way that high calories can be hazardous for your health.”
wrongfunds
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by wrongfunds »

Wiggums wrote: Wed Sep 15, 2021 8:44 am
RadAudit wrote: Wed Sep 15, 2021 7:24 am You're missing the fact that a number of BHs plan on living forever.
This made me smile…
Kidding aside, here is a thought experiment. Let us say that in our lifetime, there is a potion developed for immortality but it costs $1M per person for it. How many millions would you then need? Would you NOT pay for your kids potion? What about grandkids? Now you know why lots of BH never stop accumulating. Because we *know* there is a potion just around the corner given how fast AI is advancing.
bltn
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Re: My dad is taking Social Security at 62, why would anyone not?

Post by bltn »

marcopolo wrote: Fri May 19, 2017 11:46 am
CnC wrote:
assuming no annual cola .....

......Everyone knows that $100 now is worth more than $100 in the future.
This is exactly why there is a COLA. Not sure why you would ignore it in setting up the scenarios, but then consider inflation in the context of evaluating the scenarios. That seems inconsistent.

There are pros/cons to delaying vs starting early. Remember, all the withdrawal scenarios are "supposed" to be actuarially the same. Everyone needs to consider their own situation and needs. But, you do need to do the analysis in a reasonable way.
This is a very good point. With all withdrawal patterns actuarially the same, the only consideration is one’s personal needs or desires.
I started social security at fra because I worked until then and wanted to take the ss benefits at a lower tax level after I retired. But I didn t want to wait until age 70 because I thought we might enjoy the money more earlier in life.
smitcat
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Re: My dad is taking Social Security at 62, why would anyone not?

Post by smitcat »

bltn wrote: Wed Sep 15, 2021 11:09 am
marcopolo wrote: Fri May 19, 2017 11:46 am
CnC wrote:
assuming no annual cola .....

......Everyone knows that $100 now is worth more than $100 in the future.
This is exactly why there is a COLA. Not sure why you would ignore it in setting up the scenarios, but then consider inflation in the context of evaluating the scenarios. That seems inconsistent.

There are pros/cons to delaying vs starting early. Remember, all the withdrawal scenarios are "supposed" to be actuarially the same. Everyone needs to consider their own situation and needs. But, you do need to do the analysis in a reasonable way.
This is a very good point. With all withdrawal patterns actuarially the same, the only consideration is one’s personal needs or desires.
I started social security at fra because I worked until then and wanted to take the ss benefits at a lower tax level after I retired. But I didn t want to wait until age 70 because I thought we might enjoy the money more earlier in life.
"With all withdrawal patterns actuarially the same"
Actuarially nuetral by age and payment except for:
- potential spousal benifits
- ACA affects
- potential Roth conversion affects
- after tax considerations
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JoeRetire
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Re: My dad is taking Social Security at 62, why would anyone not?

Post by JoeRetire »

bltn wrote: Wed Sep 15, 2021 11:09 amWith all withdrawal patterns actuarially the same
Except that they aren't...
Just remember: it's not a lie if you believe it.
bltn
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Re: My dad is taking Social Security at 62, why would anyone not?

Post by bltn »

smitcat wrote: Wed Sep 15, 2021 12:37 pm
bltn wrote: Wed Sep 15, 2021 11:09 am
marcopolo wrote: Fri May 19, 2017 11:46 am
CnC wrote:
assuming no annual cola .....

......Everyone knows that $100 now is worth more than $100 in the future.
This is exactly why there is a COLA. Not sure why you would ignore it in setting up the scenarios, but then consider inflation in the context of evaluating the scenarios. That seems inconsistent.

There are pros/cons to delaying vs starting early. Remember, all the withdrawal scenarios are "supposed" to be actuarially the same. Everyone needs to consider their own situation and needs. But, you do need to do the analysis in a reasonable way.
This is a very good point. With all withdrawal patterns actuarially the same, the only consideration is one’s personal needs or desires.
I started social security at fra because I worked until then and wanted to take the ss benefits at a lower tax level after I retired. But I didn t want to wait until age 70 because I thought we might enjoy the money more earlier in life.
"With all withdrawal patterns actuarially the same"
Actuarially nuetral by age and payment except for:
- potential spousal benifits
- ACA affects
- potential Roth conversion affects
- after tax considerations
Good points about the spousal benefits, and Roth conversion affects. Again, I thought I would enjoy the benefits more in my 60 s than later in life. Each person s values and needs are different.
bltn
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Re: My dad is taking Social Security at 62, why would anyone not?

Post by bltn »

JoeRetire wrote: Wed Sep 15, 2021 12:43 pm
bltn wrote: Wed Sep 15, 2021 11:09 amWith all withdrawal patterns actuarially the same
Except that they aren't...
I was thinking about the op s initial post. In addition, one would think the benefits taken over a long period of time would be equivalent. If they aren t, please educate me.
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JoeRetire
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Re: My dad is taking Social Security at 62, why would anyone not?

Post by JoeRetire »

bltn wrote: Thu Sep 16, 2021 10:17 am
JoeRetire wrote: Wed Sep 15, 2021 12:43 pm
bltn wrote: Wed Sep 15, 2021 11:09 amWith all withdrawal patterns actuarially the same
Except that they aren't...
I was thinking about the op s initial post. In addition, one would think the benefits taken over a long period of time would be equivalent. If they aren t, please educate me.
It was designed to be actuarily neutral, but since then improvements in longevity mean that delaying is more beneficial than planned.

https://crr.bc.edu/wp-content/uploads/2 ... _19-18.pdf
Just remember: it's not a lie if you believe it.
smitcat
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Re: My dad is taking Social Security at 62, why would anyone not?

Post by smitcat »

bltn wrote: Thu Sep 16, 2021 10:11 am
smitcat wrote: Wed Sep 15, 2021 12:37 pm
bltn wrote: Wed Sep 15, 2021 11:09 am
marcopolo wrote: Fri May 19, 2017 11:46 am
CnC wrote:
assuming no annual cola .....

......Everyone knows that $100 now is worth more than $100 in the future.
This is exactly why there is a COLA. Not sure why you would ignore it in setting up the scenarios, but then consider inflation in the context of evaluating the scenarios. That seems inconsistent.

There are pros/cons to delaying vs starting early. Remember, all the withdrawal scenarios are "supposed" to be actuarially the same. Everyone needs to consider their own situation and needs. But, you do need to do the analysis in a reasonable way.
This is a very good point. With all withdrawal patterns actuarially the same, the only consideration is one’s personal needs or desires.
I started social security at fra because I worked until then and wanted to take the ss benefits at a lower tax level after I retired. But I didn t want to wait until age 70 because I thought we might enjoy the money more earlier in life.
"With all withdrawal patterns actuarially the same"
Actuarially nuetral by age and payment except for:
- potential spousal benifits
- ACA affects
- potential Roth conversion affects
- after tax considerations
Good points about the spousal benefits, and Roth conversion affects. Again, I thought I would enjoy the benefits more in my 60 s than later in life. Each person s values and needs are different.
The amount of funds we spend by age is not related to when we begin to take SS, why would it be?
Once that is out of the way its just a math comparison with our specific variables and numbers.
tim1999
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by tim1999 »

JoeRetire wrote: Mon Sep 13, 2021 4:54 pm
tim1999 wrote: Mon Sep 13, 2021 4:19 pm Looking back in my family history, every single male in the past 40 years would have better off taking SS at 62 instead of FRA or beyond. None of them made it to the break even points, though one was close. And to my knowledge, none of them took it at 62.
Yikes - scary.
At what ages did they die?
Were any of them married?
Do you actually know when they started their benefits?
All were either never married or already widowed with no minor children at the time of their own deaths; none had a survivor to receive benefits. Most passed in the 62-72 range, one made it to 77. All either took SS at their full retirement age, or died after 62 but before electing to take benefits (I assisted with most of their estates or otherwise had access to this info). Without getting into personal details, some made lifestyle choices that led to their lack of longevity while others did all the right things but still had the same fate (hit by a drunk driver, etc.)
smitcat
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by smitcat »

tim1999 wrote: Fri Sep 17, 2021 2:57 pm
JoeRetire wrote: Mon Sep 13, 2021 4:54 pm
tim1999 wrote: Mon Sep 13, 2021 4:19 pm Looking back in my family history, every single male in the past 40 years would have better off taking SS at 62 instead of FRA or beyond. None of them made it to the break even points, though one was close. And to my knowledge, none of them took it at 62.
Yikes - scary.
At what ages did they die?
Were any of them married?
Do you actually know when they started their benefits?
All were either never married or already widowed with no minor children at the time of their own deaths; none had a survivor to receive benefits. Most passed in the 62-72 range, one made it to 77. All either took SS at their full retirement age, or died after 62 but before electing to take benefits (I assisted with most of their estates or otherwise had access to this info). Without getting into personal details, some made lifestyle choices that led to their lack of longevity while others did all the right things but still had the same fate (hit by a drunk driver, etc.)
I am sorry - that is pretty terrible.
I do not know what the odds are of of every male person having all of these:
- single at time of passing
- passing well before average lifetime
- all having taken SS later than 65
But it must be astronomically low ....
cegibbs
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by cegibbs »

Take it at 62 and don’t look back and second guess the decision later on.
Silk McCue
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by Silk McCue »

cegibbs wrote: Sat Sep 18, 2021 12:18 pm Take it at 62 and don’t look back and second guess the decision later on.
Very poor advice for many people.

Cheers
cegibbs
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by cegibbs »

Silk McCue wrote: Sat Sep 18, 2021 1:40 pm
cegibbs wrote: Sat Sep 18, 2021 12:18 pm Take it at 62 and don’t look back and second guess the decision later on.
Very poor advice for many people.

Cheers
Why do you think my reply was for everyone? My reply was for the OP based on the information they provided.
Silk McCue
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by Silk McCue »

cegibbs wrote: Sat Sep 18, 2021 5:19 pm
Silk McCue wrote: Sat Sep 18, 2021 1:40 pm
cegibbs wrote: Sat Sep 18, 2021 12:18 pm Take it at 62 and don’t look back and second guess the decision later on.
Very poor advice for many people.

Cheers
Why do you think my reply was for everyone? My reply was for the OP based on the information they provided.
Sorry it’s page 5 of a post that was originally started in 2017 with over 200 replies. Most recent discussions have not been about the OP.

Cheers
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by chassis »

cegibbs wrote: Sat Sep 18, 2021 12:18 pm Take it at 62 and don’t look back and second guess the decision later on.
Agee.
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by etfan »

If a person is 62 and is debating whether to take SS or wait, that means that waiting is an option, which in turn means that the person doesn't need money (can afford to live without if).

And if that is the case, then why not take it at 62 and invest it for the 8-10 years that you can afford to live without it.

Wouldn't that be "the best of both worlds"? Depending on your monthly amount, you may be able to add a lot to your portfolio over 8 years.
THeads
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by THeads »

For us, it is Roth conversion. By the time we retire, 8 or 10 years is not even enough time for us to do Roth conversion and stay under 22% tax bracket. SS will make it even worse.
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by McDougal »

etfan wrote: Sun Sep 19, 2021 2:15 am If a person is 62 and is debating whether to take SS or wait, that means that waiting is an option, which in turn means that the person doesn't need money (can afford to live without if).

And if that is the case, then why not take it at 62 and invest it for the 8-10 years that you can afford to live without it.

Wouldn't that be "the best of both worlds"? Depending on your monthly amount, you may be able to add a lot to your portfolio over 8 years.
It might be best, assuming the market cooperates. Then again, it might not be best.
smitcat
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by smitcat »

etfan wrote: Sun Sep 19, 2021 2:15 am If a person is 62 and is debating whether to take SS or wait, that means that waiting is an option, which in turn means that the person doesn't need money (can afford to live without if).

And if that is the case, then why not take it at 62 and invest it for the 8-10 years that you can afford to live without it.

Wouldn't that be "the best of both worlds"? Depending on your monthly amount, you may be able to add a lot to your portfolio over 8 years.
"Wouldn't that be "the best of both worlds"? Depending on your monthly amount, you may be able to add a lot to your portfolio over 8 years."
It could go up or it could go down.
I would guess you are assuming that they would invest all of it in equities.
As an alternative they could just shift their currnet AA to higher equity % each year knowing that their 'fixed income" SS is rising as a backstop.
Please condiser the after tax implications of any of these options in the entire picture of what is 'spendable' dollars vs total dollars.
grok87
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by grok87 »

Silk McCue wrote: Sat Sep 18, 2021 1:40 pm
cegibbs wrote: Sat Sep 18, 2021 12:18 pm Take it at 62 and don’t look back and second guess the decision later on.
Very poor advice for many people.

Cheers
it's a difficult question. the latest social security trustees report forecasts that, under current law, social security will pay out at 76% of scheduled benefits starting in 2033- i.e. 12 years from now
https://www.ssa.gov/oact/trsum/
in general i am supportive of waiting to age 70 as a form of longevity insurance. but the reduced payout starting in 2033 may mean that it is better to take benefits early at 62 if more of those payouts would be at the full 100%

very tricky issue.

cheers,
grok
RIP Mr. Bogle.
Silk McCue
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by Silk McCue »

grok87 wrote: Sun Sep 19, 2021 8:13 am it's a difficult question. the latest social security trustees report forecasts that, under current law, social security will pay out at 76% of scheduled benefits starting in 2033- i.e. 12 years from now
https://www.ssa.gov/oact/trsum/
in general i am supportive of waiting to age 70 as a form of longevity insurance. but the reduced payout starting in 2033 may mean that it is better to take benefits early at 62 if more of those payouts would be at the full 100%

very tricky issue.

cheers,
grok
Opensocialsecurity.com can be used with a setting that analyzes that very situation. Advanced options -> Possible Future Cut in Social Security benefits. It will then allow you to toggle between that scenario and the no cut scenario just above the “Test an alternative claiming strategy:” graphic.

Cheers
delamer
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by delamer »

etfan wrote: Sun Sep 19, 2021 2:15 am If a person is 62 and is debating whether to take SS or wait, that means that waiting is an option, which in turn means that the person doesn't need money (can afford to live without if).

And if that is the case, then why not take it at 62 and invest it for the 8-10 years that you can afford to live without it.

Wouldn't that be "the best of both worlds"? Depending on your monthly amount, you may be able to add a lot to your portfolio over 8 years.
But often waiting is an option because someone is drawing down their retirement savings to cover expenses.

Clearly, you wouldn’t want to be spending your existing savings with one hand while adding to those savings (in the form of investing your Social Security) with the other hand.
One thing that humbles me deeply is to see that human genius has its limits while human stupidity does not. | | Alexandre Dumas, fils
grok87
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by grok87 »

Silk McCue wrote: Sun Sep 19, 2021 8:40 am
grok87 wrote: Sun Sep 19, 2021 8:13 am it's a difficult question. the latest social security trustees report forecasts that, under current law, social security will pay out at 76% of scheduled benefits starting in 2033- i.e. 12 years from now
https://www.ssa.gov/oact/trsum/
in general i am supportive of waiting to age 70 as a form of longevity insurance. but the reduced payout starting in 2033 may mean that it is better to take benefits early at 62 if more of those payouts would be at the full 100%

very tricky issue.

cheers,
grok
Opensocialsecurity.com can be used with a setting that analyzes that very situation. Advanced options -> Possible Future Cut in Social Security benefits. It will then allow you to toggle between that scenario and the no cut scenario just above the “Test an alternative claiming strategy:” graphic.

Cheers
Thanks
RIP Mr. Bogle.
JDave
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by JDave »

Think of Social Security as longevity insurance.
What if your dad lives to 103?
etfan
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by etfan »

delamer wrote: Sun Sep 19, 2021 10:00 am
etfan wrote: Sun Sep 19, 2021 2:15 am If a person is 62 and is debating whether to take SS or wait, that means that waiting is an option, which in turn means that the person doesn't need money (can afford to live without if).

And if that is the case, then why not take it at 62 and invest it for the 8-10 years that you can afford to live without it.

Wouldn't that be "the best of both worlds"? Depending on your monthly amount, you may be able to add a lot to your portfolio over 8 years.
But often waiting is an option because someone is drawing down their retirement savings to cover expenses.

Clearly, you wouldn’t want to be spending your existing savings with one hand while adding to those savings (in the form of investing your Social Security) with the other hand.
True. It only makes sense if you're still working.
inputjam
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by inputjam »

I read this somewhere. It really crystalized matters for me.

If you die before you reach your break-even date, you have no problem because you are dead. If you outlive your retirement savings, you have a long-term problem. If you cannot make ends meet without Social Security at age 62, you have a near-term problem. Concern yourself first with your near-term problems, if any, then with your long-term problems, if any. Do not concern yourself with whether you get what you "deserve" until you solve the problem of what you *need*. If you have sufficient funds that you have neither a short-term nor a long-term problem, it doesn't matter, so be grateful.
grok87
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by grok87 »

JDave wrote: Sun Sep 19, 2021 10:38 am Think of Social Security as longevity insurance.
What if your dad lives to 103?
agree. i have a friend who is turning 101 this year
RIP Mr. Bogle.
Tom_T
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by Tom_T »

etfan wrote: Sun Sep 19, 2021 10:44 am
delamer wrote: Sun Sep 19, 2021 10:00 am
etfan wrote: Sun Sep 19, 2021 2:15 am If a person is 62 and is debating whether to take SS or wait, that means that waiting is an option, which in turn means that the person doesn't need money (can afford to live without if).

And if that is the case, then why not take it at 62 and invest it for the 8-10 years that you can afford to live without it.

Wouldn't that be "the best of both worlds"? Depending on your monthly amount, you may be able to add a lot to your portfolio over 8 years.
But often waiting is an option because someone is drawing down their retirement savings to cover expenses.

Clearly, you wouldn’t want to be spending your existing savings with one hand while adding to those savings (in the form of investing your Social Security) with the other hand.
True. It only makes sense if you're still working.
If you're still working, then you will be paying taxes on a good portion of your SS income, so that changes the analysis.
chipperd
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by chipperd »

CnC wrote: Fri May 19, 2017 1:07 pm Thanks for all the replies and the condolences. I realize my title and opening post may have come across as a bit inflamitory. But it was not meant as such.

Ultimately i guess it is up to the person and the situation, it sounds like even if my math isn't completely accurate most people agree that he isn't making a huge mistake even if they plan to choose differently for themselves.

If he listened to convention wisdom he would still be working and not got to spend any time in retirement with his wife. So there was not much that was going to change his mind. We talked and agreed money buys a 60 year old a lot more enjoyment than it does an 80 year old


Ultimately he isn't going to run out of money, he has a greatfull son who was taken care of and raised well and will make sure dad isn't shivering in the dark eating dog food. So those dollars spent raising me can count as an investment into longevity insurance.

Thanks for the thought out replies to whoever gave them.
The highlighted above is why wife and I both plan to take our social security benefits ASAP.
As others have said, it's quite an individual decision that goes way beyond just how much $ one can get out of the system. To me (and I guess you and your dad) it's how much of the emotional intangibles/freedoms one can derive as benefits from the system.
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GreenLawn
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by GreenLawn »

vitaflo wrote: Sat May 20, 2017 8:26 pm For this topic, I've always appreciated this old post by cut-throat:

"Delay Social Security to age 70 and Spend more money at 62"
viewtopic.php?t=102609
The above referenced post changed my mind about taking SS early. I always assumed I'd take SS at 62 because I'm frugal by nature and I'm concerned I wouldn't spend enough of my savings while I'm young enough to enjoy it. I plan on spending a large chunk of my savings on travel, and that extra SS payment would encourage more travel than I otherwise might feel comfortable taking. The above referenced post states I can have my cake and eat it too, so why not wait?

Covid has restricted the amount I'm currently spending on travel, plus so far I'm buying whatever I want with minimal, if any, reluctance. I'm easily amused so my entertainment is cheap, except for travel.

I may reconsider delaying SS to later years if my tightwad tendencies return (even after rereading the persuasive case made in the referenced post) and a monthly SS check is required to pry my entertainment dollars loose, but so far I'm content to wait.
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vanbogle59
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Re: My dad is taking Social Security at 62, why would anyone not? (If they already quit working)

Post by vanbogle59 »

Silk McCue wrote: Sun Sep 19, 2021 8:40 am Opensocialsecurity.com can be used with a setting that analyzes that very situation. Advanced options -> Possible Future Cut in Social Security benefits. It will then allow you to toggle between that scenario and the no cut scenario just above the “Test an alternative claiming strategy:” graphic.

Cheers
How cool is THAT?!?!
TY! :beer

I just ran our numbers. The difference between "No change, ever" and "Possible Future Cut in Social Security benefits" was only about 10% in present value.

Once again confirming that this decision, though not irrelevant, will most likely be overrun by market performance (or other, real-world events) in my predicted "30 year" retirement.
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