yet another Social Security timing Q
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yet another Social Security timing Q
Just edited as I learned that retroactive active benefits are only allowed to those at FRA or older (and only to benefits up to 6 months prior to the claim date.)
I would like to double check some things about the optimum strategy suggested by Open Social Security.
My birth month is July 1953. My PIA is $3300 and the monthly benefit increases to $4372 if I file to start benefits at age 70.
My spouse's birth month is Feb 1957. Benefit starting this month is $450 due to low earnings and WEP/GPO reduction. Cannot file for retroactive benefits because not yet at FRA.
1. Spouse files for benefits to begin now
2. I file for spousal benefits only to begin now.
3. I later file for benefits on my work record to start on July 2023.
4. My spouse files for spousal benefits to start on July 2023.
In my case, 1 and 2 are relatively small potatoes, so I don't anything to jeopardize 3 and 4.
Does the above seem like a sensible and permissible strategy? Also will the SSA have information for the WEP and GPO? My spouse has already filed for (small) state pensions. I suspect the state pension funds communicate with the SSA.
I would like to double check some things about the optimum strategy suggested by Open Social Security.
My birth month is July 1953. My PIA is $3300 and the monthly benefit increases to $4372 if I file to start benefits at age 70.
My spouse's birth month is Feb 1957. Benefit starting this month is $450 due to low earnings and WEP/GPO reduction. Cannot file for retroactive benefits because not yet at FRA.
1. Spouse files for benefits to begin now
2. I file for spousal benefits only to begin now.
3. I later file for benefits on my work record to start on July 2023.
4. My spouse files for spousal benefits to start on July 2023.
In my case, 1 and 2 are relatively small potatoes, so I don't anything to jeopardize 3 and 4.
Does the above seem like a sensible and permissible strategy? Also will the SSA have information for the WEP and GPO? My spouse has already filed for (small) state pensions. I suspect the state pension funds communicate with the SSA.
Last edited by SpideyIndexer on Sun Mar 26, 2023 5:24 pm, edited 1 time in total.
Re: yet another Social Security timing Q
Put your numbers in this calculator for any/all answers...SpideyIndexer wrote: ↑Thu Mar 23, 2023 1:58 am Just edited as I learned that retroactive active benefits only extend to FRA (and only up to 6 months prior.)
I would like to double check some things about the optimum strategy suggested by Open Social Security.
My birth month is July 1953. My PIA is $3300 and the monthly benefit increases to $4372 if I file to start benefits at age 70.
My spouse's birth month is Feb 1957. Benefit starting this month is $450 due to low earnings and WEP/GPO reduction. Cannot file for retroactive benefits because not yet at FRA.
1. Spouse files for benefits to begin now
2. I file for spousal benefits only to begin now.
3. I later file for benefits on my work record to start on July 2023.
4. My spouse files for spousal benefits to start on July 2023.
In my case, 1 and 2 are relatively small potatoes, so I don't anything to jeopardize 3 and 4.
Does the above seem like a sensible and permissible strategy? Also will the SSA have information for the WEP and GPO? My spouse has already filed for (small) state pensions. I suspect the state pension funds communicate with the SSA.
https://opensocialsecurity.com/
Please note the color chart at the very end after you calculate your plan, that will show you the results of all combinations of age and filing.
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Re: yet another Social Security timing Q
I have used Open Social Security. Do BHs think its results are reliable?
One thing about the programs and websites which caused some misunderstanding on my side is that none of them can deal with WEP and GPO, as far as I know. In our case, my spouse could not receive any benefits as age 62 because the benefit would be zero.
One thing about the programs and websites which caused some misunderstanding on my side is that none of them can deal with WEP and GPO, as far as I know. In our case, my spouse could not receive any benefits as age 62 because the benefit would be zero.
Re: yet another Social Security timing Q
"Do BHs think its results are reliable?"SpideyIndexer wrote: ↑Thu Mar 23, 2023 10:02 am I have used Open Social Security. Do BHs think its results are reliable?
One thing about the programs and websites which caused some misunderstanding on my side is that none of them can deal with WEP and GPO, as far as I know. In our case, my spouse could not receive any benefits as age 62 because the benefit would be zero.
Results are factual if you want to optimize SS.
Note ...I did not say optimize your total plan.
"One thing about the programs and websites which caused some misunderstanding on my side is that none of them can deal with WEP and GPO, as far as I know."
Correct - nor do the SS calculators deal with any other parts of your portfolio, your goals, your charitable contributions, heirs, etc.
They are identified and function as SS calculators and Mike Pipers Opensocialsecurity is by far the best I have seen.
You will need to learn the WEP and GPO rules for your specific case as they vary in some ways.
Then if you want much larger scope calculators to figure out total future plans they would include:
RPM
https://www.bogleheads.org/wiki/Retiree_Portfolio_Model
Pralana
https://pralanaretirementcalculator.com/
Another note - these types of calculators require much more time to setup, then run, and then review the results.
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Re: yet another Social Security timing Q
Thanks. I certainly did NOT expect Open SS to deal with other parts of my financial planning.
I just want to understand something about the "deemed rules." I thought that anyone filing will now be deemed as filing for ALL of their benefits. Yet according to Open SS, my spouse can file for earned benefits only, and I can file for spousal benefits only. No deeming. (I won't yet be collecting on benefits from my work record, and my spouse won't yet be collecting benefits on my record.) Can that be correct? It seems counter to the 2016 rules.
I just want to understand something about the "deemed rules." I thought that anyone filing will now be deemed as filing for ALL of their benefits. Yet according to Open SS, my spouse can file for earned benefits only, and I can file for spousal benefits only. No deeming. (I won't yet be collecting on benefits from my work record, and my spouse won't yet be collecting benefits on my record.) Can that be correct? It seems counter to the 2016 rules.
- ObliviousInvestor
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Re: yet another Social Security timing Q
FWIW, Open Social Security does account for WEP/GPO provided that you give it the appropriate inputs after checking the box for government pension.
As smitcat notes though, Open Social Security is only looking at one piece of the decision (actuarial math). It's ignoring other factors such as taxes that could be important. You may find my session from last year's Bogleheads conference to be of interest. You can find it (and all the other sessions) here:
https://boglecenter.net/2022conference/
As smitcat notes though, Open Social Security is only looking at one piece of the decision (actuarial math). It's ignoring other factors such as taxes that could be important. You may find my session from last year's Bogleheads conference to be of interest. You can find it (and all the other sessions) here:
https://boglecenter.net/2022conference/
Mike Piper |
Roth is a name, not an acronym. If you type ROTH, you're just yelling about retirement accounts.
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Re: yet another Social Security timing Q
You were born before January 2, 1954, so you have the old deemed filing rules.SpideyIndexer wrote: ↑Thu Mar 23, 2023 11:27 am Thanks. I certainly did NOT expect Open SS to deal with other parts of my financial planning.
I just want to understand something about the "deemed rules." I thought that anyone filing will now be deemed as filing for ALL of their benefits. Yet according to Open SS, my spouse can file for earned benefits only, and I can file for spousal benefits only. No deeming. (I won't yet be collecting on benefits from my work record, and my spouse won't yet be collecting benefits on my record.) Can that be correct? It seems counter to the 2016 rules.
https://secure.ssa.gov/poms.nsf/lnx/0200204035
And she wouldn't be deemed to have filed for her benefit on your work record, because she isn't eligible for a spousal benefit until your own retirement benefit begins.
Mike Piper |
Roth is a name, not an acronym. If you type ROTH, you're just yelling about retirement accounts.
Re: yet another Social Security timing Q
Open OpenSocialSecurity, then check
Click here to select situation(s) [ ]
...
Select
[ ] Pension from employment not covered by Social Security taxes
....
Scroll down & fill in WEP info.
Ipsa scientia potestas est. Bacon F.
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Re: yet another Social Security timing Q
Three followups:
I. Here is a description ofthe proposed strategy, suggested by Open SS, in simplest terms. No need to muddy up the water with WEP and GPO.
Spouse A, higher earner and older, born before 1954
Spouse B, lower earner, born after 1954
Both qualify for SS retirement benefits on their own work record
Steps
1. Spouse B files first for reduced benefits (starting before FRA.)
2. Spouse A files for spousal benefits ASAP after benefits for Spouse A are approved, before reaching age 70.
3. Sometime later, Spouse A files for retirement benefits based on his/her work record. Perhaps at age 70 or maybe earlier.
4. Spouse B either files for spousal benefits. Or perhaps he/she is automatically deemed to receive them, it's not clear to me which.
My first question, has anyone out there in BH land successfully executed such a strategy and received the benefits claimed?
II. Second question: What sequence of filing for benefits were the "new" filing rules enacted to prevent? (Perhaps it is something similar to the above except that Spouse A, the older of the two, was born after 1954? For some reason the law gave those above a certain age a pass?)
Thank you.
I. Here is a description ofthe proposed strategy, suggested by Open SS, in simplest terms. No need to muddy up the water with WEP and GPO.
Spouse A, higher earner and older, born before 1954
Spouse B, lower earner, born after 1954
Both qualify for SS retirement benefits on their own work record
Steps
1. Spouse B files first for reduced benefits (starting before FRA.)
2. Spouse A files for spousal benefits ASAP after benefits for Spouse A are approved, before reaching age 70.
3. Sometime later, Spouse A files for retirement benefits based on his/her work record. Perhaps at age 70 or maybe earlier.
4. Spouse B either files for spousal benefits. Or perhaps he/she is automatically deemed to receive them, it's not clear to me which.
My first question, has anyone out there in BH land successfully executed such a strategy and received the benefits claimed?
II. Second question: What sequence of filing for benefits were the "new" filing rules enacted to prevent? (Perhaps it is something similar to the above except that Spouse A, the older of the two, was born after 1954? For some reason the law gave those above a certain age a pass?)
Thank you.
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Re: yet another Social Security timing Q
Just wanted to mention that I found the checkbox for additional options at the top of the Open SS screen. I was pleasantly surprised at the features available.
OTOH, the SSA has a tool for calculating benefit reduction due to WEP and GPO. Even though the SSA has the record of yearly earnings on which one paid FICA tax, these amounts are not automatically populated in the tool but instead must be typed in year by year. Not very user-friendly.
OTOH, the SSA has a tool for calculating benefit reduction due to WEP and GPO. Even though the SSA has the record of yearly earnings on which one paid FICA tax, these amounts are not automatically populated in the tool but instead must be typed in year by year. Not very user-friendly.
Re: yet another Social Security timing Q
I don't work for these guys...there is another paid program...maximizemysocialsecurity.com
I do believe it takes WEP into account. At least that's what a friend of mine told me who is subject to WEP.
I do believe it takes WEP into account. At least that's what a friend of mine told me who is subject to WEP.
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Re: yet another Social Security timing Q
This is a restricted application strategy. (Spouse A filing a restricted application for just spousal benefits. Many Bogleheads executed such a strategy, though given the DoB cutoff it's less common these days and will soon be irrelevant for anybody who did not already take advantage of such.)SpideyIndexer wrote: ↑Fri Mar 24, 2023 2:13 am Three followups:
I. Here is a description ofthe proposed strategy, suggested by Open SS, in simplest terms. No need to muddy up the water with WEP and GPO.
Spouse A, higher earner and older, born before 1954
Spouse B, lower earner, born after 1954
Both qualify for SS retirement benefits on their own work record
Steps
1. Spouse B files first for reduced benefits (starting before FRA.)
2. Spouse A files for spousal benefits ASAP after benefits for Spouse A are approved, before reaching age 70.
3. Sometime later, Spouse A files for retirement benefits based on his/her work record. Perhaps at age 70 or maybe earlier.
4. Spouse B either files for spousal benefits. Or perhaps he/she is automatically deemed to receive them, it's not clear to me which.
My first question, has anyone out there in BH land successfully executed such a strategy and received the benefits claimed?
The changes from the Bipartisan Budget Act of 2015 were designed to eliminate precisely this strategy (as well as the "file and suspend" strategy which was much less common and not applicable here). But again, people born before 1/2/1954 were grandfathered under the old deemed filing rules.SpideyIndexer wrote: ↑Fri Mar 24, 2023 2:13 am II. Second question: What sequence of filing for benefits were the "new" filing rules enacted to prevent? (Perhaps it is something similar to the above except that Spouse A, the older of the two, was born after 1954? For some reason the law gave those above a certain age a pass?)
Mike Piper |
Roth is a name, not an acronym. If you type ROTH, you're just yelling about retirement accounts.
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Re: yet another Social Security timing Q
Thanks, Mike. Hoping to see confirmation from others. I have been digging through the original source material, the SSA "Program Operations Manual System" for which you posted the link and have found it a bit difficult to parse.
What is the difference between being entitled and eligible for certain SS benefits? The POMS makes that distinction.
For other readers, here is the link again: https://secure.ssa.gov/poms.nsf/lnx/0200204035.
What is the difference between being entitled and eligible for certain SS benefits? The POMS makes that distinction.
For other readers, here is the link again: https://secure.ssa.gov/poms.nsf/lnx/0200204035.
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Re: yet another Social Security timing Q
Yes, that's a super critical distinction.SpideyIndexer wrote: ↑Fri Mar 24, 2023 11:27 am Thanks, Mike. Hoping to see confirmation from others. I have been digging through the original source material, the SSA "Program Operations Manual System" for which you posted the link and have found it a bit difficult to parse.
What is the difference between being entitled and eligible for certain SS benefits? The POMS makes that distinction.
For other readers, here is the link again: https://secure.ssa.gov/poms.nsf/lnx/0200204035.
Eligible means you're eligible for a benefit -- the same thing most people would understand it to mean.
Entitled means that you're eligible for a benefit and have filed for that benefit. (Note that the filing can be a deemed filing.)
https://www.ssa.gov/OP_Home/cfr20/404/404-0303.htm
Mike Piper |
Roth is a name, not an acronym. If you type ROTH, you're just yelling about retirement accounts.
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Re: yet another Social Security timing Q
Also, if you want to hear from people who have filed a restricted application, I would encourage you to make a new thread with such a title, to get more attention. (Or retitle this thread if possible?)
Mike Piper |
Roth is a name, not an acronym. If you type ROTH, you're just yelling about retirement accounts.
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Re: yet another Social Security timing Q
Mike is the Oblivious Investor that created Opensocialsecurity. He is a respected member, spoke at our conference last fall and is considered a top expert in Social Security. He is our goto when any details need clarification.SpideyIndexer wrote: ↑Fri Mar 24, 2023 11:27 am Thanks, Mike. Hoping to see confirmation from others. I have been digging through the original source material, the SSA "Program Operations Manual System" for which you posted the link and have found it a bit difficult to parse.
What is the difference between being entitled and eligible for certain SS benefits? The POMS makes that distinction.
For other readers, here is the link again: https://secure.ssa.gov/poms.nsf/lnx/0200204035.
He is the undisputed expert here.
Cheers
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Re: yet another Social Security timing Q
I am feeling more comfy with the (I) strategy (due to my again.) A nickname for it is "Claim Now, Claim More Later." Interest is this will be waning since those born before 1954 will be age 70 or older by the end of 2023. Though I suppose the couple could always gain an extra time, up to 6 months, if they execute the claims in steps 3 and 4 retroactively. This could be beneficial to push SSA income into the following year in order to increase Roth conversions.
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Re: yet another Social Security timing Q
I helped a good friends execute this with a 6 month look back in late 2021. They had no idea such a thing existed. Roth conversions were not a part of their plan. Doing so to push income into the next year to support Roth conversions can certainly make sense.SpideyIndexer wrote: ↑Fri Mar 24, 2023 11:50 am I am feeling more comfy with the (I) strategy (due to my again.) A nickname for it is "Claim Now, Claim More Later." Interest is this will be waning since those born before 1954 will be age 70 or older by the end of 2023. Though I suppose the couple could always gain an extra time, up to 6 months, if they execute the claims in steps 3 and 4 retroactively. This could be beneficial to push SSA income into the following year in order to increase Roth conversions.
Cheers
Re: yet another Social Security timing Q
My DH and I have done steps 1-3, but slightly differently.SpideyIndexer wrote: ↑Fri Mar 24, 2023 2:13 am I. Here is a description of the proposed strategy, suggested by Open SS, in simplest terms. No need to muddy up the water with WEP and GPO.
Spouse A, higher earner and older, born before 1954
Spouse B, lower earner, born after 1954
Both qualify for SS retirement benefits on their own work record
Steps
1. Spouse B files first for reduced benefits (starting before FRA.)
2. Spouse A files for spousal benefits ASAP after benefits for Spouse A are approved, before reaching age 70.
3. Sometime later, Spouse A files for retirement benefits based on his/her work record. Perhaps at age 70 or maybe earlier.
4. Spouse B either files for spousal benefits. Or perhaps he/she is automatically deemed to receive them, it's not clear to me which.
My first question, has anyone out there in BH land successfully executed such a strategy and received the benefits claimed?
DH was eligible to file a restricted application. I filed after FRA and DH filed for spousal benefits at the same time. We filed in early January, 6 months retroactively for tax reasons (to maximize Roth conversions in the prior year). We did not wait for my benefit to be approved before he filed for the spousal benefit. We both filed online on the same day. As I recall, we each got a letter instructing us to call a particular SSA office to set up an appointment to review our applications. I called and mentioned DH had also applied for spousal benefits so the SSA rep set up a joint appointment.
I suspended my benefit as of the month DH turned 70 so I could earn more Delayed Retirement Credits. DH filed for his benefit to begin at age 70. Since my benefit is suspended, it should resume automatically at age 70. My own PIA is more than 50% of DH's PIA so a spousal benefit for me on DH's record is not an issue for us.
This is the short version of the story. The long version includes it taking about a week just to get through to the SSA office on the phone to set up the appointment, additional steps to prove my identity to the SSA, multiple steps to get the suspension done and get DH switched over to his age 70 benefit, but it all turned out OK in the end.
Re: yet another Social Security timing Q
Our ages are within a couple months of you and your wife. Been collecting a restricted spousal since spouse filed at 62. Just filed to reverse roles with my benefit, and my spouse taking spousal. Both the initial filing and the new filing actions were recommended by opensocialsecurity.com. No point in us delaying past my age 70 since my birthday is before July. In your case delaying your own benefit until January and getting 6 months retroactive might be beneficial as you could do a Roth conversion this year and then the next year convert little if anything. Doing so, next year you and your wife would have close to 1.5 years of SS at your higher rate, maybe $90 to $100K SS, and you could have much of that large SS benefit be untaxed unless you have significant non-SS income.SpideyIndexer wrote: ↑Fri Mar 24, 2023 11:50 am I am feeling more comfy with the (I) strategy (due to my again.) A nickname for it is "Claim Now, Claim More Later." Interest is this will be waning since those born before 1954 will be age 70 or older by the end of 2023. Though I suppose the couple could always gain an extra time, up to 6 months, if they execute the claims in steps 3 and 4 retroactively. This could be beneficial to push SSA income into the following year in order to increase Roth conversions.
Re: yet another Social Security timing Q
In our case it took two months to get the phone appointment. They did take the information for both my self benefit and spouse taking spousal on my benefit on the same call.Chip Munk wrote: ↑Fri Mar 24, 2023 12:13 pm
This is the short version of the story. The long version includes it taking about a week just to get through to the SSA office on the phone to set up the appointment, additional steps to prove my identity to the SSA, multiple steps to get the suspension done and get DH switched over to his age 70 benefit, but it all turned out OK in the end.
Re: yet another Social Security timing Q
I don't mean to hijack this thread, but I have a related question.
Wife and I are both retired. She turned 65 last October, I turned 65 a few days ago.
I think (?) I ran Open Social Security (OSS) a few years ago (~2019) and I also ran Maximize My Social Security (MMSS) about the same time. I know MMSS recommended that we both wait until we turn 70 to file for SS benefits (actually 69.5 for my wife), and I thought OSS came up with the same recommendation.
I just ran OSS again, and it says my wife should file now, and I should wait until age 70. I also ran MMSS, and it still says wait.
Did OSS change their model some? Is there a flaw in the MMSS model?
Wife and I are both retired. She turned 65 last October, I turned 65 a few days ago.
I think (?) I ran Open Social Security (OSS) a few years ago (~2019) and I also ran Maximize My Social Security (MMSS) about the same time. I know MMSS recommended that we both wait until we turn 70 to file for SS benefits (actually 69.5 for my wife), and I thought OSS came up with the same recommendation.
I just ran OSS again, and it says my wife should file now, and I should wait until age 70. I also ran MMSS, and it still says wait.
Did OSS change their model some? Is there a flaw in the MMSS model?
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Re: yet another Social Security timing Q
Open Social Security's model hasn't changed. However, the default discount rate that it uses is the yield on 20-year TIPS. And that does change over time. (And with TIPS yields having increased over the last year, that will push recommended filing dates earlier in some cases.)Horsefly wrote: ↑Fri Mar 24, 2023 1:28 pm I don't mean to hijack this thread, but I have a related question.
Wife and I are both retired. She turned 65 last October, I turned 65 a few days ago.
I think (?) I ran Open Social Security (OSS) a few years ago (~2019) and I also ran Maximize My Social Security (MMSS) about the same time. I know MMSS recommended that we both wait until we turn 70 to file for SS benefits (actually 69.5 for my wife), and I thought OSS came up with the same recommendation.
I just ran OSS again, and it says my wife should file now, and I should wait until age 70. I also ran MMSS, and it still says wait.
Did OSS change their model some? Is there a flaw in the MMSS model?
As far as the difference between Open Social Security and Maximize My Social Security, the major point is that MMS uses age-at-death assumptions, whereas Open Social Security (at least by default) uses mortality tables to calculate a year-by-year probability of each person being alive, which allows for a more realistic representation of joint life expectancies.
Forcing you to pick your age at death ignores the uncertainty in lifespans. For a single person, this isn't terribly important. But for a married couple it skews the results.
If a user provides the average life expectancy as the assumed death age for each spouse, it results in significantly understating the "second to die" joint life expectancy (thereby understating the value of having the higher earner wait) and it significantly overstates the "first to die" joint life expectancy (thereby overstating the value of having the lower earner wait).
My session from last year's conference digs into the importance of joint life expectancies.
https://www.youtube.com/watch?v=atTp3sATI44
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Roth is a name, not an acronym. If you type ROTH, you're just yelling about retirement accounts.
Re: yet another Social Security timing Q
I ran MMSS a few years ago. Wife is a few years older than me and she had enough credits to file, but was mostly a stay at home mom, so it isn't very much. MMSS, with 90 years old as our lifetime, said the maximum benefit was: for her to file at FRA, for me to file at 70. The difference between filing at FRA for myself and waiting until 70 wasn't all the great (still using 90) -- sub $100K as I recall.Horsefly wrote: ↑Fri Mar 24, 2023 1:28 pm I don't mean to hijack this thread, but I have a related question.
Wife and I are both retired. She turned 65 last October, I turned 65 a few days ago.
I think (?) I ran Open Social Security (OSS) a few years ago (~2019) and I also ran Maximize My Social Security (MMSS) about the same time. I know MMSS recommended that we both wait until we turn 70 to file for SS benefits (actually 69.5 for my wife), and I thought OSS came up with the same recommendation.
I just ran OSS again, and it says my wife should file now, and I should wait until age 70. I also ran MMSS, and it still says wait.
Did OSS change their model some? Is there a flaw in the MMSS model?
Re: yet another Social Security timing Q
Ok, thanks @ObliviousInvester and @twh.
I guess I neglected to say it, but my wife's PIA is about 15% less than mine.
We decided to go ahead and file for her. She's all excited now - I think she believes she's got some extra spending money every month that she wasn't expecting!
We're still doing Roth conversions every year, so I may have to watch that to make sure we don't take a bigger IRMAA hit than we already are.
I guess I neglected to say it, but my wife's PIA is about 15% less than mine.
We decided to go ahead and file for her. She's all excited now - I think she believes she's got some extra spending money every month that she wasn't expecting!
We're still doing Roth conversions every year, so I may have to watch that to make sure we don't take a bigger IRMAA hit than we already are.
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Re: yet another Social Security timing Q
I wanted to mention that Mike Piper seems to be on top of the SSA's ins and outs.
I apologize for being anal about things; my reason is that the stakes are pretty high when claiming SS retirement benefits. If one does something wrong in claiming benefits which permanently reduces ones lifetime benefits, there may be no recourse. So it's good to hear anecdotes from others.
I apologize for being anal about things; my reason is that the stakes are pretty high when claiming SS retirement benefits. If one does something wrong in claiming benefits which permanently reduces ones lifetime benefits, there may be no recourse. So it's good to hear anecdotes from others.
Re: yet another Social Security timing Q
No need to apologize. I'm glad I took the time to read lots of threads here and review the answers to relevant questions in the "Ask Larry" section of the Maximize My Social Security site before filing for benefits for myself and my DH. I hope it's OK to post the link to "Ask Larry": https://maximizemysocialsecurity.com/ask-larry And we're so fortunate to have Mike Piper participating in this forum! He's a great teacher and his calculator is such a useful resource. There's a lot of great information on Mike's website: https://obliviousinvestor.com/SpideyIndexer wrote: ↑Sat Mar 25, 2023 1:39 am I wanted to mention that Mike Piper seems to be on top of the SSA's ins and outs.
I apologize for being anal about things; my reason is that the stakes are pretty high when claiming SS retirement benefits. If one does something wrong in claiming benefits which permanently reduces ones lifetime benefits, there may be no recourse. So it's good to hear anecdotes from others.
Some of the reps people have encountered when calling the SSA are not up to speed on all of their policies, particularly if you're doing something out of the ordinary. And sometimes the SSA makes mistakes in calculating benefits. It makes sense to know the rules before you file so you'll know if you're being given incorrect information.
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Re: yet another Social Security timing Q
Yes I understand! Be careful to avoid too much extra spending.Horsefly wrote: ↑Fri Mar 24, 2023 1:54 pm Ok, thanks @ObliviousInvester and @twh.
I guess I neglected to say it, but my wife's PIA is about 15% less than mine.
We decided to go ahead and file for her. She's all excited now - I think she believes she's got some extra spending money every month that she wasn't expecting!
We're still doing Roth conversions every year, so I may have to watch that to make sure we don't take a bigger IRMAA hit than we already are.
I agree one ought to keep an eye on one's Medicare MAGI and projected IRMAA. Lots of things may be changing in your financial picture, including SS income and interest income due to higher rates.
To help with this, in the past several years my standard procedure is to work up on dummy tax returns for the current year, using the TurboTax version for the previous tax year. Some minor details may need to be massaged but it will be pretty close, barring new major tax law changes. (Remember that TCJA expires in 2026. My default assumption is that is will not be extended, so for long-term estimates, I use pre-TCJA 2017 tax software and manually calculate certain "corrections" related to our ages etc.)
Re: yet another Social Security timing Q
OP—-I was born in July of ‘53 (same as you) and DW in February of ‘56 (1 yr older than your wife). We executed this strategy about 3 years ago — DW filed for her benefits and I filed for my spousal benefits. I plan to file for my full benefits in December of this year so that I’ll get retroactive payments going back to when I turned 70 in July, payable in January of 2024. She will do the same, requesting a switch from hers to a spousal.
Thanks to opensocialsecurity.com for reinforcing the value of utilizing this strategy.
Thanks to opensocialsecurity.com for reinforcing the value of utilizing this strategy.
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Re: yet another Social Security timing Q
Thanks again. Not sure about whether the 6 month delay for pushing out income to TY2024 would be very helpful in my case Will do some what if studies. The trade off would larger Roth Conversion in 2023 combined with slight cash flow hassles for the retroactive claims on my record vs larger Roth conversion in 2024 if no retroactive payment.
There should be no difference in total payout as everything ought to be trued up based on my PIA. I'm not 100% sure that the retroactive claim process would apply to both me and my spouse in the scenario; maybe I will Ask Larry or Mike.
I learned the SSA allows one to change one's mind after filing for benefits, within one year of the claim. You would have to pay them back. I don't advise planning on this but at least certain mistakes can be corrected.
There should be no difference in total payout as everything ought to be trued up based on my PIA. I'm not 100% sure that the retroactive claim process would apply to both me and my spouse in the scenario; maybe I will Ask Larry or Mike.
I learned the SSA allows one to change one's mind after filing for benefits, within one year of the claim. You would have to pay them back. I don't advise planning on this but at least certain mistakes can be corrected.
Re: yet another Social Security timing Q
I just remembered one other thing that might be helpful. If you want tax withheld from your benefit, mention it to the SSA rep during the phone call to review your applications. In my experience, they do not ask you if you want tax withheld and there was no check box on the application form to request it if I recall correctly. If you don't bring it up during the call, you will have to file form W-4V and it can take a few months for the SSA to process it.
When you apply for your own benefit to switch from a spousal benefit where taxes were being withheld, you must mention it again because you are applying for a different benefit. Any withholding that was in place for your spousal benefit does not carry over.
Your withholding choices are limited to 7%, 10%, 12%, or 22%. The percentage is applied after your Medicare premium and Part B and Part D IRMAA (if you owe them) are deducted from your benefit.
When you apply for your own benefit to switch from a spousal benefit where taxes were being withheld, you must mention it again because you are applying for a different benefit. Any withholding that was in place for your spousal benefit does not carry over.
Your withholding choices are limited to 7%, 10%, 12%, or 22%. The percentage is applied after your Medicare premium and Part B and Part D IRMAA (if you owe them) are deducted from your benefit.
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Re: yet another Social Security timing Q
One thing that you definitely want to be careful about is not hitting the IRMAA limit in that first year due to receiving the retroactive payments in addition to the regular payments, especially if both are on Medicare.SpideyIndexer wrote: ↑Sun Mar 26, 2023 4:52 pm Thanks again. Not sure about whether the 6 month delay for pushing out income to TY2024 would be very helpful in my case Will do some what if studies. The trade off would larger Roth Conversion in 2023 combined with slight cash flow hassles for the retroactive claims on my record vs larger Roth conversion in 2024 if no retroactive payment.
There should be no difference in total payout as everything ought to be trued up based on my PIA. I'm not 100% sure that the retroactive claim process would apply to both me and my spouse in the scenario; maybe I will Ask Larry or Mike.
I learned the SSA allows one to change one's mind after filing for benefits, within one year of the claim. You would have to pay them back. I don't advise planning on this but at least certain mistakes can be corrected.
(I'm gonna have to check how close we're going to be with the significant increases in yields, given our large taxable account and having pension and starting the lower SS this year (but with only one of us on Medicare, so not a potential double hit with IRMAA if we did trip up and go over)