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Retirement Math


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So....Mrs. LL and I are seriously looking at our retirement timing.

 

Going to see the folks at SS after the 1st to get their input.

 

But in the meantime, if anyone has some thoughts, please let 'em rip.

 

Simplified facts:

 

I'm 66 and self-employed.  I can work as long or as short as I care to.  Right now, I don't think I want to keeping working after maximizing my monthly SS benefit at age 70.  If I work until 70, I add almost another $1000/mo. to my benefits.  (I know; I know; I'm deferring receipt of money in the meantime; that's OK - I'm still working and adding $ to the kitty.)

 

Mrs. LL is 65 and working, but would prefer to stop as early as practical.

 

My puzzlement concerns the so-called spousal benefit.  Different sources say different things.  All I'm trying to figure out is when one or both of us should claim it.  Add to that simple question the "deferred" option, where one of us claims our benefits (having reached our full retirement age at 66) but then immediately defers those payments.

 

Head is spinning; I'm a lawyer, not a math whiz.

 

Any thoughts?

 

Gracias.

 

LL

 

Mrs. LL is 

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Used to be you could defer drawing you SS but draw off your spouse without any penalty to your SS benefit and the wife could do the same till you each reached you max benefit age.  No idea if that is still possible.

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17 minutes ago, Sedalia Dave said:

Used to be you could defer drawing you SS but draw off your spouse without any penalty to your SS benefit and the wife could do the same till you each reached you max benefit age.  No idea if that is still possible.

 

Yeah - that's the question.  Hopefully I'll get some solid info from SS.

 

Thanks.

 

LL

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See SS. Before doing anything, meet with a CFA (not CFP) that can give advice on your unique situation such as assets, passive income, quality of life and such. That extra money from SS may or may not be worth it.

 

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This last week I received my Social Security notice.

I has the increase numbers and other information.

The increase is 2.8%. Nothing note worth.

 

BUT...New information and changes.

 

What if you work in 2019?

If your are at full retirement age (66) or older for all of 2019, you may keep all of your benefits no matter how much you earn.

If younger than full retirement there are limits to how much you can earn before we reduce your benefits.

If you are under 66 for the full year, you can earn up to $17,040 before SS is reduced. $1 for every $2 over.

If you become 66 during 2019, you can earn up to 45,360 before SS is reduced. 1 for every $3 over.

 

There's more but it has to do with younger than 66 during any part of 2019.

==================

Also when I was ready to retire, I ran spread sheets on the amount of dollars I would get at 63, 64, 65, 66...

I wanted to know when the dollars would cross.

Example:

II start getting SS at 63.

How many months out would the $ from 64 meet.

I was thinking a3 or 4 years.

Turned out, it was not 3 or 4 years.

Taking SS at 63 the numbers showed that SS 64 would meet at about 15 to16 years out.

I would get receive money a full year earlier and the 64 dollars would not give more until 15 years later.

So I took it at my next birthday...should have waited one month more.

The SS support person did not start me on my birthday but said I will get you your first payment in the next 3 days. This made it before my birthday and reduced my monthly payment by $17.

I suggest signing up after your birthday and don't let them try to set you up earlier to get a payment in a few day.

 

 

 

 

 

 

 

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If you wait until 70 years old, you're leaving a lot of money on the table. Take your current level and figure out how much you leave behind if you wait four years. Example: let's say your benefit is $2,800/month if you claim it now. Four years from now (48 months) you will have missed out on $134,440. How many years will it take the increased benefit to make up the lost income? 

 

For your wife, it depends on what month she turns 66 in 2019. The difference in waiting until 66 vs claiming it earlier in the year isn't likely to be much. Then again, you may decide it's worth it to wait until 66. There are limits on income by claiming prior to 66 years of age. At 66 years, that limit goes away, regardless of when one claims it.

 

Good luck!

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I was in the unfortunate position of having to retire early.  Depending on exactly how you look at it.  Two big questions.  Question number one is when does actual income during the intervening time cross with the potential and how much is the loss.  And, after retiring, I never looked back. Ever.  Disney Vacation Club is real hard to beat.  

 

Question number two is even more important.  The Muni Buss question.  What if, after your key decision, you meet the Muni Buss inna cross walk and never get to see retirement??

 

Life is short.  Eat Desert FIRST.  SAME SAME Retirement.

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Get the name of everyone in SSA that you talk to, and the name of their manager.  If you can record the calls.  Get everything in writing. Talk to an accountant who specializes in Social Security, or maybe an accounting law firm. Get everything from them in writing.

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I have no idea but if I were you I would talk with a CPA that deals with Social Security in your area.

 

https://www.google.com/search?q=social security accountant in massachusetts&tbm=

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I retired at 58. I worked for a large aerospace company that paid extremely well with great benefits. They had a "leveling" plan where they asked me when I would draw SS. I said 65, they then added my SS to my Company retirement. When I turned 65, they reduced my retirement by the amount of ss that I got.

 

My situation was a little different because I got cancer when I was 53. The Doc told me I had a 1 in 10 chances living 5 years. After the 5 years was up, he told me it looked like I had it whipped. Got my wakeup call and we retired. Been 19 years now and counting. I also am 50% disabled with a service connected disability, so that is icing on the cake.  Company also gives me and my wife supplemental insurance that pays for our Rx's and pays what is not covered by medicare. We saved our money, made some great investments that paid off handsomely so retirement is great. Life is good!

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I took early retirement for a variety of reasons that all came together in 2015.  I don't know what your respective commuting situations are, but that is something to consider in addition to Social Security and pensions in  determining whether it is financially feasible to retire.  When I sat down to calculate how much money would actually end up in my pocket, when I factored in the rather high commuting costs I was subjected to, I determined that by working I only put $20 a month more in my pocket than I would in retirement.  I figured I could squeeze $20 a month from somewhere and said, "I'm outta here!"  I retired on December 31, 2015 at 3:30 PM (but who's counting) and never looked back. 

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