Drawing Social Security early or not?

[Paul_G]

I dont think a car forum is a good place to get one's financial advice, thats a given. But I am sure many on this board have already contemplated retiring, some decided to do it, and some not. It is a pretty complicated mess trying to figure it all out.

I have figured something out about Social Security and just want to share it, and maybe see if others have a differing view, or maybe I am completely wrong in how I am figuring it.

So I am going to put some real numbers on this. The financial advisers I have spoken too already, most are young men college educated, try to steer you to waiting as long as you can to collect Social Security. Why would they do that I wonder?

For some, maybe Social Security alone, if that is all one has to live on in retirement, probably is not enough to live comfortably if they take it early at age 62, or even 65. So waiting to take it at full retirement age of 66 and x months, (i use x because your age determines what month you reach full retirement age), or even 70, is a necessity. OK, I agree with that. But for those who have other forms of income in retirement, like a company pension, rental income, 401K, you name it. Retiring early may not be a bad idea.

The numbers:
Lets say a person retires at age:
62, draws $1866 per month. At age 70 he will have drawn out $179136, at age 80 $403056
66/8 m $2592 per month. At age 70 he will have drawn out $93312, at age 80 $404352
70, draws $3283 per month. At age 80 you will have only drawn out $393960

Looking at these real numbers. A person would have to live to age 80 just to break even over retiring early at age 62. Retiring at age 70, fat chance of getting much of your money back from SS at all. For some, if your finances require it, may have to wok longer to get the higher monthly payment from SS.

Retiring early at age 62 gives the individual the best chance of recovering the most of his money that has been paid in to SS over his working life. If a person can retire early and chooses not to, there is a better chance that SS, or the government, will not have to pay out the money that has been collected for this individual over his lifetime.

We can all got to https://www.ssa.gov/myaccount/ and register to get your real retirement numbers.

 

[GetX'd]

A much simpler way to determine how much more or less you get can also be done in percentages. Simply said it's +8% for every year you wait past 62. I'll wait the 4 years to my full retirement age and get 32% more than had I collected at 62.

 

[ws23jrt]

I agree it is a complicated decision and should be made with the whole picture of assets at the time one makes up their mind.

I like the way you spelled out an example.
For me age 66 was my best guess/option. It was taken on the advice of my financial planner. He was able to plug in my investment income with my pension to a program that shows all the scenarios that add to the SS income and make a taxable package that is an important factor.---IRS is always at out throat.

 

[ws23jrt]

A much simpler way to determine how much more or less you get can also be done in percentages. Simply said it's +8% for every year you wait past 62. I'll wait the 4 years to my full retirement age and get 32% more than had I collected at 62.

You will also miss 4 years of payments by doing so.
Knowing when we will die is a key piece of information that makes this tough.

 

[Dennis H]

63 1/2. Still working. Not always about the money.

 

[GetX'd]

You will also miss 4 years of payments by doing so.

Of course you do - nothing's free. You don't get 32% more for free. That's the case no matter which way you look at it. You get more for waiting, less for not.

 

[Fran Blacker]

Don't trust answers you get if you call a SS office. You call ask a question, get an answer and call another time ask same question different answer.

 

[Paul_G]

A much simpler way to determine how much more or less you get can also be done in percentages. Simply said it's +8% for every year you wait past 62. I'll wait the 4 years to my full retirement age and get 32% more than had I collected at 62.

I asked about that. Waiting and getting more sounds like a good idea, right? until...

I was told that SS makes a determination of how much money they will pay out to an individual based on income and other factors. Everyone is different. So SS puts a number on you, how much they will pay out to you in total based on average life expediencies. Then they divide this number up, age 62 to end of life, age 65 till end of life, etc., eventually maxing out your monthly benefit payment at age 70.

So if you live to the age of average life expectancy, you draw the same total amount regardless of when you started drawing your benefit.

 

[khryslerkid]

I say to take it the earliest you can if you can survive on that amount.

 

[Ranger16]

The SSA website has a calculator to show your break even point.
There are many variables and everyone situation is different, but from what I read, general consensus is take what you can as early as you can. That's your best chance of coming out ahead. I bailed the day I turned 62 and have no regrets.

 

[Paul_G]

I will say, that taking SS early, as soon as you can, gives you the best chance of getting back the most of your money. Because... we dont know when we are going to die.

 

[dave dodge]

I think it all has to do with the individual 's financial situation and health. I chose to take mine at 62 because of family health history. Would rather to have less now then getting nothing later! Just my 2 cents.

 

[5.7 hemi]

When you draw SS, and don't die within a few years of collecting said money, you will far exceed what you have put into to it, that's FACT!

 

[Pops1967GTX]

Wait a minute, aren't our kids going to take care of us.

 

[Fran Blacker]

Dislocated an ankle when I was 59 and 9 months. Took 15 month before I went back to work. Company sickness and accident ins stopped after 9 months. 4 years earlier union offer extra insurance for $10 a week it would add $100 a week to the companies $360 a week. After you were disabled for 9 months you could collect about $1600 a month. The only thing you had to apply for SS disability. They supplied and paid for the lawyer. Only thing if you got disability you paid them back. When you get disability from SS they back pay you to 5 months after your disability. So I got a check for 8 months of SS and used that to pay them back. I went back to work 2 days before the check and approval came through. SS allows you to try to go back to work and allows you to collect SS for up to 9 months. After 7 months I needed a second knee replacement so that was the end of my working. Retired at full SS at 62. Second knee replacement didn't go as well as the first. 6 months before it stop hurting then the ankle was so bad could work on it. Went for x rays on it, they told me it shot. Didn't do crap for 2 years then went to a pain management clinic, Hydrocodone to the rescue. I never take more than 2 in a day. Mostly 1 or 1 1/2 and I'm good for 4/5 hours.

 

[NOSTRT980]

I also went at age 62 and didn't look back.

 

[pturner]

I was hoping "Affordable Healthcare" would be affordable so I could get out at 62, BUT Affordable Healthcare is not so affordable. So I am working on until 65 just for insurance, and some salary. Not eligible for TennCare as I own my home.
PT in Tennessee

 

[mopar 3 B]

SS or not will be working till I no longer can. Self employment does have some advantages. No full SS benefits till 67 and stand to lose way to much from retirement fund till 67. Started one pension plan at 60 just because if I didn't and something happened to me the wife would get nothing this way she gets it for remainder of her life if I go first.
If you like what you do and can still do it why retire. Go part-time have some extra spending money and enjoy a few more days off.

 

[toolmanmike]

I just retired in June @ 62. Being self employed for the last 3 decades I have only paid in the minimum required so there isn't a huge difference between my monthly payout at 62 or 66-2mo which is my maximum. I believe my break even is mid 70's. If we could predict when we will die it would be easier to plan of course. I am over my income level so far this year so I will sign up first of next year.

 

[dart4forte]

I started drawing SS at age 62 which was January of this year. Made a nice little pay raise to my retirement.