The Hidden Social Security Math Nobody Shows Retirees

[69 Sleeper Bee]

Good thread.
I did the math for myself based on average life expectancy of men in my family and it is 85 so if I start collecting at 67 which is my full retirement age I will make max $ in the long run vs. waiting till 70 to start. I could start collecting at 66 and it would not be much different so depending on my health in 3 years we will see. ( so far God has blessed me in the good health department )
I have a SARSEP Ira that was started in the late 80's and has done very well.
Bottom line for me is I am self employed and have been most of my life and I love drawing house plans and I plan on doing that till I drop like my dad did ( he was 85 ) so I will have a steady income to boot.

 

[RR Fan Dan]

I did the math long ago and I would have to be in my 80s before losing money by taking it at 62. At by the time I was 80 if I lived that long I will have collected over $600k. Investing 1/3 of that in tax free IRAs would make more money. Take it now. They are counting on you dying.

 

[Dennis H]

No Tax on SS. Just picked up about $600 @ Month. My bracket!

 

[RR Fan Dan]

No Tax on SS. Just picked up about $600 @ Month. My bracket!

I don’t understand, SS is taxed as income. Actually taxed twice. Once out of your paycheck and then again when they give it back to you. Anything you make over your deductions is taxable.

 

[68 Sport Satellite]

I’m an outlier on this issue. But I have a family tree with scary longevity. My doctor and my lawyer told me to go long. I worked full time until 69, took SS at 70. Drew my investments down to make it happen.

Result is a benefit of 50k per year. Even if I live to 100, and adjusted for inflation. Not for everyone, but I’ve always been a bit of a freak, and managed accordingly.

It also gets taxed at a lower rate than income from other sources. If I predecease my spouse, she can switch to my benefit. It’s more than she made when she worked full time.

can you please explain what you mean by "drew my investments down to make it happen"? I'm 8yrs out from 62 and planning to start drawing SS at 62 as I've also seen so many videos explaining the overall cash coming out better if you start early at 62 instead of waiting.

 

[RR Fan Dan]

can you please explain what you mean by "drew my investments down to make it happen"? I'm 8yrs out from 62 and planning to start drawing SS at 62 as I've also seen so many videos explaining the overall cash coming out better if you start early at 62 instead of waiting.

I’m not sue what he means but I retired at 59 1/2 when I could draw my IRAs without the 10% penalties. That was last year. I had money saved from work and I also drew down $14k from IRAs for this year 2025. That’s what my standard tax deduction is so I won’t pay taxes on it. I’ll be 61 in a few weeks and I’ll draw down again come January for 2026. In December 2026 I will receive my first SS check and won’t have to draw down any more IRAs until it’s mandatory at I think age 72.