Posted on 11/14/2015 10:20:29 AM PST by Bernard
Do SS benefits increase based on age breaks? There seems to be a different level of benefit at age 62, age 66, and age 70. So as an example, the monthly benefit at age 62 is $2,000, age 66 is $2,500, and age 70 it becomes $3,000.
When I read the literature from SSA, it sounds to me like once you start collecting retirement benefits, the based amount you collect is "frozen" at that level, and subject only to COLA increases.
I understood that if you start collecting at age 62, your benefit will stay at the $2,000 subject to COLA changes. The person my wife spoke to indicated that if you start at age 62, in addition to the COLA increases, you could expect other increases based on getting to the age milestones.
Does anybody here know what actually happens? Thanks.
It’s more than a “slight” increase actually. If your full retirement age is 66, and you file suspend at that age, then you get 8% more per year every year up to age 70. That’s 4 years at 8% a year. Where else can you earn that kind of guaranteed money nowadays?
This is a great thing to do IF you can afford to wait until 70 to start receiving SS payments.
Either way, you still start Medicare benefits the first day of the month of your 65th birthday.
Of course, that all depends on America still having the current form of government, SS still being solvent enough to pay out as promised, and the government not declaring bankruptcy.
I checked with SSA to see if this was going to decrease my eventual benefit and was (thankfully) advised that they calculate based on a certain number of your highest paid quarters.
I took mine at 63 mainly to reduce the amount of bucks I would have to withdraw from tax sheltered accounts to get a living wage.
I am single and they F&&K you hard so I play the tax avoidance game. The main thing is to live well and avoid the tax man.
For example I pay taxes on 85% of my SS, thank you Bill Clinton, I also pay taxes on 100% of my account distributions. Next year I have to pay the minimum Income Tax on my differed savings.
I am setting it up so that it is going to be a zero sum game.
The person your wife spoke to does not know what she is talking about.
Your SS is frozen at the amount it is when you take it.
If you file and suspend at your full retirement age, then at age 70 you will get the maximum monthly payment (your monthly payment is based on your highest 35 years of earnings). You don’t accumulate any more benefit after age 70.
This works quite well.
http://www.bankrate.com/calculators/retirement/social-security-benefits-calculator.aspx
I feel ya brother. You eventually get to that MAAGI and AGI crap that triggers severe penalties on the Part B premiums and Part D...... Bastards.
I have resorted to adjusting withdrawals and working part time to come in under their damned limits.
That's what I thought, but before I passed on starting to collect now, I wanted to verify. This posting forum seemed to be the best place to get multiple confirmations regardless of what the right answer was. And I would trust Freeper answers more than something coming from a government employee.
And what is worse, that the government employee was giving out wrong answers, or that she was calling people to promote the giveaway of government money? I wonder if she has a calling list that includes the private lines for Bill Gates and Warren Buffet, in case they are not collecting benefits.
Which is why my retirement date will be when I am 70 or older.
A lot of this depends on your marriage status. You may have more options if you are widowed or divorced. This is more likely if your spouse worked and was older than you.
But lets say that you are and have always been single or you were the oldest or the bread-winner within your marriage. If that’s true you basically have a SS retirement age range of 62 to 70. After 62 you can retire and the amount you get is set at the date you chose to first receive your SS which increases as long as you put off your first SS check until you are 70.
Your benefit is determined by your 30 highest years of income subject to SS. So if you are still working at 62. Your SS income is growing both by the delay of each quarter you don’t take your benefit. And it goes up for each year you are making a greater amount of money than your lowest pay year.
If you could estimate how long you are going to live, then you could better choose a retirement date. If you don’t plan to live to 80 and want to stop working, you should take your money at 62. But if you are married, either you or your wife will likely live past 80, so its better to wait.
SS is hardly enough to live on. Some people have to, but most cannot. I would suggest the best thing to do is to keep working and to put off retirement as long as you can. If you need this money you would be better off still working if you can. When people say they need the SS check. I think they actually need to keep working. If that is not possible or you only work part time or you have some disability, by all means take the SS.
Back before I retired a pal and I sat around and talked about Medical after retirement.
We were both VN guys and both had minor disabilities. We both knew that the Company the had recently bought us would screw us out of retirement Medical benefits, EXELON sue me, despite the fact they bought our service when they bought the company.
So we decided to go to the VA ain’t the best but if you yell loudly the treatment is not bad. In the end EXC screwed us.
I retired early at 62 while Hubby continued to work. He was forced into a slightly early retirement when we refused to relocate to California so he lost his job. My SS increased because I was able to draw off Hubby’s considerably larger monthly check at that time. But . . after a few years of trying to live on our combined two SS incomes, Hubby gladly went back to work when he was called back to the work force from retirement. He is now continuing to work part time through a small consulting company we started . . but taxes are literally killing our chance to make it a success. However, once Hubby went back to work, our SS benefits increased so when he finally reached full retirement age and could draw AND work, both of our SS benefits had increased due to those work years. Having a company makes it a little more difficult but we’re hoping it will increase our SS benefits too.
Our government cannot declare bankruptcy. It will payout SS. If the government has a problem with a growing SS debt, it has three possible ways to make the payments. One way is to print more money which could (it does not have to) devalue your money and cause inflation. This is happening in Europe now. Or it could push back the retirement year. So lets say early retirement is pushed back to 63 and regular retirement is pushed back from 67 to 68. And lastly, they can change the benefit. They can lower it for some or for all.
The easiest thing to do is the first thing, print money. Printing money allows the government to pay off all sorts of debts and it will be universally felt. The problem with lowering the amount or moving back the age is that it hits just retirees at a crucial time. That group will be very mad. And if you try to get just those who make more money, that group will game the system so the government will not likely save enough money to make a difference.
You can qualify for the increased amount later if you repay the SS Admin for the benefits already paid. In other words, if you retire at 62, and at 66 pay back your benefits for the last 4 years, you will qualify for the higher rate.
I was diagnosed with metastatic prostate cancer (bone mets) in 9/15. Started taking my SS when I turned 62 in April. I’d have to live until 79 or 80 before it would make sense to wait until I was 66.
That’s not likely to happen, but I should be still around for a cure to be found. In the mean time, The extra money now added to retirement pay and 401k means we are financially secure for the duration. Not rich, but better off than 90% of people our age.
1. I wasn't sure how long Uncle Sam would be able to pay me my SS, given the state of the country's economy and fiscal well-being. Better to take it while you can before the SHTF.
2. I wasn't sure how long I would be around myself. No one does. Waiting until you're 66 or 72 to draw your SS does you absolutely no good if you die at age 64.
3. I calculated the difference between the amount I would draw at 62 versus the amount I would draw at, say 66 by waiting to draw at the older age. I took the "a bird in hand is worth two in the bush" approach. I realized it would take me until almost age 70 before I made up for the foregone income I would give up between age 62 and age 66 if I waited.
4. And finally, the time utility of money. A dollar in your pocket today, is worth more than that same dollar five or ten years from now (even without factoring any inflation, which makes the dollar today even more valuable). You can touch it, you can feel it in your pocket, you can spend it, you can save it, you can do what ever you want with it. The point is, you can use the dollar now instead of just thinking about using the dollar down the road sometime in the future.
So for me it was a no-brainer. I started drawing it right way and have never had regrets. The only thing that bothers me is that the government keeps trying to tell us there is no inflation and so therefore, there are no COLA increases like there used to be.
The bureaucrats who figure the inflation rate take out everything that the consumer has to pay for to survive, like food, gas, energy, housing before they run their calculations and then tell us there is no inflation. Anybody who has bought food or gas or electricity or a home aver the last 6-8 years, knows that there is inflation. The government doesn't want to officially admit to it though because it triggers higher mandated spending on their part. So it's to their benefit to artificially manipulate the rate to keep these mandated spending items, like SS COLA increases, to a minimum.
It is my understanding that there is an 8% reduction for each year that you take it before your “full” [benefit] retirement age, which for me is 66 years and 8 months since I was born in 1958.
There is I believe a ~5% yearly increase for each year you delay taking benefits after your “full” [benefit] retirement age.
I’d get about 17% more per year by waiting until age 70, but that is something I probably won’t be able to do since I would need money to pay for Medicare by age 67.
What I’ll probably do is to spend down to about $3,000 (except an IRA) by about age 62 and get SNAP “food stamp” benefits.
By age 65 I’ll just have my IRA (~$4,000). That will go for Medicare premiums. By age 67 I’ll have to take Social Security (unless I can get pre-Christmas retail work after age 65).
Older poor/low-income people:
1. spend down non-IRA money to $3,000 (age 60 cutoff) to get food stamps
2. find roughly enough work to pay essential bills (property tax, electric, Medicare premiums, etc.)
3. when you need money despite 1,2 get Social Security
The other way is to continue working....the company will deduct your SS payroll amounts and it will be added to the next years payments....Spokeshave who is 73 and still working.
And, of course, after I drop dead, the margin utility of extra income drops as well, at least for me.
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