My husband and I started at 62. Why wait until 66 or 70? You may not even be alive by then. Even if you are, you may be too old or sickly to enjoy retirement. I want to enjoy my later years while I still have enough energy and health to do most all the things my husband and I want to do.
Can you people stop bitching about registration and speak to the subject of the article?
Get to the gist of it.
Later
The truth is that Social Security is a “dead man walking”, but in such a way that it shows how it should be ended with minimal harm to people.
That is, FICA taxes are just a trick to effectively double the income tax on people. Supposedly, FICA goes to pay for both SS and Medicare, but the truth is the money is spent, and more, as soon as they get it. Congress gets around this scam by just appropriating “right now” money, a fraction of what it should be, to pay current costs by beneficiaries.
So the way to end the racket is first, to assure beneficiaries that they will continue to get the SS owed them. But then, no longer admit young people to the system, to kill it off at the “front end”. Which also means that they no longer have to pay FICA taxes.
Young people who work in minimum wage jobs will still get withholding, but it will go into private individual retirement accounts, with strict limits as to how the money within can be invested, such as tax free municipal bonds.
The big trick then comes into play, which is to encourage those currently in the system to leave the system. This is by offering them a sweet deal. First of all, they no longer pay FICA, but these monies will go into their IRA. Second, each year they can get a previous years FICA rebate, so money from a previous year when they paid FICA will go back to them as well.
Say someone has been paying into the system for 20 years. The first year they pay no FICA, and the FICA money they paid for year 19 also goes into their IRA. This means that they will retire with a fat IRA, not just a small monthly SS check.
This way it may take about 30 years for SS and Medicare to fully die, but nobody will get screwed in the deal, and the lower tax revenues the government gets are paid for by reducing the size and cost of government.
Ping
My entire retirement strategy is predicated on the fact that Social Security will not be around when I'm ready to retire. All that FICA money I've had taken out of my paychecks over the years might as well have been tossed into a fireplace and set on fire. That's the assumption I'm basing my retirement on.
So that's why I've been maxing out my 401(k) over the past 20 years and have it well into six figures. If I can get another 20 years of work out of my body, I'll have the several million I will probably need to fund a retirement without Social Security. If Social Security is still around, it will be a bonus and I can use it for beer money.
I don’t want it.
There’s one very good reason to wait as long as you can, particularly if you’re going to have to rely upon Social Security to finance a fair portion of your basic lifestyle. Of course, that usually means working longer.
The reason is that Social Security payments are, at least to an extent, inflation protected. While that doesn’t matter much if inflation continues at 2-4%, it could matter a great deal if inflation starts running 8-10% for several years running.
Most retirees invest their other financial assets relatively conservatively and those assets won’t rise with inflation (although they might earn higher interest), so Social Security could be the one asset that keeps you from having to reduce your standard of living significantly following an extended inflationary period.
It’s either that or invest in riskier assets like real estate, common stocks, and precious metals, all of which should end up higher following an inflation binge.
So, if at 62 Social Security is already a significant part of your retirement income, be aware that it could be most of your income after an inflation binge and that the rest of your assets probably won’t have kept pace.
The main arguments for taking it early are: 1) you’re in poor health and are either unable to work, or likely to not live long, or both, or 2) you’re male...we just don’t seem to make it out of the 70’s that often, and it’s in the 80’s and 90’s that this would be likely to be most important.
That 8% increase in benefits every year is significant, but you have to live a long time to make up waiting until 70 to start collecting. As I said though, it’s the one financial asset that is most likely to have a decent inflation factor built into it, so if you don’t need it, or can work a bit longer even part time to sustain your living standard without collecting SS, I’d consider it if you’re healthy and expect to live for years in retirement.
And face it, if you work longer and don’t collect and then die at 66, missing four years of SS payments is the least of your worries. If you hate your job, that’s also a consideration, of course.
Ping for later
I think I will retire at 70 or 72.
A popup appeared preventing me from reading the site. The only way to get rid of it was to “register.” No thanks.
The only practical reason to start taking Social Security at age 62 is if you are no longer generating revenue.
I’ve been reading Seeking Alpha for awhile. This was one of the best articles I’ve seen in quite some time.
It's not as much as if you wait to 65, but I figured I deserved to see some of it before I ended up the same way.
The SS check helps out with the necessities, but if you don't have any savings, you're going to take about a 50% loss of income/standard of living.
Six years later I'm still going strong, and I'm glad I saved up for all the stuff that a SS stipend doesn't cover.
I be probably registered there five or six times over the past years. Hit unsubscribe on their “spam” and they leave you alone. All in all not a horrible site.
Same here.
Wants registration.
Adios.
If you take SS before age 66 (unless they have moved that target again) you will have to take Medicare. Otherwise you can forgo it.
My feeling is that a point will be reached where those receiving SS will continue receiving and new filers will be owed IOUs when the well begins to dry. If you are already receiving it the government would be in major breach by stopping it. The people who receive lesser amounts a month is what the government would love to see.
I will be 62 in October. The astounding thing is that putting my pension and social security together I will be bringing home more money in Oct. than when I was teaching.
I also have two tax shelters that I have been putting money into for over 20 years.