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Mainly...
(1) When to start collecting.

But also...
(2) Whether to reboot after a year, paying back the first year's benefit.

And...
(3) Whether to complexify things by one of us collecting immediately and the other delaying (I note that we are very close in age, 5 months apart, and that my benefit is 70% of his).

If we both start collecting SS as soon as the paychecks stop, we won't hit our assets hard each month until we're making up for years of insufficient COLAs in SS and the pensions.

OR, we could delay SS a few months till DH reaches 64 & I reach 63 1/2, providing about another hundred bucks/month by my calcs, but requiring us to fund almost all income needs out of savings for the first few months of 2013.

OR, we could both delay SS longer, but I'm a bit uncomfotable with that on several levels...the possibility of Congress changing the SS benefit formula for anyone who hasn't staring collecting yet, not just those under 55...depleting savings more rapidly when we don't have LTCI (and doubt we could qualify for it now, with DH's micro-strokes--but that's the subject of another question!), or make ourselves too poor to afford a CCRC should that look sensible down the road.

And reboot a year later (or not), whether we start SS immediately or delay 3 months (or longer).

OR, one of us could start collecting before the other (I note that my benefit is 70% of his).

Note that we will get a slight raise in income at age 65 when DH's small private pension kicks in, and a big raise at age 70 when RMDs kick in.

I'm willing to provide the numbers if you need them to help me figure this out.

I'm hoping to hear from you numbers dudes! My number comfort consists mostly of being able to make a simple equation whenever possible: X over Y = A over B. But that doesn't solve everything-
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"But also...
(2) Whether to reboot after a year, paying back the first year's benefit."


the government closed that option last year.


No paying back a year or years of benefits and 'starting over'.

Gone....

Closed....

Kaput...

t.
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"Mainly...
(1) When to start collecting." - alstromeria



I'm planning on starting to collect social security in a couple of years when I turn 62. My number #1 reason is that I don't think I'll live to be old enough to make it worthwhile to wait. Another words I think I'll come out better, dollar wise, to start at 62. I don't come from a family of long livers and most of my family just made it to their early to mid 70s with my mom checking out at 51 and my dad only making it to 65.

My understanding is that 84 is the magic number you have to live to make it worthwhile to wait till full retirement age. I have very little confidence I'm going to make it to 84. Not that living to be real old is all that appealing to me anyway. It's not like I wake up every morning feeling wunderbar. It takes me a while to get going in the morning.

Number two is in the back of my mind is that once I start collecting social security is that once I'm on it they are less likely to mess around with it. Once that check is being automatically deposited in my checking account every month the law of inertia will dictate that it will continue to do so. My thinking is the longer I wait the more time I give the politicians time to screw around with it.

Plus I'm excited by the idea of having an extra $809/month to squander. Who knows I might start back going to the Florida Keys every year? I miss Key West. It's not like I'm getting any younger. Every year that goes by my arthritis gets worse. It's not like I'm going to be feeling better when I'm 66 than I am at 62. If I wait till 66 chances are I'll feel less like traveling than I do at 62. There's something to be said for doing the stuff you love while you're still young enough to enjoy it.

Art
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Whether to reboot after a year, paying back the first year's benefit."
-----------------
the government closed that option last year.


I thought they just ended the option to reboot anytime, reducing it to rebooting after 12 months max. Did they take that away, too? If so, that may up the odds for delaying SS being a good decision.
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Thx, Art.

A few comments on your comments:

My understanding is that 84 is the magic number you have to live to make it worthwhile to wait till full retirement age. I have very little confidence I'm going to make it to 84.

I hope your health improves or stops worsening.
I also think about not aging well so I've already done most everything I really wanted to. Of course I'd be more than happy to do more of it!
I thought the break-even age was more like 80.

...once I'm on [Social Security] they are less likely to mess around with it.

That is my concern as well. But they'll still mess with us by changing the COLA formula so we fall further and further behind inflation. They did this just a few months ago in SC with state pensions. The COLA is capped at 1% per year, not matter what the inflation rate is.

Key West. It's not like I'm getting any younger. Every year that goes by my arthritis gets worse.

I encourage you to discuss with Bonnie how much you'd love a Key West vacation over Christmas break (leaving enough time to spend with family, too--hey, maybe some of them would like to join you and share a rental!). You mention this sort of thing regularly; it's clearly important to you.

I wonder if you might benefit by replacing a bathtub with a jet tub? Hot, bubbly water feels soooo good! Also, does your health insurance cover massage therapy and/or physical therapy?
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If you're an Amazon Prime member, you can get this Kindle book for free:

http://www.amazon.com/gp/product/B009K7ZNDS/ref=docs-os-doi_...

It was free to everyone a week or two ago. It does a good job of going over all the options available.
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OR, we could both delay SS longer, but I'm a bit uncomfotable with that on several levels...the possibility of Congress changing the SS benefit formula for anyone who hasn't staring collecting yet, not just those under 55...depleting savings more rapidly when we don't have LTCI (and doubt we could qualify for it now, with DH's micro-strokes--but that's the subject of another question!), or make ourselves too poor to afford a CCRC should that look sensible down the road.

I really don't think you need to worry about this. It would be political suicide for them to make changes for those close to collecting. In any case, if they ever talk about doing so, you can apply for benefits before any changes can become effective.
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First, you are correct that you have one re-do in the first 12 months after your initial application.

It sounds like you need to explore options where you or your husband collect on spouse's record, and then collect on your own record later. Normally, it would be you collecting on your husband's record, but with his medical situation, you may need to re-think it.
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"If so, that may up the odds for delaying SS being a good decision." - alstromeria


How long do you think you're going to live? That is the main thing that decides when to take social security. It's a numbers game. Because if you all ready have health problems and people in your family don't live to be real old; you may come out better to go ahead and start at 62. I seem to recall I read that 84 years old is like the magic number you have to live to in order to come out better to wait till 65 or 66 years old.

Art
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"I wonder if you might benefit by replacing a bathtub with a jet tub? Hot, bubbly water feels soooo good! Also, does your health insurance cover massage therapy and/or physical therapy?" - alstromeria


We had a hot tub before and it broke down a lot. It was also very expensive to run - sucking up about $100/month in extra electricity. It sat out on our back deck.

I've thought about putting in a hot tub here where we live now. One problem we have is mosquitoes. I think they'd drive me crazy even with the steam and chlorine vapors rising up. They are voracious. They are those little evil Asian black mosquitoes and they don't give up easily.

So along with a hot tub we'd have to have a screened in back porch built to keep the little buggers out. That would add to the cost substantially.

I'm just not sure I want to deplete my savings for a hot tub even though I know I would enjoy it. Maybe eventually when my arthritis gets to the point where I can't stand it anymore. It does feel incredibly good to float around in a tub of hot bubbly water. Gravity free warm water is mighty nice!

Art
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"I encourage you to discuss with Bonnie how much you'd love a Key West vacation over Christmas break (leaving enough time to spend with family, too--hey, maybe some of them would like to join you and share a rental!). You mention this sort of thing regularly; it's clearly important to you." - alstromeria


Back when I was younger I did a lot of traveling on the cheap. We even took Florida diving/fishing vacations when we were still in college. One time we were down near Panama City, Florida driving on highway 98 and we had just crossed that big bridge and the alternator light on our old Ford LTD came on and I had to replace the alternator in that car. I remember unhooking the batteries and disconnecting the belt and taking out the old alternator and buying a new one at an Auto Parts store and putting a new one in right there setting beside the road.

We sometimes camped out and got eat up by mosquitoes and sometimes stayed in cheap hotels and ate sandwiches made with stuff we bought at grocery stores.

The point is I'm over it. I'd rather wait a couple of more years and when I travel I want to take a big wad of cash and stay in nice hotels and eat at nice restaurants with good food and if my car breaks down I want to be able to pay someone else to fix it.

I've had a taste of what it feels like to stay in a nice hotel. Last October we went to Orlando with Bonnie and stayed at the Marriott Grand Lakes Hotel and it was posh. Linda and I spent a good portion of that trip floating down their "lazy river swimming pool" and I sat in their two hot tubs and we ate out at restaurants and I've about decided that if I can't do it in style I don't have much interest in traveling at all.

So I think I'm going to wait. Seattle Pioneer likes to make fun of people who use their social security to travel but that's what I'm thinking I might do. Heck we might even fly out to Vancouver, B.C. and ride one of those Cruise ships up to Alaska one summer. I know Linda would love that!

Art
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At age 58, I haven't focused too much on Social Security strategy yet. I try to follow SS benefit developments a little and have a current placeholder plan.

Since they took away the "do over at any time" option, here is my plan of record: 1 - SGSpouse, who has slightly lower SS benefits coming to her would begin collecting at or near age 62 (I would be 63). We could include a 12 month "do over" option to her benefits. 2 - I would postpone collecting until we either begin to experience health issues or attitude changes slowing us down - possibly until age 70. Taking SGSpouses benefit early would provide us with guarantee of at least some payout regardless of short longevity or failing health. Also, if only one of us has a long, active retirement, the larger COLA'd benefits would still be available.

There are still plenty of things that could change this plan between now and five years from now when SGSpouse turns 62. We don't really need the benefit to support the lifestyle we are enjoying right now and we are both still pretty healthy and active. If things haven't changed much in 5 years, we might feel like the probability of us living beyond the longevity tables is high and choose to hold off on collecting her benefits too so she can get a larger COLA'd benefit when we need it age 100. Conversely, if we are experiencing medical problems and fear that we will end up reducing the averages published in the longevity tables, we might choose to collect earlier.

If you just look at the financial part of things and assume average longevity, waiting to age 70 is the best deal, but I think this overlooks some important considerations. I've seen many people I know slow down and reduce their lifestyle dramatically prior to age 70 - often for health reasons. For these people, the age 62 benefit dollar would have been worth a lot more than the age 70 benefit dollar. And, of course, many don't live a lot of years past age 62.
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roemeria: OR, we could delay SS a few months till DH reaches 64 & I reach 63 1/2, providing about another hundred bucks/month by my calcs, but requiring us to fund almost all income needs out of savings for the first few months of 2013.

Why not let one of you start early and the other late? Preferably the one with the higher income ans shorter life expectancy start late. This way, the surving spouse can still collect the other's SS when he (or she) croaks. I started mine later and I have more income, so the Countess will take hers at 62, in the expectation that she will outlive me and get my higher rate when I kick the bucket.

Count Upp
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Art: One time we were down near Panama City, Florida driving on highway 98 and we had just crossed that big bridge and the alternator light on our old Ford LTD came on and I had to replace the alternator in that car. I remember unhooking the batteries and disconnecting the belt and taking out the old alternator and buying a new one at an Auto Parts store and putting a new one in right there setting beside the road.

Our 1964 Jaguar XK-E coupe (red) ate its alternator one fine September day in Bend, Oregon. The nearest Jaguar dealer was in Sacramento. I drove only during daylight, and stopped often for gas, recharging at each stop. When we got to Redding, it was 105 degrees. The Jaguar's transmission came roughly between the two seats, and it was HOT. Oh, yes, no A/C. My wife was close to heat prostration, We stopped at a bowling alley, and she laid on a bench while I got some ice water for her. Miserable trip, but we got a new alternator in Sacto ($600 at that time) and were able to continue the trip.

It was a helluva car, except it liked to cruise at 100-120 mph.

Count Upp
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If you're an Amazon Prime member, you can get this Kindle book for free:

http://www.amazon.com/gp/product/B009K7ZNDS/ref=docs-os-doi_......

It was free to everyone a week or two ago. It does a good job of going over all the options available.


Thx--I'm downloading it right now (and hey, next time, let us know about good books for free during their free period!). With an iPad, not a Kindle, I have to pay $4.99 for it since I have an iPad running Kindle software, not an actual Kindle, which I'd like to add to our electronics collection, but subject of another post ;-)
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I meant replacing a regular bathtub with a jet tub, not buying an outdoor hot tub--which, delightful as they are, cost $$$ to buy, refill, heat, and maintain.

Mom has arthritis and takes a bath in her jet tub every evening before bed--she says it helps the arthritis plus relaxes her for sleep. When Daddy was alive, it was their comforting evening ritual for him to fix them tea, and a little while later for him to draw her bath. She felt loved, and he felt needed and appreciated. I bet that was as good for their health as actually taking the bath!
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Why not let one of you start early and the other late?

I don;t know how to crunch the numbers to figure out if it's a good deal for us.

Preferably the one with the higher income ans shorter life expectancy start late.

I'm not convinced that DH, with the higher benefit and a whopping 5 months in age on me(!), will be the first to shuffle off this mortal coil. Other than his micro-strokes, a one-time event a few years ago that hasn't been repeated, he's been far healthier than me. We've been assuming he'd outlive me--but in case we're wrong, giving me 100% survivor on his pension. It's add shades of grey to me.

By starting only one of our SS benefits, even if the other takes the 50% spousal benefit, we'd have to shell out a lot more from assets every month. I just don't know if that makes sense. Spending extra money every month makes me nervous--funny, but spending one big lump sum for the 12-month reboot doesn't bother me as much--go figure. I guess it feels more like an investment with an 8% return.

Are any of you aware of online calculators I could plug our numbers into to help figure this out? Or, if I provide the numbers, could any of you make the calculations?

SG, do you cover this in your retirement book for engineers?

When I read online articles about starting one SS benefit early and the other later, the situations just don't seem applicable. First, we're already past 62. Second, as of Dec 31, we're both already retired. Third, we're the same age. Fourth, we'll be receiving 2/3 of our income from SS if we both start collecting in full in 2013. (Actually that 2/3 number is in a gelatinous state...if I were comfortable taking 4% of the income-producing portfolio, it would be different. But I'm planning to take between 1 and 2% and have notations for every year on the extra amount, which I call the slush fund--for things like hurricane deductible, new car, deciding to take a villa in Europe for a few months with our BFFs, hearing aids, assisted living...)
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"I meant replacing a regular bathtub with a jet tub, not buying an outdoor hot tub--which, delightful as they are, cost $$$ to buy, refill, heat, and maintain." - alstromeria

We don't have room for it. Our bathrooms are not big enough to accomodate a jet tub.

Plus I'm a big guy and I don't fit down in a bathtub too good. I take showers. I have a standup showerstall in my bathroom.

Another words what I'm trying to tell you is that if I get any kind of warm jaccuzi action going it would have to be a regular outdoor hot-tub.

Believe me I've thought this through pretty thoroughly - many times.

Art
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alstromeria adds, "I'm not convinced that DH, with the higher benefit and a whopping 5 months in age on me(!), will be the first to shuffle off this mortal coil. Other than his micro-strokes, a one-time event a few years ago that hasn't been repeated, he's been far healthier than me. We've been assuming he'd outlive me--but in case we're wrong, giving me 100% survivor on his pension. It's add shades of grey to me."
-------------------------------


It's too bad we don't know our exact exit date. It would make planning for retirement a whole lot easier! <grin!>

Artie
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Are any of you aware of online calculators I could plug our numbers into to help figure this out? Or, if I provide the numbers, could any of you make the calculations?

Here is a site that will crunch the numbers for a fee:

http://www.socialsecuritysolutions.com/get-your-solution.php...

I have no idea if they're any good. I found them from another forum thread:

http://www.city-data.com/forum/retirement/1710765-those-conf...

Here's another forum where someone provided their summary:

http://www.early-retirement.org/forums/f28/are-the-reports-f...

Here's a link to AARP's calculator mentioned in the thread:

http://www.aarp.org/work/social-security/social-security-ben...

I'd read the book you downloaded first to get a better understanding of your options. Then I'd try the AARP calculator. If you're still uncertain, I'd go ahead and use the fee site.

Do view both of the forums linked for other general retirement issues.
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I used the AARP calculator. No matter what you enter, they give the same answer: higher earner files and suspends at 66, lower earner collects whichever is higher at 66 (their own benefit or 50% of spouse's), higher earner collects at 70, everybody lives fo-evah <eye roll>.. It's like a broken record.

I don't want to shell out massive amounts of savings until we're 66 and 70. More modest amounts, OK. Rebooting, yeah, maybe. One file this year one file next, I'd consider it.
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We took an Alaskan cruise--I highly recommend it!
We stayed on a small ship with a library instead of a casino--just my style.

Vickifool
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It's too bad we don't know our exact exit date. It would make planning for retirement a whole lot easier! <grin!>

Artie


I'm reading a book called "Machine of Death" about a machine that will tell you your cause of death.

Not the date, unfortunately.

Vickifool
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SG, do you cover this in your retirement book for engineers?

Sorry, Alstro. I retired at age 49 so SS was so far away it didn't seem worthwhile to research it in detail. Even then, I figured that laws and regulations were likely to change dramatically before I was in a position to do something. My coverage of SS in the book is pretty much restricted to information from the Official website of the US Social Security Administration. By the way, they have THE benefits calculator (http://www.ssa.gov/retire2/AnypiaApplet.html).

There are many problems with trying to choose a strategy to optimize SS benefits. First, you have to make assumptions about how long you are both going to live, how long you are both going to live healthy, and how the economy is going to treat your other assets during your lifetime.

If you both will live a long, healthy life and you don't need the benefits to enjoy it, then the best strategy is for you both to postpone as long as possible.

If you both get hit by a bus at age 63, then you would have been better off taking what your could get at age 62.

I think if you don't really need SS benefits, then postponing as long as possible is the best strategy. A large COLA'd guaranteed benefit is one of the best hedges against longevity risk you can have. If you planned your retirement to last to age 90 and you live to age 103, A healthy SS benefit is going to be very valuable. And if you don't live to age 70 but you didn't need the SS benefit to live the lifestyle you desired, then the loss of benefits really won't bother you . . . unless the duality and separation of the holographic universe turns you into a bitter corpse.
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...unless the duality and separation of the holographic universe turns you into a bitter corpse.

---------------------------------

I think that was unnecessarily mean spirited. And wrong.

Believing in an afterlife gives me a feeling of hope. It makes me understand why I am here. Obviously, what I believe doesn't need to be what you believe. But I don't think we should destroy each other's beliefs, either.

Is that what you want to leave as a legacy for your life here on earth - destroying people's faith and attacking them?
I sure hope not. What we do and say can influence people and make a difference, for good or for ill. Taking away a person's faith can leave them adrift, without a core and without hope. No one should destroy another person's beliefs.

"Cloud Atlas" is just a movie, but the synopsis basically conveys what is possible. And although I haven't seen it, it does say that one life can impact another, which I believe. Isn't that what Charles Dickens wrote about in "A Christmas Carol"? In many of his books? Man has been exploring the issue of our impact on each other for millennia.
Opening tomorrow, "Cloud Atlas"
http://www.imdb.com/title/tt1371111/
An exploration of how the actions of individual lives impact one another in the past, present and future, as one soul is shaped from a killer into a hero, and an act of kindness ripples across centuries to inspire a revolution.
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"Is that what you want to leave as a legacy for your life here on earth - destroying people's faith and attacking them?" - lindytoes


My experience with atheists has been that they seem to be very angry, negative, unhappy, sarcastic, mean, belittling, pejorative, and intent on making everyone else as miserable and unhappy as they are.

Personally I'm looking forward to seeing my mom again. I was 15 years old when she died and I miss her. I'll be 60 years old in a few months so it's been 45 years since I've seen her. I'm hoping she's there waiting for me in the light when it comes my turn to cross over.

Did ya'll see on last night's Big Bang Theory Leonard mention to Penny about the Holographic Universe theory?

Art
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trying to choose a strategy to optimize SS benefits

That's the thing. I'm not even convinced that collecting the max from SS over time is necessarily the wisest goal. I think greater income in one's 60s & 70s may be more valuable than greater income in one's 80s and beyond. I'm probably influenced by not expecting to exceed the ordinary life span. Also by observing my mother up close reduce her spending over time...now in her 80s, no more entertaining, very little travel, much less eating out, less frequent maid service and salon services, much less driving, less book-buying and more library, fewer movies and no more live performances, more aggressively seeking out discounts but less shopping otherwise--so she goes to 3 grocery stores for bargains, but rarely shops for anything else.

Studies--or maybe just one study--showed that retirees spend more in early retirement than later, although maybe that's simply because income tends to fall over time due, I suppose, to death of one spouse in married couples, unwise investing, over large asset withdrawals either every month or occasional lump sums, and unCOLAd corporate pensions. Maybe failing health keeps you closer to home, falling appetites has you buying two dozen Lean Cuisine on sale instead of restaurant meals or meat/fish, and canned soup or scrambled eggs for dinner instead of a traditional meal (at least that's true of my 80something mother).

Because of RMDs, many peoples' incomes jump when they turn 70*. And I think a GOP COngress will at least try to downgrade the SS COLA formula and refuse to up the SS tax to where it should be (I've read that if we had followed the Greenspan COmmission's plan to the letter, we'd already be taxing up to $180k in income instead of $110k or whatever now).

In practical terms, is there even a difference between self-funding for a year (3400-3500/mo to replace SS for us), then filing for SS, or filing asap and then having the option to pay that $41k back in a year and rebooting? I tend to think of rebooting as buying an 8% annuity (for $41k that pays $3300 the first year, then COLAd). I don;t have the math to know if that's a good deal, nevermind that isn;t it essentially the same investment to self-fund for the first year?

Am I making any sense?

* And another issue...conventional wisdom said to spend down taxable assets before IRAs, but I've run across recommendations to spend down IRAs to avoid unnecessarily large & taxable RMDs.
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My experience with atheists has been that they seem to be very angry, negative, unhappy, sarcastic, mean, belittling, pejorative, and intent on making everyone else as miserable and unhappy as they are.

Atheists/agnostics are not all the same, just like Christians aren't. And they have their moods, just like CHristians do. I have seen very nice Christian neighbors suddenly make hateful remarks about people who are different by race, religion, sexual orientation or political orientation. I have seen them stop saying Hi to me when they learned I wasn't one of them. If atheists in America are bad-humored at times, there is reason for it (so to speak-). I can also understand why Christians get cranky about everyone in America not believing with them or at least keeping their unbelief to themselves.

It can make one cranky to hear daily public prayers (does God care who wins a high school football game?) and that you're going to hell and are the cause of America's problems, and to hear any believers belittle the absurd dogma and ritual of others while seldom having any perspective on their own beliefs and practices.

I don't know if you're right about the reason for duality and separation, but I agree there is plenty of it! I like your beliefs far more than most because your beliefs are sweet and kind to all. I love my husband's boss because he's an evangelical who acts in a CHrist-like manner, good to all, not disparaging of any (save occasionally college administrators ;-)
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I used the AARP calculator. No matter what you enter, they give the same answer: higher earner files and suspends at 66, lower earner collects whichever is higher at 66 (their own benefit or 50% of spouse's), higher earner collects at 70, everybody lives fo-evah <eye roll>.. It's like a broken record.

I don't want to shell out massive amounts of savings until we're 66 and 70. More modest amounts, OK. Rebooting, yeah, maybe. One file this year one file next, I'd consider it.


That's been my experience too. It's likely because the 8% increase you get overwhelms the analysis. I'd guess the fee site will tell you something similar, but will maybe pinpoint the time frame better.

My feelings are similar to yours, not wanting to shell out savings. While the downloaded book leads to a similar conclusion as above, there is a chapter discussing not following it if you believe you can out preform the 8%, with funds you "save" by taking SS earlier. In my case, I want to leave an inheritance, so the best way to do so is to not use as much savings early. I also think by doing so, you'll have a cushion in case they make changes to SS that will affect current retirees collecting.
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That's the thing. I'm not even convinced that collecting the max from SS over time is necessarily the wisest goal. I think greater income in one's 60s & 70s may be more valuable than greater income in one's 80s and beyond. I'm probably influenced by not expecting to exceed the ordinary life span. Also by observing my mother up close reduce her spending over time...now in her 80s, no more entertaining, very little travel, much less eating out, less frequent maid service and salon services, much less driving, less book-buying and more library, fewer movies and no more live performances, more aggressively seeking out discounts but less shopping otherwise--so she goes to 3 grocery stores for bargains, but rarely shops for anything else.

Studies--or maybe just one study--showed that retirees spend more in early retirement than later, although maybe that's simply because income tends to fall over time due, I suppose, to death of one spouse in married couples, unwise investing, over large asset withdrawals either every month or occasional lump sums, and unCOLAd corporate pensions. Maybe failing health keeps you closer to home, falling appetites has you buying two dozen Lean Cuisine on sale instead of restaurant meals or meat/fish, and canned soup or scrambled eggs for dinner instead of a traditional meal (at least that's true of my 80something mother).

Because of RMDs, many peoples' incomes jump when they turn 70*. And I think a GOP COngress will at least try to downgrade the SS COLA formula and refuse to up the SS tax to where it should be (I've read that if we had followed the Greenspan COmmission's plan to the letter, we'd already be taxing up to $180k in income instead of $110k or whatever now).

In practical terms, is there even a difference between self-funding for a year (3400-3500/mo to replace SS for us), then filing for SS, or filing asap and then having the option to pay that $41k back in a year and rebooting? I tend to think of rebooting as buying an 8% annuity (for $41k that pays $3300 the first year, then COLAd). I don;t have the math to know if that's a good deal, nevermind that isn;t it essentially the same investment to self-fund for the first year?

Am I making any sense?

* And another issue...conventional wisdom said to spend down taxable assets before IRAs, but I've run across recommendations to spend down IRAs to avoid unnecessarily large & taxable RMDs.


One plan to consider is to take income from your traditional IRA and convert it to a Roth IRA up to the top of your tax bracket. Do this until you reach 70 (maybe beyond). This will reduce your RMDs (smaller pot), and allow you to manage income after age 70 with the Roth.

I agree with you that it's likely as you get older, you'll spend less. Already, I don't see us traveling as much (bad knees), and I've discussed the issue on other sites and most agree that expenses go down (health care may be the exception). RetiredVermonter is a living example who confirmed this in his retirement. If we're wrong about expenses, I know we can make adjustments if needed. The biggest adjustment would be to move to a lower COL area, if we haven't already done so.
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"The biggest adjustment would be to move to a lower COL area, if we haven't already done so." - akck


Any lower COL and I'd have to be living in a thatched roof hut in the Amazon Jungle with the Yanomamo Indians.

Or in a Van down by the river!

Artie
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I'm guessing this will confuse you further because I'm not sure about it either. I found it on this thread:

http://www.city-data.com/forum/retirement/1710765-those-conf...

Social Security Claiming Tricks to Maximize Payout:

http://finance.yahoo.com/news/social-security-claiming-trick...

Social Security a Catalyst for Money in Motion:

http://www.bankinvestmentconsultant.com/news/social-security...

When I get a chance, I'm going to run some scenarios to see if it's accurate.

To illustrate the complexity of social security, Meyer warned advisors of so-called “rat holes,” or periods of time during which people should never claim benefits. Individuals born between 1943 and 1954 should never claim benefits between the ages of 62 and one month through 63 and 11 months, nor should they claim benefits between 65 and five months through 67 and seven months.
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Individuals born between 1943 and 1954 should never claim benefits between the ages of 62 and one month through 63 and 11 months, nor should they claim benefits between 65 and five months through 67 and seven months.

Huh? I thought one's as-yet-unclaimed SS benefit goes up a steady 0.00666... a month (like he sez, 2/3 percent per month before full retirement age), which is 8%/year. What does he mean? And why apply this rule only to individuals, not couples? Because he assumes the older-and-of-course(!)-higher-earning spouse will do the apply and suspend plan?

I'd love to hear from more folks about when they started SS, and why.
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"Huh? I thought one's as-yet-unclaimed SS benefit goes up a steady 0.00666... a month (like he sez, 2/3 percent per month before full retirement age), which is 8%/year. What does he mean? And why apply this rule only to individuals, not couples? Because he assumes the older-and-of-course(!)-higher-earning spouse will do the apply and suspend plan? I'd love to hear from more folks about when they started SS, and why." - alstromeria

---------------------


And what if you are big and fat and don't think you're going to make it much past your early to mid 70's? They are assuming that everyone expects to live to be in their 80's which ain't necessarily so? I come from a family that has the good sense to die at a fairly young age.

Artie
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I think that was unnecessarily mean spirited. And wrong.

. . . then we have a very different sense of humor.

But I have no desire to destroy anything for anyone. Don't let my jokes shake your faith whether you find them funny or not.
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My experience with atheists has been that they seem to be very angry, negative, unhappy, sarcastic, mean, belittling, pejorative, and intent on making everyone else as miserable and unhappy as they are.

Now see . . . I find that comment condescending and mean . . . the kind of thing someone who is angry, negative, unhappy, sarcastic, mean, belittling, pegorative, and intent on overusing their Thesaurus simply to type a revengeful post.

But, hey, if posting that makes you feel better, I'm all for it.
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I'd love to hear from more folks about when they started SS, and why.

I crunched the numbers until I was blue in the face and shriveled in the brain. It didn't matter. I've read different takes on what the "magic number" is: 84, 82, 85. Let's say it's 84, just for argument. That means you "break even" at 84. So if you live to 85, you've "lost" a couple bucks that you would otherwise have had. How much? Not a lot, not so much that you should worry about it for the next two decades, certainly.

Mrs. Goofy and I both stopped working in 2001 (she went back to work from 2003-2008, roughly.) But when she stopped, all income (except for investment dividends and interest) also stopped, obviously. That made me uncomfortable, so I decided to start taking SS at age 65 1/2, which was a bit over a year ago.

She is quite a bit younger than I (7 years) so she won't be eligible for a while. And when she becomes eligible, we'll probably hold off on her, since we have some money coming in, so hers can build. In the meantime, I don't have to see $4-5,000 a month fly out the door with no paycheck to replace any of it. It may not have been the most mathematically correct answer, but it gave us peace of mind to have something coming in, so that's what we did.

(For the record, my mother died at 90, my father is still alive at 92 - but then I have asthma issues, so I may not last as long. But that wasn't really part of the final calculation; it was more about "what gives us some peace of mind now.")
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"Taking away a person's faith can leave them adrift, without a core and without hope. No one should destroy another person's beliefs. "

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

Part of faith is overcoming doubts and questions. The idea
is not that everyone agrees or that there are proofs that
you can point at and say "Well see!!!".
There is uncertainty in life.
Why would anyone expect more certainty about death?

Howie52
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"My experience with atheists has been that they seem to be very angry, negative, unhappy, sarcastic, mean, belittling, pejorative, and intent on making everyone else as miserable and unhappy as they are.

Now see . . . I find that comment condescending and mean . ."

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

An individual's experience is an individual's experience.


Howie52
Why, I know one or two atheists who are quite even-tempered - sometimes.

One of the interesting lines from Alice in Wonderland revolves around
Alice's discussion with a caterpillar - where temper is used in
terms of anger as well as in terms of "staying in proportion".
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"Mainly...
(1) When to start collecting.

But also...
(2) Whether to reboot after a year, paying back the first year's benefit.

And...
(3) Whether to complexify things by one of us collecting immediately and the other delaying (I note that we are very close in age, 5 months apart, and that my benefit is 70% of his)."

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

DW and I are in the situation where she does not qualify for
SS on her own. So the decision is when do we start receiving
the SS under my work record. We have talked about it and plan
to try to wait until I'm 66 before starting. However, if we
find we need the funds we will start when I'm 62 or later.
Right now we expect that my current work will stay alive for
another year - maybe two. There is a chance that it can stay
afloat for 4 or 5 years.
I think the issue is not really about optimizing - it is about
living. If you need the funds, you have to try to get what is
available. What is needed becomes the question - and an
individual's circumstance defines that answer more than what
might be more or less efficient.

Howie52
Not known for being a great help.
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Whoops, correction(s) needed.

I said I started talking SS at 65 1/2. Don't know where that came from, but it was at 62 1/2. I've been getting it for nearly 3 years.

And if I had it to write over again, I'd say something like: even if the 'breakeven' is 84, suppose you live to 90. You've "lost" 6 years worth of increases, but I submit that the money is better used when you are younger, more active, more able to use it to travel, for entertainment, etc. As you age (especially past 85, in my experience), your world tightens. Foreign travel is a chore, entertainment mostly consists of getting together with friends for a meal, or perhaps watching television.

Now other people may have different experience, but based on my parents, Mrs. Goofy's parents, and others we have known, I think I'd rather have a few extra bucks now than worry about having a few less when I'm 87. (Of course I intend to have plenty enough to get into a retirement home, but then your world diminishes even more.)
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Art, I told Marian the last time I talked with her about my arthritis. About 15 or 16 years ago, my orthopaedic MD said I had a "medium" case of arthritis in my left knee and a "small" amount in my right knee, showing me the X-rays. She prescribed a Rx, however, I never took it. Instead, I started taking an exercise which she also showed me. For the past 3 years, I have been taking 4 1200 mg. of fish oil per day. The important numbers on the fish oil are the EPA 350 mg. or 1400 mg. per day and DHA of 240 mg. or 950 mg per day. To make a long story short, I have no problems with my arthritis. In fact, when X-rays were taken this year, my arthritis has not progressed from 15 years ago.

I understand yours is in your back. Do you take fish oil? If not, I highly suggest it. It never hurts, says my MD. And, it might help.

Donna
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SG: Don't let my jokes shake your faith whether you find them funny or not.

<sneer> Your feeble attempts at humor make me laugh.

Count Upp
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"Mainly...
(1) When to start collecting.

I started collecting at 67. The Countess is somewhat younger than I am. We plan to start her at 62 1/2. When I croak, she will be stepped up to my rate in any case.

Count Upp
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"I think I'd rather have a few extra bucks now than worry about having a few less when I'm 87." - Goofyhoofy


Oh God! I hope I'm long gone from this world by the time I'm 87! I hope my ashes have been scattered and 12 years have all ready passed by.

And I agree with the rest of your premises in your post. My plan is to start social security when I'm 62. Who knows there might even be an Alaskan cruise in my future! I think Lindytoes would enjoy that!

Art
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"I understand yours is in your back. Do you take fish oil? If not, I highly suggest it. It never hurts, says my MD. And, it might help."
Donna



Donna thank you for your concern. I might try it. In fact I think my wife might have or take fish oil capsules. The first time it repeats on me though it's over.

Art
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Donna thank you for your concern. I might try it. In fact I think my wife might have or take fish oil capsules. The first time it repeats on me though it's over.

Art


Try Fisol or Super Fisol--they're enteric coated so they don't repeat. I tried the repeating kind and couldn't stand them. These have never repeated.

http://www.amazon.com/Natures-Way-Fisol-Fish-Softgels/dp/B00...

Karen
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Huh? I thought one's as-yet-unclaimed SS benefit goes up a steady 0.00666... a month (like he sez, 2/3 percent per month before full retirement age), which is 8%/year. What does he mean? And why apply this rule only to individuals, not couples? Because he assumes the older-and-of-course(!)-higher-earning spouse will do the apply and suspend plan?

I ran my numbers as if taking SS each year from 62 to 67. The only thing I could discern was that taking it at 64 had the break-even point with age 62 occurred a little earlier than the other years. I just checked whole years, so I didn't test the 67 and 7 months. Oh, I just realized a flaw in my analysis. I forgot to inflate each benefit starting point. I don't think it will change the analysis much, other than having break-even points occurring earlier.
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Art, I buy Sundown or Nature's Bounty fish oil capsules from Kroger when they have them buy one get one free and on senior discount day. I'm not sure I have ever seen them not be on sale so it is probably one of those pretend sales. I never have any trouble with repeat.

You could also check the price at Sam's Club.
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If you need the funds

If we kept our savings under the mattress, we could self-fund our desired retirement income for a long time, but we'd need to take 5%--wouldn't want to do that for long. What if we need assisted living later and couldn't afford it because we depleted our savings?

So..do we "need" the funds? I don't know how to answer that except to say Yes...and No.
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I think I'd rather have a few extra bucks now than worry about having a few less when I'm 87.

My thoughts as well, but in my usual unsure manner, I may wait till DH turns 64 and I turn 63 1/2 and stay open to the reboot the following year. Anyway, I may be chatting with Art (and any of you other short-timers ;-) in the Great Beyond by age 87.

PS--I learned this weekend that DD is pregnant, so even more to live for it seems!
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"PS--I learned this weekend that DD is pregnant, so even more to live for it seems!" - alstromeria


Supposedly Grandmothers are why we live so long.

The Evolutionary Importance of Grandmothers

"In the 1980s, Kristen Hawkes and James O'Connell spent time with Hadza hunter-gatherers. They noticed that the older women in the society spent their days collecting tubers and other food for their grandchildren. That was the proverbial fallen apple that sparked Hawkes' interest in the Grandmother Theory, which says that humans evolved to live so long because grandmothers were around to help take care of the young'uns.

The Grandmother Hypothesis goes further than to establish the importance of grandmas. In our early years as a species, the theory goes, older women helped gather food for their offsprings' offspring. In so doing, they were freeing up their daughters to have more children, more quickly. So the most evolutionarily fit grandmothers have the most grandchildren, to whom they pass on their longevity-promoting genes."

full article can be read @:

http://www.theatlantic.com/health/archive/2012/10/the-evolut...

Art
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Instead of buying DGS some winter clothing, I should've collected tubers!

=alstro, visiting DD & fam next week
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"Instead of buying DGS some winter clothing, I should've collected tubers!" =alstro, visiting DD & fam next week


Sweet potatoes and white potatoes and yams are tubers. Just buy him some of those? Close enough?

Art
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Sweet potatoes and white potatoes and yams are tubers. Just buy him some of those? Close enough?

Art


You are correct that they are all tubers, but sweet potatoes aren't related to the others. More a large vine than a small potato plant.

from wiki: The sweet potato (Ipomoea batatas) is a dicotyledonous plant that belongs to the family Convolvulaceae. Its large, starchy, sweet-tasting, tuberous roots are an important root vegetable.[1][2] The young leaves and shoots are sometimes eaten as greens. Of the approximately 50 genera and more than 1,000 species of Convolvulaceae, I. batatas is the only crop plant of major importance—some others are used locally, but many are actually poisonous. The sweet potato is only distantly related to the potato (Solanum tuberosum).

http://en.wikipedia.org/wiki/Sweet_potato
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I ran my numbers as if taking SS each year from 62 to 67. The only thing I could discern was that taking it at 64 had the break-even point with age 62 occurred a little earlier than the other years. I just checked whole years, so I didn't test the 67 and 7 months. Oh, I just realized a flaw in my analysis. I forgot to inflate each benefit starting point. I don't think it will change the analysis much, other than having break-even points occurring earlier.

I re-ran my numbers with an inflation equalizer and there there is an advantage to taking SS at age 64 over age 62. For me, taking SS at age 64 had the break-even point somewhere between age 73 and 74. For other years, break-even happened between ages 74 and 77. I don't see any advantage to taking it past age 67 and 7 months with my simple comparison.

In my original plan, I was taking SS at age 62. Now I'll at least explore taking it at age 64. The likely scenario I'll end up taking will depend on how my investments are doing at age 61 and each year following to age 64. There's a good chance I'll make it past age 74 so we'll benefit by waiting.
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"If we kept our savings under the mattress, we could self-fund our desired retirement income for a long time, but we'd need to take 5%--wouldn't want to do that for long. What if we need assisted living later and couldn't afford it because we depleted our savings?
So..do we "need" the funds? I don't know how to answer that except to say Yes...and No. "

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

There will always be uncertainty - but if you say "yes" then you
want to get the funds as early as you can.

But if you say that you could fund your retirement at a 5%
withdrawal rate - but not for long - then what is "long"?
Figure that the delta from 62 to 66 is 4 years - so is 4 years
"long"?

I figure to retire when I'm 64 - and expect to have funds set aside to
cover expenses till I reach 66.
Great expectations sometimes come to naught.
If naught comes to pass - I will not hesitate to draw on SS
early.

Everyone makes their own choice - cause everyone has a
different concept of living. Other folks can offer perspective
but the decision comes down to you.

Good luck and may you choose wisely

Howie52
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Here's another link about using a service to determine when to take SS:

http://www.cnbc.com/id/49627711?par=RSS
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Now, now, Art. Lindytoes might not be the only one interested. Shucks, maybe Astroe, her DH and I would be interested to.

Donna (who loves having a crowd of friends on long trips)
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