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Subject:  Re: Study on early claiming of SS Date:  9/5/2018  5:48 PM
Author:  BruceCM Number:  20712 of 21407

In addition to the comments provided....

Once calculated, the PIA is the amount you'll receive if you begin benefits for the month you attain your Full Retirement Age, or FRA. The FRA is determined by what year you were born, which for those born between January 2, 1943 and January 1, 1955, inclusive, the FRA is 66 years 0 months. For a table showing the FRA for the year of birth, take a look at

For each month you begin prior to your FRA month, the PIA is reduced by 5/9%/mo for the first 36 months prior to FRA. Months prior to this reduce the PIA by 5/12%/month. So for those whose FRA is 66 years and 0 months, the total reduction in the PIA for those beginning benefits at the earliest possible date of 62 years 0 months is 20% + 5% = 25% reduction in the PIA. Conversely, if you wait past your FRA to begin benefits, the PIA will grow by 2/3% per month up until the month age 70 is attained and then it stops growing, other than by annual COLA adjustments.

If you elect to continue to work, for an employer or self employed, between age 62 and FRA, be aware that if your EARNED INCOME (salary and/or net self-employment income) is greater than $1,420/month for 2018, you will lose $1 of benefit for every $2 your earned income is over this limit, at least until you get to the year your reach your FRA, then the earned income limit jumps up to $3,780/mo and the penalty is reduced to a reduction in benefit of $1 for each $3 over this limit. At FRA and older, there is no benefit reduction for any amount of earned income.

Technically, the SS benefit is a form of social annuity with a potential survivor benefit, with the actual benefit to the worker and possibly the spouse of the worker, determined by the amount paid into it over one's working years. It is not a savings account and has no 'cash' or 'residual value' as a life annuity might, although some financial planners like to treat it as such in their calculations. But like an annuity, it will pay benefits indefinitely as long as you live, but if you die prematurely and have no qualifying spouse or dependents, any 'unused' portion of what you paid in over your working years is lost as is the case with a life annuity.

Its important not to confuse SSI with Social Security. SSI = Supplemental Security Income which is a form of welfare payments to those 65 and older of low income and low net worth. SS administers it but it is not part of the SS trust fund.

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