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I am currently working but only making approximately $30,000. I am 62. Is it wise to collect social security now or better to wait until I am 65 and going into full retirement?
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I am currently working but only making approximately $30000. I am 62. Is it wise to collect social security now or better to wait until I am 65..

How long to you intend to live and how badly do you need the money now?
If you start now, you will be about 81 before the total amount received would have been more had you waited.
You can go by your own state of health, and how long your parents were at death, if they died a natural death. Best wishes, Chris
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I think Crosenfield has made a mistake, or at least not been clear. Someone aged 62 who continues to have earned income is subject to the 1 for 2 clawback over the $10,700 limit or whatever it is. This is discussed on the Fool somewhere, I am too lazy to find the numerical example. So someone earning $30,000 will probably see all the SS clawed back. That's the lack of clearness I'm thinking of. Furthermore, I am pretty sure that the 20% reduction for "starting" early is permanent.
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JABoa writes:

<<Someone aged 62 who continues to have earned income is subject to the 1 for 2 clawback over the $10,700 limit or whatever it is. This is discussed on the Fool somewhere, I am too lazy to find the numerical example. So someone earning $30,000 will probably see all the SS clawed back. >>

You can find that example in my article on the forfeiture and taxation of Social Security at http://www.fool.com/retirement/retireeport/2000/retireeport000320.htm. And it is quite possible that the entire benefit could be lost when someone earns $30K.

<<Furthermore, I am pretty sure that the 20% reduction for "starting" early is permanent. >>

Well, yes and no depending on the earnings involved and how long the forfeiture continues. As I said in a subsequent article, "...the loss of benefits through work could actually result in your receiving a higher benefit later. If you take a reduced benefit at age 62 and lose part or all of that benefit because of work, then at your full retirement age (65 or older depending on your date of birth) the Social Security Administration (SSA) will recalculate your benefit based on the number of months you forfeited the reduced benefit by working." In theory, you could lose all the months between age 62 and full retirement age. In that case, all those months would be added to your original retirement age of 62, and no reduction would occur.

Regards..Pixy

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But most of this is now moot. Clinton just signed the bill that ends the clawback of benefits if you have earned income, which is retroactive to 1/1/00.

Thus the only thing to calculate is the early retirement cut in benefits.

jbw
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JBW writes:

<<But most of this is now moot. Clinton just signed the bill that ends the clawback of benefits if you have earned income, which is retroactive to 1/1/00.

Thus the only thing to calculate is the early retirement cut in benefits.>>


Au contraire, mon ami. That law applies only to Social Security recipients who are age 65 or older. The forfeiture still applies to those who take the benefit and work between the ages of 62 and 65.

Regards..Pixy
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If you choose to wait until 65 to start drawing Social Security, you will leave $30K-40K on the table. Now, if you start at age 62 and you are able to invest that money rather that having to use it for living expenses, your annual earnings from the invested money plus your pension ammount at age 62 would be close to what you would get at age 65 and you still have the $30K-40K working for you----Forever. This would mean you would probably have to cut back some on your current work, but that can't be all bad. I did this and it worked out great for me. You'll have to do the math for your particular case but I'll bet it will be worth the effort.----Saml
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do not take early SS. Its not worth the income when you consider that you will be receiving this lower income for the rest of your life. ALSO REMEMBER THAT YOU CANNOT RECEIVE MEDICARE UNTIL YOU ARE 65 !!!!!!
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take the money now. you will have to live to be about 80+ to lose a dime. in the meantime, our idiots in washington will probably find a way to piss away all the funds available to pay you. a bird in the hand may be messy- but it is a bwtter mess than washington can create.
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When I did the math for myself I found that taking SS at 62 and investing the money (even at a 5% return in a bank CD)came out way better than any other scenario. The trick is to not spend the money, invest it, and pay the taxes out of earned income. Plus too many of my friends have been dieing before 65, they'll never see a dime.
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if you feel good at 62 why quit work, unless ofcourse you work for a idiot or you just plane hate your job. working keeps your wheels in motion and gives one a sence of worth.i hope you are not going to be all tied up watching your grand kids if you quit work, i say "work until you really hate going to work". tom w
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Only you can answer the question. Your local SS office will tell you in detail how much you would have now, how much later. If you start at 62, naturally, you get less/month -- if you wait until after 65, you get more, but not that much, compared to the value of your free time. With the new SS waiver on the amount you can make , the picture is altered somewhat. My local SS office was splendidly helpful; I encourage you to give them a visit. -- Charles Elliott (retired )updoc1@excite.com
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