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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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