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RHinCT analyzes,

<<How does it "re-exposed yourself to mortality risk"?>>

It is a wash for the individual who takes early retirement, but it might be risky for their spouse. A wife, for example, who gets more by taking half of her husband's benefit than her own, gets half of the reduced benefit from early retirement. If the husband dies before paying back and re-starting at the larger rate the wife is left with half of the reduce rate forever.


Actually, the surviving spouse can do the Withdrawal of Application by paying back all the SS benefits the husband collected before he died. She would then get the higher benefit.

However, since she would only get half the husband's monthly benefit (and in dollar terms, "half" of the increase of doing the Withdrawal of Application), this is one of the few cases where it makes more sense to buy an annuity from a commercial insurance company. See this link:

The husband in this example collected $103,685 in benefits after taxes and $17,393 in investment earnings for a total of $121,078 after taxes.

The wife could buy an annuity with a $500/month benefit (half the $999 increase the husband would get) for about $90,000 if she's the same age as the husband (70) -- meaning the Withdrawal of Application strategy still leaves the surviving spouse over $30,000 ahead.

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