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When to take Social security

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  • #16
    You don’t wait until 72 because that doesn’t increase your benefit. Even when you take into account rmd at age 72 now, don’t delay past 70 because you don’t get more SS by doing that

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    • #17
      Larry Koltikoff has a book about this called Getting What You are Owed. He also sells a software program. He is the guy who developed the Maxi-Fi planner.

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      • #18
        Originally posted by Hatton View Post
        Larry Koltikoff has a book about this called Getting What You are Owed. He also sells a software program. He is the guy who developed the Maxi-Fi planner.
        The emotional issue is in the mid sixty’s “deferred gratification” until your 80’s. Even then, it’s a marginal impact since it’s a graduated scale. The marginal utility $25k per year in the 60’s vs and additional $10k in the 70’s and 80’s. That is a two personal survival, possible benefits changes, and healthcare forecast 20+ years in the future.
        And, it’s irreversible.

        No one has mentioned it. There is a potential GUILT factor. Suppose those early funds were “tagged” for one international trip per year. Husband and spouse see the world in their mid to late 60’s. Oh the trips and experiences foregone to have more income in their 80’s and the lower earning spouse passes sooner. For some, delaying will result in GUILT. Throw in conservative tendencies for sequence risk in investments and the potential for for guilt and not simply spending is a behavioral finance issue. Not just a math problem. I find it much easier plan for one than two emotionally. The math is easier. It’s life’s unknowns. I’d hate to think “if only we would have .....”. Of course if you are doing all the “ifs” anyway, that’s a different story. It’s not really a numbers problem. I’m leaning towards not shooting for a higher marginal return in our 80’s and 90’s but following the claiming spouse earlier.
        Why? Don’t plan on saving for retirement in my 80-90’s!

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        • #19
          You can buy a longevity policy on the open market. The cost for a commercial policy is far more than having the older, higher earning spouse defer Social Security until age 70. For an inflation-protected annuity with a credit rating as strong as the federal government, arguably the deferred retirement credits are mispriced (quite under priced).

          Larry Kotlikoff makes a pretty good point that you aren’t just planning for average life expectancy. You’re planning for the possibility that you’re part of the cohort that lives past average life expectancy.

          If a couple both lives to age 65, odds are better than 50:50 that at least one of them (usually the wife) will live past 90. If your spouse’s own social security check would be less than half of the higher earning spouse’s check, don’t hose your spouse by claiming early.

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          • #20
            Originally posted by Steven Podnos MD CFP View Post
            If you don’t need the money and can invest the after tax payments, this pushes out the break even point for waiting till 72 much older. In addition, I have a very strong opinion that benefits will become 100% taxable and possibly reduced for those of means.
            It’s extraordinarily unlikely that there would be a reason to wait until after age 70 to draw social security, at least under current law.

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            • #21
              Originally posted by Hank View Post
              You can buy a longevity policy on the open market. The cost for a commercial policy is far more than having the older, higher earning spouse defer Social Security until age 70. For an inflation-protected annuity with a credit rating as strong as the federal government, arguably the deferred retirement credits are mispriced (quite under priced).

              Larry Kotlikoff makes a pretty good point that you aren’t just planning for average life expectancy. You’re planning for the possibility that you’re part of the cohort that lives past average life expectancy.

              If a couple both lives to age 65, odds are better than 50:50 that at least one of them (usually the wife) will live past 90. If your spouse’s own social security check would be less than half of the higher earning spouse’s check, don’t hose your spouse by claiming early.
              You are factoring in spousal benefits, valid point. I am concerned about benefits while we both are alive.
              My spouse won’t allow me to “hose her”. Both checks are “hers”, it’s a question of how much. She decides how much ramin noodles, rice and beans I get. Three times a day if necessary. That family decision is implicit if either one takes SS before 70. No need to ask the question. She probably has a can of “whoop ass” in the pantry. Whatever I choose, I will bear the consequences. She will not be hosed.

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              • #22
                thanks for all the responses. the calculator said for father to wait til 70 and for mother to claim retroactive to August 2019. with mothers benefit so small i suspect it doesnt matter much , but father will definitely wait until 70.

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