Taking social security early, at age 62

rkunsaw said:
Taking SS at age 62 is fine if you can afford it. I hear so many people complaining though about SS being their only or main source of income and how hard it is to get by. Many of them are among those who took it early.
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It I had stayed single instead of moving to the UK in 2000 I'd still be working and I'd probably work until at least 65, maybe 67. I would not have taken SS at 62.
 

I planned ahead of time at age 40 to take SS at age 62 as well as a pension and actually retire at age 58 by living on investment earnings for four years. Retirement is all in the planning and then carrying out your plan.
 
Ameriscot said:
It I had stayed single instead of moving to the UK in 2000 I'd still be working and I'd probably work until at least 65, maybe 67. I would not have taken SS at 62.
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This is so true and it seems many just don't think about that. I had retirement and SS plus savings and my property near paid off. I worked even though officially retired to pay off the home mortgage and for a while longer building savings for future living. Not sure if people can still to that as it seems there are just no enough jobs for folks to do these days. One of my retired time employers now only hires part time employees to avoid some of the newer cost pushed on them by the current government. Things like this need to be ended by removing lots of unnecessary rules and letting businesses run for profits and employee benefits rather than to please an overspending government. My opinion for sure.
 

I think it depends on your health and on the job you are doing. My husband just turned 63 and he will get his first SS check next month. However, he was doing very difficult and physical work. He is a Respiratory Therapist and was doing 12 hour night shifts. So we decided it made more sense for him at this age to cut back, and do some agency work. He is still allowed to make $15,480 a year without it affecting his SS benefit.

I on the otherhand, am NOT doing difficult or stressful work. I also love my job. I will turn 66 in January, which is my full retirement age. So I'm going to start my SS benefits in February and continue working. There is no restriction on earnings for me now. I hope to work another 2 years... at least until Hubby is eligible for Medicare. I know I will not want to work until I am 70.. and I see a benefit to collecting SS AND working. That is a lot of $$ coming in for a few years.. and since no one knows how long they will live, I figure it made sense to double dip for a few years. I also began collecting 3 small pensions when I turned 65. There are a lot of things I can do with the extra $. We also have a pretty substancial amount saved and when I finally retire, we will begin tapping that resourse.
 
I took my SS at 62, and it wasn't that much. ... but today, 9 yrs. later, as fate would have it, it makes no difference when I took it.
It just happened to work out that way... my husband died a year and a half ago, and I lost my SS, and started collecting his.
He didn't start taking his until full retirement age.
So collecting mine at age 62 didn't affect anything.
 
BobF said:
This is so true and it seems many just don't think about that. I had retirement and SS plus savings and my property near paid off. I worked even though officially retired to pay off the home mortgage and for a while longer building savings for future living. Not sure if people can still to that as it seems there are just no enough jobs for folks to do these days. One of my retired time employers now only hires part time employees to avoid some of the newer cost pushed on them by the current government. Things like this need to be ended by removing lots of unnecessary rules and letting businesses run for profits and employee benefits rather than to please an overspending government. My opinion for sure.
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I'm lucky that my husband planned well for retirement. I didn't even start to think about it until my 40's.
 
I am 63 now and undecided. We have a very good pension and I had over 30 years with the force. So, I am OK for now and with my wife's pension and 401(k), we are in decent shape.
 
There are valid points to Both taking SS early, and Waiting till you can get Maximum benefits. I suppose if a person knew exactly how long they would live, they could make the best decision. IMO...take it as soon as you become eligible. Besides, the way our government works, who knows how much longer this program will remain intact, in its present form. The actuaries say that SS funding is sufficient for another 25 or 30 years, but after that, who knows. In another year or two SSDI will hit a brick wall, and the government could use that as an excuse to "modify" all current entitlements, including SS and Medicare.
 
If you are still working at 62, check with an accountant or other tax professional to see how much of your social security will be lost to taxes if you still get a paycheck. If you take SS prior to your full retirement age, there are limits on what you can make without losing part of the social security -- and even if that is OK with you, you will still be stuck with the reduced amount the rest of your life. I elected to wait until full retirement age to take SS because I was still working.
 
Butterfly said:
If you are still working at 62, check with an accountant or other tax professional to see how much of your social security will be lost to taxes if you still get a paycheck. If you take SS prior to your full retirement age, there are limits on what you can make without losing part of the social security -- and even if that is OK with you, you will still be stuck with the reduced amount the rest of your life. I elected to wait until full retirement age to take SS because I was still working.
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My hubby just started SS. He is 63. We didn't realize that only half of your SS amount is taxed federally.. and we live in a state that does not tax SS benefits. Also, he is allowed to make $15,450 a year without is affecting his SS.. over that amount.. for every $2 you make over that amount.. you must give $1 of your SS back. I also will start my SS in January... I'll be 66 so no limits for me
 
My problem is I really like my job, and I have no idea what I will do when I DO retire. Aimless drifting and unplanned activities have never been my strong suit. I need structure.. I need to use my brain for productive measures, but I have to be on a deadline to move.. I have to have a goal. So I have put it off..
 
There are several considerations one must explore when planning for retirement....and they vary considerably from person to person. The way I see it...take the money when you have the opportunity, because it may not Always be there. I bailed out from work at age 59 with a nice buyout from the company. That sufficed until age 59.5 when I started taking a small payout from the IRA. Then, at age 62, SS kicked in, and between the company pension, IRA, and SS, we make as much, or more, than when I was working. Looking at how much I paid into SS over my working career, we have already gotten more out of that program than I paid in. If we live to be as old as our parents, we will get 3 or 4 times as much as I paid in over 35+ working years. Therein lies the problem for SS....as longevity increases, more and more people will be withdrawing far more than they ever paid in...and that will eventually spell disaster for that program.
 
SS does not pay out from how much you paid in. In other words... the money you paid is is long gone, having paid the benefits for those collecting SS while you were working. There are no savings accounts with our individual names on them. Our benefits are paid out of the FICA tax those working are paying now. There is a way to fix SS and make it solvent forever. That would be to raise the cap on the amount of income FICA is paid on. Right now, we pay FICA on the first $115,000 of income. If you make less than that, you are in essence paying FICA on 100% of your income.. while the millionaire is only paying FICA on a very small percentage of his income. Raise the FICA cap to $250,000 and SS will be funded with no problems.
 
Very true....the funding for SS has NOT kept pace with inflation, longevity, and this growing Disparity of Wealth. Raising the caps would be the Most Obvious solution...but convincing our "bought and paid for" politicians to tax the wealthy is going to be a long hard process. Instead, they hint at things like "means testing" in the future. Most young people are convinced that SS will not be a viable program for them when they get ready to retire in another 20 or 30 years, and they are increasingly skeptical about getting anything back from that program.

The litmus test will come sometime in 2016 when the funding for SSDI is slated to dry up. At that point, our politicians are going to have to do something with our social programs to insure their future...or they will cave in to their wealthy masters, and destroy the retirement prospects for millions of our people.
 
Even though I paid into the SS system for 40+ quarters- because I have a [small] pension from a county(public employer) I won't see a dime.
 
tnthomas said:
Even though I paid into the SS system for 40+ quarters- because I have a [small] pension from a county(public employer) I won't see a dime.
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I thought you had to be a federal employee in order not to be eligible for SS? My last 10 years working in the US (out of 17) were for the state.
 
A big problem with SS is the way folks think about it today. SS was never intended to pay for your way of life at all. It is sufficient to help you after you retire,nothing else at all. We are expected to think ahead and have some sort of savings plan while working, which means our savings, any retirement plan from the employers, then add in the SS returns based on income levels and amounts taken.

Otherwise, we need to just surrender to the welfare rules and that is all we get. Which for some seems to be far too much as they are often drunks, drug addicts, never working when possible, just dependents on the welfare systems.
 
Actually there is still a "salary" restriction. In the year that you reach full retirement age, they will take $1 from every $3 of SS over $41,480 (old figure, increased for 2015) if you continue to work.
 
LogicsHere said:
Actually there is still a "salary" restriction. In the year that you reach full retirement age, they will take $1 from every $3 of SS over $41,480 (old figure, increased for 2015) if you continue to work.
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That's not what the Social Security office told me... I turn 66 in January (my full retirement age) and will collect my first SS check in February of next year. I was told there was NO limit on earnings. Could you please direct me to that provision in SS.gov? I have looked everywhere in it and cannot find it. It just tells me there is no earning restriction after full retirement age.

This is what I found on SS.gov. Since I turn 66 on January 8th... this will not apply to me.. my 8 days of earning $ at 65 will not affect my benefits or exceed $41,400

You are already age 65 at the beginning of the year but reached full retirement age in August 2014. Your benefits are $800 per month. ($9,600 for the year) You earn $68,000 during the year, with $43,410 of it in the 7 months from January through July.
Your Social Security benefits would be reduced through July by $670 ($1 for every $3 of the $2,010 you earned above the $41,400 limit). After we deduct $670, you would still receive $4,930 out of your $5,600 in benefits for the first 7 months (January through July). You would get all $4,000 in benefits for the 5 months after you reached full retirement age (August through December).
Even though you earned $68,000, you would still get $8,930 of your Social Security benefits in 2014.
 
I am amazed whenever I read an article stating how little people are saving for their retirements, and their average net worth. Do some of these people think they will never grow old??? SS is just a "supplement" and was never intended to be the sole means of support. Those who are trying to make do on SS Only certainly missed the boat during their working years.
 
Don M. said:
I am amazed whenever I read an article stating how little people are saving for their retirements, and their average net worth. Do some of these people think they will never grow old??? SS is just a "supplement" and was never intended to be the sole means of support. Those who are trying to make do on SS Only certainly missed the boat during their working years.
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While I agree that some people just didn't plan Don, there are many more people that couldn't plan. People with incomes so low, or illness that wiped out savings or some other event or series of events that prevented them from being able to squirrel away money. Someone living at or below the poverty level most of their working lives can hardly be expected to have a diverse portfolio. Conversely, I don't think folks that were able to save and plan should be punished for doing so. This is why means testing is so unfair. Once you add means testing to the mix, SS becomes a welfare program. It shouldn't be.
 
QuickSilver said:
While I agree that some people just didn't plan Don, there are many more people that couldn't plan. People with incomes so low, or illness that wiped out savings or some other event or series of events that prevented them from being able to squirrel away money. Someone living at or below the poverty level most of their working lives can hardly be expected to have a diverse portfolio. Conversely, I don't think folks that were able to save and plan should be punished for doing so. This is why means testing is so unfair. Once you add means testing to the mix, SS becomes a welfare program. It shouldn't be.
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There are certainly people who never made enough money in their working lifetimes to squirrel away much in savings. But, there are an awful lot of these Boomers who lived their lives as if there were no tomorrow, and are just now waking up to the reality that retirement is just around the corner. There were a lot of them who fell into the trap of thinking that House values would rise forever, and they lost their Butts in this recent downturn in the economy....and now, instead of having a bunch of equity in a house, they are deeply underwater. There are also a huge number of people in, or near retirement, that are carrying large amounts of Debt....mortgages, credit cards, vehicles, etc. Rule Number One for having a decent retirement is to Have NO Debt.

Means Testing would be a real slap in the face to those who worked hard and saved for retirement. Were that ever to become the norm, SS would...as you say...become just another Welfare Program for those who ignored the future.
 
In my situation, if I take Social Security at age 63, and therefore drawing less from my retirement savings, my break even point is at age 86,assuming the markets cooperate.


Taking less from your investments mitigates the sequence of portfolio bad returns that might occur early in retirement.


Sequence-of-returns risk involves the actual order in which investment returns occur. Typically, negative returns earlier in retirement have a more severe impact on your portfolio than negative returns later in retirement. That’s because your portfolio’s value is reduced by both negative market performance and any withdrawals you take to fund your day-to-day expenses. This means that a smaller amount is left behind to experience any potential future growth.
 
It would be fine to delay taking SS...IF a person knew how long they would live. However, IMO, a person can do just as well, perhaps better, by taking SS as soon as they become eligible. I have a statement showing how much I paid in over the years, and I passed the break even point after about 8 years, and now we am getting "other peoples" money. If we live as long as our parents did, we will get at least 3, maybe 4 times more than we paid in....heckuva good deal, and one of the reasons why SS may be in trouble in the future, as more and more people live longer.

Insofar as private investments are concerned...a person MUST educate themselves on how the Stock Market works, and monitor their investments or IRA closely, and be able to shift the funds around as the market conditions change. If they do so, they can stretch an IRA out to give a decent return for many years. If a person is lucky enough to find an Honest financial adviser, they can rest a bit easy, but most "advisers" are in it more for their commissions than the clients well being. Personally, I trust my own decisions, and follow the markets closely, and so far, so good.
 

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