Social Security Timing: Age 62 vs 70 to Maximize Retirement Income
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- เผยแพร่เมื่อ 27 มิ.ย. 2024
- ✅ FREE RETIREMENT ASSESSMENT ✅ freeassessment.foundryfinancia...
In this episode we dive deep into one of the most important decisions you'll have to make as you approach retirement: When to start taking your Social Security benefits.Navigating Social Security can be overwhelming and understanding how your claiming age can dramatically affect your lifetime benefits is crucial. We'll break down the options - claiming at 62, full retirement age, or delaying until 70 - and explore the advantages and disadvantages of each.Remember, there's no one-size-fits-all answer to this complex question, but being well-informed can make all the difference in your retirement planning.
This chart will help you see the exact percentage changes for your birth year: www.ssa.gov/oact/ProgData/ar_...
You can get your Social Security report here: www.ssa.gov/myaccount
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Private Facebook Group // / retirementforum
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ABOUT ME
I’ve always been passionate about personal finance, investing, real estate, and helping people find the freedom to live their life with purpose. But when my dad died in 2015, I tried to help my Mom find an advisor to sort out her finances. Instead of a helping hand, I found an industry of financial advisors dominated by glorified salespeople working on commission - pushing products that were not in my mother’s best interest. Or advisors with minimums that shut-out all but the ultra wealthy.Disappointed with the options, I took matters into my own hands and launched Foundry Financial, a wealth management firm with transparent pricing that specializes in helping provide clarity around money - so you have the confidence to make smart decisions.My goal is to help a million people retire without worry!
📅 THE BASICS OF RETIREMENT PLANNING
Retirement planning has several steps, with the end goal of having enough money to quit working and do whatever you want. Our goal is to help people master retirement and retire without worry.
Step 1: Know when to start retirement planning. When should you start retirement planning? The earlier you start planning, the more time your money has to grow. That said, it’s never too late to start retirement planning. Even if you haven’t so much as considered retirement, don’t feel like your ship has sailed. Every dollar you can save now will be much appreciated later. Strategically investing could mean you won't be playing catch-up for long.
Step 2: Figure out how much money you need to retire, The amount of money you need to retire is a function of your current income and expenses, and how you think those expenses will change in retirement.
Step 3: Prioritize your financial goals. Retirement is probably not your only savings goal. Lots of people have financial goals they feel are more pressing, such as paying down credit card or student loan debt or building up an emergency fund.Generally, you should aim to save for retirement at the same time you're building your emergency fund - especially if you have an employer retirement plan that matches any portion of your contributions.
Step 4: Choose the best retirement plan for youA cornerstone of retirement planning is determining not only how much to save, but also asset allocation. It can make a massive difference in your retirement plan.
Step 5: Select your retirement investments. Retirement accounts provide access to a range of investments, including stocks, bonds and mutual funds. Determining the right mix of investments depends on how long you have until you need the money and how comfortable you are with risk. It’s often helpful to talk with an adviser to discover the right mix of stocks and bonds.
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⚠️ "DISCLAIMER:⚠️This is not financial or investment advice. This Channel is meant for EDUCATIONAL AND ENTERTAINMENT PURPOSE only. None of this is meant to be construed as investment advice, it's for entertainment purposes only.#retirementplanning #retirement #passiveincome
When are you going to take social security?
70
It depends.
67 to 70.
Every 6 months I "rebalance" my decision just like portfolio adjustments.
Look at the factors that matter to me and then decide.
If still working then work another 6 months and decide again.
I might work to 72 or 74 if my health is good and I enjoy working. Maybe longer. Maybe less. Every 6 months I check in.
Latter is key.
Only 2% to 5% in these RETIRE AT 62 TAKE MONEY AND RUN!! comment threads enjoy work.
98% of you HATE WORK and stop asap.
I do not share your values.
At 62, I ain't waiting till 70. Hopefully next year
when I decide to stop working probably between 62 or 65. Many people die before they can breakeven at 80
62 case closed! Suppose your health declines during those years. Take it when you're still active.
I was lucky to have had a government job that allowed me to retire at 60 years old. With a small military disability my health care was covered by the VA. After 10 years of retirement, I am glad I chose to retire at 60 drawing SS at 62. I had ten great years of travel. Now at 70 it's not as easy physically traveling as when I was 60 years old. You do not need as much money as you think.
I talk about this in another video. Many advisors and retirees actually overestimate what they’ll need because spending looks like a smile - it’s not static.
I am happy for you! I think we do 'retirement' all wrong in this country. What is the point of killing yourself for 40 years straight to then be too old or sick to enjoy yourself? We should design our lives around significant breaks to travel and explore and enjoy ourselves while we still have the health and mental capacity to enjoy ourselves.
Excellent! I’m 58 and currently semi retired. I have been involved in sports and fitness all my life. In semi retirement, I became a certified personal trainer. I would strongly urge everyone to take their health and fitness seriously also. The financial component is very important, but it’s importance is greatly diminished without your health and wellness. 60 can be the new 50 or 45 with a well planned and well executed wellness and fitness program. Good luck to all.
My M.I.L retired at 68. She passed away at 70. My husband originally wanted to retire at 67. Since his mom passing. He wants us to retire at 62
Yeah, that makes sense. I have another video about what you should retire sooner rather than later. One thing I’ll add - taking Social Security later isn’t synonymous with retiring.
😊😊I calculated my best retirement income based on MY situation. I retired at 64 years+3 months. I calculated my lifetime pension, my employer provided 401k, my salary increases, the retirement insurance costs, etc. The break even point for me is calculated as 84. After 4 years, I still think it was the best decision. ❤❤
Congratulations on retiring!
I find this video, fair and informative. I am going to link it to another YTbr who just advocates that people retire at 62. As you said, it is far to complex for YTbrs to give precise advice to people. You did however cover many of the points to consider. Good Job.
Thanks. I think it’s impossible to have a static answer for everyone. So many variables.
My original plan was to work until 70 (my current age) because I enjoyed what I was doing and the people I worked with. That changed when it became harder to keep up with current technology. Also, some of my co-workers became a little too vocal about politics. So I stopped working shortly after my 68th birthday and lived on savings until I started Social Security at 70. Due to my income, it was never a great time to convert my IRAs to Roth accounts so I'll have to live with the tax hit once RMDs start, but all things considered I'm very pleased with my current situation and optimistic about the future.
Good thing is you don’t have to take your RMD until age 73
@@Satjr35031 Yes that's an option. But for us it's a bit of a mixed blessing. If we don't withdraw some money and the market has a couple good years, we may end up in the next highest tax bracket when we turn 73. So far it looks like we won't need to use any of the IRAs so we're withdrawing a little and investing it in other financial vehicles (and splurging a little too 😄).
Keep in mind that if you wait until full, your cola increase will be even more year to year.
I waited because I love working. I didn't want the work penalty. Now I can make as much as I want with no penalty.
I'm a residential contractor.
I'm very healthy and in great shape, that helps.
If you wait until you're 70 to take social security, by age 92 your nursing home will be making a lot more money from you than if you had taken it at 62.
I believe the most important part of this decision is, what is your debt? My wife and I retired early, because other then our $515.00 mortgage, we have zero debt. 20 acre hobby farm with woods, fields, 2 ponds and a 100 year old restored barn. We are busier and happier now then ever. Debt controlled most of our decisions earlier in our lives. Pay it all off and it will free you.
Your farm sounds lovely! I have a dream of buying our old family farm in New York. They sold it off years ago and I want it back in the family.
Brilliant video! Thank you!
Thanks, Mario! I appreciate your kind words.
Great video, really well done. I’ve seen a number of similar videos, but this one seems the easiest to understand, which can empower the viewer.
Thanks so much. It’s tough explaining, because the numbers move around based on the year you were born - but I wanted to at least provide a framework for thinking through it.
Fantastic video!
Thank you very much!
Great video - very useful analysis. Roth conversions are worth looking into for sure.
Thanks! Without conversions if you have a lot of money in a 401k or Traditional IRA it makes it harder to control income.
nicely done. clear, concise, hit a lot of the big items. I especially liked the Roth conversions, and even more, the potential to take profits tax free in years after I retire that I have no income.
you really have to manage this process. it's like an octopus.
Thank you very much! I'm glad it was helpful. I couldn't have said it better myself -- you have to manage it and it has a million tentacles. There are so many tiny things that you can tweak and adjust to maximize tax savings, etc.
This is where I slip in with the sales pitch, "And that's why you should hire an advisor. If you sign tonight I'll throw in some steak knives." :) I'm actually going to do a video soon on some DIY software that I'm going to make available for free to help you model out some of this stuff on your own. It's really quite surprising how much you can save in taxes if you manage it right.
Good advice!
Great info.
Subscribed
Thanks! I really appreciate it.
Great video, thanks. One factor to also consider is the SS penalty you pay if you retire before your full retirement age (67, for me). If you make over $21,240, for every $2 you make, $1 is deducted from your SS benefit. Add to this, that in the US, health insurance is tied to your job, which means that if you don’t continue to work until age 65, you won’t have Medicare and will have to spend a lot for basic healthcare.
For me, then, I will work until at least age 65, and then will wait until 67 to take SS.
You laid out, very clearly, the differences of retiring at different ages. However, you have to make sure that you are covered for health emergencies, as they are more likely the older you get, and are capable of disrupting most of your retirement savings if you don’t have continuing health coverage after you stop working.
Great comment! I’m going to do another video on some of the other considerations. There are some many variables and I was trying to keep it simple. Eventually I’ll put together a social security playlist.
Great content thanks 👍
Just subscribed
Thanks!
Thanks
No problem! Hope it was helpful.
70, which is about 1.5 years away. I retired at 50. Both my parents are in their late 90s and doing pretty well for that age. I have used every year of retirement to either sell appreciated stock or do Roth conversions. I was lucky to have decent tax diversification when I retired and it's even better now. Everybody's situation is different but I am glad to have waited.
Doug, it sounds like you managed it quite well!
I wanted until age 70 and I’m glad I did. Thanks for the video.
Thanks for watching and leaving a comment! I appreciate it.
people dont think of the tax advantages of waiting for 70...besides....why worry about the short term...ss lasts as long as you do....
Great content. You might advise your viewers that you can beginning taking ss at any time between ages 62 and 70. For example age 64 or age 65.5 so people don’t feel if you skip past 62 the next stop on the train is not until age 67 😊
That’s very true!
The biggest thing that has my husband and I concerned is the 2034 possibility of Social Security being cut around 20 percent So we don’t want to pull it till 70 to get what we would get at around 67. So we’re going to try even if he retires early to fund our retirement through pension and side hustles so we don’t have to pull Social Security till 70 because nobody’s coming up with any Information to show that we won’t lose that 20% Nobody really knows. It’s kind of scary. I know people that retired at 62 that don’t think their retirement will get cut because they’re already pulling it. They don’t realize that everybody will be cut if this comes to pass. What are your opinions on this? I just found your channel I don’t know if you’ve done a video on this before but I’m going to go check out your other videos now that I found you and subscribed! I really enjoyed this video, thank you very much , I found it very interesting!!
Thanks for your kind words.
My guess is that it’s very unlikely benefits will be cut. It’s more likely taxes will be raised or we’ll print money (causing inflation). Both are less politically painful than cutting SS benefits…but nobody knows for sure.
Retirement is as much about personal philosophy as it is the numbers. Dollar wise it pays to work as long as possible,but a lot of people dont want to do that.
This video laid that out pretty well.
Thanks!
I want to take SS at 70 because I already have full SS credits and I currently work at a city with a city pension plus a Texas Retirement System plan as well. The longer I work at my city job the bigger my two pensions will be. I will have no offset once I start taking my SS. So I want to file for SS at 70 plus I want to keep working as long as I can. Why? Because at my city job I get three weeks sick time plus over three weeks vacation time plus nine paid holidays plus my health insurance is free because I get HIPP because of an autistic son I take care of. I am 60 with zero debt, paid off house etc….and plenty of cash for emergencies like a new car paid in cash or home repairs. I also have two IRA retirement accounts. With hyperinflation getting worse I think it’s safest financially to just work until I drop dead.
Great job!
Took it at 62 exactly. I dunno if i live thru 67. I am very happy. I pay $87 premiim health care insurance. I recommend take it while still healthy as long as you get med insure till 65.
Thanks for your comment!
So far plan is 67. I rate that as I reach 62 and rate that every 3-6 months. I'll be 60 before the year ends. My life expectation is around 84-86.
Very good explanation. When to collect SS is very hard to decide.
Yes, very true! I’ve got another video coming out on SS tax, which also needs to be considered.
I love reading the comments your info is right on the mark, I'm collecting at 62 because I'm mentally worn out, was a truck driver and just want to be home now. I have a small pention from the school district so I should be okay. Life's too short wife is quitting her job after I start collecting and we will finish building our house which we started 2 years ago and we have zero debt. That's why we sold everything to pay off debt and build instead. After that we plan to travel mostly the u.s. and cheap cruises. I'm really too old at 62 to care if I bearly get by just want to take it easy with my wood working hobbies quad fishing motorcycle and I love the casinos. Wish me luck ha ha thank God our health is great thus far. Hope to get original medicare red white and blue card and possibly supplemental g? And hopefully that will cover it all plus the drug part d. Keep up the good work we need you all to keep paying fica as we retire. The best day was 9 months ago when I said good by to my employer and I will never regret that decision after 42 Years in the work force continually I am finally free oh what a feeling of pure joy. 🎉🎉😅😊
If you can make ends meet then consider retiring as early as possible, even long before 62. The benefits of the retirement time when you are younger, fitter, and more active can be more valuable than additional money. Experiences can be more valuable than money. This only works though if you can afford it and that includes medical coverage.
I was lucky to retire at age 55 from a university with a generous COLA’d pension plan. I continued in their health coverage program as well. Later, at age 61 I moved to Thailand that has a much lower cost of living. Moving overseas can be one strategy, for some, to make ends meet in retirement.
Thanks, Marty!
Great video to review again and again!!! I’m within 9 months of retirement, trying to get all my ducks in a row
Thanks so much! Congratulations on your coming retirement. I have a new video coming out soon on SS and taxation you might want to watch as well.
I’m a new subscriber. I think what needs to be a factor is health. As we get older our health changes. I’m glad you’re addressing it. I’m pre-diabetic and I’ve been fighting this for the last six years, I’m managing it without meds, I’ve changed my lifestyle. I’m determined to stay healthy to take my SS at 67 and not 62. I’ll be 60 next year so I’ve got a long ways to go but I’m not sure I would wait until 70. This was a good video ⭐️
Hey Rhoda! Thanks for taking time to leave a comment.
Health is a huge component. I always tell people, not every decision can be made in a spreadsheet. Congratulations on managing your pre-diabetes without meds.
Someday I should do a video staying healthy and active. It’s such a big part of a successful retirement.
Retiring at 62 and taking ss at 64. Will be getting/taking 50% from husband. He earned well, I was a stay at home mom. 64 is the sweet spot for this scenario.
Health is my concern. When meeting with our financial planner the spread sheet was an eye opener. My income column went blank at age 83 the average life expectancy of male. 🤔
Glad that you’re handling it without meds. I assume a fitness plan is part of your strategy. You keep plugging!!
If your job is killing you, the answer to this is easy. Don't under estimate the effect of stress on your health.
I’ve got another video I’m working on called: 5 Reasons You Should Retire Now!
One gambit never mentioned:
-Work age 67 to 70 and collect SSA.
The added 35k x 3 years will boost retirement savings.
Then retire age 70.
Still 5 years of good health to travel.
5-10 slow years.
3 to 5 at end of life.
Sounds like a horrible fucking way to live . Hey work for 50 years to enjoy 10
Nice video, thank you! There's another factor you didn't mention, nor did I see it in the comments I read-- politics. I have a concern about additional measures congress may take to "shore up" the SS fund. It's possible they'll push out the age when one can retire. I think it's unlikely they will mess with the benefits existing retirees are receiving-- that's a great way to get tossed out of office. That's why I'm leaning toward starting benefits at 62-- to become one of those "current recipients" before there's a change that negatively impacts me.
That’s an interesting perspective and makes sense. There’s no appetite to cut current benefits, but it’s easier to cut benefits that don’t yet exist.
I applied this morning, 62 this September!
I want to maintain most of my IRA money so when the market turns around, I can actually make decent returns
Congratulations. You should watch the most recent video I just posted on the bull market.
turns around? the S&P just hit all time high yesterday
My situation is a bit better. Civil Servant with CalPers coordinated with Social Security. Almost 61 now, at 63 with 30 Years-of-Service: CalPers will pay 75% of Contract wages, Social Security will pay roughly 25%. My Healthcare is tied to my job, so I need to keep working until 65 until I'm eligible for Medicare. Two more Years-of-Service brings me to 80% from CalPers & about 28% from Social Security.
That’s a good situation! I need to do a specific video on different pension programs.
@2:41 The difference monthly is significant, but the opportunity cost of that difference is the $210k ... the 2187 a month for 8 years. At a 2000/mo increase, it will take 100 mos to break even, not figuring the COLAs on the 2187. The question becomes, are you going to live beyond 83, because the way I figured it, 81-83 is the point of convergence of all 3 retirement options.
Take it as soon as you can! You could die waiting for retirement age
Thanks for your comment.
With CD's paying around 5% I am able to lock in a guaranteed rate for a full year and delay taking SSI. It hasnt been this high since 2000 when it hit 6%. Like all things, it will eventually return to normal.
You could also look at multi year guaranteed annuities. (Not a recommendation.) These aren’t the typical annuities you think of, but more like a CD from an insurance company.
They’ll let you lock in rates for 3-5 years and typically higher than a bank CD. Not sure what current rates are, but they’d been around 6%.
@@foundryfinancial I am still a customer with the same bank that I purchased that CD back in the late nineties, Mid First bank of OKC, OK, the largest privately held bank in the country.
@@billyhorton5779 I remember Mid First Bank! I lived in OKC for six years.
A couple answers is needed is the break even points and also which state you live and do they tax your Social Security
Yeah, I’m working on another video that goes into the tax question, because that’s definitely a component.
Every time he said Susha-curry I took a shot of whiskey. I'm totally drunk now.
😂 you’re welcome for the excuse to day drink.
Tell me when I'll die and I'll tell you when I should take it. However, assuming I'll live into my 80's+, then the calculations to maximize Social Security say later is better. The big question, however is whether or not our government will ever fix these programs and will they change the rules and penalize those of us who have saved well for retirement to subsidize those who haven't. Currently, I plan to retire at age 62 and take SS at 70, but as mentioned in the video, there are a lot of factors to consider so this decision could change I suppose. Thanks for the video!
There once was a man who was wise He asked when to collect his prize At 62 he could start But if he waited, he’d be smart And get more money to his surprise!
😂 thanks for the limerick!
Another way to think about this decision is not the total lifetime benefits that you accrue but how much do you think you need or can get by with at each year of living. If you decide to start taking Social Security at age 62 then you may decide that the amount you get monthly at age 92 is sufficient.
That’s true, especially because expenses often begin to dip (minus healthcare and LTC).
Planning on age 67. Seems like the right time to actually use that money based on life expectancy.
I’ve got a video coming out that walks through tax savings from possibly waiting. Should be out Saturday. I’d love your feedback.
@@foundryfinancial Sure.
I’m taking it at 62. I retired at 58, since I don’t need SS I plan to invest the money, use some if I end up needing it but most will go toward investments. I’m also single so I don’t need to consider anyone else’s needs.
At some point I want to do a video on collecting social security early and investing it.
@@foundryfinancial That would be great. I looked at the break even point thought I could extend it further if I invested. I also thought if I waited until 70 and die at 69 my heirs get nothing. If I take it at 62 and invest I have something to leave them. If I was married my decision would be different.
the way I understand it (correct me if I am mistaken) Social Security also uses the best 35 years of income to generate your "payment"...So if you only worked for 30 years, there will be five years of zeros...or if you worked full time and decide to take time off to help a loved one (elder care) and make no money, that too will impact your payment. If you are taking care of a loved one long term, look into programs that will pay/stipend/supplement you to do that. My Aunt was "paid" $15 and hour (20 years ago) to be a care giver for grams and gramps...anyway these are things that should be considered because they factor into the algorithm.
You’re correct. So for some people they may need to work longer to max out those 35 years.
There once was a man who was old He wanted his benefits to hold At 70 he did wait And got more on his plate Now he’s happy and his story is told!
There once was an old fool who would save , now at 70 he now spends from the grave.
Social security sends out reports on your benefits every year.
What's left out of this calculation is the value in waiting. You get more money as you get older but you also become less able to do things that allow you to enjoy it. As you get closer to you life expectancy you want to spend, spend, spend, since you can't take it with you.
I have another video that just released on when you should retire. Retiring and taking social security are not necessarily synonymous.
The other catch, if you're already retired, is time in the market. The sooner you take SS, the longer you can keep invested money invested, since you don't need to withdraw it to cover expenses that SS is covering. And that invested money will continue to grow and compound.
For the people who already have a decent amount invested and don't need to rely on SS income, the break even point tends to be farther out in the future than SS actuarial tables would suggest due to being able to keep invested money invested longer.
I understand all that you shared. With that said there has to be someone or some entity that has put together a quantitive way to your key health markers (I.e. blood pressure, A1C, cholesterol, etc.)…and with those health inputs plus your nest egg, plus your social security at 62,
FRA, and 70…other income, Roth IRA…it would ‘spit out’ your most favorable benefit, based
on those inputs. If this
has not been done-surely
it would be a great insight
as to what retirement
avenue is most beneficial
when taking social security. What do you think???
That would be really nice! Great idea. Of course, I’ve seen unhealthy people live a long time and healthy people die early.
As I approach retirement, the biggest consideration for me is (a) how I want to live and, in service of that, (b) what I need to live that way. And my "visible horizon" is 5 to 10 years; anything beyond that is in the fog of the distant future. Certainly, I want to be able to live comfortably beyond that 10 years, and that's part of my planning and analysis, but I won't decide on when to take Social Security (or the annual withdrawal from my retirement account, whether 4% or 2.5%) based on an actuarial table and breakeven analysis; my father died at 49 and my mother at 95, so... who knows when my time will be up?
It sounds like you're approaching it the right way. I'm in a similar situation. My father died early, but my grandparents are in their late 90s -- so who knows. For me, the question would be - could I delay social security and possibly still retire. Sometimes you can use those early years to do ROTH conversions or work part-time, which would allow you to delay. But, the decision will be different for everyone.
@@foundryfinancial I'm in a niche category, as I have always lived modestly and have spent the last 20+ years living and working outside the U.S. (Ukraine, Germany, Costa Rica, Sri Lanka, Taiwan & Albania), teaching as a second career. This began with Peace Corps Ukraine in 2003, when I suffered from corporate fatigue and boredom and wanted to explore the world and make a difference. I plan to continue living outside the U.S. My current plan is to spend the fall of each year in Las Vegas* and the other 9 months in Albania*, using those places as launching pads for travel. I was able to contribute the maximum to my 401Ks when I had company jobs in the U.S. and have invested fairly (sometimes too) aggressively; at the age of 62, I'm now parked in index funds.
*These places make sense for me for myriad reasons -- Nevada has no state income tax and Las Vegas has a comfortable autumn climate, international cuisine, and an airport that flies lots of places -- and I'm not tempted by gambling. Americans can stay in Albania for a year without a visa, American flags fly everywhere for historical reasons, the climate is seasonal, but moderate, the landscapes and seascapes are exquisite, and the cuisine is influenced by Greece and Italy, which for me is a good thing. The cost of living is much lower than in the U.S. or Western Europe, and the latter is between one and three hours away by plane. Albanian doctors are Western-trained and have state-of-the-art equipment, but the cost of care is a fraction of what it is in the U.S. So it works for me.
At 5:20 you mention about being able to take out $ tax-free from a taxable account. Do you have another video on this?
Not yet. But, I have one coming soon. If you want to set-up a quick appointment I can walk your through it - no charge. I can do it in like 5 minutes. Otherwise the video should be out in the next month.
There monthly amounts assume we work (same level of income) until 67 or 70? Just came across your video. Very helpful info, thanks!
Thanks for your kind comments. Yes, although the formula for income is fairly complicated. I have another video coming out where I talk about how to maximize Social Security payments, but I spend some time really diving into how your PIA is determined.
@@foundryfinancial new sub here. Love the charts you shared. I plan to only work till 58 or 60 (many years away), start SS at 62…how much lower would the monthly estimates be is what I’m curious about. Thanks!
It’s the same bucket of money. Take it early and enjoy longer, keeping your savings for your kids. Take it later and have more but you have just run down on your saving! There’s no magic !
Of course that assumes you quit working at 62. Additionally, many people use the years without social security income and any other income to do their Roth conversions.
You ever suggest taking the SS supplement? Im hoping to retire at 58 (12 years away). Ill have 30 year in with the Post Office and under FERS the supplement is free. Great video!! -Todd
Thanks, Todd! I appreciate your support. I'm still new to TH-cam, but I'm enjoying it.
If you take the FERS supplement, you don’t have to start taking your Social Security retirement at 62. In fact, many retirees hold off so the SS amount will be higher. Either way, your FERS automatically stops at 62. Is that what you're asking?
@@foundryfinancial I think so...lolol...I'm trying to wrap my head around it all. My thoughts were to start the supplement at 58 then take SS at 62 then I'll also have a pension and my TSP (which needs work).
If you could bulk up your TSP and outside savings, it might let you delay past 62 and really increase the long term payout. The FERS supplement is a great perk.
If i got 1 million I would be able to make 100k/yr with interest alone and then wait until I hit 67 and haul in that full retirement check too.
How are you earning 10% interest without taking a lot of risk?
I retire next year at 61. My retirement plan shows that if I take at 62, I will lose $500k over 30 years and die nearly broke. If I take at 67, I will have more than I can ever spend (Monte Carlo 100%). SS should only be one element in your overall financial plan.
Congratulations on your upcoming retirement. I have video on the Monte Carlo analysis. It’s not perfect, but it can be helpful.
Individual people should know when they should take ss. Based on their own finances, I don't understand why they need for someone to tell them that.
Thanks for your comment!
One other consideration. Will your spouse receive your Social Security once you pass? Mine would not 😮 since both of us were government
workers and our earnings level. So I took it at 62 and it is our travel fund.
Congratulations! Enjoy the traveling.
We currently have our 401k with the Vanguard advisory management service. When I watch your videos, I wonder if I should get to a 60/40 or 50/50 investment spot and move to a financial planner like yourself. I need a better retirement strategy like the conversation to Roth you mentioned. What are your thoughts? Or do I need both?
I’d need a bit more information to help you make a better determination. Feel free to reach out and set-up a free consult. Just use the link in the description.
Banking on that you’re not going to die before 70, 80, 90. I’ve seen too many family and friends die in their 60s and never enjoy life in retirement. I’ll retire and start at 62
I actually have a video on why you should consider retiring sooner, rather than later. But, I’d add - taking social security and retiring aren’t always synonymous.
Hi. Fine video. How do capital gains of $100k per year from inheritance affect social security/retirement?
Depending on your total income, it could impact your taxation and what you pay for Medicare. Now, it will also depend on whether that inheritance is also a capital gain. You might want to talk with a financial planner about all of that.
At 30....35 find a Job or Career you love. You really enjoy. Then retirement is not an issue. A person has plenty of time off during the year. Waking up to "Everyday is Sunday" is not my idea of fun. Stay productive or you will die many years before should have.
What isn't asked enough, is how do you feel? Can you PHYSICALLY do the job anymore?
After being on my feet doing a fairly physically demanding( but well-paid union) job, I was
ready to retire on my own, before my employer decided (justifiably), to retire. Sometimes,
it isn't about the statistics.
Sure, but also - retiring and taking social security are not synonymous. In fact, for tax purpose it can make sense to retire before taking SS.
I understand that it takes approximately 3 months to receive your first social security payment. Since even months make a difference. Will the distribution amount be calculated from the date of application or the 3 months in the future when one receives the first payment ?
The distribution amount calculates your benefit based on your lifetime earnings, not the date you apply or receive your first payment. The 3 month delay is only for processing your application and setting up your payments. Is that what you mean?
If you are a single-owner S-corp contributing up to $300k
per year to your Defined Benefit Pension Plan that you will
begin withdrawing from at 70-1/2, you must pull $100k in W2
income in order to qualify.
Does this force you to postpone SS until age 70, or is there
a work-around?
Are you saying you have to earn 100k a year up to 70? If so, you could take SS at FRA with no impact. I’m not sure I fully understand what you’re trying to get around. Feel free to set-up a quick call.
62 - But it would be handy if we had an expiration date for our health and life... Just saying. In 20 years this amount will be worth so much less... idk... Thankfully I am not totally reliant on it like many are.
It would make planning so much easier!
@@foundryfinancial Right... LOL. Every day is a gift. Food , shelter , clothing and a few other thingies aren't guaranteed though. Hard times coming for a lot of people I fear.
Had to wait for full retirement at 66, but wasn’t receiving what your numbers show, mine was around 2.2K.
The numbers fluctuate for each person depending on wages and the year you were born. Just trying to give a framework for thinking through it. That’s why everyone needs to pull their own report.
The goal isn't necessarily to maximize your social security payment. The goal is to start social security at the best time/age for YOU! This will be different for every single person and will be dependent on MANY factors including your health, employment status, financial well-being and many other factors. There is no one size fts all solution. Understanding how to get the MOST MONEY is easy and we don't need anyone explaining that!
I’m not sure if you’re responding to my video or to other comments, but what you’re saying is the point of the video. As I state there are lots of considerations and there’s no perfect answer.
what about when medicare premium is in the equation? Also, how can those who are applying for spousal widow benefits off an ex's record able to know any income when ssa will not share their information? How could someone make a sound decision is that scenario?
You can begin Medicare without claiming Social Security. The question is just whether you can afford it. You will need to sign up separately though.
Was there something else you were thinking about in relation to Medicare?
Do you take one time fee only financial advice clients?
Yep, we do one time financial plans for people. Happy to chat. www.foundryfinancial.org/get-started
I have not done a good job of money management and thus have no choice but to wait it out until 70 irrespective of my health or how long I live. I am four months from my FRA (66 and 6 months). My problem is that I have a lot of real estate debt. I am trying to pay off my income property by the time I am 70 but my house is a lost cause and I dont want to move from it. Too expensive and stressful to do that but I need to maximize my income to service that debt. I am trying to invest money too. Doing OK with stocks not so well with bitcoin. I am beginning to think BTC is just a big ponzi scheme. Hopefully I dont lose my job between now and 70.
Do you have significant equity in your home? You might be able to do a reverse mortgage. Although they’re much less attractive in our current rate environment.
@@foundryfinancial yes I do. I owe about $630k but my appraisal that I was told to do after my wife passed away says its worth $1.8M. So a reverse mortgage is an option but I would like to save that as a last resort.
Retire at 70, if my job and health permit. Neither of my parents made it to 80.
There’s also a benefit to retiring a bit early and using other assets and then switching on SS at 70.
Your calculations, and most other financial planners, ignores the compounding of COLAs that are added to the SSA estimates in your statement. The statement numbers are only what you qualify for if you are that age today.
There are so many variables in the calculations, but I am trying to give general rules of thumb and trying to find a break even point. While COLA can impact what you'll receive -- the idea is you'll be receiving the same in "real dollars". But, COLA will not impact the percentage increases between taking your benefits at age 62, FRA or 70.
Is that what you're saying? Or am I missing something?
@@foundryfinancial I’ve been retired for 6 years, but have not started SS yet. Every year since, my estimated benefit at age 70 increases. Other than COLA adjustments, I’m not aware of anything else that will cause that to occur.
If you saved no money for retirement then i recommend working as long as you can and take a 70, if you saved over 500k and your house is paid for then this calculation changes allot!!
It depends on your other income and expanses. Rules of thumb only get us part of the way.
if not receiving at 62 causes you to start pulling more money from your portfolio, what are the potential opportunity costs of pulling the money out of the market and not allowing it to grow for 30 years?
It depends. There can be some benefits from a tax perspective to not taking SS and then taking capital gains from your taxable account - potentially tax free. You’d have to run the numbers. I’m going to release a video and give people access to some software that’ll help you run some of those numbers.
I'm curious what you know or hear about Social Security going broke or paying a reduced benefit by either 2032 or 2036 which is ,of course, when I will be 61 and 65 respectively. My opinion of the Federal Government is so low that I'm planning my retirement as if Social Security won't even exist!!!
Have you heard anything? What is your sense of this potential mess?
Thank you for the video.
The Social Security trust fund could be depleted in 2034. BUT, even if the trust fund becomes depleted, the Social Security Administration will continue to take in payroll taxes from workers and their employers, allowing the program to pay the majority of benefits. Honestly, I think the gov’t will raise taxes or go into more debt before cutting benefits on current recipients. Social security recipients are VERY powerful voting block.
I'm pretty sensitive about both of these topics.
NO I THINK ILL WAIT TILL I AM 80 TO COLLECT .LOL
Ha. That’s a new take. :)
Take it at 90
Haha.
,,😂😂😂😂😂😂😂😂😂
I split it went at 65.5 years
Congrats on retiring!
No discussion on taxation of social security payments.
No, I’ve got another video coming out on that. There are lots of moving pieces on the tax question.
@@foundryfinancial This video focuses on the amount to be received based only on the age the payments begin, as if that's the only consideration. Whether 50 to 85 percent of the payments being subject to income tax seems to be equally if not more relevant.
Yeah, it’s definitely a consideration. I just think it needs a stand alone video - because there are so many moving pieces to taxation and I wanted to help keep this as simple as possible.
That's if you make it to 70 to even collect that money Nothing is ever guaranteed so I be Retiring at 62.
Well taking SS and aren’t synonymous, it it just depends on your situation. There are also tax implications to consider.
Yeah I get it Texas Are an issue. But there's also ways around that as well. Because I'm planning to run A home based business. The information you provide is very insightful so I thank you. Have a great day!🙂
I was under the impression that you gain 6% raise for every year after 62 and then 8% for each year after 67 till you turn 70! Please confirm....
It actually depends on when you were born. Here's the exact chart. www.ssa.gov/oact/ProgData/ar_drc.html
Need more income at age 62, get a job. Need more income at age 75, you are SOL. At age 75, you will be glad waiting until 70. I consider SS to be insurance against being OLD and BROKE. Just as I won't set fire to my home just to "get my money back" from years of paying into insurance. As long as I am not old and broke, I will be fine. It's the bigger monthly check in my late years that I want maximized.
That’s a very smart way to think about it.
Exactly, we don’t know how much food is going to cost and fuel.
What’s the price of freedom?
I actually have a new video talking about why you might want to retire sooner rather than later.
Pension Annuity of 2000.00 a month or lump sum of 390.000
You'd want to talk with an advisor about that decision.
Thank you for your advise
A LOT OF PEOPLE DO NOT LIVE TO AGE 70.
But a lot of people DO!
I'm 62, my wife is 61. I'm going to take SS at 70. My wife's SS will be a lot less than mine. At what point can she apply for SS for us to get the most benefit?
You can boost your own retirement benefit by putting off claiming Social Security until age 70 and accruing delayed retirement credits, but they do not apply to spousal benefits.
The most your spouse can receive on your work record is 50 percent of your primary insurance amount, which is the monthly benefit you are entitled to at full retirement age. If your spouse claims before her FRA, it can lower her payout.
But, I’d you wait till 70 then your spouse could possibly start her benefit now and then switch to her spousal benefit when you begin claiming. But this isn’t advice and you want to talk with an advisor.
The biggest factor is life expectancy. Both my parents lived to 81. The difference for me starting at 62 rather than 67, is $2,000 total if I too die at 81. If I take some of that SS and put it in a qualified investment I'll more than make up that difference. Your chart is off by 10's of thousands btw.
The numbers and percentages jump around a ton depending on when you were born. They’re not exact - that’s why you have to pull your own report.
The investing the early money is an interesting strategy. I’ve thought about doing a video where I run those numbers.
Chances are good you will live much longer than your parents....I would plan on it..good luck !
My friend was waiting until age 70 , he died at 69 and 7 months.
That's tragic. I'm sorry. One thing I'll point out, delaying SS does not mean delaying retiring.
According to the US government (CDC) the average lifespan in the US is 76 years old 😪 ... So, if you wait until 70 to file for social security you may never make it to the break even point 😳 On a side note a friend who is a University Professor and a CPA filed as soon as he became eligible. 👊🏻
76 is average lifespan from birth, NOT average lifespan from many years older!
@@commonsense6967 depends on your ethnicity, native Americans, black and Alaskan natives are less than whites....
At 92 I really won't have the need for income like I expect I will at 62. Deferring taking SS so I can be a wealthy 90+ year old makes little sense to me.
Well for some people it’s less about being wealthy and more an insurance policy. You can typically work if you hit hard times at 62…a little harder at 92. But that’s also why there’s no perfect answer.
@@jackdreddle2740 Not necessarily, the size of the check is based on an amortisation schedule, so if your life aligns closely with that in should make little difference to the outcome, if you live longer, you lose out on some income, if you live less then you are ahead.
The biggest wildcard I worry about is the medical insurance thing. My state did not do the medicare expansion and the Health Marketplace for my state is a freakin' joke. Blue Cross has cornered that market and offers very poor insurance. If I lived in another state, it might be a different story. I am now realizing that I made a huge mistake doing a ROTH IRA also. I never earned enough to be in a high tax bracket. I would have been much better off doing a regular IRA and getting the tax break the year I contributed. This stuff is such a confusing mess where you just sort of pick something and try and figure it out later. You have to do something, you can't let the fear of making a wrong financial move paralize you, but sometimes it is just hard to swallow when you scrimped and saved for 40 years and only in hindsight do you see where you could have made a better decision.
Hey there. I'm interested why you made a mistake doing a ROTH. I almost always see the exact opposite. High earners sometimes make a mistake with a ROTH and not lower wage earners. Might be an interesting video in there.
Retire on "day one" of your eligibility, work towards getting rid of everything that you own, and let the Social Security System take care of you.
Thanks for your comment!
I'll have 20 years of government service by age 65 which is 8 years away. I am covered by FERS, my TSP, Roth IRA and taxable investments. I am investing for dividends now and the FI in FIRE. "If" I can retire off FERS, my TSP and dividend income would it still make sense to take my social security benefit at 65 when I retire and use that monthly benefit to reinvest back into dividend investments?
Realized I never replied to this. I'd watch my video on how Social Security gets taxed. It might make sense to retire earlier and begin converting your TSP into a ROTH. But, you'd need to talk to someone or get an online calculator and run the numbers. th-cam.com/video/NWDuuejW2Po/w-d-xo.html
@@foundryfinancial Due to public service loan forgiveness program I will need the 8 years. I had planned to roll my TSP into an IRA and invest that in dividend stock
Don't just look at the dollar sign, take the mortality rate and the danger of not getting SS after 2035 into consideration, unless you have extra funds you can dip your hands into and hold on till you reach the maxium, otherwise get your SS much sooner than later
There are many variables that go into when you should take social security- including current cash flow.
Can my spouse take their SS at 62, then flip to mine at 70 and get 50% of mine?
It depends. Now, if they were born before 1954 the answer was/is yes (there are two other exceptions as well). But, for most people going forward, the answer is only if your spouse is not yet receiving retirement benefits. In this case, you can claim your own Social Security beginning at 62 and make the switch to spousal benefits when your husband or wife files. *not financial advice, you'd want to confirm this on your own*
Actually, a spouse is only eligible for 50% of your FRA benefit minus a percentage for each month they took SSA before their FRA. They are never eligible for 50% of the amount you get at 70.
Yeah, I should have clarified - they only get 50% of the FRA, not your amount at 70. But, they can claim at 62 (with standards reductions) to begin benefits and then flip to spousal benefits.
Your spouse will get your larger Soc Sec when you pass. If you pass at 70....80....90 but didnt start collecting until 70- she gets your much larger check, forfeiting her own.
Take it at 35.
Ha! Might be a bit early.
@@foundryfinancial Not really. We have a million slugs in this country having a ball on Disability Fraud. They are experts on every single Govt Freebie under the sun. Next time you're near a Handicapped Spot watch who jumps out of the $80K cars & trucks. Hacks & slugs. Including "Disabled" Vets. They make a sport out of Disability Fraud.