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I had lunch with some friends from my old company last week and we discussed their retirement plans. Many are delaying Social Security until FRA (full retirement) at age 67 or until age 70 to take advantage of the 24% increase over FRA. The conversation then turned to strategies to bridge the 2-5 year gap between retiring and applying for SS.
If you delayed or plan to delay Social Security, how did you/will you bridge the gap between retiring and applying for SS? For those already retired, anything you’d do different in hindsight?
Strategies to bridge the gap:
For those that are interested in reading more about TIPS ladders (mentioned in posts by William, Rob, and Randy below), here’s some links:
Four Easy Steps to Build a TIPS Ladderby Alan Roth 10/7/24
https://www.advisorperspectives.com/articles/2024/10/07/four-easy-steps-build-tips-ladder
The Pros and Cons of Building a TIPS Ladder for Retirement Income
by Rob Berger
https://www.youtube.com/watch?v=TeS64sZz4NA
Also check out Laura Kelly’s recent article for HD:
https://humbledollar.com/2024/09/laying-down-a-floor/
Combination of cash and stock that can be liquidated to provide income between when we stop working and we can tap retirement accounts and Social Security. The truth is we are considering taking Social Security earlier than FRA, because we plan on retiring at aged 57 from full time work. We are 53 now.
The missus is an RN who can probably easily find some PT work and I hope to pick up some consulting work to help extend our current savings between when we stop working FT and when we claim SS. Without going crazy working FT in semi retirement, the less we need to pull from cash and taxable accounts, the more we will delay taking Social Security.
do want to always keep at least 2 years of liquidity handy, so when we hit that mark, we will likely claim SS and start tapping some retirement accounts while doing Roth conversions.
Doing those three things in the same year may put you in a higher tax bracket. I’m doing Roth conversions since age 58, spending from taxable account until 70 when claiming Social Security and not tapping traditional accounts until RMDs at 75. A TIPS ladder will help bridge the gap.