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I realize I am on the outside looking in, out of sync, ignoring “expert” advice and rehashing the subject, but I can’t help it. I need help here.
I simply cannot understand why anyone living off their investments would use those investments to live on in favor of delaying social security until age 70.
It seems to me that unless there is a gigantic pool of money they’ll never need, they are taking an unnecessary risk using more of their investments sooner rather than later. I think they call it opportunity cost. I used three AI apps and they all had the usual arguments for and against delaying to age 70. They were consistent about taking benefits when you need the money to live on and cautioned about using other assets just to delay.
Yes, I get some of it. A higher monthly SS benefit and with it a possible higher spousal survivor benefit. But part of the value there is the age difference between spouses. Assume age 70 is achieved, the life expectancy for males: is approximately 14 to 15 years. for females: approximately 16 to 17 years. Unless there is a significant younger age difference for a surviving spouse, there is not much time for the higher benefit to be needed – statistically. And you can provide for survivors in other ways.
Is a retirement plan going to succeed or fail based on the higher monthly Social Security benefit starting at age 70? Is that more important than accumulated assets and sustaining, if not growing them, for an extra three years or so? What if the person wants to retire earlier than FRA, is the extended period using more investments before age 70 still valid?
I read these words on Open Social Security “The strategy that maximizes the total dollars you can be expected to receive over your lifetimes is as follows:” Sometimes it is age 70, sometimes not, but I say “so what?”
Why would that be my goal? Besides, that advice does not even consider a persons total financial picture – investments, annuities, a pension.
I’m ready for the 🔻 just show me the real value of the trade off using unsecured money now for the possibility of higher monthly income several years in the future.
I’m fairly new to this site and have really enjoyed the difference of opinions. It helps me see things from different perspectives.
We have been considering this issue for a while now. I’m 68 and my wife is 65. This issue is a little more challenging for us, since we have a 13 year old adopted child who is entitled to benefits on both our work records.
We decided my wife (with the lower benefits) and our daughter would collect on my wife’s work record and I would defer my benefits for some period of time. Now that I have deferred for 19 months, we have decided it’s time for me and my daughter to collect based on my work record. Obviously, this deferral will result in significant increase in benefits.
Most people seem to insist (usually very strongly) that either collecting right at FRA or deferring until 70 is optimal. As in many issues, sometimes the best option for a person/family might be somewhere in between the extremes. For us, deferring for about 1 1/2 years appears optimal.
Another thing to consider is that if you choose to defer after FRA, you can alter that decision by applying at some later time (before 70) and receive up to 6 months in retroactive benefits. As a result, a person can defer beneifts and see how that works. If circumstances change, they can file and get up to 6 months of retroactive benefits.
Oh no, not again. Where’s the downvote button for forum posts when you need it?
I like guaranteed income. I really like guaranteed income with a true COLA (not a fixed increase with a lower starting payment if you get one with an annuity). To my knowledge it is kind of unique and an opportunity not to missed. I like taking advantage of opportunities. I like the idea of maximizing that guaranteed income with true COLA. I like the idea of getting more of income from guaranteed income of which not all of it (in our case 85%) is taxable. These are some of our reasons. Others include it is part of a coordinated financial plan in which we convert tax deferred retirement accounts to tax free funds while delaying SS in lower income years. Those are some of my reasons. Everyone is different and YMMV.